Premier Finance

Maybourne Hotels Group said to be in final stages of talks that would give American investors a £200m stake in the firm

by Katie Allen

The company that owns London’s five-star Claridge’s, Connaught and Berkeley hotels is putting the finishing touches to a £600m restructuring that will involve two US property investors becoming key stakeholders in the luxury hotels group.

Maybourne Hotels Group is said to be in the final stages of talks with US property manager Westbrook Partners and one further real estate trust, as it seeks to refinance a £600m loan from Anglo Irish Bank and Bank of Ireland.

New York-based Westbrook and the other unidentified firm are discussing taking an equity stake worth about £200m, according to reports.

A spokeswoman for Maybourne this weekend declined to discuss the situation, but said: “Our refinancing is in final stages and we are not in a position to comment until it is complete.”

The hotel group, partly owned by Irish property tycoon Derek Quinlan, needs to refinance around £600m of loans by the end of the year. There is said to be interest from some investors to buy the group outright in order to snap up the high-class hotels.

The three properties could attract US, Middle Eastern or Asian multimillionaires seeking trophy assets and a place to impress potential clients or investors. The hotels each trace their history back more than 100 years and guests have included royalty, Hollywood stars and celebrities from Queen Victoria to Cary Grant and Audrey Hepburn to Madonna.

But any such spin-off looks less likely now the owner says refinancing talks are concluding. It has been working for several months on a deal with Deutsche Bank and Barclays. The £200m stake for US investors would be likely to form part of a wider restructuring that also covers the remaining £400m.

There is also talk that some of Maybourne’s existing shareholders, which include several of Ireland’s most prominent entrepreneurs – among them property developer Paddy McKillen – could pump fresh cash into the business. Other investors include Moya Doherty and John McColgan, the entrepreneurs behind Riverdance.

New money would strengthen the company’s stretched balance sheet. According to its latest accounts, in the year to the end of June 2009 the group lost £3.2m, although that was an improvement on the £9.2m loss the previous year.

The group’s troubles have coincided with a sharp fall in commercial property values but luxury hotels have been more resilient than many other real estate assets.

Coalition proposals to limit the number of non-EU citizens UK firms can employ have angered City bosses

Leading City employers are furious about the limits being imposed by the government on the number of non-EU citizens they are able to employ and are urging a dramatic rethink of the government’s policy.

The financial district prides itself on its cosmopolitan workforce and is concerned that the quotas on migrants being set by the coalition will make it impossible for them to keep operating effectively.

A senior City source described the new rules as a “disaster”. Firms were told the implications of the policy by the government last week. Industry sources said that some top City companies believe they will be restricted to hiring as few as six non-EU nationals during the remainder of the year.

The immigration policy is being introduced at the same time the Square Mile is moaning about unpopular taxes and the Financial Services Authority’s warning that 2,500 City companies would be covered by its bonus tax. Some experts reckon all these factors together could make London a less attractive location for major international firms.

Stuart Fraser, chairman of the Corporation of London’s policy committee, said: “With all these things, it’s as if we’re saying if you’re talented in finance, don’t come here.”

Employers’ body the CBI said it was in dialogue with the Home Office over the migration caps while the City’s trade body, the Association for Financial Markets in Europe, said its members were worried: “There is a concern that it will become more difficult to move people around their businesses on a global basis.”

The CBI was reluctant to criticise government policy, saying it “remains of the view that a managed migration policy which meets the skill needs of the economy can operate within a cap on immigration”.

A spokesman added: “Last week saw the first communication with companies about the interim cap. Naturally, there will need to be a dialogue to resolve any issues”.

Fraser said he was concerned a numeric cap would always be problematic and that a points-based system such as the one used in Australia might be more effective. He felt that the individuals currently being affected – highly skilled, high-earning taxpayers – were not the ones the restrictions were aimed at. The government is consulting on its immigration policy until September.

The concerns were raised as the UK’s major banks prepare to publish figures for the six months to end of June. Bailed-out banks Lloyds and RBS are expected to return to profit. The improvement is likely to be dramatic at Lloyds, after it revised up the consensus for its figures this weekend to £1bn. That compares to a loss last time.

