Press | Vox Markets
SAA
M&C Saatchi (SAA) has announced a boardroom exodus with all its non-executive directors and the company’s co-founder Lord Saatchi to leave the crisis-hit business. The British advertising agency was forced to admit last week that a summer accounting scandal was worse than previously thought as it also fired off its second profit warning in less than three months. In a statement after the stock market had closed on Tuesday, the company, founded in 1995 by brothers and advertising moguls Maurice and Charles Saatchi, said that Lord Dobbs, the creator of the House of Cards TV series, Sir Michael Peat, the former private secretary to the Prince of Wales and a member of the family that supplied the “P” in KPMG, and Lorna Tilbian had all resigned. Maurice Saatchi, who had retained a seat on the board, is also leaving the firm that bears his name. Jeremy Sinclair, the company’s chairman, said: “We have accepted the decision of these directors to resign. We are determined to restore the operational performance and profitability of the business.”
LLOY
Lloyds Banking Group (LLOY) will reopen compensation claims for victims of the HBOS branch fraud in Reading after an independent review found the original scheme was “neither fair nor reasonable”. The decision is an embarrassing U-turn for Lloyds, which closed its £100m-plus compensation scheme in the spring and has been trying to draw a line under one of Britain’s biggest banking scandals. Sir Ross Cranston, a former high court judge who ran the independent inquiry, said the bank’s review of the fraud had “serious shortcomings”. The most serious concerned Lloyds’ “approach to assessing direct and consequential loss caused by the criminal misconduct”, he said. “This part of the customer review, both in structure and in implementation, was neither fair nor reasonable.”
SSE
The Tory donor behind Ovo Energy has been given the green light to take control of Britain’s second largest energy supplier for half a billion pounds. The UK’s competition watchdog, the Competition and Markets Authority, cleared Ovo Energy’s £500m takeover of SSE (SSE) energy supply arm, saying the tie-up would not affect competition in the energy market. The approval clears the way for Ovo to become the second largest energy supplier in the country, and propels the personal wealth of its founder, Stephen Fitzpatrick, past £600m. The former banker founded Ovo Energy in Bristol 10 years ago and still holds a 67% stake in the company, which was valued at £1bn before the SSE deal. The deal will increase Ovo’s customer base from 1.5 million to 5 million homes at a stroke.
MTC
Mothercare (MTC) sales have slid further in Britain and overseas after the retailer put its UK business into administration last month with the potential loss of 2,800 jobs. Group sales fell by 8.4% to £452.3m in the six months to 12 October, as pre-tax losses widened to £21.2m from £18.5m in the same period a year before. Mark Newton-Jones, the chief executive of the mother and baby goods retailer, said it had been through an “extraordinarily challenging period”, but Mothercare’s exit from the UK, where it had 79 stores at the time of entering administration, enabled the group to focus on expanding its international operations. He said the move would complete Mothercare’s transformation “into a capital-light business, which is expected to be both cash generative and profitable”. Newton-Jones added: “We are confident in the future of the Mothercare brand. We believe that, without the financial and management burden of running a UK retail operation, we can singularly focus Mothercare on its global international franchise.”
TED
Ted Baker (TED) could be forced to raise cash after warning of a 90% profits crash and the departure of both its chief executive and executive chairman. The beleaguered retailer said it now expected to make full-year pretax profit of £5m to £10m, depending on Christmas trading, down from more than £50m last year. It was the retailer’s fourth profits warning in a year. The company blamed the downgrade on “unprecedented” levels of discounting on the high street, which have battered its profit margins. Shares in the company plunged 35% as the grim profits update was revealed, although they later recovered to close down 13% at 346p. The shares had already lost three-quarters of their value this year after the departure of the founder, Ray Kelvin, in the wake of allegations of inappropriate behaviour, and an accounting problem. They are now down some 90% in less than two years.
ESL
Eddie Stobart Logistics (ESL) to offer investors choice in financing. Rights issue early next year follows rescue by private equity group Dbay
SAA
Lord Saatchi quits M&C Saatchi (SAA) as accounts scandal takes twist. Founder of advertising agency and three non-executive directors depart in row over reforms
LLOY
Lloyds Banking Group (LLOY) – Victims of HBOS fraud in line for bigger payout. Review says bank’s compensation scheme ‘not fair and reasonable’
TED
Ted Baker (TED) shares plunge as chief executive and chairman resign. Fashion retailer forecasts full-year profits will fall as much as 90%
RR.
Lex – Rolls-Royce Holdings (RR.)/ValueAct: breaking Brad. Shares are only a shade higher than when Bradley Singer joined in 2016
JDW
Wetherspoon (J.D.) (JDW) plan to create 10,000 jobs met with scepticism. Pub chain announces £200m investment to open new premises despite weak consumer spending
AHT
Ashtead Group (AHT) to refocus UK business after sharp profit fall. A-Plant unit has suffered from tougher competition and a weaker pound
RR.
Rolls-Royce Holdings (RR.) biggest shareholder ValueAct quits board. Representative of activist investor steps down as non-executive director
JE.
Just Eat (JE.) rejects sweetened Naspers takeover bid. South Africa’s Naspers attempts to disrupt Takeaway deal
SAA
Embattled advertising firm M&C Saatchi (SAA) was last night reeling from the shock resignations of four directors, including one of its founders. In a dramatic exodus, Lord Maurice Saatchi, Lord Michael Dobbs, Sir Michael Peat and Lorna Tilbian quit after a massive boardroom row. It is understood they left following disagreements about how to reform the company’s governance in the wake of a £12million accounting fiasco, including how quickly, and in what order, changes should be put in place. The changes were recommended in a review by auditor PwC earlier this year.
