★ 13 Companies and sectors in this issue Companies AIA................................................18 Air France-KLM ....................... 24 American Express..................... 13 Anheuser-Busch InBev.............10 Apollo Global Management.... 24 Apple...................................... 16,24 Archer Daniels Midland...........24 Assured Guaranty..................... 14 BMC Software.................12,18,24 BMW.............................................18 Bain Capital .......................... 18,24 Bank of America..................14,24 Bharti Airtel ................................ 18 Blackstone.................................. 18 CA Technologies........................18 Canon...........................................13 Carlsberg.....................................10 China Life....................................18 China Shipping...........................18 Citic Securities...........................18 Citigroup......................................14 Coca Cola....................................13 Credit Suisse.........................10,14 DLF............................................... 18 Daily Mail and General Trust . 14 Dell................................................18 Deutsche Bank................ 10,14,18 Diageo..........................................13 Elliott Management...................18 Emap............................................14 Eon...............................................24 Facebook................................ 13,15 Flagstar Bancorp.......................14 Ford.............................................. 13 Fresenius.....................................10 GIC Special Investments......... 18 GMR............................................. 18 General Electric........................... 2 General Motors ..........................4 Golden Gate Capital............18,24 Google.....................................15,16 Green Plains.............................. 24 HBOS........................................... 14 HSBC........................................... 10 Haitong Securities.....................18 Heidelberg-.................................24 Holcim......................................... 24 Huawei ......................................... 16 Infineon........................................18 Italcementi..................................24 JPMorgan Chase....................... 14 KPN.............................................. 12 Kabel Deutschland.................... 12 Khazanah.....................................18 L'Oréal ........................................... 4 Linde............................................24 Lufthansa ...................................18 MBIA.......................................14,24 MStar Semiconductor.............. 16 MasterCard................................. 12 MediaTek.....................................16 Microsoft..................................... 16 Monster Beverage.................... 24 Motorola Mobility...................... 16 Munich Re...................................18 Nestlé...........................................13 Nielsen Holdings.................. 14,24 Onex Corp.............................14,24 Penton Media.............................14 Poet ............................................. 24 SABMiller .................................... 10 Samsung..................................... 16 Sasol .............................................. 7 Sony............................................. 13 Starbucks......................................4 Telecom Italia.............................12 Telekom Austria........................ 12 Toshiba........................................ 13 Toyota ..........................................4 Unilever........................................13 Valero Energy............................24 Verizon.........................................12 Visa...............................................12 Vodafone..................................... 12 Wells Fargo.................................14 Yamaha ........................................4 ZTE............................................... 16 Sectors Media...................................... 14,15 Mobile & Telecoms...................16 Software...................................... 15 Technology HW & Equ............ 16 Travel & Leisure........................18 FINANCIAL TIMES News Briefing Gold price Source: Thomson Reuters Datastream $ per troy ounce 1300 1400 1500 1600 Apr 3 2013 1571 May 6 2013 1468.5 Gold prices see an increase of 0.3 per cent, Page 24 BMC to go for $7bn US business software group’s activists push it to private equity deal. Page 18 Nielsen deal with Onex Media measurement and retail data group offloads exhibitions unit. Page 14 Lufthansa withdrawal Wolfgang Mayrhuber bows out of race to become chairman. Page 18 Inside Business Reforms open door to performance-linked pensions. Page 14 India groups plug holes As growth fails to pick up in the country, big groups look to deleverage. Page 18 Motorola Mobility charge Brussels turns on handset maker in latest patent wars battle. Page 