Business

LONDON — British airline EasyJet on Thursday announced it had rejected a takeover approach, reportedly from rival Wizz Air, and revealed a $2.0-billion lifeline as the battered aviation sector looks to recover.

No-frills carrier EasyJet said in a statement that the bid had undervalued the group, adding that the suitor was no longer considering an offer and that the airline would now sell new shares to raise around £1.2 billion ($1.6 billion, 1.4 billion euros).

Bloomberg reported that the bidder had been Hungarian budget airline Wizz Air.

EasyJet meanwhile added that it had secured a new credit facility totalling $400 million.

The coronavirus crisis and travel restrictions have rocked airlines worldwide.

Also on Thursday, Japan Airlines said it plans to raise about $2.7 billion as it weathers the continuing impact of the pandemic on its finances.

In London, EasyJet noted that its "board recently received an unsolicited preliminary takeover approach.

"This was carefully evaluated and then unanimously rejected. The potential bidder has since confirmed that it is no longer considering an offer for the company."

EasyJet said the "highly conditional all-share" proposal "fundamentally undervalued the company". 

The rights issues would "facilitate and accelerate the group's recovery from the impact of the Covid-19 pandemic", it added.

Chief executive Johan Lundgren said the financing boost would also position EasyJet for growth, allowing it to take advantage of investment opportunities "as the European aviation industry emerges from the pandemic".

Shares dive  

Traders rushed to offload EasyJet shares on Thursday's announcements.

"EasyJet shares tumbled 10 per cent after announcing a £1.2-billion rights issue and disclosing that it had turned down an unsolicited takeover offer," noted Neil Wilson, chief market analyst at Markets.com. 

The airline's need for fresh capital is "a sign of the ongoing trouble in the sector", he added. 

In the group's final fiscal quarter, or three months to the end of September, EasyJet expects to fly just over half of the capacity seen two years earlier before the pandemic erupted.

Mirroring rivals, the carrier last year slashed costs and flights as the deadly pandemic ravaged global aviation industry.

The coronavirus outbreak grounded planes worldwide, resulting in massive losses across the aviation sector.

The industry has since been boosted by partial lifting of international travel restrictions -- with full reopenings held back by the emergence of the fast-spreading Delta variant.

Japan's borders, for example, remain closed to tourists and domestic travel has been stifled by successive waves of infections and resulting virus states of emergency.

SAN FRANCISCO — Google on Wednesday ramped up cloud collaboration tools for businesses, expecting "hybrid" work routines to remain even after the pandemic has ended.

The internet titan competes with Microsoft, Zoom, Facebook and others with online services that employees can use to collaborate remotely.

Tech giants turned to their own tools after abandoning campuses early in the pandemic, which fuelled a fierce remote work trend.

"We've seen a radical transformation, and a lot of that transformation is here to stay," Google Product Management Director Dave Citron said during a briefing on new Workspace offerings.

"But I think it is too early to say that the 40-hour work week in a cubicle is permanently dead across all industries and regions."

Major tech companies themselves have postponed workers returning to offices and expect the new norm to become "hybrid" routines that mix being on-site with working remotely.

Google said it has created a hybrid work handbook for how to take advantage of tools, as well as software for employees to conduct efficient meetings no matter where they are working from.

"We're really excited to bring this to our customers to give them some best practices as they're working to redesign their offices," Citron said.

Google also announced enhancements to its Workspace portfolio that integrate the tech giant's apps for meetings, e-mail, calendars, documents, chat and more.

"As some people return to the office, teams need that ability to flexibly collaborate from anywhere, anytime," said Workspace Senior Director of Product Management Sanaz Ahari.

"The innovations we're bringing to customers today help bridge the gaps of virtual and in-person collaboration."

Workspace added a dedicated online venue for working on projects, and unveiled interactive Series One displays designed specifically for conferencing.

An all-in-one desktop model of Series One was priced at $2,000, while a larger model designed for conference rooms was priced at $7,000.

"Based on the price points, we think the vast amount of the customers will be companies buying it for their employees," Citron said.