LLOY
Lloyds Banking Group (LLOY) boss Antonio Horta-Osorio faced embarrassment yesterday over his handling of the HBOS Reading fraud scandal. A review by Sir Ross Cranston found that the lender should reassess the compensation it gave small business customers, after corrupt bankers spent millions on luxury holidays and prostitutes. The HBOS Reading scandal saw six bankers and advisers convicted of fraud in 2017, and sentenced for almost 50 years combined, for criminal misconduct between 2003 and 2007. Although the judge found that the corrupt bankers had cheated customers out of around £245million, some victims and police sources put the damage at up to £1billion. HBOS’s owner Lloyds has only paid out £102million to 71 small businesses. This was despite Horta-Osorio vowing to compensate victims ‘fairly, swiftly and appropriately’.
JDW
Wetherspoon (J.D.) (JDW) will create up to 10,000 new jobs as it invests more than £200million in pubs and hotels over the next four years. It is to build 60 new pubs and ‘a few’ new hotels, while a further 80 existing pubs across the UK and Republic of Ireland will be doubled or tripled in size. Most of the investment will be channelled into developments in small and medium-sized towns. The chain currently runs 875 pubs and 58 hotels across the UK and Republic of Ireland, and employs 44,000 staff. New premises will be opened in places such Bourne, Lincolnshire, Ely in Cambridgeshire, and Diss in Norfolk. There will also be new pubs opening in Felixstowe, Suffolk, Newport Pagnell in Buckinghamshire and in Prestatyn, North Wales. There will also be investment in major cities including London, Birmingham and Leeds. The company founder and chairman Tim Martin said: ‘We are looking forward to opening many more new pubs as well as investing in existing pubs over the next four years.
OCDO
TSCO
SBRY
MRW
The Big Four supermarkets have had their worst run into Christmas for 15 years, according to the latest market data. The German discounters Aldi and Lidl continued to steal customers from the likes of Tesco, Sainsbury’s, Asda and Morrisons in the 12 weeks to December 1. The four combined now have just 67.7% of the UK grocery market, the lowest figure for the autumn period since 2004, according to Kantar. At the same time Aldi and Lidl saw their combined market share increase to over 14%. Sales growth of 9.3% propelled Lidl to a new record market share of 6.1%, while Aldi’s 6.2% sales growth – worth £129million – gave it a 8% market share. Ocado Group (OCDO), the fastest growing grocer, saw its sales rise 13.7%, allowing it to grab 1.4% of the total market. The Co-op, which yesterday announced a £25million investment in 30 new stores, creating 500 jobs, has also done well, growing sales by 3.6%. Tesco (TSCO) was the best performing of the largest grocers over the past 12 weeks, despite sales falling by 0.8%. Sales at Sainsbury (J) (SBRY) were down 1.1%, while Asda dropped by 1.9%. Morrison (Wm) Supermarkets (MRW) share of grocery sales dropped back 0.4% points to 10.1% as sales declined by 2.9%.
JE.
Just Eat (JE.) has rebuffed the latest attempt by South Africa’s Naspers to derail its planned deal with rival Takeaway.com, saying the £5.1billion sweetened bid undervalues the group. Just Eat said the offer from Naspers’ Dutch-listed investment vehicle Prosus – which was raised on Monday to 740p a share from 710p a share – ‘significantly undervalues’ the company. The group said it continues to back its planned all-share deal with Takeaway.com, which was agreed earlier this year. It comes after Prosus said on Monday its sweetened cash bid ‘provides certainty of value to Just Eat shareholders’. But Takeaway.com boss Jitse Groen quickly hit back at Prosus, saying a ‘slightly higher derisory cash bid remains a derisory cash bid’. In its latest rejection, Just Eat said the increased bid was just 16% higher than its share price in July before talks with Takeaway.com were revealed and 5% lower than the closing price of 777p a share on Monday.
FUM
Futura Medical (FUM) fell after the pharma group reported unexpected results from tests of a gel for erectile dysfunction. Trials showed it worked but also that a placebo gel containing some of the active ingredients worked too. This meant the trial failed to meet its goal to beat the placebo, though Futura said this could be a ‘simpler route’ to getting regulatory approval. Investors had expected a positive result against the placebo gel.
RR.
Fresh turbulence has hit Rolls-Royce Holdings (RR.) after its largest shareholder quit the board. Bradley Singer, a representative of the activist investor Value Act, is stepping down from the engine maker after almost four years as a director. He joined in March 2016 after Value Act bought a more than 10% stake in Rolls, which was recovering from profit warnings. Value Act cut its holding from 10.48% to 9.35% this year, but Singer’s departure has spooked shareholders, who are preparing for it to sell its entire stake. It comes as Rolls has struggled with problems with a set of engines called the Trent 1000, which is set to cost it £2.4billion, and as another US activist, Harris Associates, has bought a 7% chunk of the company.
BA.

BAE Systems (BA.) was knocked by reports that US President Donald Trump’s administration is putting pressure on Japan to choose a US defence company to develop its new fighter jet rather than BAE. Tokyo can either work with BAE, work with US group Lockheed Martin or develop a new plane domestically.

