It looks like The Guardian was the first to report that the Financial Times would cut up to 60 jobs in its editorial library and managing editor’s office, as well as its advertising sales, finance, IT, conferences and marketing departments. The Guardian might have overplayed things a bit, as we hear no one has decided on final numbers and that plenty of cuts could come through leaving some jobs unfilled and various other humane means.

If the FT shed 60 non-newsroom employees, that would amount to a little under 4 percent of its total staff (1,600 positions, with about 550 in editorial). As FT chief John Ridding says in the memo, it’s streamlining, not fallout from the financial crisis. In that respect, as Ridding has told us, world economic pain has been good to the FT so far. Still, it probably won’t hurt to batten down the hatches before the advertising market starts taking on water.

Here’s the memo:

Dear All,

As I have said in our staff presentations and business updates we are continuously looking to streamline our organisation, to make it as efficient as possible and to adapt it to the rapidly changing media industry.

This has involved creating a global management structure, integrating print and online, and bringing our acquisitions more closely into the FT.

We are now assessing further steps in this process, including the creation of a single magazine production operation, increasing the integration of our personal finance operations, further integrating our advertising sales teams, and transferring a number of financial functions to our operation in Manila. As a result, about 60 existing positions may be affected. We will obviously try to manage this as carefully and sensitively as possible, and we will now be launching a period of consultation about the proposed changes. Anyone who might be affected will be contacted by their manager today.

As you will have seen from the recent Pearson trading statement (attached), we are continuing to perform well despite the challenging market conditions. Our circulation is strong, a tribute to the exceptional coverage by our editorial team, while the efforts and expertise of our commercial team continues to drive revenues. Sustained success, however, means we must continue to adapt to market and audience demands and to look for efficiencies. The measures we are considering are designed to achieve that.

I’ll keep you informed about progress.

All the best

John

Arbitrage spreads on mergers have narrowed a bit from their widest levels two weeks ago, but still remain wide on a historical basis, according to Andy Baker, special situations trading strategist for Jefferies & Co Inc. 

Spreads measure the difference between the offered takeover price and the target company’s current trading price. Historically, the wider the spread, the more investors doubt a deal will close. 

Spreads are about three times wider than they were prior to the bankruptcy of Lehman Brothers, Baker said, with raw spreads currently averaging just under 10 percent.

Average spreads on strategic stock deals have improved in the past week, tightening to 8.9 percent at last night’s close, down from 11.5 percent a week ago. Strategic cash deals tightened somewhat to 6.3 percent, versus 6.9 percent a week.

Still, the spread for the InBev and Anheuser-Busch deal stood at 11.6 percent on Wedneday, while  Bank of America Corp’s planned purchase of Merrill Lynch had a spread of 10.6 percent. The spread of Cleveland Cliff’s planned purchase of Alpha Natural Resources stood at 35.7 percent, according to Reuters data.

Leverage buyouts continue to have among the widest spreads, reflecting the greater uncertainty that those deals will close amid the weak credit market and global financial crisis, Baker said. The spread on the $32.5 billion LBO of BCE Inc, the parent of Canada’s largest telephone company, stood at 18.9 percent, according to Reuters data. 

Some spreads have been stretched to the breaking point.

On Wednesday, Samsung Electronics Co Ltd, the world’s top memory chip maker, withdrew a $5.9 billion unsolicited bid for flash memory card maker SanDisk, citing the U.S. company’s deepening losses and uncertain outlook.

Investors had already been doubtful of a deal between Samsung and SanDisk, given that the spread between Samsung’s offer price and SanDisk’s trading price was 80 percent, according to Reuters data.

Another day, another round of hand-wringing: Do I, or don’t I? That seems to be the mantra of top executives mulling buys in what continues to be a rocky market while those on the receiving end are left wondering will he, or won’t he?

So far, it ain’t looking good — for the sellers, or the buyers.

Late last night, Samsung Electronics Co Ltd, the world’s top memory chip maker, decided to dump its pursuit of flash memory card maker SanDisk Corp. That unsolicited deal would have been worth $6 billion, but Samsung apparently got cold feet after seeing SanDisk’s wider-than-expected quarterly loss.

“Your surprise announcements of a quarter billion dollar operating loss, a hurried renegotiation of your relationship with Toshiba and major job losses across your organization all point to a considerable increase in your risk profile and a material deterioration in value, both on a stand-alone basis as well as to Samsung,” Samsung CEO Lee Yoon-woo wrote to SanDisk management in a letter disclosed by Samsung on Wednesday.

As a result of these developments, we are no longer interested in acquiring SanDisk at $26/share.”

Ouch. At least Lee won’t be accused of beating around the bush.

The move, of course, wasn’t a big surprise. Many investors had been doubtful a deal would get down in the first place, given that the spread between Samsung’s offer price and SanDisk’s trading price was 80 percent, according to Reuters data.