16 Chinese groups in IPOs Galaxy Securities and Sinopec Engineering seek total of $3.6bn. Page 18 Fresh prescription Move towards becoming a global pharma retailer still a goal for Alliance Boots. www.ft.com/ukcompanies Islamic insurance target Sharia-compliant cover to be offered to commercial property buyers. www.ft.com/ukcompanies Ethanol fillip Support for corn as ethanol output hits 10-month high. Page 24 Benchmark cheer Apollo hits all-time high as stocks hover near record trading levels. Page 24 Caution reigns Europe’s stocks slip off five-year highs as growth worries stall rally. Page 24 Aussie falls The Australian dollar fell amid speculation of an interest rate cut. Page 24 Markets & Investing Companies Tuesday May 7 2013 Calling in the chips Industry curbs capacity expansion to lift prices Page 16 © THE FINANCIAL TIMES LIMITED 2013 Week 19 You know you’ve got a proper bull market when a stock called GungHo tops the charts by value traded. Last Thursday, before Japan shut down for Golden Week holidays, a little-known developer of games for mobile phones did exactly that with its Y94bn ($950m) of turnover exceeding that of Sony, Toshiba and Canon put together. Even more remarkably, GungHo did so right in the middle of Japan Inc’s earnings season. That suggests the domestic retail investor is rediscovering a taste for equities. And for foreigners counting on continued rises in the world’s second biggest equity market, that could be good news indeed. For much of the 60 per cent rally in the Topix since mid- November, retail investors in Japan stood and watched, occasionally stepping in to sell long-held stocks in order to splurge on holidays and home improvements. Foreign investors, meanwhile, helped themselves to trillions of shares dumped by Japanese banks, companies and institutions seeking to rebalance portfolios. Now, however, the huge surges in companies like SoftBank-controlled GungHo – the producer of Puzzle & Dragons, a hit game now spreading outside Japan – are a sure sign retail investors are getting involved. According to the Nikkei newspaper, net inflows into stock mutual funds totalled Y440bn in April, the biggest monthly haul in 13 years. After many years of rotten performance by equities, the prevailing mood is cautious. Nomura’s surveys of individual investors continue to indicate a strong preference for cashing out, once gains reach double figures. But if expectations of inflation do begin to pick up in Japan, so, too, could tolerance for risk. And as brokers never tire of pointing out, even a 1 per cent shift within household assets would mean Y15tn of flows into stocks – or more than double the net buying from abroad this year. The next leg of the “Abe trade” could be made in Japan. The Short View Ben McLannahan Facebook to turn on video ads By Robert Budden and Emily Steel in London and April Dembosky in San Francisco Facebook is set to launch video advertising in its news feed in July as it seeks new revenue streams to bolster its share price after its lacklustre stock market listing last year. The move by the world’s dominant social networking site is a bid to tap into the vast amounts that marketers spend on television, budgets that tower over online ad spending. It is also an attempt to capital- ise on the rapid growth in online video advertising as global brands follow users from the TV to the internet. Digital video advertising spending remains a small frac- tion of the $64.5bn market for TV ads in the US but it is expanding rapidly, with eMar- keter expecting it to hit $4.1bn in the US in 2013, up 41.4 per cent from 2012. The new video ads will appear in a user’s news feed with the first video starting automati- cally but without any sound. Users will then have the option of activating audio at which point the video will restart from the beginning. Several of the global brands that sit on Facebook’s client council, an advisory board of big advertisers, are expected to take part in initial trials. Com- panies on the council include Unilever, Nestlé, Ford, Diageo, American Express and Coca Cola. There are concerns over how the ads will affect the user expe- rience. Analysts fear that if the ads prove too disruptive, they will hit activity on the site. Brian Wieser, an analyst with Pivotal Research, said video ads folded into the news feed would be no more intrusive than any other ads Facebook delivered there but any auto-play feature that forced people to watch could annoy some users. Facebook will be charging in the “low $20s” per thousand video views, even when users have not activated audio, according to people familiar with the company’s plans. Each ad will be limited to a maximum of 15 seconds of air- play and, to give more powerful exposure for brands, Facebook will initially ensure that individ- ual users see video content from only one advertiser in any one day. That rate is a little less than the average $29 that marketers pay for a broadcast TV commer- cial that reaches 1,000 people, according to MagnaGlobal. Facebook has been taking its video ad sales pitch