Tohoku Electric Power is preparing to re-open the Japanese bond markets for nuclear power companies, a year after operators were frozen out by the Fukushima disaster.

The utility will offer bonds next month to raise funds for the restoration of power plants damaged in the March 11 disaster last year. Since then, Tohoku – along with eight of the other nine electric utilities serving Japan’s regions – has been shut out of public debt markets, unable to raise any finance except bank loans or short-term commercial paper, both at significant premiums to pre-crisis rates.

Only Okinawa Electric, with no exposure to nuclear power, has tapped bond markets since the disaster. Kansai Electric and Kyushu Electric both started marketing bond offers in June last year but were forced to cancel after poor demand.

Bankers said it should be encouraging to other issuers that Tohoku, the utility most directly affected by the tsunami after Tokyo Electric Power, may be the first to show. It is expected to offer about Y25bn ($310m) of five- and 10-year bonds. “If the deal goes well, other utilities will look to come to market,” said Seiichiro Miyaoka, head of debt capital markets at UBS in Tokyo.

Market prices of existing bonds suggest that Tohoku will pay a spread of between 50 and 60 basis points over Japanese government bonds, or about four times the rate at which utilities borrowed before the Fukushima crisis. That is a reflection of the tough operating environment for Japan’s electric utilities, facing the indefinite suspension of nuclear power plants and a rise in costs caused by the purchase of alternative fuels. R&I, Japan’s biggest credit rating agency, has all 10 utilities on review for a downgrade.

Nonetheless, Tohoku will welcome the re-opening of a vital source of funding. It had been a frequent user of Japan’s public debt markets. Its Y1.18tn of bonds account for about 2 per cent of total corporate bonds outstanding. Together, the “epcos” accounted for 16 per cent of Japan’s corporate bond market at the end of September.

In their absence, credit spreads have been unusually tight, even for lesser-quality borrowers. A resumption of issuance in this area would lead to more rational pricing, “signifying the recovery of Japan’s credit markets from the earthquake”, said Akane Enatsu, a credit strategist at Barclays Capital in Tokyo.

Since the Fukushima incident, Japanese utilities have idled indefinitely reactors that were shut down for routine maintenance. This has eliminated almost all nuclear power production in Japan, which had accounted for 30 per cent of the nation’s total electricity output. By May, when the remaining two plants are closed for maintenance, Japan may be without any nuclear capacity.

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X-Rite, a developer of color management, measurement and communication software, will present in a free webinar its expertise on new measurement standards, technologies and ways operations can enhance their businesses.

For two days the event, entitled ‘New color management standards in 2012 – How will you be impacted?’ will focus on ISO color and M1 measurement standards in pre-press and print. The issues surrounding optical brighteners in paper will also be detailed before a Q&A session at the end.

Targeted at pre-press professionals and commercial printers, the webinar will take place on March 1 and March 2 at 17.30 CET (16.30 GMT).

The first to register will be among the selected few to receive ‘The M Factor’, a white paper explaining how to successfully color manage papers with optical brighteners.

To register for the free event follow the links:

March 1, 2012 – 17:30 CET (16:30 GMT)

March 2, 2012 – 17:30 CET (16:30 GMT)

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Henri Proglio’s putsch against the chief executive of Veolia, the world’s biggest water utility by sales, offers a remarkable glimpse into the inner workings of France’s grandest boardrooms.

Mr Proglio, one of France’s most powerful businessmen, stepped down as Veolia chief executive in 2009 and now runs EDF, the French nuclear energy group. But he remains a Veolia director, having controversially stayed on as its chairman for a year after joining EDF.

Opinion is divided on the probable success of the coup attempt by Veolia’s former chief against his protégé, Antoine Frérot. People close to Veolia’s board put at “50-50” the survival chances of Mr Frérot, who replaced Mr Proglio at the company’s helm two-and-a-half years ago.

But the company’s large number of institutional investors – who own 57 per cent of its capital – have been deeply unimpressed by revelations about the power struggle.

