10/10/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson and Sally Bundock.


Raising a glass to a mega drinks deal.


The world's two biggest brewers are set to complete


their merger today - creating a giant that will control


Live from London, that's our top story on Monday,


The deal between Anheuser-Busch InBev and SABMiller is one


of the biggest ever seen in the drinks industry.


We'll assess what it means for the sector and consumers.


Also in the programme, is Samsung suspending production


of its Galaxy Note 7 smartphone after a series of fires?


We'll be checking that out with our Asia Business hub.


Down again, as HSBC forecasts the pound could hit 1.10 dollars.


We were here from a top scientist who says his DNA analysis device


holds the key to stopping the rise of the superbug and deadly diseases.


And the virtual messaging service Snapchat is said to be readying


itself for market location next year. Some say it is worth $25


billion. Is it another example of an overpriced social media phenomena or


do you think it is worth it? Use the hashtag.


It's more than likely that by the end of the day the world's


two largest brewers will be saying cheers to a mega-merger that leads


to one company controlling nearly a third of the worlds beer market.


So what does the tie up of Anheuser-Busch InBev


and SABMiller mean for the industry and beer drinkers?


Well, it's a deal worth $104 billion dollars -


and as I mentioned combines the world's two biggest brewers.


The newly-created firm will produce about a third of the world's beer.


Belgium-based AB InBev's brands include Stella Artois,


Corona and Budweiser, while UK-based SABMiller produces


But not only will the name SABMiller go in the take over -


Over the next few years AB InBev is expected to gradually cut


about 3%, that's around 5,500 jobs - from its enlarged workforce.


The job cuts will form part of an annual savings drive amounting


to some 1.4 billion dollars - and despite the newly formed company


having a 30% market share, the competition in the beer


All mass-market brewers are looking to cut production and distribution


costs in the face of rivalry from smaller independent brands


I'm joined by the Alcoholic Drinks Analyst, Anne. The ink is drying on


the deal. Tel us what the couples had to do to pass completion rules?


There is a lot they had to give up to make it work, China and the US,


they had to give up SAB Miller showing the joint ventures. It was


always going to be tense, in terms of passing regulations. In Europe,


SABMiller's brands have mostly had to go. It focuses the acquisition on


emerging markets like Latin America. The two coming together, it makes


the world's biggest, controlling a third of the market. Is that a


concern for the market in general, the likes of Heineken and others


really concerned? It will make quite a difference. I don't think there


will be overly concerned. When you look at the market level, there will


not be too much change to patterns of competition. Now they have passed


the regulations, the overlap between SABMiller's countries and


Anheuser-Busch InBev, there is not much overlap. Heineken and Carlsberg


are going to be competing, market by market. What will they get on with


first, as a newly merged company question mark element the cost


savings is going to be key. There is a lot of work to be done, joining


such huge companies. In the short term there will be focused on making


it work. In the long term we have brands like Budweiser, they might


consider putting that into a new markets. We will watch this space


closely. You are an alcoholic drinks analyst, do you have to test it all,


try at all? Occasionally! It is early in the morning, so completely


with it. The entertainment company co-owned


by Hollywood director, Steven Spielberg, is to join forces


with a major Chinese Amblin will join with


the Alibaba Group to produce films Alibaba Pictures, which is led


by the e-commerce billionaire Jack Ma, will take a minority stake


in Amblin as part of the agreement. Facebook paid $5.28 million in UK


corporation tax last year, as it expanded its business


in the UK. It is a big increase


on the $5,500 paid in 2014, which prompted an outcry


from campaigners who argued it But critics may still be riled


by the fact that the company will receive a tax credit


of $14 million, which can The firm said it was "proud" to have


grown its business in the UK. The Korean electronics giant Samsung


is suspending production of its flagship smartphone -


that's according to The Galaxy Note 7 has made


headlines, following reports that Leisha Chi has been


following the story. Reuters is picking up on this, as


well. What is the latest? Well, it looks like Samsung is in major


damage control. Shares today fell by as much as 5% before closing 2%


lower on these reports of them halting production of the Samsung


Galaxy Note seven. It is the most expensive device. Customers said


there were safety problems with replacement phones, the ones being


given in exchange for the faulty ones with exploding batteries.


