Business this week

Visa confirmed it would proceed with a public offering this spring. The company hopes to raise $18.8 billion, making it America's biggest IPO. Visa takes fees from credit-card transactions; the risk from defaults on payments, a growing worry of late, is held by banks that issue the plastic. As shareholders in Visa, they will probably use money from a sale to help repair their balance sheets. See article

Moody's and Standard & Poor's reaffirmed their AAA+ ratings for MBIA, removing the threat of a downgrade to the world's biggest bond insurer—at least for the moment. With the credit markets in turmoil, bond insurers are desperate to retain the top-notch ratings that cities depend on when they borrow.

The federal regulator overseeing Fannie Mae and Freddie Mac, government-backed firms that finance and guarantee home loans, said it would consider lifting a cap on their ability to invest capital that had been imposed on the pair because of accounting irregularities. Meanwhile, Fannie and Freddie reported heavy quarterly losses partly because of higher defaults on loans and rising foreclosures. See article

Not much home improvement

Amid falling consumer confidence and another volley of statistics on the gloomy state of America's housing market, Home Depot reported the first drop in annual sales in its 30-year history.

Countrywide Financial said that “in light of recent events” it would cancel a business trip it had planned for 30 bankers to a swanky ski resort in Colorado. The mortgage lender has had to deny several rumours that it is bankrupt and only recently agreed to a takeover, for a fraction of its market value a year ago, from Bank of America. The high cost of the impending trip was criticised in some quarters.

BAA, Britain's biggest airport operator, said its chief executive was going, after a year of grumbling from travellers about flight delays and security queues at Heathrow. Its chairman has promised to restructure the company; competition regulators are to report soon on BAA's monopoly of London's airports. See article

Meanwhile, Grupo Ferrovial, the Spanish infrastructure company that owns BAA, posted a 49% drop in annual net profit partly because of service costs on its debt. Ferrovial has had to delay a debt-refinancing plan because of the credit crunch.

British American Tobacco went on a spending spree, picking up the cigarette business of Denmark's ST, for $4 billion, and Turkey's Tekel, for $1.7 billion. Big tobacco companies faced with falling demand in the West have rapidly expanded into developing markets. The latest deals give BAT a big presence in Poland as well as Turkey.

Electronic Arts, a video-game giant, unveiled a bid for Take-Two Interactive Software, the maker of the popular “Grand Theft Auto” series of games. With the newest title in the franchise due for release in late April, Take-Two said EA needed to raise its offer. See article

Ouch!

The European Commission fined Microsoft an additional euro899m ($1.35 billion) for non-compliance with an antitrust decision handed down in 2004, bringing the total penalty in the case so far to euro1.68 billion. The latest fine covers the period to October 22nd 2007, before which, the commission said, Microsoft ignored its ruling and charged competitors too much for patents and licences.

Google's share price slid again after comScore, a research firm, estimated that the number of clicks on ads on the search engine had fallen by 0.3% in January compared with the same month a year ago. Nervousness about a recession and slowdown in advertising is a factor behind Google's tumbling share price: it is down by 32% this year.

Internet users around the world were unable to view YouTube for several hours, which analysts blamed on Pakistan's government. It ordered the country's internet service providers to block access to the website as it hosted a Dutch video criticising the Koran, fearing the clip would incite violence. Apparently an error in the computer code sent out by Pakistan's biggest telecoms company affected access to YouTube elsewhere.

Market transactions

Oil traded at record high prices. With the dollar falling to a record low of $1.51 against the euro, investors were ploughing their funds into oil and other commodities to hedge against inflation.

Food prices also continued to rise. The price of wheat jumped by 25% in just one day after Kazakhstan, a big exporter, moved to impose tariffs on grain leaving the country in an effort to curb inflation at home. For sugar, the market has been rather quiet.