HONG KONG — Hong Kong marked the completion of a third runway at its airport on Tuesday at a time when the once thriving international travel hub remains cut off from most of the world.

City leader Carrie Lam presided over a topping-off ceremony for the 3.9 kilometre runway, which took five years to construct on reclaimed land.

Thanks to its location and comparatively relaxed entry requirements, Hong Kong has long hosted one of the world's busiest international airports. 

But it faces increasing competition from regional rival Singapore as well as rapidly expanding airports in mainland China.

The city's reputation as a travel hub was also dented by months of political unrest in 2019, which at one point paralysed the airport, and China's subsequent crackdown on dissent.

The business hub currently remains inaccessible to most people during the coronavirus pandemic because it maintains some of the world's strictest quarantine measures.

Almost all arrivals must complete one to three weeks of mandatory hotel quarantine, a move that has kept the coronavirus at bay but hammered the travel industry and left the city isolated.

The construction of new runways often faces strong opposition from environmental groups in western nations but Hong Kong's airport expansion saw little protest.

Before the coronavirus, the two runways were already operating well beyond their capacity of receiving and sending 420,000 flights per year. 

The third runway is expected to start operations sometime in 2022.

It is unclear whether Hong Kong will have loosened its travel restrictions by then.

Despite ample supplies, the city has one of the worst COVID-19 vaccination rates in the industrialised world and the government has given no details on when it might move towards living with the coronavirus. 

International businesses have grown increasingly frustrated, with the European Chamber of Commerce recently warning that residents were "indefinitely trapped".

But last week Lam doubled down on her zero-COVID policies and said opening travel with the Chinese mainland was more important than doing the same for the rest of the world.

TOKYO — Tokyo stocks closed higher on Monday with investors remaining buoyant over unpopular Prime Minister Yoshihide Suga's announcement that he will not stand for reelection.

The benchmark Nikkei 225 index ended up 1.83 per cent, or 531.78 points, at 29,659.89, while the broader Topix index gained 1.28 per cent, or 25.77 points, to 2,041.22.

"Gains were supported by speculation about new economic stimulus" that could be announced by the Japanese government under a new prime minister, Daiwa Securities said in a commentary.

Suga said on Friday he will not run in his ruling party's upcoming leadership vote, throwing open the race for the next premier of the world's third-largest economy.

"Last week, foreign investors returned to buy Japanese stocks, judging that the Liberal Democratic Party will avoid a drubbing in the general election, after Prime Minister Suga said he will step down," said Masayuki Kubota, chief strategist of Rakuten Securities.

The news had also prompted a positive reaction from the Tokyo market on Friday, with the Nikkei index ending  more than two per cent higher.

The dollar fetched 109.81 yen in Asian trade, against 109.73 yen in New York on Friday.

Mobile phone carrier KDDI jumped 3.64 per cent to 3,669 yen and SoftBank Corp. rose 1.02 per cent to 1,535.5 yen on speculation that political pressure on them to cut phone fees would ease with the departure of Suga, who has pushed the issue.

Renewable energy company Renova climbed 15.43 per cent to 4,900 yen on prospects that green energy policy led by Suga will continue under a new leader.

Chip-testing equipment maker Advantest closed up 2.56 per cent at 10,400 yen and chip-making equipment manufacturer Tokyo Electron gained 2.43 per cent to 50,180 yen as worries over the US Federal Reserve's exit from its monetary easing eased. 

The US central bank's easing policy is favourable to high-tech firms, which often take advantage of low borrowing costs.

BAGHDAD — French energy giant TotalEnergies has signed a $27-billion contract to invest in oil, gas and solar energy production in Iraq, the country's oil minister said on Sunday.

The announcement of the deal, supposed in part to reduce Iraq's reliance on fossil fuels, came as minister Ihsan Ismail signed the contract at a Baghdad ceremony with TotalEnergies chief Patrick Pouyanne.

TotalEnergies has not directly confirmed to AFP the value of the contract.

"This is the largest investment in Iraq by a Western company," Ismail said. "Implementing these projects is the challenge we face now."

Iraq has immense reserves of oil and gas.