Samsung issued a statement saying that they are making temporary


adjustments to the production schedule and that they planned to


conduct more in-depth inspections and improve quality control. There


are concerns. We have seen AT and T Mobile stopping the sale of the


Galaxy Note 7 because of the batteries catching fire. We have


already seen 2.5 million units recalled. The crisis looks far from


over. Thank you, as always. A quick look at the numbers, in Tokyo, the


In Tokyo, the Nikkei is closed for a public holiday -


and in Hong Kong, trade was pretty thin because of


Samsung Electronics one of the biggest losers -


as that Galaxy Note 7 crisis resurfaced.


This is what Europe looks like right now.


The weak pound giving another boost to the FTSE100 - we'll talk more


HSBC are saying it could hit parity with the euros and $1.10.


and Michelle's got details of what's ahead on Wall Street this week.


Bank profits will be in the spotlight towards the end of the


week, even though Wall Street is betting the Federal Reserve will


hike in December. Lower interest rates are continuing to squeeze the


financial sector's ability to make money. As a result, JPMorgan Chase


is poised to report a decline in third-quarter profits this Thursday.


Scandal over accounts at Wells Fargo is also likely to cast a shadow over


earnings. The third-quarter earnings season kicks off in earnest earlier


in the week, when image major metal company announces its results. A


busy week for economic data, with reports on retail sales and factory


output. We are joined by James Bevan. Nice


to see you. A lot going on today. Lots of bits of news coming out. The


pound is sinking today. What is grabbing your attention? The weak


pound is going to make it really difficult for the Government to fund


the deficit. It will make it worse before it gets better, a big worry


for the economy. The pound is down to $1.23, HSBC forecasts it could go


as low as $1.10. Parity with the euro, is that the stage we are at?


HSBC are leading the charge on how low it will go, I am on $1.15. It is


clear to keep the economy going we will have to have a weaker economy


and interest rates remain very low. As the Deutsche Bank, shares down


3%. We keep talking about this deal that the boss will broker with the


boss in the United States, but it is not coming? It is not just a problem


of the deal, it is a real challenge in the European banking system. They


are just not making profits. It is really hard for banks to make money


in the current very tough regulatory environment, in a climate where


Europe has negative interest rates. When it comes to what can be done,


we are seeing anecdotal evidence about companies looking overseas,


about whether places like Frankfurt are trying to steal the lead on


London as a result of the Brexit vote. Then we see big changes in the


value of the pound, what can be done? Is it out of the hands of the


policymakers? Absolutely not. We need Mr Hannan to step up to the


table at the Autumn Statement and say, guys, I'm going to take the


policy steps necessary to keep the boat afloat. He can most certainly


spend money, he can turn away from austerity, he can commit to fast


growth of the UK economy. That would be very good news in terms of both


market sentiment and non-domestic investors thinking more broadly


about what lies ahead for the UK. Thank you very much for your


contribution. He will be back to talk about Snapchat, Facebook and


other stories. Let us know if you think it is worth the valuation.