 
 
SAA
Advertising mogul Maurice Saatchi has quit the agency which bears his name, days after an accounting error sent shares plunging 45%. The Tory peer, one of the greatest admen of his generation, stood down as an executive director of M&C Saatchi (SAA) on Tuesday night as part of a boardroom clear-out. He quit alongside non-executives Lord Dobbs – author of political thriller House of Cards – Sir Michael Peat and Lorna Tilbian, as the company battles for stability following an announcement that it had overstated profits by nearly £12m. Insiders said the departures follow a split over the direction of the business.
Nervy investors pulled almost £140m out of property funds in just three days amid fears of a wave of suspensions after withdrawals were blocked by M&G PLC (MNG). The firm suspended its £2.5bn Property Portfolio fund last Wednesday after investors headed for the exits in droves, amid fears of a slump in the value of retail real estate due to a crisis on the high street. It sparked fears of contagion across the industry – panicking investors in other property funds, who have rushed to demand their money back. A total of £138m was withdrawn on the three trading days immediately after the M&G fund suspension according to data from Calastone, which processes funds transfers.
LLOY
The boss of Lloyds Banking Group (LLOY) has been forced into a humiliating apology after major flaws were found in a compensation scheme for victims of Britain’s biggest ever bank fraud. Antonio Horta-Osorio said sorry after a review branded aspects of the programme “neither fair nor reasonable”. The conclusions from retired High Court judge Sir Ross Cranston is a blow for Mr Horta-Osorio as he struggles to move on from the fraud at the Reading branch of Hbos, which Lloyds subsequently bought during the financial crisis a decade ago. Criminal banker Lynden Scourfield and his cronies deliberately wrecked dozens of struggling small businesses, spending the profits on prostitutes, holidays and luxury goods.
LSE
Market opening hours could be slashed by the London Stock Exchange Group (LSE) in a bid to improve traders’ work-life balance. The business is asking City workers whether the market should be open for a shorter time than the current 8am to 4.30pm as part of a consultation on how to bring more women and disabled people into the industry. Industry groups have repeatedly called for a shortening, arguing that the average London trader works a 60-hour week once extra time before and after the daily session is factored in. Only one in eight people working in London’s trading firms is female, according to figures released last year by the Financial Conduct Authority.
TED
Ted Baker (TED) stunned the City on Tuesday with a shock profit warning and the departure of its chief executive and chairman, sparking speculation the ailing retailer is now a takeover target. Last night it emerged that activist investor Toscafund has built a 5.9% stake in Ted Baker. The aggressive hedge fund, founded by Martin Hughes, has a reputation of pushing for change at companies such as Speedy Hire, the tool rental business. Earlier in the day Ted Baker warned in a brutal update to shareholders that the past 12 months had been the “most challenging in our history” as it battles to recover from a harassment scandal and an accounting crisis, as well as struggling with a wider downturn.
DOM
The long-serving chairman of Domino’s Pizza Group (DOM) will step down in the wake of a US hedge fund wrestling control of a boardroom overhaul. Stephen Hemsley, who took the role in March 2010, will leave on Dec 29 and be replaced temporarily by the senior independent director Ian Bull. The company said in October it had hired headhunter Heidrick & Struggles to find a new chairman and that the search was progressing. A new chairman will be named before a new chief executive is appointed to replace David Wild, who said in August that he was retiring. The move comes after activist investor Browning West was given a board seat and help pick a new chairman and chief executive along with Mr Bull.
TLW
Tullow Oil (TLW) has been plunged into crisis after it ousted its boss, slashed production forecasts and axed the dividend – sending shares crashing to a 20-year low. The Africa-focused business’s stock fell 71.8% to its lowest since 1999, wiping £1.4bn off the value of the company as chief executive Paul McDade and exploration director Angus McRoss quit by mutual agreement. The firm – which was worth £14bn at its peak in 2012 – is now the biggest percentage faller on the FTSE 350 this year barring companies which have gone into administration. It will trigger massive paper losses for thousands of retail investors, who hold around 15% of Tullow’s stock between them.
AHT
Equipment hire company Ashtead Group (AHT) warning of a slowdown at its dominant US business has scared investors away from the business. Ashtead derives more than 80% of its sales in the US. However, despite posting group revenues up 14% to £2.68bn in the first half and pre-tax profits 6% better at £660m, concerns about US demand saw shares drop 7.5% to £21.89. Updating on progress in the six months until the end of October, new chief executive Brendan Horgan warned that the US was seeing a “lower rate of growth compared with recent years”. This, he said, was putting pressure on operations that Ashtead.
SMDS
Questor: Smith (DS) (SMDS) needs watching but the yield and valuation make it a hold for now. Questor share tip: recent rise in profits could be short-lived if prices come under sustained pressure – but we shouldn’t overdo the gloom
LLOY
Lloyds Banking Group (LLOY) has agreed to restart a compensation scheme it set up for victims of fraud after “serious shortcomings” were found. An independent review of recompense provided to small business owners who were damaged by the £1 billion HBOS scandal found that the scheme failed to deliver “fair and reasonable offers of compensation”. Sir Ross Cranston, a retired High Court judge, said that “claims to direct and consequential loss must be reassessed” as he accused Lloyds of an “unacceptable denial of responsibility”. The Financial Conduct Authority said that the bank’s failings needed to be addressed quickly. The City watchdog added that senior management must explain how and why the issues identified by Sir Ross occurred and that “further action may be required in light of those answers”.
