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British Telecomunications on Tuesday took another step in the strategy it devised as part of its restructuring when shareholders approved the demerger of mm02, its mobile subsidiary. BT, which is being advised by Merrill Lynch, Morgan Stanley and Schroder Salomon Smith Barney, announced the demerger in May, in exchange for investor approval of its £5.9bn rights issue.

Swiss banks, corporates and the government have joined forces in the recapitalisation of Crossair, despite the EU warning that the deal represented a serious distortion of competition. The plan, known as Phoenix Plus, came after weeks of negotiations, as UBS and Credit Suisse and the government tried to raise funds from Swiss businesses and cantons.

* Bank of America Corp Rating: Aa2/A+/AA-

Two deals launched this week underline the fact that the European LBO loan market is very much open for business, despite what have been described as the toughest market conditions seen for 10 years. "This is part of the normal cycle," said one leveraged financier. "If you look at the debt multiples, we are not going to hit the volumes of the early 1990s."

Angola Mandated lead arrangers BNP Paribas (joint bookrunner), Glencore, Natexis Banque Populaires (joint bookrunner) and SG (joint bookrunner) have launched the general syndication of the $500m four year oil receivables backed term loan for Sonangol, the state owned oil producer.

Allianz upped the limit off its euro1 billion ($893.18 million) multi-currency Euro-CP programme to euro5 billion. It has also dropped Bayerische Hypotheken- und Wechsel-Bank from the dealer panel and Schweizerischer Bankverein (Deutschland) is renamed as UBS Warburg.

The French government this week launched its maiden OATei to a rapturous reception. Launched by the Agence France Trésor (AFT), it was the first government bond to be linked to euro zone inflation. The transaction, which marked a change from previous OATi offerings pegged to the domestic inflation rate, was seen as an attempt by France to broaden its international investor base, although it also clearly expanded the worldwide market for inflation linked product.

Hong Kong HSBC and WestLB have sent out invitations to potential sub-underwriters to join a $150m five year term loan/FRN facility for China Merchant Holdings Co.

Europe * Bankinter 3 Fondo de Titulización Hipotecaria

* Western Australia Treasury Corp Guarantor: State of Western Australia

Banque Internationale a Luxembourg has added Nomura as a dealer to its $5 billion Euro-MTN programme. The facility has $3 billion outstanding.

You have to feel slightly sorry for the good folk at Merrill Lynch, the firm that seems to find itself in the press almost every day, but for all of the wrong reasons. At the beginning of the year, the firm was in its customary position as the cornerstone of the US financial services industry. It had seen off blue-collar upstarts such as Charles Schwab, which had the impudence to try and tweak Merrill's tail. To its many admirers around the world, Merrill looked more solid than the Rock of Gibraltar. But 2001 has been an annus horibilis for Merrill. Rather than resembling the Rock of Gibraltar, the firm began to wobble like a blancmange at a summer staff picnic. Merrill discovered too late that it had too many eggs in the equities basket. When demand for equities disappeared, firms like Lehman caught a cold, but houses such as Merrill, Goldman and Morgan Stanley, whose investment banking businesses thrive in rising stockmarkets, contracted pneumonia.