Don't use Snapchat, because it will disappear and ten seconds and we


will not see it. Halting the rise of the superbug -


we look at new technology being used in the fight against global disease


- and the company behind it, You're with Business Live from BBC


News Did RBS squeeze struggling companies


it was supposed to be helping - That's the allegation


based on an investigation Confidential documents show that RBS


sought to profit by buying up assets cheaply from struggling businesses


and bank staff could boost bonuses Lawrence Tomlinson wrote a report


into the issue. Just explain what happened in your instance. Good


morning. I wrote a report, basically outlining exactly what Buzzfeed are


saying. That RBS crushed British businesses purely for profit. This


that have been leaked. It has been that have been leaked. It has been


rumbling on for some time. What are you expecting to happen now? My


report was written three years ago and the FCA having doing an


investigation for three years. It is about time that came out. It is also


about time Ross McEwing put his hands up to this and said, you know,


GIG was a pretty bad unit and look at some kind of redress scheme for


the businesses damaged. We are talking about something like 15,000


British businesses that went through the department, that they claimed


was not for profit. According to the secret documents, into thousand and


11, they made $1.1 billion for the bank. -- in 2011. We must mention


the RBS statement. In a statement RBS has acknowledged


that it could and should have done It went on to say that


"Despite a number of investigations that involved a detailed review


of all the evidence, including reviewing millions


of pages of documents, we have seen nothing to support


the allegations that the bank artificially distressed otherwise


viable SME businesses or deliberately caused


them to fail". In regard to GRG the bank also said


"Nor did it buy their assets That is the official RBS response to


that story. Gatwick bosses possibly building a second runway, even if it


does not get the expansion, it goes to Heathrow, they might build


another one anyway? Big week for news on that, stay tuned.


The world's two biggest brewing companies are set


It's a tie up between Anheuser-Busch InBev


and SABMiller is worth $104 billion and would create


a company controlling a third of the global beer market.


I remember when it was announced 13 months ago and there was the


discussion about whether it will happen because it is huge? Well, the


ink is drying! A quick look at how


markets are faring. Medical advances take


time, and money. But our next guest says


the technology his firm makes is revolutionising the way


scientific research Oxford Nanopore Technologies


specialises in DNA sequencing or cataloguing the order


of molecular building blocks. To do this the bio-tech firm has


developed a pocket sized device that can be used on all living things,


from human beings to bacteria. The Minion device is a portable DNA


sequencer which has huge potential in markets such as food and water


monitoring, healthcare, The goal of the company


is to enable the analysis of any living thing,


by any person, in any environment . In August 2016, Nasa performed


DNA sequencing in space on the International Space Station


using the Minion device. Oxford Nanopore Technologies is now


valued at over $1 billion. Dr Gordon Sanghera, CEO


of Oxford Nanopore Technologies. Nice to see you. Welcome. And he is


warmed with the device. What is it? How does it work? Show us the


device. So this is the world's first and only portable DNA sequencer. So


we can get DNA information live in real-time. What's it telling you


now? It isn't telling me anything. You would put a swab, a blood sample


or a urine sample or an environmentalal sample from a


reservoir and you would apply it here like a drop of blood and in


real-time, it will give you DNA information. No other technology can


do that. All existing technologies today are large central laboratory


facilities. That take many, many days. What is that replacing? Give


us a sense of the scale of something that would be in a lab versus that


port bli? The best analogy is to think about now the technology


evolved for digital photography. So in the old days we had a reel of


film. Woe sent it off to -- we sent it off to a central facility, Boots,


big machines around the back whirring a week away taking a week


or so to get your film back. This is like digital photography which means


it is real-time and it is like the ability to have so much more power


in real-time. Where can that information go to? Can it go to your


portable device? If you are in the middle of Africa and you are trying


to get a sense of the environment you're in or the dangers around you


or disease or what have you, can you get it sent to your portable device?