Shares in the company, which provides drinking water and waste water services to 173m people globally and collects and manages rubbish for about 50m, have fallen 60 per in the past year. They are down another 5 per cent since the putsch became public knowledge.

There is irritation among analysts that the board that is now so divided on whether to keep Mr Frérot is the same one that backed his recovery plan for the company, including €5bn of asset sales, which he announced only in December.

As a person close to the company says, “if a new management tears up his plans then they will need to raise capital in the market”. This is not a happy prospect given that Veolia is lossmaking, heavily indebted and was forced to take an €800m writedown in 2011.

The French state has only a limited holding in Veolia, including state-owned EDF’s 3.9 per cent and the 9.5 per cent held by Caisse des Dépôts et Consignations, a government fund.

This makes the events of the past few days even more extraordinary. Nicolas Sarkozy, France’s president, has described as “absurd” claims that he gave his blessing to Mr Proglio’s attempt to replace Veolia’s chief with Jean-Louis Borloo, a former minister, as a reward for Mr Borloo not running against him in this April’s presidential elections.

But several industry sources say the French government may have given tacit approval to the plan, pointing to the involvement of Alain Minc, a Sarkozy adviser also close to Mr Proglio.

What is certain is that the damaging fallout – which saw Mr Sarkozy accused of being “the candidate of confusion, deals and compromises” by his front-running socialist rival, François Hollande – means Mr Proglio has been left politically isolated.

Yet this does not mean that the feared corporate power broker is doomed to failure. There is criticism over Mr Proglio’s attempts to bring in a politician at the helm of a company clearly in need of someone who knows how to turn round an ailing business with 300,000 employees and operations in 77 countries.

He is also accused, by friend and foe, of “not being able to let go” of Veolia, a company he built after it was spun off from Vivendi in 2000. As a senior industry executive says: “He left it with a mess of business units without a real centre. That must be fixed.”

Nevertheless, some board members and large shareholders appear to share Mr Proglio’s unhappiness with Mr Frérot. As well as EDF and CDC, the Dassault family also owns a 5.9 per cent stake and the three could conceivably form a powerful anti-Frérot bloc.

Mr Frérot’s future will depend on how successfully he convinces the doubters that his two-year rescue plan, including the sale of Veolia’s transport business, is the only way forward for the company. The botched Borloo attempt has strengthened his hand, as has the perception that Mr Proglio’s fingers need to be prised from the company.

“To only give Frérot three months to put in place a recovery plan of this magnitude makes no sense, so he may get a few more months,” says a company insider. “But it is best not to underestimate Proglio’s determination to defend his legacy.”

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Universal Converting Equipment has introduced a package of energy consumption reducing features into its range of slitting and winding machinery.

Technical director Dave Ward explained, ‘We design our machinery to be as frugal as possible with energy and have identified significant areas where energy savings can be made; in some cases functionality and performance has been increased as a positive side effect. One of the ways we achieve this saving is by using the latest high efficiency (Efficiency 1) AC motors, with the most up to date AC Vector Drives. Commonly we design in regenerative motors rather than more traditional pneumatic brakes so rather than braking energy being lost (as heat) it is turned into electricity and used by other systems within the machine.

‘In some applications the brake energy is enough to reduce power consumption of the machine by 40 percent or more. Our machines intelligently turn off unused systems (how often do you walk past machines with hydraulic packs (sometimes on guiders) that are running whether the machine is in use or not) and avoids fan systems that run even when not required. Wherever possible we have engineered hydraulic systems out of our equipment. Even our touch screens are set to go into power save mode when not used for a period.’

Pictured: Universal X3 slitter rewinder

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Antoine Frérot could face an attempt to oust him at the company’s next board meeting on February 29

Antoine Frérot, chief executive of Veolia, the world’s biggest water utility by sales, is facing a boardroom coup orchestrated by his former mentor, Henri Proglio, the boss of EDF.

In a tale of intrigue that is typical when big business and politics collide in France, Mr Frérot could face an attempt to oust him at the company’s next board meeting on February 29, when directors will sign off on annual losses of €200m.

