06/04/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson


Despite plunging oil prices, investment in shale gas


Live from London, that's our top story on Wednesday 6th April.


The price of crude has slipped back below $40 a barrel as supply


So why are investors still piling their cash into shale?


A $160 billion deal goes up in smoke.


US drugs giant Pfizer scraps its takeover of Botox maker


Allergan, as President Obama gets tough on tax inversion.


And European markets are higher despite Greece's debt saga


The global beauty industry is worth more than $110 billion a year,


but how do you make your brand stand out?


We sit down with the boss of skincare giant Rodial.


It's a hit with celebrities and the rest of us, but is it


And as Paypal scraps plans to create 400 jobs in North Carolina


after the state recently passed anti-gay laws we want to know,


is big business right to get involved in social issues?


And is this corporate activism the way to change the law?


Oil has been particularly volatile over the past couple of days


But despite the uncertain outlook for producers,


America's fracking fever continues, because new figures suggest


investors still have their faith in the US shale story.


According to research from the Carbon Tracker Initiative,


investors are piling back into the sector, investing


an incredible $8.9 billion in the first quarter of 2016.


That's the highest level of investment in the industry


on a quarterly basis since 2011, and a tenfold increase


It's a surprising figure, considering Carbon Tracker forecasts


that fracking companies will suffer 10% lower output this


Investors are apparently betting that the price


of oil can't go any lower, and that now the only way is up


We have been talking about how billions of investment money has


been withdrawn or put on hold, we are seeing a lot of investment, is


this investors betting that the US shale oil and gas has hit rock


bottom? That is the inspiration I would say, because oil was below $30


in January, so the first quarter of this year, that is the lowest. We


have had forecast of $10 by some banks, but the perception had been


that this is the bottom, and from now on the prices would gradually


recover. That is the only explanation I can see. It is all


about nothing, they are taking risks, and I doubt if those putting


money in two huge analysis, they go by ear, feelings, and they take


positions. It is like playing at the casino. If you look at the US


fracking picture, it is fragmented, you have big players, little


players, they each need a different price to break even. There is a lot


of the smaller guys that are suffering. Did you think this is


right for consolidation, the guys sucking up the little ones? That has


been the expectation for the oil industry in general. But it has not


been as much as people expected. The costs vary. The range of different


companies, each company has its own break even price. The cost of


operations has fallen, there are now less than 500 bricks, there had been


2000. The costs have come down, which might make the investors say,


they can not be as bad losers, maybe profit makers. It is unusual. We


always appreciate your time, thank you for explaining that.


Germany's Angela Merkel has warned that it's not legally possible


for Greece to reduce its debt burden while remaining in the EU.


Talks have resumed this week between Greece and its creditors


The IMF has long argued for Greece to be given debt relief.


Ford says it plans to build a new $1.6 billion


It says the move will create 2,800 jobs, and will focus


But Republican presidential candidate Donald Trump has called


The instant-messaging service Whatsapp says it will be encrypting


So-called end-to-end encryption scrambles messages,


making them only readable by the sender and


The firm, which has a billion users around the world,


says file transfers and voice calls will also be encrypted.


