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  • Skyscanner sold to China travel firm Ctrip in £1.4bn deal

    A screengrab of the Skyscanner websiteImage copyrightSKYSCANNER/BBC

    Skyscanner, the UK-based travel search business, has been bought by Ctrip, China's biggest online travel firm.

    The deal values Skyscanner at about £1.4bn ($1.75bn).

    The firm, which has its headquarters in Edinburgh, is available in more than 30 languages, with about 60 million monthly active users.

    It was set up to let users compare prices from different travel sites when searching for flights, hotels, and rental cars.

    Skyscanner said it would continue to run independently, with the same management team.

    Simon Jack: Is the Skyscanner deal good or bad news?

    The news of the deal comes just hours after Chancellor Philip Hammond promised £400m to help Britain's successful digital start-ups avoid being snapped up by larger rivals.

    "I am taking a first step to tackle the long-standing problem of our fastest growing technology firms being snapped up by bigger companies, rather than growing to scale," Mr Hammond said in his Autumn Statement.

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    'Powerful technology'

    Ctrip was founded in 1999 and is one of China's best-known travel businesses.

    The deal would "strengthen long-term growth drivers for both companies," said James Jianzhang Liang, co-founder and executive chairman of Ctrip.

    "Skyscanner will complement our positioning at a global scale and Ctrip will leverage our experience, technology and booking capabilities to Skyscanner's," he added.

    Skyscanner was set up in 2003, and co-founder and chief executive Gareth Williams said the deal took his firm closer to its goal "of making travel search as simple as possible for travellers around the world".


    Media captionSkyscanner CEO on the secrets of being a boss

    BBC's Dougal Shaw on meeting an unassuming boss

    You have to go through a slick PR machine to get time with Gareth Williams. But once you reach him, it's like having a chat with a friendly, unassuming bloke down the pub.

    Which is how his company was founded. Gareth Williams thrashed out the original idea for Skyscanner with two university friends in a pub back in 2001.

    A passionate skier, he was frustrated by the time it took to sort through potential flights.

    Lean in and listen carefully. Every softly-spoken word is measured, well-considered and laser-like to-the-point.

    I met him this summer for a recording of CEO Secrets, our entrepreneurship series.

    Interestingly, the Skyscanner team is very keen to play down the label of being a "unicorn company", a young company valued at more than $1bn, even though that's an elite club that you'd think would be nice to join.

    Forget that, they told me. They were more keen to talk about their actual revenues from customers, their rate of growth and their next generation work with automated bots.

    Perhaps that's what sealed the deal with Ctrip.

    Skyscanner officeImage captionSkyscanner says it will continue to be based in Edinburgh

    "Ctrip and Skyscanner share a common view - that organising travel has a long way to go to being solved. To do so requires powerful technology and a traveller-first approach," Mr Williams said.

    The sale comes about a year after Skyscanner announced a fresh round of investment to help it expand. Its backers include investment firm Sequoia as well as the Malaysian government's strategic investment fund, Yahoo Japan and fund manager Artemis.

    Its biggest investor, Scottish Equity Partners, welcomed the sale and said it was "particularly pleased" that Skyscanner would continue to be headquartered in Edinburgh and to operate independently.

    Shanghai-based Ctrip became China's biggest internet travel service after merging with a similar business, Qunar, last year. That deal gave Chinese internet giant Baidu, which controlled Qunar, a 25% stake in Ctrip.

    Analysis: Dominic O'Connell, Today business presenter

    Two days after Theresa May promised the CBI a more interventionist industrial policy, one which might stop important British companies being sold to foreign rivals, along comes a deal to expose the shortcomings of such a promise.

    Skyscanner, the Edinburgh-based technology company, has been sold to a Chinese rival for £1.4bn. Skyscanner sells travel online, but it is much more than just another travel website; its technology frequently sees it cited as one of Britain's top technology companies, and it is one of the UK's few "unicorns" - youngish tech companies with valuations north of $1bn.

