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Shares in National Express rally amid excitement of new route; Embassy cigarette firm Imperial Tobacco wins backing of its shareholders; British drivers spent £36.5bn on cars last year report says.

Shares in National Express rallied today amid excitement that it was about to become the new operator of the prestigious East Coast Main Line (ECML).

The transport group is reportedly favourite for the franchise, ahead of rival bids from Arriva, Virgin/Stagecoach and First Group.

The success would help the company overcome the disappointment of the loss of its East Midlands rail franchise, which encompasses the company’s existing services of Midland Mainline and Central Trains, to rival Stagecoach earlier this year.

It would also be a boost for National Express’s chief executive, Richard Bowker, the former head of the now-defunct Strategic Rail Authority who joined as chief executive last year.

Shares were up by more than 8% following the weekend press reports.

National Express, which also operates the c2c and One Railway, declined to comment ahead of an announcement from the Department for Transport (DfT), which is set to confirm the winner of the franchise tomorrow.

Embassy cigarette firm Imperial Tobacco today won the backing of its shareholders for a £11bn takeover of Gauloises firm Altadis.

Bristol-based Imperial has been engaged in a long-running pursuit of Altadis, after first making an approach for the Spanish firm in March.

The vote by Imperial shareholders in Bristol also gave directors the ability to carry out a fund-raising rights issue worth up to £5.4bn.

Shareholders overwhelmingly backed the resolution, with 99.82% of those voting being in favour. Imperial hopes to complete the deal in the October to December quarter, following approval from regulators in Spain.

The acquisition will consolidate Imperial’s position as the world’s fourth largest tobacco group, strengthening its position in Germany, France and Italy, while enabling it to close the gap on its three biggest rivals - Philip Morris, British American Tobacco and Japan Tobacco.

It will also boost its position in growing markets such as Morocco, Russia, Finland and Poland.

Additionally, a combination of the two firms would enable Imperial to get its hands on Altadis’s Cuban cigar business, which includes brands such as Montecristo and Romeo y Julieta and has a strong presence in North America.

British drivers collectively spent £36.5bn buying new and used cars during 2006, figures showed today.

Drivers spent an average of £1,509.67 per household on cars last year, the equivalent of 4.4% of household disposable income, according to Halifax.

The group said people collectively spent £11.1bn more on cars last year than in 1996, when spending totalled £25.4bn, an increase of 28% once the impact of inflation is taken into account.

But it said people were getting more for their money, as car prices have actually fallen by 26% during the past 10 years.

There were just under 31 million cars on the roads at the end of last year, up from 26 million in 1996, with people now changing used cars on average every four years, falling to every three years when a car is more than 10 years old.

The research found that 4x4s were depreciating fastest, losing an average of 34% of their value during the past two years, compared with just 20% for a supermini.

The pound at 5pm was US$2.0123 compared to US$2.0200 dollars at the previous close while the euro at 5pm was £0.6769 compared to £0.6769 pounds at the previous close.

See tomorrow’s nebusiness to find out which company will be creating 150 new jobs in the North-East and for an in depth look at the changing fortunes of ICI.


David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer