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Socialist win in Catalonia draws line under separatist turbulence

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Socialist win in Catalonia draws line under separatist turbulence

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Spanish prime minister Pedro Sánchez’s Socialists scored a clear win in the Catalan regional elections on Sunday, as support for pro-independence parties dropped and his party sought to draw a line under more than a decade of separatist turbulence.

The Catalan arm of the Socialist party did not secure enough votes to govern alone, however, pushing it into negotiations with other parties over possible coalitions and voting pacts that could yet include a kingmaking role for the ERC, the least radical brand of separatists.

Salvador Illa, the Socialist regional leader, said “The Catalans have decided to begin a new era” that was open to all — “whatever they think, wherever they come from, wherever they live, whatever language they speak”.

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Illa, whose party is a strong defender of Spanish unity, presented the result as a victory over pro-independence forces that have led the regional government for 14 tumultuous years, including an illegal and failed referendum on secession in 2017.

Second place went to Junts per Catalunya, a hardline separatist party led by Carles Puigdemont, who campaigned from France having had to live as a fugitive from Spanish justice over his role in the referendum. However, he was denied his dream of returning to Catalonia to lead a pro-independence coalition government by a collapse in support for the separatist party that has led the incumbent government.

The result was a partial vindication for Sánchez, who has sought to heal some of the divisions created by the referendum, which triggered the worst constitutional crisis in Spain in four decades. His most controversial move has been an amnesty for Puigdemont and hundreds of other separatists, which is due to become law either this month or in June.

Oriol Bartomeus, a political scientist at the Autonomous University of Barcelona, said the 42 seats the Socialists won in the 135-member Catalan parliament, up nine from three years ago, were “oxygen for Sánchez”.

But he also highlighted “good results” for rightwing parties that take a far harder line against separatists. The conservative People’s party, the national opposition, increased its seats from three to 15 while the far-right Vox party maintained its 11 seats.

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The Socialist party cannot afford to shun the pro-independence parties entirely because its most likely path to government depends on the support — or at least the co-operation — of Esquerra Republicana de Catalunya (ERC), a separatist leftwing group.

ERC led the incumbent minority Catalan government and was the night’s biggest loser, shedding 13 seats to end up with 20. However, it gains a potentially pivotal role from the progressivism it shares with the Socialists and their possible coalition partner, Sumar, a hard-left group that won six seats.

Toni Roldán, a former centrist lawmaker in Spain’s national parliament who is now at the Esade business school, said joining a coalition with the Socialists would undercut ERC’s hopes of leading the pro-independence movement in the future.

A more likely option, he said, would be for ERC to give the Socialists the votes they need to form a minority administration then make deals from outside government to “agree on some laws”.

Pere Aragonès of ERC, the region’s outgoing president, said the party would move into opposition.

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Puigdemont, whose Junts per Catalunya increased its seat count by three to reach 35, criticised ERC for letting down the separatist side.

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Everton’s lenders battle to take control of Premier League club

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Everton’s lenders battle to take control of Premier League club

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Everton Football Club’s creditors are battling to buy the Premier League side from its British-Iranian owner Farhad Moshiri, in the latest twist following the collapse of 777 Partners’ takeover deal.

Stockbroker entrepreneur Andy Bell and property magnate George Downing are competing against US firm MSP Sports Capital to enter exclusive talks with Moshiri, according to people with knowledge of the matter.

While Bell, Downing and MSP are central figures because of the loans they have provided to help fund the club’s new stadium, the people said Everton has received other investment proposals.

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The Liverpool-based club has been in limbo since September, when 777 agreed to become its next owner. However, the Miami investment firm failed to meet a series of conditions required for Premier League approval and its deal with Moshiri expired last week.

BDT & MSD Partners, the merchant bank and investment firm, is ready to provide financing to the club as part of a takeover, according to people with knowledge of the matter. The US bank has not agreed to back either of the creditors yet, those people said, but is willing to support the most credible buyer.

BDT & MSD, Moshiri, Everton and Bell declined to comment. MSP and Downing were approached for comment.

US insurance group Advantage Capital Holdings, a big lender to 777, has made a separate proposal, according to a person with knowledge of the matter. Bloomberg earlier reported that A-Cap had offered to refinance all of Everton’s existing debt and take a minority equity position, with Moshiri retaining a majority stake.

A-Cap did not comment on the proposal but previously told the Financial Times that it was now a “senior secured creditor of the club”.

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Following its bid in September 2023, 777 provided more than $200mn of loans to Everton. The apparent shift of the debt to A-Cap follows the Miami firm’s move to appoint an outside restructuring firm after clashes with 777’s creditors and the unravelling of its Bermudian reinsurance funding structure.

A-Cap has been slashing its exposure to 777 after US state regulators and rating agencies raised concerns.