    When pundits try and come up with candidates to be the "British Google", Skyscanner is a name that frequently comes up.

    It is hard to see, however, what Theresa May could have done - even once her new industrial policy is in place - to stop the sale.

    Like most British tech companies, Skyscanner has a small army of investors, ranging from traditional private-equity investors to technology specialists like Sequoia Capital.

    It would be hard to argue that there is some national interest in interfering to keep it in British hands, and to do so would interfere with the basic rights of investors to sell their property.

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  • Opec plans fresh oil price talks says energy minister

    Oil producers in the Opec group of countries will make another attempt this week to reverse a slump in crude prices, according to Algeria's energy minister.

    Noureddine Bouterfa said there would be an informal gathering of Opec members on the sidelines of a energy conference in Algiers on Wednesday.

    An oil output cut or freeze would be on the agenda, he said on Sunday.

    "We will not come out of the meeting empty-handed," the minister added.

    Oil prices collapsed from peaks of more than $100 a barrel in mid-2014 to near 13-year lows below $30 in January. The price on Friday was $44.48 a barrel.

    That slump has been causing problems for countries which rely heavily on revenues from exports.

    Opec's 14 members, which produce about a third of the world's oil, have so far failed to agree a deal to cut output that would prop up prices.

    But the state of the oil market was "more critical" than when Opec last met three months ago, Mr Bouterfa said.

    Crucially, Saudi Arabia, the largest Opec member and which has resisted production curbs, may now be more willing to cut output, he added.

    Saudi Arabia pumped a record 10.69 million barrels a day in August compared with 10.2 million in January, according to data compiled by Bloomberg.

    'Best solution'

    Although Wednesday's meeting is an informal gathering, Mr Bouterfa did not rule out it becoming a formal event.

    He said: "Either we reach an agreement, which would be good, or we reach an understanding on the elements of an agreement, and that would also be good.

    "Every state in the organisation agrees on the need to stabilise prices, it just remains for us to find a format that pleases everyone. The best solution would be a (production) freeze."

    Opec members are losing between $300m and $500m a day, Mr Bouterfa said. "No (oil) company will be able to withstand it if prices remain under $50 a barrel," he added.

    Source: BBC

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  • China slowdown is global economy's biggest threat, Rogoff says

    The former chief economist of the International Monetary Fund has told the BBC a slowdown in China is the greatest threat to the global economy.

    Ken Rogoff said a calamitous "hard landing" for one of the main engines of global growth could not be ruled out.

    "China is going through a big political revolution," he said.

    "And I think the economy is slowing down much more than the official figures show,"

    Mr Rogoff added: "If you want to look at a part of the world that has a debt problem look at China. They've seen credit fuelled growth and these things don't go on forever."

    British exposure

    Last week, the Bank of International Settlements, the global think tank for central banks, said that China's debt to GDP ratio stood at 30.1%, increasing fears that China's economic boom was based on an unstable credit bubble.

    The figure was described as "very high by international standards" by the Financial Policy Committee of the Bank of England, which will now test British banks' exposure to a Chinese slowdown.

    British banks have $530bn worth of lending and business in China, including Hong Kong. That is about 16% of all foreign assets held by UK banks.

    'A worry'

    "Everyone says China's different, the state owns everything they can control it," Mr Rogoff, now Professor of Economics at Harvard, said.

    "Only to a point. It's definitely a worry, a hard landing in China.


    "We're having a pretty sharp landing already and I worry about China becoming more of a problem.

    "We've taken it for granted that whatever Europe's doing, Japan's doing - at least China's moving along and there isn't really a substitute for China.

    "I think India may come along some day but it's fallen so far behind in size it's not going to compensate."


    Mr Rogoff said that European economies and the US had to ensure they were "on their feet" before any slowdown started to bite.