One name in the frame to take over from Mr Frérot was Jean-Louis Borloo, a centrist former minister, which sparked rumours that he was being lined up for a reward after deciding not to run against Nicolas Sarkozy, the incumbent, in the forthcoming presidential elections.

However, a senior French industrial source said: “This putsch was cooked up by Henri Proglio, who just cannot let go of a company [Veolia] that he created. This does not have the backing of the president.”

Mr Sarkozy said suggestions he was behind the coup were “absurd”, while Mr Borloo played down his interest.

Mr Proglio built Veolia, a provider of drinking water and waste water services to 173m people, into a global company with €35bn of annual sales after its spinoff from Vivendi in 2000. But he left it saddled with debt and struggling divisions in north Africa, Italy and North America.

Mr Frérot took over at Veolia in 2009 after Mr Proglio became chief executive of EDF, the French nuclear power group. For a time, Mr Proglio clung on as Veolia chairman while running EDF before being forced to step down. Mr Proglio is still on Veolia’s board and has approached several directors to support his coup.

People close to Mr Frérot insisted he would fight to stay and that they believed Mr Proglio had misjudged the board’s mood. “Veolia absolutely needs to transform itself and Henri just can’t accept that,” one insider said.

Relations between the two men soured badly last year after Mr Frérot implicitly criticised Mr Proglio’s legacy and said he would quit almost half of the 77 countries where Veolia does business. In a plan signed off by the board, Mr Frérot gave himself two years to turn things round after announcing plans to reverse Mr Proglio’s expansion drive and a €5bn fire sale of assets to cut €14.7bn of net debt. Veolia last year made two profit warnings and took an €800m writedown.

The coup attempt by Mr Proglio, who is one of France’s most powerful businessmen because of his close ties to Mr Sarkozy, is particularly audacious given that his own future at EDF is uncertain should the Socialists win power in May.

Anne Lauvergeon, former chief executive of Areva, the French atomic reactor group, has also accused Mr Proglio of playing a part in her removal from the post.

Shares in Veolia fell 3 per cent on Monday to €9.29.

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Sun Chemical has released its 2011 sustainability report, which expands on its established data-driven metrics – showcasing how the company’s leadership in sustainability is helping customers adapt and be more eco-efficient.

While the company continues to be data-driven in its sustainability efforts – reporting the performance measurement for seven key sustainability metrics as outlined in its previous reports – the 2011 sustainability report expands on this and cites specific examples of how its products, services and projects are helping customers improve their environmental impact.

‘We’re now going beyond providing meaningful data that will help meet customer goals,’ said Gary Andrzejewski, Sun Chemical’s corporate vice president of environmental affairs. ‘We are showing concrete examples of things we are doing to help customers produce less waste and carbon dioxide, while at the same time improving the efficiency of their operations.’

The report continues to show data collected every year since 2005 from approximately 170 Sun Chemical sites in over 25 countries. The key sustainability metrics measured include: energy consumption/conservation at production and non-production sites, the energy carbon footprint at the production sites, process waste reduction, water consumption, materials safety, and employee safety.

‘Our sustainability policy pushes us as a company to improve the eco-efficiency of our processes and products,’ Andrzejewski said. ‘Our R&D efforts are a pivotal part of this process as we provide our customers with solutions that will be both eco-friendly and save them money. These data-driven sustainability reports have played a key role in helping our customers achieve many of their eco-efficiency goals.’  

The report also highlights Sun Chemical’s leadership role in low migration technology. Other products and services mentioned in the report include: SunGraphics SunLite In-Position Printing Plates for corrugated carton printers, the Sun Chemical Dispenser Program for the commercial and label, narrow web market, the SunMag Synergy ink/fount emulsion system for publication printers, and SunClean/SunWash cleaner and wash technology for heatset printers.

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Leaders of the water industry have urged a fresh push behind efforts to promote water trading between different regions amid mounting fears of a drought in parts of south-east England.

Executives say regulatory reforms and investments are needed to make it easier to transfer water from areas with plentiful water to regions facing a shortage.

Tony Wray, chief executive of Severn Trent Water, which serves the Midlands and parts of Wales, said: “We need a long-term transmission plan.”