Banks with big investment divisions such as Barclays are likely to suffer amid predictions of falls in profits of up to 40% in some divisions. Even profit rises in their high-street operations may not cushion the declines.

Anti-ageism campaigners believe UK employers are targeting mature workers for forced retirement

The number of over-60s forced to retire against their will increased dramatically last year to 100,000 as employers targeted mature workers for job cuts in the recession.

An average of just 25,000 sexagenarians had been forced out of the workplace in each of the previous two years, according to Age UK. The charity highlighted the fourfold jump as the government unveiled proposals to scrap the default retirement age of 65 and decreed employers should no longer be free to push someone out of their job because of their age.

The business lobby has mounted a campaign of fierce resistance, arguing that if it loses the right to shed older staff it will reduce flexibility. But anti-ageism campaigners say the figures are evidence that employers are too keen to lay off older workers.

Age UK reckons axing of the 100,000 mature employees cost the UK £3.5bn in lost economic output, and accused business organisations of trying to maintain “an unequal status quo”.

“Employers are trying to breathe life into dead arguments in a desperate attempt to keep the upper hand over older workers’ retirement decisions,” said director Michelle Mitchell.

“The government has made the right call on forced retirement and we encourage ministers to stand by it.”

Employers have argued the changes will make it hard to discuss the subject of retirement with older workers who may not be able to work so effectively as younger staff, particularly in manual jobs.

Business groups have also attacked the timetable for change – of just over a year – as too tight. But Age UK says they have already had plenty of time to find new ways to talk to older staff about their future.”There must be a better way of broaching this subject than waving the threat of forced retirement at them,” said Mitchell.

The government wants the law changed to keep pace with rising life expectancies and the costs entailed. Announcing the plan, last week, it published an “impact assessment” claiming the benefits outweighed the costs.

“There’s overwhelming evidence that older workers, the UK economy, public finances and employers themselves will all benefit from the abolition of forced retirement,” said Mitchell.

Katharine Whitehorn, page 29

Ruth Sunderland, page 40

Unions angered by payout to chief executive who mothballed Teesside plant with loss of 1,000 jobs

Kirby Adams, the outgoing chief executive of Corus who threw 1,000 steelworkers out of a job this year, is believed to have been paid more than £2m.

The jobs were lost after the partial mothballing of one of Corus’s plants, Teesside Cast Products (TCP). The trade union Community described Adams’s pay as “an insult to all steelworkers”.

Talks to sell the TCP plant have entered an advanced stage. Corus has been in negotiations with the Thai steelmaker SSI since May and a deal could be reached within weeks, which would provide a rare boost for the struggling economy of the north-east. But one industry source cautioned that there was no certainty that the sale would go ahead.

Adams will leave Corus next month for “personal reasons”, less than 18 months after taking the helm at the troubled group. Local MPs accused the 54-year-old American of “relishing antagonistic confrontation” during negotiations with unions over the future of the TCP plant.

According to the GMB union, Corus – now a subsidiary of Tata Steel Europe – has cut 6,000 jobs across Europe since Adams joined the company. The chief executive was dubbed “arrogant and disrespectful” by MPs in March after he declined to give evidence to the north-east regional select committee about the closure of the TCP plant.

According to the annual report of Tata Steel Europe, the highest-paid director for the financial year ending in March received £2,039,140. Because it is no longer publicly listed – after it was bought by the Indian group Tata Steel in 2007 – the company does not have to identify the director in question. But it is almost certain that Adams, who is to stay on as a paid consultant when he quits his present job, was the beneficiary.

Last year the company imposed a pay freeze on all workers, including directors, because of the global economic downturn, which saw demand for its steel products slump. During the first nine months of last year, Corus made pre-tax losses of £662m but since then it has returned to profit.

Adams continued the restructuring of Corus set in motion by his predecessor, Philippe Varin, and has been helped by the economic upturn this year.

Michael Leahy, general secretary of Community, said of the £2m payout: “When Corus has been crying poor and offering pitiful pay rises to our members, who worked tirelessly to bring the company back to profitability, this revelation of boardroom excess is an insult to all steelworkers.”

