Morning Financial Press Review - 18/11/19
Below are the key morning and weekend press headlines, featuring the The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Labour and have denounced each other’s claims in a war of words over the party’s pledge to nationalise swathes of the former state telecoms giant and offer free broadband. John McDonnell, the shadow chancellor, said chief executive Philip Jansen’s £100bn estimate for the cost of nationalising BT was “ludicrous”. Labour has said it would cost £20bn to roll out full-fibre broadband across the UK by 2030, although that does not take into account the cost of compensating BT investors with gilts. A source close to BT said Labour’s £20bn figure was “ridiculous”, warning that the policy had “not been thought through at all”.
boss Johan Lundgren will warn investors to expect slower growth in capacity when he reports on a bruising year this week. He is also expected to relaunch its holiday business to capitalise on the collapse of Thomas Cook and Monarch, alongside results that will show a slide in profit. Brexit uncertainty has hit demand at Europe’s second-biggest airline, affecting its “load factor” — a measure of how full its planes are — and revenue per seat. The carrier, founded in 1995 by Sir Stelios Haji-Ioannou, is expected to say that its load factor fell by 1.4 percentage points to 91.5% in the year to the end of September, while revenue per seat shrunk 2.7%.
Scandal-hit has been forced to accept an emergency high-interest loan to avoid a collapse before Christmas that would put more than 6,500 jobs at risk. The firm is taking a £55m loan from investment firm Dbay Advisors – with interest charged at an initial rate of 25pc. The deal will give Dbay a majority stake in the company, saddling existing shareholders with massive losses. The cash injection came after Eddie Stobart’s banks refused to lend it more money, as it grapples with a multimillion-pound accounting black hole. One insider said: “If the deal doesn’t happen extremely soon, it could be curtains.”
The Labour party has pledged to overhaul the public appointments system after one of the government-appointed commissioners who sets the UK minimum wage joined the board of , the security company facing allegations of systematic violations of migrant workers’ human rights. Clare Chapman has served since March 2015 as one of nine commissioners on the government’s Low Pay Commission tasked with setting the national living wage, the legal minimum hourly rate. She was appointed as a G4S director in September. G4S has faced repeated controversies over its treatment of workers and users of government services. In September, it said it will end its involvement in the immigration and asylum sector following a scandal at a detention centre near Gatwick.
Almost 6,000 shareholders who claim they were ‘mugged’ by the bank’s takeover of HBOS at the height of the financial crisis have suffered a High Court defeat. Some 20 months after the trial in London ended, a judge finally dismissed the £385million case brought by a group of 5,803 former Lloyds TSB shareholders who were hit by heavy losses. The investors – many pensioners and Lloyds employees – claimed bosses recommended the deal in September 2008 without disclosing that HBOS was riddled with bad mortgage debt.
Saudi Arabia has placed a price tag of up to $1.7 trillion on its oil producer Aramco, significantly lower than its original target, after lacklustre demand from overseas investors. The kingdom plans to raise between $24 billion and $25.6 billion by selling a 1.5% stake in the energy giant on the local stock exchange. The proceeds are about a quarter of the $100 billion Crown Prince Mohammed bin Salman, commonly known as MBS, had once hoped to reap from the listing.
The owner of Primark has defended the fast-fashion industry and said that shopping on the high street was more environmentally friendly than online delivery vans “puffing their way up and down a street”. George Weston, chief executive of , said that the scale of Primark’s global operations meant that it had “one of the world’s best supply chains and we don’t air freight the goods, we ship them, which has far lower emissions”. “Far from being a problem we are a solution,” Mr Weston said, referring to concerns that environmental awareness among young shoppers would hurt Primark. He said that if shoppers “order clothes online and collect in store then that is more environmentally sustainable”.
Former boss Andrew Tinkler is pressing forward with a rescue plan for struggling haulier , which faces a cash crunch and a fight to save 6,500 jobs. Mr Tinkler, who ran the logistics fleet as part of Stobart Group until 2014, is preparing a £75m deal for the trucking company. On Friday, Eddie Stobart recommended to shareholders a £55m loan from investment firm Dbay Advisors that would give it a majority stake and saddle existing shareholders with losses.
Hedge funds have laid hundreds of millions of pounds of bets against companies that could come under attack if Jeremy Corbyn gains power. More than £700million of shares have been ‘shorted’ across major companies that could face nationalisation or the loss of public sector contracts. Data from the Financial Conduct Authority shows that 9%, or £225million, of the shares of – a defence industry outsourcer that could lose work under Labour – are being shorted. Water firms and have bets of £157million and £62million respectively taken out against them. has a £114million short against it. Others that could be affected include British Gas owner and outsourcer .
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