News

Software giant Microsoft is in talks to acquire Yahoo's online search business for $20bn. The proposal forms the centrepiece of a complex transaction that would see Microsoft support a new management team to take control of Yahoo.

But there is no intention of Microsoft tabling another takeover bid for the web giant, after its aborted $47.5bn offer this summer, reports the Sunday Times.

Dragons' Den star Theo Paphitis was this weekend trying to mount an eleventh-hour rescue deal for Woolworths' high street stores, potentially saving thousands of jobs. The entrepreneur had a meeting with the administrators of the retailer at Woolworths' London headquarters at the end of last week. He is working on a plan to salvage a core of the chain's most profitable stores and keep the Woolies name on the high street, reports the Sunday Times.

The beleaguered furniture retailer Land of Leather is believed to have received a number of bid approaches as the economic gloom takes its toll on the high street. The chain, headquartered in Kent, is understood to have received several preliminary takeover inquiries in the past few weeks through its main financial adviser Investec, the investment bank. Among those thought to be interested in the retailer is Hilco, the turnround specialist that had tried to buy Woolworths for £1 before the store group's collapse into administration, writes the Sunday Times.

Tesco will reveal its worst sales performance since the early 1990s recession this week as concern mounts that more high-street retailers are facing financial collapse. On Tuesday, Tesco will report third-quarter like-for-like sales growth of just 1.9%, its worst financial performance since 1992. Tesco, led by Sir Terry Leahy, has been hit by rejuvenated competition from Asda and Sainsbury's as well as the discounters such as Aldi and Lidl, writes the Observer.

A group of businessmen, customers, account holders and shareholders is mounting a legal challenge against the government's controversial move to allow the merger of HBOS and Lloyds TSB without a referral to the Competition Commission. The Merger Action Group has lodged an application with the Competition Appeal Tribunal claiming the decision made by Business, Enterprise and Regulatory Reform Secretary Lord Mandelson was 'unlawful', writes the Observer

Energy Minister Mike O'Brien has pledged to stop power companies raiding customers' accounts to charge for gas and electricity they have not used.He has ordered regulator Ofgem to investigate why they are sitting on possibly billions of pounds they have taken from accounts without consent, writes the Mail on Sunday.

ITV is set to cut its £1bn a year programming budget in a move that could affect chairman Michael Grade's recovery strategy for the commercial broadcaster. Since arriving at the company at the beginning of last year, Grade has maintained that ITV's continued high level of investment in programme production is vital to its long-term performance, reports the Mail on Sunday.

Business services group Rentokil Initial has brought on board advisers to restructure its £1.1bn debt pile, underlining the deepening financing crisis facing blue-chip British businesses. The pest-control and office-cleaning conglomerate has been working with NM Rothschild, the investment bank, to find a syndicate of lending banks that is willing to replace a £250m loan that matures in January 2010, writes the Sunday Telegraph.

Vincent Bolloré, the French financier, will restart his mission to appoint independent directors to the board of Aegis, the media group, following the ousting last week of its chief executive Robert Lerwill. Mr Lerwill, who left the company suddenly in the wake of a boardroom dispute, opposed a tie-up with Mr Bolloré, claiming his stake in rival Havas would be a conflict of interest, writes the Sunday Telegraph.

Europe's economy officially collapsed into recession for the first time since its inception during the third quarter, boosting hopes that the European Central Bank will be forced to cut interest rates again in December.The eurozone, made up of the 15 countries that use the euro as their primary currency, shrank by 0.2 percentage points between July and the end of September, having contracted by the same margin during the preceding three months as well, reports the Sunday Independent.

Interest rates will be cut again this week by up to 1 per cent when the Bank of England's Monetary Policy Committee has its monthly meeting. Economists predict that Mervyn King, the Governor of the Bank, and his MPC team will sanction a cut of at least a half a percent to 2.5% on Thursday, writes the Sunday Independent.