Community is now negotiating with management over a pay rise for the current financial year, after an initial offer of 1.5%, improved to 2%, was rejected. The offer included a one-off payment of £200 in recognition of sacrifices made by workers over the past year, when shift levels were cut and pay was frozen.

One of the complications surrounding the sale of the TCP plant has involved the fate of the accompanying carbon credits. Steelmaking is highly carbon intensive and plants must participate in Europe’s emissions trading scheme, which requires them to own “licences to pollute” in order to operate. Last year, Corus was awarded about €100m worth of carbon credits. If it decides to sell those attached to the TCP plant, the value of the plant will be hit as the new owner would have to buy new credits on the market in order to operate.

The plant was partially closed in February, several months after an international consortium reneged on a 10-year deal to buy steel made at the site. Adams insisted that the sudden loss of this contract meant closure was unavoidable.

The American has described himself in an interview as a “straight shooter”. “I don’t sugar coat and I might irritate some people,” he told the Financial Times. “If this is what some people might call ‘adversarial’, then it seems to me that this could be a compliment.”

Polly Toynbee claims (Comment, 28 July) the government wants to replace public funding of the arts with private. That is simply not the case – I have always argued that private funding should be in addition to, not instead of, public money. Why? Because state funding offers stability over many years which usually philanthropy cannot. It also, with a proper arm’s-length relationship, allows creative risk-taking and artistic freedom that is not always possible with other forms of funding. But the arts, too, should play their part in helping to reduce the deficit.

So we need to protect the arts, which in this country are probably the finest offered anywhere in the world. We also need to explore whether the government can do anything else to help. That’s why I returned the lottery to its original four pillars, which will lead to a significant boost in arts funding. That’s why I am concentrating on removing costs from the parts of my budget that are not frontline. That is also why we are right to explore whether philanthropy can be increased, with the important caveat that this will be more difficult for smaller organisations, especially those outside London. Restoring the nation’s finances is in the interests of all our sectors. We don’t yet know what cuts we will have to make to our budget in the autumn spending review, but this government’s support for the arts remains rock solid. The 2 million people in our creative industries and our reputation as a society that is both civilised and creative demand no less. 

Jeremy Hunt MP

Secretary of state for culture, Olympics, media and sport

• As a governor of the British Film Institute at the time of the creation of the UK Film Council, I have to demur from Colin McArthur’s description of the BFI’s support for the UKFC as “treacherous” because the council was “designed to supplant it” (Letters, 29 July). The council was not so designed, but rather it represented a rational plan to focus official support for the film industry. The BFI’s cultural functions were left untouched. OK, I will admit to naivety. The Film Council rapidly became a quango to give quangos a bad name – its chief executive earning more than the director of the Tate. He and its bloated staff have palpably failed to build a self-sustaining film industry. But we were not to know that in 2000. Not all of us at that time despised the BFI “as a ghetto peopled by unworldly intellectuals”. For me it was rather a matter of its patchy record of support for production. McArthur’s touching belief in the “irony” of the BFI surviving the Film Council is probably just as naive as my belief a decade ago that the Film Council was a good idea. The BFI is surely just as threatened by this government’s Kulturkampf as any other cultural organisation.

Professor Brian Winston

University of Lincoln

No good purpose is served by merging UK Sport and Sport England (Olympic authority demands role in merged body, 28 July). UK Sport has been an unqualified success story, transforming performance at international level. In contrast, Sport England has for 25 years been overmanned and unfocused. A nation defines itself by its commitment to excellence. The last thing that government should do is to tamper with an organisation which has consistently delivered it.

At a superficial level, a merger may seem logical, and the argument may be made that international performance depends on high participation levels. Not so. No event shows this more clearly than the marathon. There, male participation levels have risen close on a thousandfold since 1980, but performance levels have dropped. The independence of UK Sport must be retained, for linking it with Sport England can result only in dilution and damage to our Olympic prospects. What is needed is a rigorous review of Sport England, a quango which has struggled to make substantial improvement in participation levels. Taxpayers’ cash should instead be directly injected at source, to county sports partnerships and local authorities for support to our best clubs. And sport (and the arts) must be made a statutory requirement for our local authorities. That could be done at the flick of a pen, and at no cost. That (and excellence) is the Big Society.

