October 11, 2006 12:50 pm

Carphone’s Dunstone faces his biggest test

Carphone Warehouse is buying AOL’s UK internet access business from Time Warner for £370m. This is a transformational deal for Carphone but whether it works will depend on whether Carphone can cope with the rapid growth. The evidence so far is not encouraging. Carphone confirmed our Saturday story, saying it expects its broadband business to run up an operating loss of £70m during the 2007 fiscal year, £20m more than originally forecast. The company has been offering “free” high-speed internet access since April to people who signed up to its £21 a month fixed-line phone service. The Carphone spokesman’s protest that the company is a victim of its own success is a PR man’s way of saying they didn’t plan properly. Carphone shares initially fell more than 3 per cent on the broadband losses but they’re now up 9 per cent, following news of the AOL deal.

Matalan has at last agreed a 200p-a-share deal with its founder, chairman and controlling shareholder, John Hargreaves.

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Collins Stewart Tullett has confirmed the story in today’s Daily Telegraph, that it is in talks to buy Hawkpoint, the M&A boutique chaired by David Reid Scott. What the talks say about Hawkpoint’s need for broking is at least as interesting as what they say about Terry Smith’s expansion plans for Collins Stewart and his call on the M&A cycle.

J Sainsbury said in a trading update that underlying sales, excluding petrol, rose 6.6 per cent in the 16 weeks to October 7. That was slightly ahead of analysts’ forecasts of 6.5 per cent growth. Elsewhere in the sector, Burberry unveiled a 10 per cent increase in first half underlying sales. The luxury retailer’s shares jumped 3.9 per cent to a new high of 530.15p on the news.

Very interesting to see Babcock & Brown is to float a newly-formed investment company in London in early November, the infrastructure group’s first investment fund to list outside of Australia. This follows its Eircom takeover foray earlier this year.

George Wimpey has become the latest company to report problems in the US. The housebuilder said today in a trading update that its US order book was down 35 per cent by value and 28 per cent by volume year-on-year. Its UK business, however, seems strong.

Russian fertiliser company Uralkali has pulled its plans to float in London. We need to look more into the details of why, but it seems to confirm the thrust of our package in Tuesday’s paper about demand for foreign stocks on Aim falling short of supply.

The sale of London City Airport to a consortium led by AIG has been confirmed.

Air Partner, the world’s leading air charter broker, on Wednesday moved into the management and operation of private jets for the first time with the £4.4m takeover of Gold Air International from Gold Group.

Stand by later for the online diary being filed by our leisure correspondent, Blackjack Blitz, from the international online gaming conference taking place in Barcelona this week. He promised to file by lunchtime, but he’s in Spain so that could mean anytime.

Finally, imagine Philippe Jabre’s surprise this morning when he opened his copy of The Independent and saw a picture of me at the bottom of p44, accompanying the piece about his plans to set up a new hedge fund. I don’t mind: it is not often enough that I get taken for a millionaire hedge fund manager who can swallow a £750,000 fine without blinking. But poor Jabre. Being mistaken for a journalist seems very infra dig.

Rumour of the Day: Monstermob shares are up almost 10 per cent on rumours that our markets writer Neil Hume is picking up that the takeover talks they admitted to in August might soon come to fruition.

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