Afternoon Financial Press Update
Paul Kettle
PM Press Round-Up -3 min read
15:38, 25th March 2019

Below are the key headlines from today’s updated papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here

Satellite giant Inmarsat soars as it backs £2.6 billion private equity takeover. Satellite firm Inmarsat (ISAT) FOLLOW succumbed to a second takeover bid in eight months on Monday as it recommended a $3.4 billion (£2.6 billion) offer from a private equity-led consortium. The 546p all-cash offer comes from a team including Apax Partners, the buy-out house which floated Inmarsat in 2005, fellow PE firm Warburg Pincus and two Canadian pension funds, and beats a cash-and-shares 532p bid from Inmarsat’s US rival EchoStar last July.

Majestic Wine puts stores up for sale in radical revamp. Majestic Wine (WINE)FOLLOW  has unveiled a radical revamp that will see its retail business put up for sale or run down as it focuses on its faster-growing Naked Wines division. The cash raised from selling Majestic and its 200 stores will be invested in Naked, the online-only business bought for £70m four years ago. Rowan Gormley, chief executive, said if no buyer emerged for the Majestic business, it would be run down and unprofitable stores would be shut. About a fifth of Majestic stores are owned by the company, and these properties would be sold off. “We are open to any permutation of sale, from someone buying the whole business through to people wanting to buy a handful of stores,” he said.

Technology could eliminate 1.5m jobs in UK. Nearly 1.5 million jobs in England are at a high risk of automation, according to the Office for National Statistics, with female-dominated occupations most vulnerable to changes in technology. An analysis of 20 million jobs in England found that 7.4 per cent could easily be replaced by computer programs, algorithms or robots. Customer service, manufacturing and administrative jobs were the most at risk, while managerial, healthcare and teaching roles were the safest. The ONS said that a significant number of jobs had already been automated over the past decade; as a result, the proportion of jobs at high risk of automation has fallen from 8.1% in 2011.

Rolls-Royce’s biggest investor cuts stake as share bonuses return for bosses. Rolls-Royce Holdings (RR.) FOLLOW biggest investor, the US activist ValueAct, has cut its stake in the blue-chip engineer, offloading shares worth about £250m. The sale of the 1.5% stake in the company takes ValueActs’s holding down in Rolls-Royce down to 9.5%. Investors took flight at the news, with Rolls shares slipping 1.8% to 887p. Regulatory documents on Monday revealed the sale, which took place last week, on the same day Rolls posted its annual report. It revealed that for the first time in four years long-term incentives were paid out, adding that Rolls’ “business performance drove bonuses above target”.

Pennon Group (PNN) FOLLOW takes £16m hit from Interserve collapse. The owner of South West Water and waste giant Viridor has taken a £16m hit on its full year profits following the collapse of Interserve earlier this month. Pennon is owed £72m from the embattled services giant, but booked the £16m writedown to reflect the chances of it clinching the full compensation amount. Interserve was forced to hand all assets over to its lenders as part of a pre-pack administration process less than two weeks ago after investors rejected a rescue deal put together by management. The troubled contractor had been carrying out work at a recycling and renewable energy centre owned by Viridor in Glasgow, and owes the company money to cover “rectification and completion costs”

Non-Standard Finance attacks Provident’s choice of Vanquis Bank chair. Provident Financial (PFG) FOLLOW takeover suitor Non-Standard Finance (NSF) FOLLOW upped the ante on Monday, saying its choice for Vanquis Bank chairman was “manifestly better” than the current candidate. Vanquis Bank is Provident’s main credit card division, and a larger proportion of the firm than the better-known doorstep lending business. John van Kuffeler, chief executive of Non-Standard Finance, said former Co-op Bank chief Niall Booker, who NSF wants to be Vanquis Bank chair if it wins the takeover struggle, had “a lot more edge” than Vanquis’s new chair Robert East, who was named on Saturday.

IGas Energy (IGAS) FOLLOW is betting shale gas could be a winner post Brexit. Up until now it has been cheaper for the UK to import its oil and gas from European pipelines as well as the North Sea but should we leave the EU without a deal then it may be necessary to look at other options. One company which could benefit is IGas, the UK’s largest onshore and gas producer. IGas is drilling the country’s third shale gas well in the north of England as it looks to follow Cuadrilla into fracking in the UK. Two weeks ago the firm completed successful tests at that well at Tinker Lane in north Nottinghamshire. The firm is doing the drilling with partner Ineos, which believes the drill tests show it could produce enough shale gas to keep the whole country supplied for 29 years. Alex Smith at Investec says: “Core analysis is now being conducted and this should give further insight into the resource potential and shale characteristics. The company will give a further update upon completion of the analysis in quarter two.

Convatec Group (CTEC) FOLLOW rose 4.2p to 138.4p after naming Genus chief Karim Bitar as its chief executive. The company — which makes colostomy bags — has struggled since its float in October 2016 and has been without a chief executive since a profit warning last October. Bitar has a reputation for turning companies around and Genus shares fell 132p to 2230p as the animal genetics group said it will now have to look for a new boss.

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