    "The IMF has marked down its forecasts of global growth nine years in a row and certainly the rumour is they're about to do it again," he said.

    Beyond China, Mr Rogoff said there was a good deal of uncertainty in the world over issues such as whether Donald Trump or Hillary Clinton will win the US presidential election.

    He argued it was difficult to judge what Mr Trump would do if he won, and that a victorious Mrs Clinton might have her plans for infrastructure spending, for example, blocked by the Republican House of Representatives.

    "I am certainly nervous, probably much more about a Trump victory, just because of not knowing what's next," Mr Rogoff said.

    "I don't like the [protectionist] trade policies of either candidate. I think free trade has benefitted the States immensely in its leadership position. So watching as an economist, this has been a painful election."

    Brexit impact

    Mr Rogoff said it was unclear what the impact of Brexit would be on the UK economy as it was not yet possible to define the trade model that would be agreed or judge how well the European economy would be performing at the time Britain leaves the European Union.

    Despite praising the Bank of England's pro-active response to the referendum result, Mr Rogoff said that central banks were in an increasingly invidious position.


    "Monetary policy has its limits - it is not a panacea," he said.

    "It is a little bit the fault of central bankers for allowing themselves to take too much credit when things are good, and [then] getting blamed too much when things are bad.

    "But monetary policy doesn't make an ageing economy young, it doesn't make an economy which is having little innovation suddenly innovate, it doesn't make an economy with a Zombie banking sector somehow miraculously healthy.

    "I have a concern about monetary policy at the moment - that it is being asked to take on roles that it's not built for. It is being asked to do helicopter money where you just print money and hand it out to people.

    "In Europe, central banks are buying up a significant proportion of the corporate debt market - that's what you do in China, in India, they're doing that in Japan also.

    "There are all sorts of other pressures and I worry in the long run that central banks are losing their independence."

    Source: BBC

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  • Samsung delays restarting sales of its Galaxy Note 7 in S Korea

    Samsung has said it will delay restarting the sale of its Galaxy Note 7 phone in South Korea, as the firm needs more time for the global recall of the device.

    The South Korean tech giant was forced to recall some 2.5 million devicesglobally due to overheating batteries.

    Dozens of devices were reported to have caught fire.

    The phone was to be back on the shelf on 28 September but is now expected to be available 1 October at the earliest.

    On 2 September Samsung had said it would stop selling the phones and offered to replace the ones already sold. The firm also urged people to stop using the device.

    The global recall affects 10 markets. In South Korea, some 200,000 customers have already returned their devices with the same number of people still left for the recall, according to Samsung.

    Reuters reported that the next markets where the phone will be available for sale again will be Australia and Singapore in October.

    What makes lithium batteries catch fire?

    On Friday, cabin crew on an Indian passenger aircraft used a fire extinguisher to tackle a smoking older Samsung handset.

    The Galaxy Note 2 - a model launched in 2012 - was smouldering and spitting sparks, according to a statement from airline IndiGo.


    In the US, regulators have ordered a formal recall of the Note 7, while the country'sFederal Aviation Administration has told airline passengers not to bring the phones on planes unless they keep them turned off and don't charge them during the flight.

    A number of airlines around the globe have also banned the phone from being used or charged on their planes.

    The phone was originally launched on 19 August and had been generally well-received by critics and consumers.

    The recall comes at a crucial time for Samsung as rival Apple has just released its new iPhone 7.


    Source: BBC

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  • Supercar maker McLaren denies Apple investment report


    Formula 1 team owner McLaren has dampened down a report that Apple has made a buyout or investment approach for the supercar maker.

    The Financial Times reported that talks had started several months ago.

    But a McLaren spokesman said: "We can confirm that McLaren is not in discussion with Apple in respect of any potential investment."

    However, the firm "regularly" has "confidential conversations with a wide range of parties", he added.