to agencies in recent weeks amid the annual “upfront” market in the US where TV networks sell about three-quarters of their commercial inventory. Based on the initial inventory available on Facebook, the online video ads could generate up to $1.5m of new revenues a day, people familiar with the social network’s plans said. In the first three months of this year, the company gener- ated revenues of $1.46bn. Face- book declined to comment. Data trail, Page 15 Social networking site aims to boost revenues Concerns over impact on user activity Protests mount over use of BP Gulf spill funds By Ed Crooks in New York A plan to build a convention centre in Alabama using money given by BP to restore the coast of the Gulf of Mexico has angered environmentalists, rais- ing concerns over how funds to improve the environment are spent. The plan is part of $594m worth of projects announced last week by BP and the five coastal states affected by the 2010 Deepwater Horizon disas- ter, funded out of the $1bn that the company promised in 2011 for early restoration of the gulf. Groups including the National Wildlife Federation have pro- tested that building the conven- tion centre in Gulf State Park in Alabama, justified as a way to improve public access to the natural resources of the coast, will do nothing to repair the damage done by the spill. The controversy is a foretaste of even fiercer disagreements that are likely over the much larger sums expected to flow into the region in damages and penalties following the trial over the disaster at the federal court in New Orleans. The centre is planned as part of a refurbishment of the park costing $85.5m, the bulk of the $94m spending announced in Alabama. It will replace a lodge that was wrecked by Hurricane Ivan in 2004. Robert Bentley, Alabama’s governor, said the centre, which will be built and run by a pub- lic-private partnership, would create jobs and help generate tourism. David White of the NWF said his organisation was “shocked” by the decision. “The American public expects to see BP’s oil spill money spent on projects that will restore the health of the gulf coast, not on pork- barrel projects like a convention centre,” he said. Several of the new projects are not directly related to dam- age done by the spill. Texas, for example, is spending more than $10.7m to restore Galveston Island State Park to its condi- tion before Hurricane Ike, in 2008. In Florida, $4m will fund two passenger ferries. BP said that although some of the places where its money was being spent had not been directly affected by the spill, the projects would “address loss of use by providing residents and visitors with new recreational options, better access to existing natural resources and a greater opportunity to enjoy them”. Projects have to be approved by BP and the natural resource trustees, which are representa- tives of several US federal gov- ernment departments and agen- cies, and the five coastal states of Louisiana, Alabama, Missis- sippi, Florida and Texas. Tapping revenues: the new ads on the social networking site will play automatically without sound in a user’s news feed Getty Bitcoin virtual currency triggers radar of real-time US regulators By Tracy Alloway, Gregory Meyer and Stephen Foley in New York Senior US financial regulators are discussing whether Bitcoin, the cyber-currency, might fall under their regulatory remit. Bitcoin “is for sure something we need to explore”, Bart Chilton, one of the five commis- sioners at the Commodity Futures Trading Commission (CFTC) told the Financial Times. A person familiar with the CFTC’s thinking said the regula- tor was “seriously” examining the issue. Mr Chilton said: “It’s not monopoly money we’re talk- ing about here – real people can have real risk in these instru- ments and we need to ensure that we protect markets and consumers, even in what at first blush appear to be ‘out there’ transactions.” The Bitcoin is attracting the interest of regulators amid booms and busts in the value of the four-year-old cyber-currency that have spurred media inter- est. Intensified regulatory scru- tiny could pose challenges for proponents of Bitcoin, who have praised the currency for its independence from traditional authorities. In March, a branch of the US Treasury said that all compa- nies that exchange or transfer the virtual currency would be considered “money services businesses”. That means they must provide information to the government and introduce poli- cies to prevent money launder- ing. Since the ruling, at least three companies in North Amer- ica have reported having their accounts closed by their banks. The CFTC regulates deriva- tives contracts and, under Dodd- Frank financial reform, has sweeping authority to oversee retail foreign exchange dealers. CFTC jurisdiction generally does not extend to cash markets unless exchanges list deriva- tives contracts based on them. One person familiar with the discussions said that Bitcoin would not become subject to CFTC jurisdiction unless it became the basis for a deriva- tives contract.