The call came as industry leaders prepared for a “drought summit” with Caroline Spelman, environment secretary, on Monday to discuss the threat of widespread water shortages this year over large parts of the south-east.

A year and a half of protracted low levels of rainfall in the region have left soil so dry, and reservoir and river levels so low, that widespread restrictions on water use by farmers, households and businesses are likely, water companies warn.

“There is a danger of crying wolf,” said Peter Simpson, managing director of Anglian Water. “But we are in drought.” The conditions in his region, he says, are “close to the situation in 1976”. Then, Britain’s worst drought in living memory led to widespread water rationing and public standpipes.

Yet, with northern and western parts of Britain experiencing normal conditions, the south-east’s plight has thrown attention on whether suppliers could do more to transfer water to where it is most needed.

Industry leaders are loath to talk of a “national grid’ for water. But many argue the merits of further improvement to the limited interconnections between water regions to tackle the risk of localised shortages.

That threat prompted Thames Water to warn last December that it might be forced to make its first full-scale use of a desalination plant at Beckton in south-east London, officially opened in 2010 at a cost of more than £250m.

Mr Wray, whose Severn Trent region borders Thames Water, argues more interconnections between regional water networks could prove a far cheaper solution than individual companies seeking to meet demand from their own resources.

Such a network might require a realignment of historic supply infrastructure and agreements dating back to the Victorian and Edwardian eras.

Mr Wray argues changes in the current incentive regime should allow companies such as United Utilities in the north-west and Severn Trent to produce and transmit water to London and the south-east in times of shortage.

United Utilities, which enjoys a low cost of water, could allow diversion of water to Severn Trent to transport that water via the River Severn, through a switch in the Cotswolds, into the Thames River basin.

“United Utilities would be rewarded, Severn Trent would be rewarded for moving the stuff through, and Thames Water wouldn’t have to have a desalination plant” said Mr Wray. “For the customers, it would be a better outcome, and have better ecological consequences.”

Mr Simpson, of Anglian, pointed out there was already a substantial degree of water trading and transfer between companies. But these were overwhelmingly the result of arrangements ahead of privatisation in 1989, he said.

At the moment there are “peculiar regulatory incentives and disincentives” constraining further development of water trading, he added.

But the floodgates could be about to open. Most industry figures and Ofwat, the regulator, support changes to legislation planned under the recently published white paper, which would reward companies for building assets to supply water from their own resources, in effect penalising them for buying in water that could be more cheaply produced from neighbours.

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Skanem will buy 51 percent of the shares in Indian label converter Interlabels.

Owner and CEO of Skanem Ole Rugland said: ‘By partnering with a company that matches Skanem’s corporate culture, we will strengthen the group’s overall vision and strategy. Interlabels is a professional company with great experience in handling demanding customers and complex orders. They also have competence and a solid knowledge base, which will be extremely useful for the cooperation in India, as well as for Skanem Group worldwide.’

Skanem already has one factory in Asia – located in Bangkok, Thailand which opened in 2007 – but Interlabels is its first establishment in India. Rugland continued: ‘Interlabels is today a well run, profitable company. Our aim is to support this profitable growth. We therefore want to build on the existing management and staff on site.’

Interlabels has a leading position in India with two factories, as well as a factory in Nairobi, Kenya and a large customer reach. Bhavin Kothari, managing director of Interlabels, said: ’We believe this alliance with a global leader like Skanem will help ensure a continual strong focus on innovations and leadership in the South Asian region.’

Kothari further explained the strong synergies between the two companies: ‘The product range and customer profiles of both companies are quite similar. We also believe that Skanem’s global presence and expertise combined with Interlabels local experience and coverage will make the venture a formidable force in the Indian label industry.’

Rugland concluded: ‘India is a market with a great potential and rapid consumption growth. Through this partnership, we get access to this exciting market.’

Pictured: (L-R) Sales and marketing director of Interlabels Gautam Kothari, CEO and owner of Skanem Group Ole Rugland and managing director of Interlabels Bhavin Kothari

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