SAA
M&C Saatchi (SAA) was cast deeper into turmoil last night after its co-founder and three independent directors resigned in the wake of an accounting crisis. Lord (Maurice) Saatchi, 73, who founded the company with his brother Charles a quarter of a century ago, has tendered his resignation. Lord Dobbs, 71, the Conservative peer who wrote the House of Cards drama series, Lorna Tilbian, a media industry financier, and Sir Michael Peat, 70, a former courtier and KPMG partner, have left the board with immediate effect. The departing directors are understood to have demanded that David Kershaw, 65, chief executive, and Jeremy Sinclair, 73, chairman, carry the can for an accounting scandal that has cut its market value in half since August. When Mr Kershaw and Mr Sinclair declined, they resigned instead, industry sources told The Times. A different source with knowledge of the situation said Mr Kershaw and Mr Sinclair sought outside counsel and were advised it would not be in the best interests of the company to step down immediately.
TED
Further misery was heaped on Ted Baker (TED) investors yesterday after the fashion group delivered another profit warning that claimed the scalps of its long-serving chief executive and chairman. In an unscheduled trading update, Ted Baker said that its full-year profits would be as little as £5 million, a 90% nosedive on a year earlier. In response to the collapse in profits Ted Baker said that Lindsay Page, 61, would be stepping down as chief executive with immediate effect after 22 years with the business. David Bernstein, 76, the chairman, is accelerating his retirement plans.
BA.
Competition between Britain and the United States to help build Japan’s next fighter jet has intensified with defence officials on both sides of the Atlantic intensifying their lobbying of Tokyo. The Ministry of Defence and BAE Systems (BA.) have been forced to counter rising pressure on Japan from the American defence department and Lockheed Martin over a contract to build the F-3 fighter, sources said. Japan is seeking to replace its ageing fleet of single-engine F-2s with twin-engine jets capable of patrolling larger areas. It is concerned about China’s increased military presence in the South China Sea and North Korea’s repeated firing of long-range missiles into the Sea of Japan.
SENS
The two most senior non-executive directors of the healthcare technology company founded by Lord Drayson, the former science minister, have resigned suddenly after a corporate governance fiasco. Annalisa Jenkins, who was appointed as acting chairwoman of Sensyne Health (SENS) in October, and Andrew Gilbert, the senior independent director, have left the board. Sensyne has appointed Sir Bruce Keogh, 65, an existing non-executive, as interim chairman and has appointed Spencer Stuart, the headhunter, to find a permanent chairman and non-executive directors. Sensyne has had four chairmen and women since it floated on the London Stock Exchange’s junior Alternative Investment Market in August.
RR.
The biggest shareholder in Rolls-Royce Holdings (RR.) has resigned from the aerospace company’s board after almost four years, leading to expectations that the US activist investor could cut its stake. Bradley Singer, chief operating officer of Value Act, stepped down as a non-executive director of the engineer on Monday. The change, revealed yesterday, prompted shares in Rolls-Royce to drop by as much as 5%, putting it among the biggest fallers on the index. Value Act reduced its stake in March, taking its position from 10.94% to 9.48%, when it sold 1.9 million shares at about 20% above Monday’s share price. The board change has raised expectations that Value Act will sell more shares.
AHT
Ashtead Group (AHT) is planning to refocus its equipment rental business in Britain after its performance was hurt by subdued demand, which has forced the company to cut prices in an attempt to attract customers. Shares in the company fell yesterday after half-year results revealed disappointing figures for its UK division, which is called A-Plant. This year Ashtead named Brendan Horgan, 46, as its chief executive, replacing Geoff Drabble, 60, who grew the business into a FTSE 100 company during his 12-year tenure. Mr Horgan has been with Ashtead for more than 20 years and previously ran the Sunbelt division, which highlights the importance of the US to the group. The UK accounts for less than 10 per cent of Ashtead’s revenue but the performance of A-Plant concerned investors yesterday.
HSBA
HSBC Holdings (HSBA) private Swiss bank has been fined $192 million for conspiring with United States citizens to evade taxes. The justice department said that the bank used various methods to help Americans hide their offshore assets from US authorities, such as using code-named and numbered bank accounts and otherwise “relying on Swiss bank secrecy”. The bank admitted that between 2000 and 2010, it conspired to defraud the US of taxes, commit tax evasion and file false federal tax returns. The justice department said that the bank had about 720 undeclared US client relationships in 2002 and held about $1.3 billion in undeclared assets for American clients in 2007. The department said yesterday that the bank had agreed to pay the fine and enter into a three-year deferred prosecution agreement.
FUM
A junior biotechnology company testing a treatment for erectile dysfunction was taken aback to find that it flopped — while a placebo got the desired result instead. Now Futura Medical (FUM) wants to get the placebo approved by regulators. It had been working on a gel — MED2005 — for more than a decade but it proved of only limited use in a late-stage clinical study, while the placebo drug with which it was being compared yielded “statistically significant and clinically meaningful” improvements in patients’ conditions. James Barder, chief executive of Futura, said the outcome was “surprising” and added that he and his team “did not entirely know” why the placebo had the effect that it did.