    The Financial Times reported that a potential deal would see Apple pay up to £1.5bn for McLaren, or make an investment for part of it, citing sources it said had been briefed on negotiations.

    It said that Apple was interested in accelerating its own car projects.

    The BBC understands that McLaren had been in talks with Apple over its rumoured Apple car, but those talks had not come to fruition.

    Analysis: Theo Leggett, BBC business reporter

    Why would Apple be interested in McLaren? It's hard to see why the technology giant would want control of a Formula 1 team, or what interest it might have in the supercars built by McLaren Automotive. A more likely target is McLaren Applied Technologies, a sister business to the other two.

    Part of what it does is data analytics. During Formula 1 races, McLaren uses computers to model pretty much any scenario that might occur, so that the team can adapt its strategy on a continuous basis. This kind of modelling can be used in other scenarios too - for example to predict how traffic will flow through a typical city centre, and how problems in one area might have knock-on effects miles away.

    It also develops advanced materials - lightweight carbon composites and complex alloys, which are used by the automotive business. And it's recognised as a leader in the development of simulators, which can model and predict vehicle behaviour.

    It's an open secret in Silicon Valley that Apple is developing a car; it's widely believed the company has ambitions to become a leader in the market for driverless vehicles.

    Advanced materials, predictive analystics and expertise in simulating vehicle behaviour... you can start to see why the Californian giant might be interested in a relatively small business based in Woking.

    F1 team is used to delivering updates every couple of weeks

    Apple ploughed $1bn (£770m) into Chinese ride-hailing app Didi Chuxing earlier this year and is testing driverless electric cars.

    Jim Holder, editorial director at Haymarket Automotive, said that Apple updates its products every year, whereas carmakers only do it every five to seven years.

    Such is the pace of development within Formula 1 that McLaren will upgrade and refine its racing cars multiple times each week during a season. It is thought that Apple is particularly keen on McLaren's expertise in rapid response times.

    If Apple wants a prototyping arm with established credentials - McLaren is a great fit.

    Mr Holder added Tesla has disrupted the car industry, but Apple buying McLaren would be much bigger.

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  • Shares of troubled shipping firm Hanjin jump 28%


    Shares of Hanjin Shipping have jumped by as much as 28% in South Korea.

    That's after the board at Korean Air Lines - Hanjin's biggest shareholder - approved a loan of 60bn Korean won ($54m; £41.5m) for the troubled shipping firm.

    The airline says the funds will be provided as soon as "the necessary procedure is completed", without elaborating further.

    Hanjin Shipping had sought bankruptcy protection earlier this month.

    The troubled firm was saddled with debts of more than $5bn. Previous attempts to raise fresh funding had failed.

    Korean Air was up almost 6% in early trade.

    Stranded in Singapore: The search for Hanjin Rome

    Stranded in Singapore: What happens to the shipping crew

    Hanjin Bankruptcy: What does it mean for corporate Korea?

    Estimates from the South Korean government have shown the company needs at least 600bn won to cover unpaid costs such as fuel and cargo handling.

    Earlier this month parent company Hanjin Group said it would inject 100bn won in fresh funds to resolve the disruptions to the cargo transport currently stuck at sea. That includes a 40bn injection from the private funds of Chairman Cho Yang-ho.

    Hanjin needs to submit a rehabilitation plan in December, and the firm's creditors will need to agree on that plan.

    The shipping firm has been granted stay orders to protect its ships from seizure in various ports including South Korea, the United States and Japan. But dozens of other ships are anchored off ports while the company tries to secure funds to unload cargo.

    Korean Air Lines has a 33.2% stake in Hanjin Shipping. A host of other shareholders have a less than 1% stake, and they include fund managers such as BlackRock Fund Advisors and Northern Trust Investments, Inc.

    Hanjin is the world's seventh-largest container line and has been unprofitable for four of the past five years.

    The global economic downturn in recent years has affected profits across the cargo shipping industry.

    Source: BBC

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