Friday evening business bulletin

May 9 2008 By The Journal

Airports operator BAA today said it was raising £400m from shareholders amid concerns over its plans to refinance £10bn in debts.

The group - majority owned by Spanish infrastructure firm Ferrovial - said it had "not yet finalised certain aspects" of the refinancing due to ``challenging market conditions".

BAA had been hoping to transfer around £4.7bn in bonds into a new ring-fenced funding vehicle backed by its three London airports - Heathrow, Gatwick and Stansted - as well as the Heathrow Express.

But the company said it had not yet received sufficient commitments from banks for the refinancing move.

It hopes to begin consultation with its bondholders "in the coming weeks" through the Association of British Insurers when aspects of the refinancing had been finalised.

The FTSE 100 Index sunk more than 1% into the red today as forecasts of heavy falls on Wall Street spooked investors.

Banks and mining stocks led the market’s decline, with the Footsie down 80.9 points at 6189.9 by the mid-session.

Soaring oil prices - to yet another new record high of nearly 126 US dollars a barrel - also dragged airlines lower, adding to concerns ahead of predictions of a dire opening for America’s Dow Jones Industrial Average, which is expected to plummet 100 points in early trade.

Among London’s blue chips, Carphone Warehouse was one of the session’s worst performers, down 7% as investors showed disappointment with yesterday’s announcement of a £1.1bn deal with US consumer electronics group Best Buy.

Isle of Man-based airline EuroManx announced today it had gone out of business.

The company blamed "rising fuel prices" among a number of factors which had drastically affected passenger numbers within the past six months.

EuroManx operated cheap flights from the island to Liverpool, Belfast, Manchester and London City.

All services were cancelled with immediate affect today as passengers learned the news when they arrived for their scheduled flights.

Rival airline Flybe has stepped in to offer free replacement tickets for passengers who have EuroManx bookings for Manchester and Liverpool flights.

In a statement on the EuroManx website, the company, which employed about 70 people, said: ``It is with great regret that EuroManx have announced today that the company is ceasing operations forthwith with no further flights being operated."

The pound at 4:30pm was US$1.9476 compared to US$1.9548 at the previous close while the euro at 4:30pm was £0.7930 compared to £0.7883 at the previous close.