MKS
Marks & Spencer Group (MKS) has boosted its efforts to revive its clothing division by hiring a senior Adidas director to take charge of its supply chain. Paul Babbs, who has been with the German sportswear company for the past 12 years and was most recently its chief supply chain officer, will take the same role when he joins in late spring, according to a staff memo seen by The Times. The move comes three months after the retailer fired its previous supply boss, Gordon Mowat, and ousted its clothing chief executive, Jill McDonald, in July after a disaster in its denim department. Steve Rowe, Marks’s chief executive, said that a failure to order enough pairs of jeans had resulted in the “worst availability I have ever seen”. The mistake, which resulted in empty rails of the jeans popularised by a Holly Willoughby marketing campaign, was internally called “jeansgate”.
LSE
A plan to shorten the long hours worked by stock market traders and fund managers has moved a step closer after the London Stock Exchange Group (LSE) began to canvass the City on the proposals. The exchange yesterday started a consultation to examine whether the trading day should be cut in a move aimed at improving work-life balance. It comes after the Investment Association, whose members manage about £7.7 trillion of assets, and the Association for Financial Markets in Europe last month called for market hours to be reduced from between 8am and 4.30pm currently to between 9am and 4pm.
TSCO
SBRY
MRW
A warning that shoppers have reined in their Christmas spending before the election hit the share prices of supermarkets. November is usually a good month for the nation’s grocers as consumers begin to load up their cupboards before the festive season. Tomorrow’s election, coupled with recent wet weather and a lacklustre Black Friday, have put paid to that this year. Total British grocery sales growth slowed to 0.5% in the 12 weeks to December 1, with all of the “Big Four” supermarkets losing market share to the discounters Aldi and Lidl, according to research by Kantar. Tesco (TSCO) was the best performing of the big supermarkets with sales falling by 0.8%. Sainsbury (J) (SBRY) sales declined by 1.1% and Asda’s shrank by 1.9%, while sales at Morrison (Wm) Supermarkets (MRW) fell by 2.9%. Lidl’s sales rose by 9.3% over the period and its German rival Aldi enjoyed a 6.2% rise. As a result the Big Four’s combined share of the grocery market fell to 67.7%, down from 69.1% last year.
 
TLW
Tullow Oil (TLW) was a big riser, climbing 5¾p to 45¾p after it slashed its production outlook, suspended the dividend and announced the exit of its chief executive. Yesterday’s rise was something of a “dead cat bounce”.
PDL
Petra Diamonds Ltd.(DI) (PDL) was forced to close its three mines in South Africa amid an energy crisis in the country. The state-owned electricity supplier, Eksom, had asked the company to cut their energy usage to relieve pressure on the national power system. After the close Petra said that its operations, including the Cullinan mine, where the famous diamond was found, were running again, although not at full capacity. Bosses said that the impact of the stoppages would depend on how long it was until normal service was resumed.
MCLS
The convenience stores group McColl’s Retail Group (MCLS) found itself in the red, as it cautioned that adjusted profits this year would come in at about £32 million, worse than analysts had expected. McColl’s blamed poor weather and lower consumer confidence throughout the second half.
JE.
Just Eat (JE.) swatted away the latest bid from Prosus yesterday but the takeover battle is likely to rumble on, according to Liberum, the City stockbroker. The Dutch investment company, increased its offer to 740p a share this week, which valued Just Eat at £5.1 billion. The online takeaway marketplace said that the improved bid “significantly undervalues” the business and urged shareholders to back the all-share merger it agreed this summer with Takeaway.com. Just Eat shares closed at 781½p yesterday, which suggests that the market is readying itself for more offers, and Liberum expects Prosus to oblige. “We see the bid of 740p per share as unlikely to be accepted, but we do not believe that Prosus will stop its pursuit of Just Eat,” the broker said. Liberum argues that Takeaway.com will also have to respond with a better offer, as the deal on the table values Just Eat shares at about 697p, 12% shy of their current market value. In addition, two big shareholders, Eminence Capital and Aberdeen Standard Investments, have previously said that they would need more money to give their blessing to any transaction.
SN.
Tempus – Smith & Nephew (SN.): Hold. New chief executive expected to continue predecessor’s promising strategy and scope for acquisitions
BKG
Tempus – Berkeley Group Holdings (The) (BKG): Buy. Cash buffer will enable it to weather political uncertainty
JE.
The battle for control of UK food delivery firm Just Eat (JE.) has intensified as rival bidder Prosus raised its offer to £5.1bn. Prosus is seeking to break up the agreed merger between Just Eat and Dutch rival Takeaway.com, a deal that would create one of the world’s biggest online food delivery companies. Prosus, the Amsterdam-listed offshoot of South African technology group Naspers, launched a rival 710p a share cash offer in October and has raised its terms to 740p a share, further above Takeaway.com’s £4.8bn offer. Prosus argued that its bid was “the only one that delivers certainty in the face of undeniable industry change”. Just Eat said its board was studying the increased offer, and advised shareholders to take no action. Shares in the business closed up slightly on Monday, gaining 4p to 781p.
TLW
Shares in Tullow Oil (TLW) plunged to a 16-year low after the company surprised investors by slashing its production forecast, scrapping its dividend and announcing that its chief executive and exploration director had left. Tullow said Paul McDade was leaving after almost two decades at the London-listed company. He was appointed chief executive in 2017. Angus McCoss, the head of exploration, was also ousted with immediate effect. The company will be run by the chair, Dorothy Thompson, a former Drax boss, until a new chief executive is found, while Mark MacFarlane, its east Africa chief, becomes chief operating officer. Thompson said: “The board has been disappointed by the performance of Tullow’s business and now needs time to complete its thorough review of operations.”
