Activist investor Elliott buys stake in troubled insurance group Saga (SAGA). Beleaguered investors in troubled tours and insurance business Saga got a rare boost on Wednesday when it emerged activist investor Elliott is targeting the company. A filing to the stock market reveals that the US investor, which has assets of $35 billion (£28 billion), has grabbed 5% of the shares. Elliott has a reputation as a tough player, having forced shake-ups in numerous UK boardrooms. Last year it successfully pushed for the break-up of Whitbread, which sold Costa Coffee to Coca-Cola. It also had a stake in GKN, later sold to Melrose. Saga has been in the mire lately, issuing a profit warning in April and admitting it would have to slash prices on insurance products. Chief executive Lance Batchelor has led the company since a 2014 float, but plans to step down in January.
Johnson Matthey (JMAT) today joined the list of household names like BMW and Volvo swallowed up by Europe’s car crisis. Johnson’s clean air unit — which makes catalytic converters for cars and trucks and accounts for 60% of the group’s overall profits — will make less profit for the year than initially expected. The firm blamed China’s slow implementation of global emissions rules, while analysts said the update was no surprise given the rapid slowdown in car sales across Europe. The company also said divisional head John Walker would retire after 35 years with the company and would be replaced by Joan Braca, currently president of Tate & Lyle’s food and beverage division.
Exporters like British American Tobacco (BATS) and Diageo (DGE) were benefiting from the pound’s slide to a two-year low. BATS added 20p at 2971p and Diageo was up 12p at 3431p. Currency traders are worried about a new hardline approach to Brexit from the Conservative leadership contenders seeking to woo party members. Both Boris Johnson and Jeremy Hunt have said they could take Britain out of the European Union without a deal at the end of October, potentially sparking chaos and hammering growth. One broker said: “It is increasingly looking like there is going to be something far scarier than ghouls and ghosts on Halloween.”
Shares in Emmerson (EML) were on the rise after Stagecoach founder Ann Gloag upped her stake in the potash miner to more than 3%. Gloag is one of Scotland’s richest women and first invested in Emmerson back in June last year when it was re-admitted to the London stock exchange.
The European car industry was in turmoil today after dismal sales figures for June showed a severe sector-wide slowdown. Last month car sales in the European Union dropped by 7.9%, according to the Association of European Carmakers, the biggest fall since December. Registrations dropped to 1.49 million, compared with 1.62 million a year earlier. The industry has been hit hard by weakening China demand amid the United States-China trade war as well as a slump in diesel demand. All major markets reported a dive, including the UK, which posted a 4.9% fall to 223,400 car sales. Germany, which only just avoided recession this year, saw sales drop 4.7% to 325,200, while Spain clocked up an 8.3% decline. The worst was France, which posted an 8.4% drop.
Watches of Switzerland (WOSG) on Wednesday set its sights on big-spending City workers in expansion plans as it toasted soaring sales in maiden results. Boss Brian Duffy said the UK’s biggest Rolexes seller has agreed a deal with landlord British Land to next year open a large new store at the Broadgate redevelopment in the Square Mile. A branch will also open at Battersea Power Station. Duffy said these mark the first investment commitments in the UK since Watches floated in May at 270p per share.