But despite being the number two producer in the Organisation of the Petroleum Exporting Countries, it is experiencing an acute energy crisis and chronic blackouts that fuel social discontent.

Officials justify the lack of investment and the dilapidated state of its energy network by citing falling oil prices, which represent more than 90 per cent of state revenue.

The country is highly dependent on neighbouring Iran, which supplies it with a third of its gas and electricity needs.

However, Baghdad currently owes Tehran six billion dollars for energy already supplied.

The contract inked on Sunday with TotalEnergies covers four projects, an Iraqi oil ministry source said ahead of the signing ceremony.

One of these aims to pipe seawater from the Gulf to southern Iraqi oilfields. Water is used to extract oil from subterranean deposits.

Two projects focus on extracting and exploiting gas in southern Iraq, which is rich in fossil fuel deposits.

The fourth project will see the installation of a solar farm in Artawi, near the southern port of Basra.

The Iraqi source said that ultimately, the solar panels should produce "1,000 megawatts" of electricity, the equivalent of the energy produced by a nuclear reactor.

"Iraq will not pay anything," the source added.

France's former Total, which has renamed itself TotalEnergies to symbolise a diversification into cleaner sources of power, is one of the world's top five energy companies.

While still focused on oil and gas, the company has indicated that this year it will devote 20 per cent of its growth investments to electricity and renewable energies.

DUBLIN — Ireland on Thursday slapped Facebook's WhatsApp messaging service with a record fine for breaching EU data privacy laws after European regulators demanded the penalty be increased.

Ireland's Data Protection Commission (DPC) was entrusted with the case because Facebook's European headquarters are situated in the country.

"And following this reassessment the DPC has imposed a fine of 225 million euros ($267 million) on WhatsApp," the commission said, by far the largest penalty it has ever issued to a company, dwarfing the 450,000-euro fine imposed on Twitter last year. 

As Ireland hosts the regional headquarters of a number of major tech players such as Apple, Google and Twitter, the DPC has been largely responsible for policing adherence to the EU's landmark General Data Protection Regulation (GDPR) charter.

But Ireland has come under pressure for not taking a firm enough line against tech giants, who are generally understood to be drawn to the country by its low corporate tax rate of 12.5 per cent.

WhatsApp said it would appeal the decision.

"We disagree with the decision today" it said in a statement, calling the penalties "entirely disproportionate".

'Dissuasive fine' 

The DPC launched the WhatsApp probe in December 2018 to examine whether the messaging app "discharged its GDPR transparency obligations" with regard to telling users how their data would be processed between WhatsApp and other Facebook companies.

In an initial finding submitted to other European regulators for approval last December, the DPC proposed imposing a fine of between 30 and 50 million euros, but a number of national regulators rejected the figure, triggering the launch of a dispute resolution process in June.

Last month, the European Data Protection Board (EDPB) instructed the DPC to increase the fine, with Germany's regulator leading the calls for the penalty to be higher. 

The EDPB said that the fine had to "reflect a significant level of non-compliance which impact on all of the processing carried out by WhatsApp" in Ireland.

The fine had to be "effective, dissuasive and proportionate", it said. 

Hailed as a potent weapon to bring tech titans to heel, the GDPR endowed national watchdogs with cross-border powers and the possibility to impose sizeable fines for data misuse.

But Germany's data protection commissioner, Ulrich Kelber, in March wrote an open letter criticising the DPC for the "extremely slow" way it handled GDPR complaints. 

PARIS — Google on Wednesday said it is appealing a decision by France's competition watchdog to hand it a 500 million-euro ($590 million) fine in a row with news outlets over the use of their content under EU copyright rules.

"We disagree with some of the legal elements, and consider the amount of the fine to be disproportionate compared to the efforts we have put in place to reach a deal and respect the new law," Sebastien Missoffe, head of Google France, said in a statement.

The fine, issued by the French Competition Authority in July, was the biggest in the agency's history for a failure to comply with one of its rulings. 

The watchdog said Google had failed to negotiate "in good faith" with media companies in a long-running legal battle over the Internet giant's use of snippets of articles, photos and videos in search results. 