AMGO
The chief executive and chairman of the subprime lender Amigo Holdings (AMGO) are stepping down, signalling fresh turmoil at the loans group after its billionaire founder pushed his way back on to the board. The chief executive, Hamish Paton, who has been in the role for less than five months, will continue in the job for another year to ensure an orderly handover to his successor. Also departing is the chairman, Stephan Wilcke, who will not stand for re-election at the company’s next annual general meeting in July 2020, along with Clare Salmon, head of the remuneration committee, who said she would step down “at the first suitable opportunity”.
TLW
Tullow Oil (TLW) troubles shake investor trust and raise prospect of sale. Output problems and plunging shares focus attention on oil explorer’s overconfidence
JE.
Lombard – Prosus’s £5bn bid for Just Eat (JE.) shows price of competition. New offer described as ‘derisory’ by rival, but it prices in the presence of Uber
TLW
Tullow Oil (TLW) shares plummet 70% after group cuts outlook. Chief executive and head of exploration leave FTSE 250 oil and gas explorer
BUR
Burford Capital (BUR) chief executive fears Argentine reprisals. Chris Bogart tells US court he fears for safety if $1bn case is moved to Buenos Aires
TLW
Lex – Tullow Oil (TLW): downhole. Explorer announces another trim to over-optimistic estimates
HSBA
HSBC Holdings (HSBA) reshuffles top team ahead of restructuring. Interim chief Noel Quinn plans big overhaul of group to slash costs in Europe and the US
AMGO
Subprime lender Amigo Holdings (AMGO) chief and chairman quit. Departures follow move by founder James Benamor to reassert control of the business
JE.
Dutch investment firm Prosus has sprinkled an extra £200million on top of its offer for takeaway delivery app Just Eat (JE.). Prosus has upped its bid to £5.1billion from £4.9billion, as it tries to outdo an offer from fellow Dutch bidder Takeaway.com. Takeaway.com’s share price increased by nearly a fifth since Prosus entered the race in late October, meaning its rival share-based deal has grown more attractive. Prosus has also lowered the threshold the offer has to reach for it to go through to 50% to grease the wheels of it being successful. Originally the company was looking for 90% acceptance, but it revised this down to 75% in November. The deadline for shareholders to accept has been extended to 27 December.
TSCO
Tesco (TSCO) shares climbed in early trading after it confirmed it was considering selling its Thai and Malaysian businesses after an approach by an unnamed buyer. The supermarket said it was reviewing its strategy, which could see it quit two of its last foreign markets, only six months after boasting it would expand in the region. Tesco, which has 1,967 stores in Thailand and 74 stores in Malaysia, has been operating in Asia for over 20 years. It stressed there was no assurance its Asian business – which could be worth as much as £7.2billion according to the City – would be sold. ‘The evaluation of strategic options is at an early stage, no decisions concerning the future of Tesco Thailand or Malaysia have been taken, and there can be no assurance that any transaction will be concluded,’ Tesco said in a statement.
GFS
G4S (GFS) will find out today if it has been removed from a leading ethical stock market index after it was blacklisted by Norway’s state investment fund over human rights concerns. The security services group has been included on the FTSE 4 Good index for the past three years. The index puts an ethical stamp on companies that are environmentally and socially responsible. But campaigners have called for G4S to be booted out after Norway’s pension fund said it would no longer invest in the firm over concerns it contributed to human rights abuses in its Middle East operations.
DeepMatter Group Plc (DMTR) surged after announcing it will work with Astrazeneca to help speed up the development of new medicines. The pharmaceuticals group will use the Scottish technology firm’s Digital Glassware platform for drug experiments. The platform uses artificial intelligence and allows chemists to share the details of their experiments with other scientists in real time.
MKS
Marks & Spencer Group (MKS) started the week with a bang as it was bestowed a rare double upgrade from analysts at Goldman Sachs. They U-turned on their own advice, swinging from a ‘sell’ recommendation to ‘buy’. This represents a rare boost for the retailer, which has continued to struggle despite being years into a plan to turn the company around and was booted out of the FTSE 100 in September. Goldman analysts said they saw improvements in its crucial womenswear division from a low point in April. And they were impressed that M&S avoided the sort of deep Black Friday discounting that could have shredded margins. Brokers also raised the target price on its stock from 170p to 220p.
SNR
Senior (SNR) soared 12.4p, to 190.4p after it confirmed media reports that it is mulling the sale of its aerostructures business, which is the company’s largest division and makes aeroplane parts. It told the stock market it has been ‘reviewing all strategic options’ for the aerostructures arm – but stressed it is at an early stage and that a sale might not happen. The news has not been a surprise for many in the City, which comes a month after Senior kicked off a £20million restructuring programme to combat the business’s weak performance.
KIE
Kier Group (KIE) advanced after reports that Terra Firma Capital Partners, run by private equity tycoon Guy Hands, is one of the final bidders for its house building division, called Kier Living.
DTY
Shares in funeral services provider Dignity (DTY) lost as much as 5% after it set December 27 as the date for non-executive director Mary McNamara to step down from the board. McNamara announced in September she was looking to leave because she was spread too thinly over multiple board commitments. But the departure of an experienced director comes at a tricky time for Dignity, which is in the process of restructuring.
