Morning Financial Press Review 21/01/20
Below are the key morning press headlines, featuring the The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
has spent £1.7 billion on two defence businesses that will help it expand in the US. The British defence group will spend almost £1.5 billion buying Collins Aerospace’s military GPS division, which makes technology that helps guide missiles to their targets. And it will spend another £210m on a unit of American rival Raytheon, which makes airborne radios and communications systems for customers that include the US Department of Defence. Both firms have to sell some of their divisions so that the deal, which was announced last June, can get approval from regulators. BAE’s takeovers, however, depend on the Raytheon-UTC merger going through, as well as also getting the green light from regulators. - The Mail
has advised its shareholders to accept a £405 million takeover by , calling it the “only feasible option” to save its North Yorkshire mining project. Sirius said that it deeply regretted being unable to fund the mine itself, but it warned that if Anglo’s offer was not accepted there was “a high probability” that it would fall into administration. The proposed deal, which requires the approval of 75% of shareholders, should save hundreds of jobs at Sirius Minerals’s North Yorkshire mine and its processing site on Teesside. Mark Cutifani, Anglo’s chief executive, said that its intentions were “preserving and creating jobs, not cutting them”. Chris Fraser, Sirius’s chief executive, and other senior management will move to Anglo for at least 12 months. - The Times
One of Portugal’s richest men has attacked huge payouts handed to the bosses of vodka maker as a row between the pair intensifies. Western Gate, the investment firm of retail tycoon Luis Amaral, has written to investors in Stock Spirits urging them to back an unprecedented demand for the firm to pay a special dividend to shareholders. Mr Amaral claims that profits are not being fairly shared around. The three-and-a-half page letter, a copy of which has been seen by The Daily Telegraph, says Stock Spirits is blighted by a “culture which seeks to reward management without recognising the modest performance of the underlying business”. Stock Spirits is recommending investors reject the non-binding resolution put forward by Western Gate, which owns 10pc of the company. - The Telegraph
was being tipped as a potential bid target last night after a warning over poor Christmas trading sent its shares tumbling by more than a quarter. After five years of beating City expectations, followed by one modest downgrade last November, the premium tonic maker issued its first fully fledged profit warning and the resulting 542p slump in its shares to £14.53 wiped £630 million from its market value. Analysts mulled over the possibility that it could become attractive to the big soft drinks groups. Edward Mundy at Jefferies, the investment bank, said: “The debate on whether ‘big soda’ may look to add Fevertree to strengthen the portfolio offering within the premium mixers sub-category may start to resurface.” - The Times
Shares in fell sharply after the indebted shopping centre owner confirmed it would push ahead with a cash call thought to be worth as much as £1bn. Intu, which owns shopping centres including the Trafford Centre in Manchester and Lakeside in Essex, said it would attempt to tap investors for funds alongside its full-year results at the end of the February, confirming reports. The company has been hit by the weak backdrop for high street retailers, with struggling groups including Arcadia and Debenhams occupying a lot of space in its centres. While Intu did not confirm how much it planned to raise, the figure is thought to be around the £1bn mark. - The Guardian
is braced for a pay showdown at this week’s shareholder meeting. Shareholder advisory group ISS says a £100,000 rise in two years for finance chief Mike Scott is not justified and it raised concerns about unequal pension contributions of bosses and staff. Both ISS and peer Glass Lewis recommend shareholders reject Countryside’s pay report for last year. ISS also recommends only qualified support for the new pay policy. Mr Scott’s salary rose by 17% to £350,000 in October; another 14% rise to £400,000 is proposed from this October. With bonuses, he was paid £915,000 last year; Ian Sutcliffe, who quit as chief executive on Jan 1, earned £2.6m. The firm says it sets starting salaries below market level and raises them subject to performance. Glass Lewis said this did not justify the rise. - The Telegraph
Analysts at Morgan Stankley issued a gloomy note on yesterday, saying that expectations for a quick recovery from a bad year were too optimistic. Asos’s challenges were greater than many realised, they said, driven by the eye-watering rate of returns that bedevil lots of online retailers, as well as slowing growth in buying clothing over the internet. Shares in Asos should trade at about £20, according to Morgan Stanley, a big discount to the £30.35 at which they closed last night. Its team said that Asos was expected to deliver healthy growth in its most recent quarter when it reports on Thursday, but that didn’t change the picture that it would fall short of present growth expectations for the next few years. - The Times
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