Tom McNab

St Albans, Hertfordshire

• I read the article on Peter Keen’s view of sport funding with disappointment (Half of Britain’s Olympic sports may have funding slashed, 27 July).

Sport isn’t just about winning, it’s about taking part. I subscribe to this old but reasonable view. If Olympic funding is just directed towards a tiny minority of elite sports then large numbers of people involved in the other Olympic sports will be told that their sport isn’t valid and so they need not take part, and newer sports like floorball (pencilled in for the 2020 Summer Olympics) will never get a look in.

Sport is less about nationhood than it is about people. British pride is, in my opinion, a lower priority than giving large numbers of children and young adults something to aim for, keeping them healthy and helping them develop as adults by playing sports as part of a team. The Olympics is more useful to us as a nation as a way of keeping our youngsters engaged in society and not part of crime and excessive behaviour (eg drinking) as so often happens these days.

And what about the world’s perception of Britain? Having well-behaved young Brits on holiday abroad every summer is more important to Britain than a few Olympic medals once every four years.

Peter Goodman

Southern Vipers Floorball Club and Farnham Unihockey & Floorball Club

• “Do we want to win – yes or no?” asks Peter Keen. Do we not hope that as many people as possible compete and enjoy themselves? At a time of economic constraint, why should the taxpayer support a few full-time professional sportsmen and women who spend their whole lives training and competing at the expense of the community? It would be wonderful to see a true amateur who did a proper job for a living finish with a medal.

Michael Cornelius

Ledbury, Herefordshire

• I have been on the 2012 Olympic site as I was interested in volunteering to help at the London Olympics as a “Games Maker”. I was shocked to see that the “presenting partner” for the Games Maker (volunteer) programme is McDonald’s. Why have the organisers of our Olympics let them become hijacked by a company that promotes and sells junk food? How will this sponsorship help Britons become a healthier nation?

Shaun Oliver

Portsmouth, Hampshire

• Your report (Olympic authority tops quango rich list, 2 July) reveals what may have been the real motivation behind the intensive lobbying for the UK to host the Olympics. The executives’ securing of 15 salaries between £142,000 and £390,000 rings a contrasting sour note with their pleas for volunteers to see the job through.

John Tyldesley

Preston, Lancashire

Lucy Mangan on the people making the headlines in the last seven days

People

Caps off

Tony Hayward

BP has axed its chief executive to try and draw a line under the Deepwater Horizon disaster, the handling of which he … well, didn’t. Though he did manage to offend the families of the 11 people who died in the explosion and anger the rest of the US by whining that “No one wants this over with more than I do. I would like my life back.”

Axed seems a slightly inappropriate term, of course, for Hayward, who will leave not immediately, as the term would imply, but in October. With a £1m payoff and £600,000 a year pension, and a new job, in a non-executive position at TNK-BP, his firm’s joint Russian venture, he’s got his life back. Hurrah.

Bill’s bills

Chelsea Clinton

Omigod, it’s TODAY! Entirely unconfirmed reports suggest that as you read this, the $7,000 (£4,500) cake is being assembled, $500,000 worth of flowers are being artfully distributed, and the $125,000 meal for 500 is being prepared. The daughter of Bill ‘n’ Hill will be zipping herself into a $25,000 Vera Wang dress, and Hillary – if she didn’t have her ducts cauterised during the Lewinsky days – will be dabbing away a tear. And you know who will be being kept away from the bridesmaids by a large and vigilant contingent of the $200,000 security detail.

Only $30,000 has apparently been spent on the booze, so guests – fill a flask for your breast pocket but don’t reach in there too fast. You’ll probably be shot. Have a wonderful day!

Management study

North Korea’s football team

They do things a little differently in Kim Jong-il’s land. As its punishment for losing all three of their games in South Africa during their first ever World Cup, the national team have been subjected to public humiliation at the People’s Palace of Culture in Pyongyang. They received a six-hour reprimand from 400 students for letting down the country.