The row has centred on claims that Google has used this content in its search results without adequate compensation, despite the seismic shift of global advertising revenues towards the search giant over the past two decades.

In April last year, the French competition authority ordered Google to negotiate "in good faith" with media groups after it refused to comply with a 2019 European Union law governing digital copyright.

The so-called "neighbouring rights" aim to ensure that news publishers are compensated when their work is shown on websites, search engines and social media platforms.

Last September, French news publishers including Agence France-Presse filed a complaint with regulators, saying Google was refusing to move forward on paying to display content in web searches.

While Google insists it has made progress, the French regulator said the company's behaviour "indicates a deliberate, elaborate and systematic lack of respect" for its order to negotiate in good faith. 

The Competition Authority rebuked Google for failing to "have a specific discussion" with media companies about neighbouring rights during negotiations over its Google Showcase news service, which launched late last year.

Missoffe insisted that Google "recognises neighbouring rights, and we remain committed to signing agreements in France".

"We have extended our offers to nearly 1,200 publishers and modified aspects of our contracts," he said, adding that the company has "shared data demanded of us in order to conform to the Competition Authority's decision".

CAIRO — Egypt signed a $4.45 billion contract on Wednesday with a consortium including Siemens to construct a high-speed electric rail line between the Red Sea and the Mediterranean, state television said.

The railway will run 660 kilometres between Marsa Matrouh on northern Egypt's Mediterranean coast to the Red Sea port of Ain Sokhna in the east.

State television said the deal covers the design, implementation and "maintenance for 15 years of the [Egypt's] first fast electric train network... worth $4.45 billion".

The project will be carried out by the transport ministry and a consortium of Egyptian and German companies, led by Arab Contractors, Orascom and Siemens, it added.

In February, the ministry announced the end of preliminary work on the project, which is to be completed in 2023.

The line will stop at 21 stations including the coastal city of Alexandria and the country's new administrative capital, some 45 kilometres east of Cairo.

Siemens said on its website that the project will "save passengers up to 50 per cent on travel time" and "ensure faster delivery of goods thanks to creating a rail link from the Red Sea to the Mediterranean". 

Since his election in 2014, President Abdel Fattah Al Sisi has launched several infrastructure mega-projects.

In 2019, Canadian manufacturing group Bombardier announced it had signed a multibillion-dollar agreement to build two automated monorail lines in notoriously congested Cairo.

Egypt's railways have been plagued by a string of deadly accidents widely blamed on crumbling infrastructure and poor maintenance.

WASHINGTON — Fear of the fast spreading Delta variant of COVID-19 and rising prices undermined Americans' confidence in August, according to a survey released on Tuesday.

The Conference Board said its consumer confidence index fell more than 10 points to 113.8, the lowest since February and the second consecutive monthly decline after the July index was revised down to 125.1.

"Concerns about the Delta variant — and, to a lesser degree, rising gas and food prices — resulted in a less favourable view of current economic conditions and short-term growth prospects," Lynn Franco, senior director of economic indicators at The Conference Board, said in a statement.

The surge in infections and hospitalisations due to the new variant has caused businesses to re-impose mask-wearing requirements, while the end of government stimulus benefits has taken a toll on free-spending consumers. 

At the same time, the recovering economy continues to deal with supply bottlenecks that have sent prices rising.

Franco noted that while plans for major spending — on homes, autos, and major appliances — "cooled somewhat," more Americans are planning vacations in the next six months.

"While the resurgence of COVID-19 and inflation concerns have dampened confidence, it is too soon to conclude this decline will result in consumers significantly curtailing their spending in the months ahead," Franco said.

However, the expectations index which reflects consumers' short-term outlook for income, business and labour market conditions dropped to 91.4 from 103.8.

Consumer views on the current and future prospects for the labour market deteriorated very slightly, while sentiment about business conditions were more downbeat, according to the survey.

Economist Robert Frick of Navy Federal Credit Union said confidence "finally succumbed to the rising COVID-19 Delta wave".

However, he said, "Americans overall are flush with cash and eager to spend it as the economy reopens."