But it’s also another sign that caution rules these days. As reporter Jessica Hall pointed out in her DealTalk column earlier this week, even marquee mergers have become more difficult and costly to close amid an ongoing credit freeze and financial crisis.

Look at GE and its appliance unit. That dance card has been open since May and suitors remain reluctant. Reporter George Chen, in another DealTalk column, points out that potential buyer Haier, China’s largest home appliance maker, plans not to bid for the unit until it sees clear signs of a U.S. market recovery. Chen was citing people with direct knowledge of the matter.

Meanwhile, General Motors is looking for a large investment from outside investors as a possible alternative to a deal with Chrysler, the Financial Times reported on Tuesday. GM and Chrysler have been in merger talks in an attempt to shore up cash and survive an industry slump, sources have said.

As the old saying goes, money makes the world go round. But the globe doesn’t appear to be spinning very fast these days.

More Deals of the Day:

** Japan’s largest beer maker Asahi Breweries Ltd is in a leading position in a bid for Groupe Danone’s Australian and New Zealand businesses, which could be worth up to A$1 billion ($678 million), a financial source said.

** Samsung Electronics Co Ltd, the world’s top memory chip maker, dropped a $5.9 billion unsolicited bid for flash memory card maker SanDisk Corp, citing the U.S. company’s deepening losses and uncertain outlook.

** Barnsley Building Society is to merge with larger UK rival Yorkshire Building Society after revealing a possible 10 million pound writedown from its exposure to two Icelandic banks, the companies said in a joint statement.

** Nissan Motor Co is proposing to buy about 20 percent of Chrysler and bring the troubled automaker into the Franco-Japanese alliance with Renault SA , the Detroit News reported, citing sources familiar with the situation.

** British Gas owner Centrica Plc said it bought Semplice Energy Ltd, a clean technology services provider, for up to 1.5 million pounds ($2.53 million) in cash to expand its range of energy efficiency and low-carbon capabilities.

** Legal and professional fee insurer Abbey Protection Plc said it would acquire three companies in the Accountax fold for an initial consideration of 4.4 million pounds ($7.4 million).

** Shares in global miner and takeover target Rio Tinto Ltd jumped 5 percent in a weak market, swept up by rumours ranging from a sweetened cash bid by BHP Billiton to a Chinese counter-bid.

** Wind turbine maker Clipper Windpower Plc said it has completed a joint venture agreement with an energy unit of oil major BP Plc for the development of a windfarm in U.S.

** Spain’s largest property company Martinsa Fadesa said its 50 percent owned Moroccan unit has sold assets for 165.7 million euros ($218.5 million), making a pretax gain of nearly 43 million.

** U.S.-based DTCC (Depository Trust & Clearing Corporation) and London-based LCH.Clearnet said they planned to merge to form the world’s leading clearing house. LCH.Clearnet shareholders would receive total consideration of up to 739 million euros ($974.7 million), the majority of which would be funded through LCH.Clearnet’s revenue, the companies said in a media release.

** Vienna stock market operator Wiener Boerse agreed to buy a majority stake in the Prague Stock Exchange to boost its position in the emerging markets of central and Eastern Europe.

** CITIC Pacific Ltd said it was in preliminary talks to sell its motor vechicle and food distribution unit, Dah Chong Hong Holdings Ltd.

It was a busy day for several leading drug companies, as they made acquisitions, or sought to reassure investors they have the means to follow through with planned acquisitions:

** GlaxoSmithKline Plc is acquiring Biotene, maker of a leading over-the-counter treatment for dry mouth, for $170 million in a move to bolster its consumer healthcare business.

** Swiss drugmaker Roche Holding AG confirmed its commitment to a $43.7 billion bid for the rest of Genentech Inc and reported a 2 percent fall in nine-month sales to 33.3 billion Swiss francs ($29.26 billion).

** Novartis AG has reached a deal to buy the pulmonary drug delivery unit of Nektar Therapeutics for $115 million in cash.

OTHER DEALS OF DAY:

** The Paris and Amsterdam airport authorities will own 8 percent of each other in a strategic alliance and cross-shareholding agreement announced by the French government.

** Russian airline S7 will file a “serious” bid for Austrian Airlines on Tuesday but it will tie it to conditions and ask for more time in the auction due to end next week, a source close to S7 said.

** Google Inc Chief Executive Eric Schmidt said the company had agreed to keep talking with the U.S. Justice Department about its proposed online advertising deal with Yahoo Inc.

** Brazilian mining giant Vale denied rumors that it was preparing a renewed proposal to buy a stake in Swiss rival Xstrata.

** Verizon Wireless, the second-largest U.S. mobile service provider, says it intends to follow through with its acquisition of Alltel Corp, despite tough credit market conditions, the Wall Street Journal reported.