 
TLW
ECO
KOS
Tullow Oil (TLW) was the biggest mid-cap faller after its chief executive left, it downgraded its production forecast, suspended the only recently reintroduced dividend and kicked off a review of its operations. The explorer’s shares absolutely tanked yesterday, falling to 39.94p as it went into full crisis mode. But it dragged a number of other companies into the red with it. Shares fell in AIM-listed Eco (Atlantic) Oil & Gas NPV (DI) (ECO), which is one of Tullow’s exploration partners for oil off the coast of Guyana. And Kosmos Energy (DI) (KOS), which works with Tullow in Ghana.
CINE
Cineworld Group (CINE) fell as UBS analysts trimmed the target price it has set for the cinema chain from 345p to 325p. UBS brokers kept a ‘buy’ rating on its shares, saying a poor showing at the box office has partly been offset by the prospect of more savings between Cineworld and Regal, the US group it bought for £2.4billion last year, as they merge.
SVS
British science is to be handed a major boost from a US property developer preparing to plough up to $500m (£380m) into building new laboratories across the country. San Diego-based real estate firm Creative Science Properties has teamed up with estate agent Savills (SVS) to scout out locations in Cambridge, Oxford and London where new labs could be built. Rob Sadler, from Savills, said there is growing demand for extra space from the UK’s world-class pharmaceutical companies, sparking a flurry of interest from international investors. He said the cheap pound has also made the country an attractive proposition at the moment.
BOO
The founders of Boohoo.com (BOO) have bagged £142.5m from selling part of their stakes in the fast fashion website. Mahmud Kamani and Carol Kane, who set up the retailer in Manchester 13 years ago and turned it into a £3.2bn company, sold 50 million shares between them at 285p a share. Mr Kamani, which still has a 13% slice in the business, sold 35 million from £99.8m, while Ms Kane parted with 15 million shares for £42.8m and retains a 2.7% stake. The duo have promised not to sell any more stock for 18 months. A spokesman for the firm said the sales were intended to help with personal financial planning.
MTRO
Colombian billionaire Jaime Gilinski Bacal has become the biggest investor in Metro Bank (MTRO) – fuelling speculation of a possible takeover bid. The tycoon first emerged as a Metro investor in late November and is now its biggest shareholder with a 6.1% stake, replacing hedge fund chief Steve Cohen who has been selling down his holding. His pole position on the shareholder register has raised eyebrows among analysts. It comes as Metro Bank’s founder and chairman Vernon Hill and chief executive Craig Donaldson prepare to quit the lender’s board, following an accounting error which has sent shares plummeting 96% from their peak in 2018.
TLW
Tullow Oil (TLW) has been plunged into crisis after it ousted its boss, slashed production forecasts and axed the dividend – sending shares crashing to a 20-year low. The Africa-focused business’s stock fell 71.8% to its lowest since 1999, wiping £1.4bn off the value of the company as chief executive Paul McDade and exploration director Angus McRoss quit by mutual agreement. The firm – which was worth £14bn at its peak in 2012 – is now the biggest percentage faller on the FTSE 350 this year barring companies which have gone into administration. It will trigger massive paper losses for thousands of retail investors, who hold around 15% of Tullow’s stock between them.
HSBA
HSBC Holdings (HSBA) has launched a major overhaul of its top team as interim boss Noel Quinn tries to stamp his mark on the lender. Longstanding investment banking head Samir Assaf – who once described himself as the “last man standing” during a previous exodus – is moving on, and the bank is also replacing its chief operating and risk officers. The changes have emerged months after Mr Quinn blasted the lender’s performance as “not acceptable” following an 18% fall in third-quarter profits compared to 2018. Only $100m (£76m) of the lender’s $4.8bn profit was generated outside Asia, piling pressure on divisions to up their game in Europe and the US.
AMGO
Amigo Holdings (AMGO) is losing its chief executive and chairman as founder James Benamor returns to try and restore the fortunes of the struggling company. Chief executive Hamish Paton has agreed to quit after less than five months in the role, while chairman Stephan Wilcke said he will not seek re-election at Amigo’s annual meeting next summer. Clare Salmon, chairman of the company’s pay-setting committee, is also set to depart. The clear-out sent shares rising and sparked speculation that the lender could be taken private.
TLW
Tullow Oil (TLW) has been plunged into crisis after it ousted its boss, slashed production forecasts and axed the dividend – sending shares crashing to a 20-year low. The Africa-focused business’s stock fell 71.8% to its lowest since 1999, wiping £1.4bn off the value of the company as chief executive Paul McDade and exploration director Angus McRoss quit by mutual agreement. The firm – which was worth £14bn at its peak in 2012 – is now the biggest percentage faller on the FTSE 350 this year barring companies which have gone into administration. It will trigger massive paper losses for thousands of retail investors, who hold around 15% of Tullow’s stock between them.
JE.
The £5 billion bidding battle for Just Eat (JE.) is heading for a Christmas showdown, with both suitors under mounting pressure to sweeten the terms of their competing offers for the food delivery group. Takeaway.com, the Dutch peer tabling a recommended all-paper bid, is facing calls to give Just Eat shareholders as much as 58% of the enlarged share capital, up from the present 52%, while Naspers is tipped to have to lift its cash offer to at least 800p. The South African technology group, bidding via its Dutch subsidiary Prosus, finally bowed to the inevitable yesterday by raising its cash offer from 710p a share to 740p. However, it failed to land a knockout blow, as some of the British group’s biggest shareholders immediately rejected the £5.1 billion offer.