I sent a message to a friend last night and I got that message. Have a


look at the Business Live website, talking about the Swedish fashion


retailer, pre-tax profit for three months down, although sales in March


were up by 2%. This is one of my favourite subjects, aviation, and


easyJet. This is a tweet from our colleague. Not a bad number of


passengers. That percentage is also important,


because it is about getting those planes full and being able to charge


more for them. The temperature is rising in Mumbai


and the heat has been on the UK's Business Secretary Sajid Javid over


the last few days. He's been accused of not


doing enough to protect He'll arrive in Mumbai today


for talks with Tata Steel over In a couple of hours in that


building behind me the Tata chairman will meet Sergei Javad. I have


spoken to Tata, they are sending out an assurance that the process of


sale they will follow for their UK operations will be thorough and


transparent. The Business Secretary is hoping to get an agreement that


whatever deal they strike for the takeover of those operations, it


would result in mass job losses in the UK -- won't. They employ 15,000


workers in its steel operations in Britain. The Business Secretary met


with a potential buyer yesterday, the Chief Executive of liberty


house, a commodities firm. He has told us he might be interested in


purchasing the UK steel operations, and if there was an offer on the


table that he made yesterday, that is something which we are expecting


to be discussed in this meeting here today. We will be back with you if


we hear any more. An important day, not only for Tata in India, but also


for those here in the UK. Japan's Nikkei ended lower again


today, marking its longest losing It's more than three years


since Prime Minister Shinzo Abe launched his three-pronged


stimulus-and-reform plan to revive the stagnant economy,


but it's had limited impact. Elsewhere, European markets


are higher today despite the fact that Greece is dragged back


into the headlines by the IMF. We'll hear from Christine Lagarde


on those comments over Greece later And later today we'll get the most


recent minutes from the US Fed, where there could be some detail


on any divisions on the committee. We will keep a close eye on those


numbers. US drugs giant Pfizer has decided


to kill off its planned $150 billion takeover of rival Allergan


after US authorities launched a clampdown


on so-called tax inversion. The deal would have moved


the biggest drug company in the US to Ireland to lower its taxes,


but that deal is now off. It is not confirmed, what we are


expecting it to be off. Great to have you with us. It is fascinating.


As a lay man, you would go, hang on, perhaps Pfizer were not interested


in the product, it wanted lower tax? That was a key part of the deal,


they were going to save $1 million a year. The tax rate in Ireland is


12.5%, in the US it is 35%. The challenge now, if the deal is off,


what they do next, but also it is interesting from the US


administration point of view that this is their headline act, that


they wanted to stop this happening, to send a message. Yes, and the boss


of Tata tried to buy AstraZeneca in 2014, that was predicated on taxing


version, partly, that did not work either. The Administration bringing


in these antique inversion rules, purely aimed at Pfizer, with


language relating to the way this deal was structured. He did not


specifically mention Pfizer, but on top of that, multinationals will be


looking at it. Multinationals operating in the US are up in arms.


It is an expensive end to the deal, they will have to pay a break fee.


Bankers were due to earn money on the deal. They will get some of it,


but not all of it. It is part of a movement to get tough on tax, we


have seen it, who is paying tax where. That continues apace. Yes,


Bernie Sanders has mentioned it, as has Donald Trump, in the wake of the


Panama papers being released, it is more relevant than ever. We will


keep our eye on that, and you will talk through some stories later.


The global beauty industry is worth $110 billion a year,


but how do you make your brand stand out?


If you thought snakes, dragons and super stem cells


were the stuff of fantasy, think again.


The cosmetic brand Rodial used flashy-sounding names


to capture a corner of the market, treating skin conditions.


When you arrive at work in a morning, ever spare a thought


for the teams of overnight workers who keep our schools,


An army of contract cleaners work overnight


to look after two thirds of offices and schools in the UK.


The cleaning sector is worth ?8 billion to the British economy.


Steph is at the British Cleaning Council's trade


Good morning, yes, this is one of the companies being exhibited, you


have failed their! I am on one of the ride on bits of kit. It is an


end street worth to the UK economy. It employs 450,000 people, which


will increase by 3% in the next year. It is one that is growing. It


is changing a lot. Often, cleaners would be the people you did not


really see in the office, because they would be the people working


when you are not there, but that is changing. Because of that, the kit


is changing as well. A lot smaller kit, although this is not


representative! That is so they can actually make sure they can get


round the offices. They were telling me something that has had a big


impact is the increase in the minimum wage, because this is an


industry that pays around the minimum wage. That has made an


impact. The company you saw earlier were telling me that they have had


to put up prices in order to cover this. Jackie is racing me this


morning! A lot of innovation here, it is changing the way the industry


is working. If you look at the types of people employed in the sector,


one in three in England is a migrant, so the EU referendum could


cause uncertainty. And I think I will finish this by racing Jackie,


so I will see you later. Big industry, but what is more important


is I win this race. Of good stuff. I hope she is not


trying to get back to the office. The website, the place to find the


latest revelations. The price of crude slips back below


$40 a barrel as supply But despite this, investors


are still piling their cash into shale, as they bet


on a recovery in energy prices. Even though production is expected


to be down on last year. Beauty may well be in


the eye of the beholder. More people watching, would probably


agree! But it's also a billion dollar


industry. Skin care is an especially important


part of the picture - with latest figures suggesting it's


worth more than $110 That there is a lot of money, for


cream, stuff for your face! So do you distinguish yourself


in such a crowded market place? That's a question for our next


guest. Maria Hatzistefanis


is the founder of Rodial. The company specialises in helping


deal with a range Maria started life as a journalist -


but spotted a gap in the market It's grown a lot since then -


and now operates in 35 It's said to count celebrities


amongst its fans - Unfortunately, we could not get Kim!