Everton is one of the most successful teams in English football history, having been crowned champions of England nine times, although the most recent of those triumphs came in 1987.

The lossmaking, indebted club has struggled since its finances were dealt a blow by the coronavirus pandemic, which meant matches had to take place in empty stadiums. Another blow came when Russia invaded Ukraine, forcing Everton to cut ties to sponsors connected to oligarch Alisher Usmanov, Moshiri’s former business partner, who was placed under sanctions.

Meanwhile, Everton has had to finance the construction of a waterfront stadium that is designed to increase its match day takings in comparison with its current home ground, Goodison Park.

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MSP, Bell and Downing are among the investors that have provided about £160mn in loans to help finance the Bramley-Moore Dock stadium. Rights and Media Funding, which has also financed clubs in Spain’s La Liga, is another lender.

Bell, who founded UK broker AJ Bell, and Downing are Everton fans. MSP, which is led by American-Iranian businessman Jahm Najafi and former sports agent Jeff Moorad, owns a minority stake in McLaren Racing, which competes in Formula One and other car racing competitions.

Everton’s net debt increased to roughly £330mn at the end of June 2023 from £141mn a year earlier. Those figures do not include the debt associated with A-Cap and 777.

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Nonprofit CFO Accused of 'Simply Astonishing' Fraud

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Nonprofit CFO Accused of 'Simply Astonishing' Fraud


The former chief financial officer of a nonprofit tasked with improving Detroit’s waterfront has been charged with a fraud that prosecutors say is “simply astonishing in scale.” William Smith, who was fired as CFO of the Detroit Riverfront Conservancy last week, is accused of stealing around $40 million from the nonprofit between late 2012 and March this year, which works out to almost $300,000 a month. He has been charged with bank fraud and wire fraud, the US Attorney’s Office said in a news release.

  • A criminal complaint alleges that Smith, 51, “used the embezzled funds for his own personal gain and enrichment, spending the funds on airline tickets, hotels, limousines, household goods, lawn care, clothing, and jewelry,” the Detroit Free Press reports.

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ECB cuts interest rates for first time in 5 years

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ECB cuts interest rates for first time in 5 years

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The European Central Bank has cut interest rates for the first time in nearly five years, moving faster than its US and UK counterparts, but warning that price pressures remain high.

The ECB lowered its benchmark deposit rate by a quarter percentage point to 3.75 per cent after its governing council met in Frankfurt on Thursday.

Traders in swaps markets slightly lowered their bets on a second cut by September to 65 per cent, from 70 per cent ahead of the announcement.

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The bank said it was “now appropriate to moderate the degree of monetary policy restriction” in response to a more than 2.5 percentage point fall in inflation since its last rate increase in September 2023.

But it cautioned that it was “not pre-committing to a particular rate path” and warned that “domestic price pressures remain strong as wage growth is elevated, and inflation is likely to stay above target well into next year”.

At a press conference, ECB president Christine Lagarde said that inflation was expected to “fluctuate around current levels” for the rest of this year before declining next year.

She said the ECB had decided to cut “because overall our confidence in the path ahead — because we have to be forward looking — has been increasing [in] the past few months”, adding that the “reliability of our forecasts” had risen markedly in recent quarters.

Lagarde forecast that wage growth would moderate and worker productivity would improve over the course of the year, helping to ease labour cost pressures for companies.

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Data released last week showed Eurozone inflation accelerated for the first time this year to 2.6 per cent in May, having slowed from a peak above 10 per cent in 2022.

Raising its forecasts for this year and next, the ECB said inflation would average 2.5 per cent in 2024, 2.2 per cent in 2025 and 1.9 per cent in 2026.

“The statement arguably gave less guidance than might have been expected on what comes next. In that sense, the immediate tone is a ‘hawkish cut’,” said Mark Wall, chief European economist at Deutsche Bank. “This is not a central bank in a rush to ease policy.”

The euro nudged higher 0.2 per cent to $1.0888 after the ECB announcement.

Interest rate-sensitive two-year German Bund yields — a benchmark for the Eurozone — edged higher to 3.02 per cent, up 0.05 percentage points on the day.

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Thursday’s move came a day after a similar rate cut by the Bank of Canada and follows earlier decisions to ease monetary policy by central banks in Brazil, Mexico, Chile, Switzerland and Sweden this year.

By contrast, the US Federal Reserve is expected to keep rates on hold next week at a 23-year high range of 5.25 to 5.5 per cent after price pressures in the world’s biggest economy proved more stubborn than expected.

The Bank of England is also considered unlikely to lower its bank rate from a 16-year high of 5.25 per cent when it meets on June 20.

The ECB lifted its growth forecast for this year from 0.6 per cent to 0.9 per cent. It expects 1.4 per cent growth next year and 1.6 per cent in 2026.

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