Rumour has it that the coach, Kim Jong-un, has been sent to work on a building site and expelled from the Workers’ party of Korea.

Don’t you wish, sometimes, that the human race could learn to find a happy medium occasionally? Somewhere between “£600,000 a year for life for mismanaging the greatest environmental disaster in history” and “public shaming and banishment for losing a football match”. Somewhere between those two.

What they said

“Every one of them had a tough life. First [problem] was to master a foreign language as your own. Think and speak it and do what are you told to do for the interest of your motherland … without counting on diplomatic immunity”

Vladimir Putin hails the spy ring

“I’ve taken a lot of lessons from him, but I don’t have that ability to carve the ocean like he does”

Cameron Diaz on her Knight and Day co-star Tom Cruise. Ah, actors

“For sustainability reasons“

Andrew Thornton, owner of a Budgens store in north London, explains why he stocks squirrel meat“I know the history of actors making music is a chequered one, but I promise no-one will get hurt”

Hugh Laurie, who is recording a blues album in New Orleans.

What we’ve learned

• The first Twilight novel has become the 13th book this century to sell 2m copies in the UK

• 200,000 people a year are injured by flip-flops

• A quarter of dogs are overweight

• 1 in 36 pound coins is fake

• The average mobile phone has 18 times more germs than a toilet handle

• Churchill’s false teeth sold for £15,200

… and what we haven’t

• What we should all go and see at this year’s Edinburgh festival

Please help a clumsy coffee drinker. Plus what’s the best way to cook a little bit of beef and how can I make my favourite lemon tart and still boycott Nestlé?

I have been making and enjoying a chilled lemon tart for years, but since our family boycott of all things Nestlé, I’ve been unable to buy the condensed milk needed. Do you know of other brands?
When I was at school, every now and then I’d buy a tiny tin of condensed milk. I would pierce a hole on either side of the top, then lie on my bed with the tin balanced precariously against my nose, so the condensed milk would flow gently into my open mouth. Such bliss. A brand called Fussells was my preferred choice, because its flow was better suited to this form of gastronomic indulgence. Sadly, it was bought out by Nestlé some time ago. But never fear: Sainsbury’s and Tesco have Farmlea condensed milk for 99p, Asda sells Tropical Sun condensed milk for £1, and then there’s Cadbury’s Marvel condensed milk, which I’m reliably informed is sold at larger branches of the Co-op at around £2.05.

Can you get indestructible (perhaps plastic) “glass” for a three-cup cafetière? I keep breaking them, especially at work. I don’t think they were designed for clumsy people.
I’ve lost count of the number of cafetières that have exploded, shattered and otherwise been destroyed at my hands over the years. So much so that I eventually abandoned it as a method of making coffee. Had I discovered the range of ”unbreakable polycarbonate” cafetières made by Le’Xpress earlier, things might have been different. Denny & Sons have them – a three-cup one costs £8.99 – as well as a range of stainless steel cafetières at around £12.99. Alternatively, try Coopers Direct, who sell the Le’Xpress stainless steel three-cup jug cafetière for £11.24.

What’s the best way to cook a small joint of beef weighing, say, 1.5kg? My recipe books and my internet searches all talk about much bigger joints, and say to put it in a very high oven for 20 minutes, then turn down the oven for the rest of the cooking time. But a small joint would be well on the way to being cooked through at the first stage, and I haven’t been able to adjust times satisfactorily.
Aha, this is just the case for the ultra-low temperature roasting method. You’ll need to invest in a good meat thermometer and, possibly, an oven thermometer, too (built-in oven thermostats are notoriously inaccurate). The other thing you need to bear in mind is 52C. When your meat thermometer shows your piece of beef has an internal temperature of 52C, then you know it’ll be nice and rosy inside. Turn on the oven to the lowest possible setting, ideally 75C (around gas mark ⅛). Rub the joint all over with vegetable oil and season. Pop it into a roasting tray, slip it into the oven and cook until the internal temperature reaches 52C – this should take somewhere between two to three hours. That may seem a lot of trouble, but it isn’t really, once you’ve got used to the idea – it’s not as if you’re actually doing anything, after all; it’s just a matter of giving yourself a bit more time than you’re used to. When the beef has reached the magic temperature, heat a tablespoon of butter in a frying pan until it starts to foam. Place the joint in the pan. Cook for few minutes, spooning the butter over it all the time. When one side has browned, turn the meat over and repeat on the other side. Leave to rest for 10-15 minutes, and your joint of beef will be pink and perfect.