TLW
Tullow Oil (TLW) shares plummeted by more than two thirds yesterday after the company axed its chief executive, cut production guidance and suspended its dividend. Tullow said that Paul McDade, its chief executive, and Angus McCoss, the exploration director, had resigned by “mutual agreement and with immediate effect”. Dorothy Thompson, the company’s chairwoman, said that the board were disappointed with the performance of the oil producer and were responding with “decisive action”. Mrs Thompson, 59, will become Tullow’s executive chairwoman on a temporary basis in the wake of the departures of Mr McDade, 56, who has been with the company since 2001 and has been its chief executive since 2017, and Mr McCoss, 58.
SLA
A net £30.8 million was withdrawn from one of Britain’s biggest property funds last Friday after the gating of a rival fund. Morningstar, an information group that monitors fund flows, said that the money had been pulled from the Aberdeen UK Property fund and that it had come after a net outflow of £31.6 million on Wednesday, but one of only £480,000 on Thursday. The fund, managed by Standard Life Aberdeen (SLA), is among several seen as being vulnerable to redemptions after M&G suspended trading in its £2.5 billion Property Portfolio fund. Some investors, institutional and retail, are said to be scrambling to pull out their money, fearing that it could be locked in funds for months.
TSCO
The potential sale of Tesco (TSCO) multibillion-pound Asia business could lead to a bumper payout for investors, prompting shares in the retailer to rally. The supermarket chain confirmed yesterday it is considering a disposal of its retail operations in Thailand and Malaysia as part of a review of its business in the region after “inbound interest” from prospective buyers. The business is valued at about £6.8 billion. Analysts at Bernstein said that a deal could result in a special dividend or share buyback, while Shore Capital’s team said that they expected any deal “to involve substantial sums, which could result in a material distribution to shareholders”. Analysts at Jefferies said: “With no obvious internal competing uses for this capital, shareholders should reasonably expect very sizeable exceptional distributions.”
HSBA
A further exodus of senior figures is looming at HSBC Holdings (HSBA) as the bank strives to overhaul its business and boost profits. Marc Moses, its chief risk officer, will leave in January while Andy Maguire, the lender’s chief operating officer, is also going and Samir Assaf, head of the investment bank, is taking on a different role. The moves come after the dismissal in August of John Flint, 51, as chief executive by Mark Tucker, who became the first outsider to hold the chairman’s role at HSBC in October 2017. Mr Tucker has overseen sweeping changes to the bank’s senior management in Britain and its trouble-hit American business.
SNR
Senior (SNR), a British-based supplier of components to Boeing, Airbus and Rolls-Royce could be sold off. Senior, a quoted precision engineer, has indicated that it is willing to listen to offers for its aerostructures business in a deal that analysts said could raise £450 million. The news follows the sale of Cobham, another British aerospace group, to an American private equity firm. The news helped the shares to pull up from the near-eight-year lows at which they have been trading, closing up 12½p at 190½p.
AMGO
The founder of Amigo Holdings (AMGO) has staged a boardroom coup that prompted the sudden resignations of its chairman and chief executive, plunging Britain’s biggest guarantor lender into turmoil. Hamish Paton, who became chief executive in July, stepped down yesterday and Stephan Wilcke, the chairman, will go at the annual shareholder meeting next year. Amigo said that a third director, Clare Salmon, who chairs the board’s remuneration committee, also would leave “at the first suitable opportunity”. The exodus came as James Benamor, Amigo’s founder and controlling shareholder, appointed himself and Kelly Black, one of his lieutenants, to the board as non-executive directors. It marks Mr Benamor’s return to Amigo after standing down as a non-executive in September last year, three months after the lender’s flotation.
PFG
Provident Financial (PFG) has turned to the chief financial officer of Secure Trust, the specialist lender, to fill the same role on its board. Neeraj Kapur, 53, will take the job at the doorstep lender in April from Simon Thomas, who is leaving Provident for health reasons. Mr Kapur has been at Secure Trust for eight years and previously worked at Royal Bank of Scotland. His appointment was seen as a boost for Provident in its ambitions to go through the complex process of being allowed by the regulator to use its internal model to assess risk, which could save it money. He also will help to bolster the senior team of Provident, which fought off a hostile takeover bid from Non-Standard Finance, a rival, in June and is striving to move past regulatory investigations into its previous practices.
MKS
Goldman Sachs thinks that investors should buy shares in Marks & Spencer Group (MKS) — a notable U-turn for the investment bank from the gloomy “sell” recommendation that it has held on the retailer for much of the recent past. That has proven to be sound advice. However, Richard Edwards and his team at Goldman believe that the tide has turned, citing an improvement in customers’ opinion of the womenswear collection over the past six months. This has helped to stabilise the number of people shopping at M&S and has led to customers spending more money on each visit. Given the “more positive consumer feedback” and the assumption that M&S didn’t slash prices over Black Friday, as some of its peers did, Goldman’s analysts now estimate that like-for-like sales in the second half will be down by only 0.5% compared with last year, having previously predicted a 2% fall. The fabled double upgrade — from “sell” to “buy” — lifted M&S shares by 7p to 208¼p, although Goldman thinks they are worth closer to 220p.
 
MTRO
Colombia’s richest men has become the biggest investor in Metro Bank (MTRO). Jaime Gilinski Bacal, a banking tycoon acting through Spaldy Investments, now controls 6.1% of Metro shares, making him the largest shareholder. The shares dropped 4¾p to 177½p.