So we got Fritzy! Victoria Fritz sat down


with the founder of the company and asked her whether Rodial's


claims that its fancy ingredients fix skin complaints


were medically proven. With all our products,


we use ingredients that have gone Everything we use, backed


up by research. At the same time, we want them


to be exciting, fun, we want the customer to get involved


with the lifestyle. Your range includes snake serum,


dragon blood, stem cell superfoods. I assume you have neither snakes,


dragons, in your products! So do you not feel


you're misrepresenting? When we started, we were really


small, so I needed to come up with names to make


the range stand out. One of the first


products, snake serum. When I came up with the idea,


I thought shall I call it anti-ageing, or use


the main ingredient, I thought, how much more exciting


to call it snake serum, Of course, people love


the name, some hate it. But what we got, a lot of buzz,


people talking about the brand. And when you do not have a huge


advertising budget, it takes your company


to the next level. You first worked as a beauty writer


so you've been on both sides. You know how many freebies


these magazines get. How unbias is the advice


from beauty editors? When it comes to magazines,


I think we know most journalists are unbias,


at times we would send products, they wouldn't cover it


unless they liked it. If they are not an advertiser they


do not have an obligation to cover. Win it comes to celebrities, unbias


recommendation of the products, but sometimes. Anybody can be a beauty


blogger. How concerned are you about controlling the brand online? You


cannot control it. What we do as a business, we make sure that whatever


content we produce, whatever the message, we take it across


platforms, Instagram, YouTube, e-mail databases, making sure that


everybody gets the same message. How people take that message,


interpreted, that is something that we cannot control. What does the


future hold? Do you plan on expanding? I want to develop social


media, even further, that could be with the YouTube channel, we also


launched a docu-series, behind-the-scenes, a project. And


that would enable us to communicate with everyone, grow the brand. And


on the other hand, physical stores, grow in the UK with Harvey Nichols,


and I want to take this internationally, New York, Hong


Kong, and take this spatial, flagship business globally. That was


the boss speaking. Her name? Maria Hatzistefanis


is the founder of Rodial. Sorry if you're watching for that!


Quickly moving on, James is back. Taking a look at the newspapers.


Prince Andrew stepping in with Tata. Beijing. He has been critical, China


has been said to be part of the problem? Prince Andrew was in China,


speaking to the president, we do not know what the response was, but as


we were talking about, Russia is another huge issue, in terms of the


amount of steel, it is not just China, so presumably Xi give him a


robust response. And Lithuania also exports about 95% steel. Is it


correct that the royals get involved? We have even been told,


they could get involved, with the EU debate, should they be getting


involved, using any clout? Prince Andrew, he was involved, with her,


-- the trade envoy, he clearly would have been bruised, Dell must --


briefed, it is not going to change policy but it does add some


pressure. Clearly, this widens it to an audience. Royals getting


involved. Raises the profile. Do you think that he has been raising the


profile, more than Business Live? I doubt that. And PayPal. PayPal, not


going to tolerate North Carolina discrimination. They have been


calling this the bathroom law. It has been targeting the transgender


community, using public bathrooms lined with the gender on their birth


certificate. Yes, PayPal weren't going to be opening an office, and


North Carolina, but do note, business and action, not going to


this day because they do not like the stance on the issue. We have


been asking people, a people think this was correct. Christina has


said, yes, it is the only way to hit the bottom line. Businesses should


be free to take decisions, according to ethos. But Jack says it raises


questions for Nissan. At Mississippi. It raises the question


is, does business have an active role to play, or just an observer?


That is correct, and American tech businesses have been on the front


foot, then some more traditional companies, when it comes to social


activism, money where the mouth is. Funny place, the States! So


different, between the coasts. It is difficult to believe it is 2016.


Good on you James.


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