• Got a foodie question for Matthew? Email food.for.fort@guardian.co.uk

The Bank of England base rate is predicted to stay at 0.5% for years – so it’s a great time to follow them with your mortgage

Predictions this week that the United Kingdom is set for four more years of rock-bottom interest rates spell bad news for savers, but will leave millions of people sitting on base rate tracker mortgages feeling very smug.

And it’s not too late to join their ranks. There are some great tracker home loan deals on offer, particularly if you are looking to remortgage and have built up a reasonable amount of equity in your property.

A leading group of economists reckons that the Bank of England base rate – which has been stuck at 0.5% since March 2009 – will stay at this historically low level until the start of 2014, as the government’s austerity measures slow the economy and reduce the need for rate hikes.

“A base rate of 0.5% will begin to look like the new normal,” says Peter Spencer, chief economic adviser to the Ernst & Young Item Club forecasting group, which claims that its predictions are independent of political, economic or business bias.

The Item Club say that high energy prices and next January’s VAT rise will keep inflation above its 2% target for a while; but then it will start falling, and to prevent it from really plummeting, “it will be necessary to keep the bank base rate low at 0.5% for much longer than the [government's new] Office for Budget Responsibility and the markets have anticipated”.

On the same day, another forecasting group, the Centre for Economics and Business Research, gave a similar verdict. It didn’t go quite as far as the Item Club, but it firmly believes that interest rates will stay low for a long time – “at least to the end of 2011 and probably beyond”.

That all suggests that if you are looking for a new mortgage, settling on a competitively priced base rate tracker is a bit of a no-brainer. The top deal is First Direct’s lifetime tracker where you pay bank base rate plus 1.79% for life – giving a current rate of 2.29%. There is an arrangement fee but, as part of a summer promotion, it is only £99. What’s more, you are not locked in by any early repayment penalties, so if and when rates start to rise, you can quit and switch to a fixed-rate elsewhere (there is a £149 “closure fee” to pay). It is a repayment mortgage, where your monthly repayments cover both interest and part of the capital.

If someone with a £100,000 mortgage and an expiring 5.99% two-year fixed-rate deal moved to First Direct’s 2.29% tracker, they would typically see their payments fall by more than £200 a month.

The big downside is that the maximum loan-to-value (LTV) on this deal is 65%, which will put it out of the reach of many homebuyers. If you can’t manage that, there are 75% and 85% LTV versions available, but the rates are a lot higher – 2.79% and 3.99% respectively.

First Direct is likely to find plenty of takers in the light of this week’s predictions, particularly among those coming to the end of their current mortgage deal; let’s hope it can cope with the demand.

ING Direct is close behind with a lifetime tracker where borrowers pay base rate plus 1.85% for the term of the mortgage, giving a rate of 2.35%. Again, there are no early repayment penalties. The maximum ING will lend on this product is 60% of the property’s value. If you are looking to borrow up to 75%, you pay 2.65% (base rate plus 2.15%). In both cases the fee is a lot higher than First Direct’s: £945.

David Hollingworth at mortgage broker London & Country says that, with forecasts pointing towards the base rate remaining low for some time, borrowers will inevitably look to trackers as the cheapest option in a stable, low-rate environment.

But, he adds, they should still “stress-test” their own monthly budget to see how big an increase they could cope with if things do change. “Ultimately, the base rate will rise, and the debate will continue to be about when, not if.”

Those who do opt for a tracker may want to consider making overpayments or putting some money aside “to help reduce the mortgage more quickly, which will stand borrowers in good stead for when rates do climb,” says Hollingworth. However, Mark Harris at rival broker Savills Private Finance warns that “trying to guess interest rates is a dangerous game”. His bottom-line advice is: “If you can’t afford to get it wrong, fix.”