It is indeed. It can be plugged into a laptop and run locally on a laptop


and it was used in Africa to look at Ebola and it is being used to track


Zika. The key element is the real-time nature so we're tracking


and trending in real-time, not after the event. And then we're having to


try and shutdown particularly when you think about something like Zika


where the spread of infection is going very quickly. We touched on in


this the introduction, but to get the medical advances, you need time


and money. You have been successful in attracting money. How do you


explain that to your investors in terms of the practical applications


for? Where would it be used and what difference will it make? So we've


raised, we have been around for 11. We have 300 people, we are not a


start-up. This is not some idea of when will it come? This is


commercially available. We have invested ?350 million. Now 11 years


ago when we spoke to traditional venture capital companies, firms,


who have a three to five year turn around time, this was a bigger play


and they were fortunate to get investors who saw the long-term


view, the disruptive nature, how this could be a game changer. How we


could start to fight the rise of superbugs, how we can track and


trend and control things like Zika and they bought into the idea of


patient capital to make a big technology play in the UK. Is it


selling now and is it making money for those that invested 11 years


ago? It is. We are in the foot hills of commercialisation. We launched


the product 15 months ago. So who are your clients? The bulk of market


is researchers, early adopters, people who do genetic research in


laboratories, but we believe quickly the technology will leapfrog into


applied markets. And once the clients have got this and saturated


that market, do you have something else that you will develop? So two


things, the way to think about the market today for researchers, there


are 8,000 large central laboratory DNA sequencers. In our first year


we've placed 3,000 of these. There are probably 100,000 molecular


biologists who would want one of these to do desk top manipulation of


DNA measurement, trending and tracking. So there is a huge market


just in the research markets, but when you think about for example we


had the problem with an infection of water in Preston. Having real-time


DNA information along that supply chain from the reservoir to your tap


would mean that you would prevent such outbreaks. So the applied


markets are going to be absolutely huge for this kind of technology.


It is fascinating stuff. It really is. I've learnt a lot this morning.


Really nice to see you. The Chief Executive of Oxford Nanopore


Technologies. Thank you very much. In a moment we'll take a look


through the business pages but first here's a quick reminder of how


to get in touch with us. The Business Live page is where you


can stay ahead with all the day's breaking business news. We'll keep


you up-to-date with the latest details with insight and analysis


from the BBC's team of editors right around the world. And we want to


hear from you too. Get involved on the BBC Business Live web page.


On on Twitter. And you can find us on Facebook.


Business Live, on TV and online whenever you need to know.


Ben is taking charge of the tablet! Sally hadn't loaded the stories. .


James is back. Are you a Snapchat user? No. . Why could it be worth


?25 billion? The capacity for companies like this to generate


significant revenues from advertising and cash payment, you


can send money through Snapchat and access stories which have been


stored from your friends and the expectation is that ads will be


slithered into the news flow and both of those can generate


substantial revenues. With Snapchat, they are not making revenues right


now, but they have loads and loads of users... They are not making


profits. But they have many, many users? Quite right. The story for


all investors to contemplate is how much money can they make and how


quickly can it roll out? We will talk about Facebook in a MinION, but


it is very clear that Facebook surprised a lot of people myself


included, as who how quickly they can ramp up revenues and exceeding


analysts estimates quarter after quarter. I remember we were cynical


when Facebook was floated. I was as well, were you Ben? I mean, let's


talk Facebook 11 million tax credit it is going to get after vowing to


pay more to the taxman. It is paying more tax, but it will be able to off


set some later on. Well, there has been a change this the tax code and


HMRC are acting properly. The Government set the rule book. This


is to do with the setting aside money for an options scheme as part


of remuneration, so it is legitimate. But there is a global


issue about how much tax these entities should be paying anyway.


This is about what Facebook is paying in the UK. It is the UK


Government chasing after Facebook, but it is a global organisation and


it is a hot subject here and in many countries around the world. It is


because companies have demonstrated that they put shareholder value


first. They will pay legitimate taxes, but they will use the law to


pay as little tax as possible and countries generally compete in order


to have companies in their jurisdictions so we have a


relatively low corporation tax. You think back to the austerity that we


faced in the UK. It has been borne by people who have lost jobs, by


private individuals who've been paying more tax, companies actually


have been paying less tax as a rate. Another day, another warning on


Brexit. This time Wall Street bosses weighing into this. JP Morgan and


Morgan Stanley potentially looking elsewhere for their business, not


necessarily just Frankfurt because we sort of are assuming Frankfurt


would be where financial services would go to? Frankfurt have been


blowing the trumpet saying guys you should come here. So has Paris. New


York will be a very hot place for these companies to operate because


they are American. They have a lot of businesses out there already, why


do they need to be in the UK? What about the Far East? Many of them


have businesses in the Far East. Of course, in a 24 hour global


business, you have to pass the buck from office to office to office


which includes significant exposure in the Far East. If you said where


should investors be contemplating, it is developing markets with new


market emergence. You made it snappy. We got there in the end when


the tablet was loaded! Hello there. Another pretty chilly


week in store. In fact, things are set to turn cooler as the week wears


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