For example, for a family with a single earner and a mortgage that takes up quite a big chunk of household expenditure, who don’t want to live with the fear of interest rates rising, “fixing is always the right thing to do”. However, he says, if you are under less financial pressure, and able to absorb a bit of interest rate rise, “then trackers probably look good value”.

Just to complicate matters, there are some very good fixed rate products around at the moment, with a few two-year deals at under 3%. HSBC’s start at just 2.69% for those borrowing a maximum of 60% of their home’s value (with that rate, there is a £1,499 booking fee and the most it will lend is £250,000). Yorkshire building society has a two-year fix at 2.89% (£995 product fee) or 2.99% (£495 product fee) where the maximum loan is 75%. The Yorkshire’s five-year fixes start at 3.99% with up to 75% LTV.

This week also saw Barclays’ Woolwich mortgage arm launch the “drop lock”, a facility for all new tracker and offset mortgage customers that will allow them to switch to a fixed rate product in the future without incurring an early repayment charge.

“The ‘drop lock’ provides customers with peace of mind that they can go into a low tracker rate now and switch at a point in the future when they need greater security,” says Andy Gray at Barclays. The Woolwich’s lifetime tracker rates start at 2.89% (Bank of England base rate plus 2.39%), though to get that you need to be borrowing no more than 70% of your property’s value, and the minimum loan is a hefty £200,000. There is also a £1,499 fee to pay. For those who can manage a 20%-plus deposit, there is a new Woolwich lifetime tracker with a repayment rate of 3.88% (base rate plus 3.38%) and a £999 fee.

Next week: What to do with your savings in the new era of rock-bottom rates

Hong Kong billionaire adds world’s second-largest utilty to UK holdings

Hong Kong billionaire Li Ka-shing is to buy EDF’s UK electricity networks for £5.8bn, giving him ownership of grids supplying a third of the country’s population.

The tycoon’s investment vehicles Cheung Kong Infrastructure (CKI) and Hongkong Electric will buy three British electricity distribution networks and a private power networks business from EDF, the world’s second-largest utility.

They supply power from the high-voltage grid to 20 million people in London and England’s east and southeast, and also to the London Underground, Heathrow airport and the Channel tunnel.

Li beat competition from a rival consortium that included the Macquarie Group of Australia, Canada Pension Plan and the Abu Dhabi Investment Authority as the sale dragged on for a year. The purchase is one of the biggest deals in Europe by a north Asian company but ranks behind the $14.3bn Chinalco paid for a 12% stake in Rio Tinto two years ago.

His name may not be well known to Brits, but the UK brands octagenarian Li’s empire owns – and has owned – certainly are. After building Hutchison Whampoa into a major industrial holding company, he went on to revolutionise the UK’s mobile phone market in the 1990s with the creation of Orange and earned a reputation as a dealmaker when he sold it for $14.6bn in 1999.

Hoping to repeat the trick, Hutchison came back into the UK’s mobile market a few years later with another mobile operator, 3. Hutchison also owns Superdrug, three of Britain’s biggest ports, including Felixstowe and Harwich, and Cambridge Water. Although 3 has yet to make a profit for Li, he has made big profits elsewhere.

Having invested about $2bn in the business, he sold his stake in Indian telecoms company Hutchison Essar to Vodafone for $11.1bn three years ago. In the last Forbes rich list, Li’s personal wealth was estimated at $16.2bn. He is also Asia’s biggest investor in Britain, but has a no-frills lifestyle, being a plain dresser and prodigious philanthropist.

The purchase caps a process that has dragged on for more than a year, delayed by a change in EDF management, British regulatory rulings, and difficulties with pension trustees. But the final price represents a handsome improvement on the €5bn (£4.2bn) target EDF set itself for the disposal.

Analysts said the deal would double CKI’s presence in the United Kingdom, helping to overcome its limited room for domestic growth. CKI already invests in Britain’s gas and water industries and owns utility businesses in Australia, Canada and New Zealand.