Rebooted UK-French software merger rewards patience 5 Sep 2017 After two botched attempts in as many years, French industrial group Schneider and UK software maker Aveva are trying to hook up again. The $3.9 bln deal is as complex as it is financially alluring. With past glitches ironed out, the merger has a good chance of becoming reality.
Telefonica’s O2 float is best placed on hold 4 Sep 2017 The Spanish telco has been considering an IPO of its UK arm since regulators blocked a sale in 2016. A legal row over mobile spectrum auctions would complicate pricing, and debt is less pressing since Telefonica cut its dividend. Better to delay than cancel another offering.
Trump may unite Congress – against him 31 Aug 2017 The U.S. runs out of money in a month and the president is attacking lawmakers in his own party. That could prompt Republicans and Democrats to work together to keep the lights on. Plus: Rupert Murdoch could be overpaying for Sky.
Carrefour’s ills demand Tesco-like revamp and more 31 Aug 2017 The French supermarket said full-year operating profit could fall 12 percent, partly due to stiff competition at home. The grocer’s new CEO faces even more challenges than Tesco’s Dave Lewis did three years ago. Domestic market share is shrinking and its online offering is weak.
British banks edge closer to painful PPI clarity 29 Aug 2017 The UK watchdog is encouraging consumers to claim for mis-sold loan insurance by Aug. 2019. If it works, the 36 bln pounds big banks have set aside so far may not be enough. A firm deadline could make the final bill larger but is a necessary step in fixing finance’s reputation.
UK pay clampdown places enduring faith in markets 29 Aug 2017 The government will force companies to disclose how much their CEOs are paid relative to their workers. The move to restore public faith in business relies on shareholders to hold firms to account. But past efforts to improve transparency have failed to check corporate excess.
Consumer giants’ disclosure is near sell-by date 25 Aug 2017 Firms that make food and personal-care products are pouring money into startups and young brands. Unilever, the most acquisitive, has made 15 such deals since 2014. Yet they don’t give investors enough information to judge their dealmaking nous. It could be their loss.
Accounting revamp does European banks a favour 25 Aug 2017 Changes that come into force in 2018 will force lenders to provision for bad loans in a new way. Banks say earnings will be more volatile as a result. Perhaps at the outset. But the switch will also make them safer and lower their cost of capital over the economic cycle.
Deutsche sets tone for painful analyst price war 24 Aug 2017 Deutsche Bank has halved the going rate for its fixed-income research, which clients must soon pay for separately under new European rules. Banks may have to give even more ground. Buyers will only get more demanding – and may want to pick which boffins they really need.
Dixons double whammy is surprise that wasn’t 24 Aug 2017 The UK electronics retailer’s shares fell 30 percent after profit guidance was cut. The main culprits, EU roaming rules and a Brexit-linked consumer slowdown, were known risks. Analysts and the company underestimated their impact. Too much faith in forecasts breeds market jolts.
WPP underestimates pinch from corporate austerity 23 Aug 2017 The ad group cut its 2017 net sales guidance, blaming lower spending by consumer-goods giants which make up about a third of revenue. Boss Martin Sorrell reckons this will reverse. The danger is that zero-based budgeting and shareholder activism make frugality the new normal.
Murdoch’s Sky bid looks ever less rational 22 Aug 2017 The media mogul’s Fox last year offered 11.7 bln pounds for the 61 pct it doesn’t own of the pay-TV firm. Sky’s subscriber growth has since slowed and a regulatory review has brought political heat. It may not stop him, but Rupert Murdoch will struggle to make the deal pay.
Provident Financial kneecaps cash-greedy investors 22 Aug 2017 The door-to-door lender slashed its profit forecast, ousted its CEO and is under investigation from the UK authorities. Worse still, the dividend yield just fell from 8 percent to zero. Yield-chasing funds had fair warning the company was living beyond its means.
O2 – and Britain – are losers in 5G spectrum fight 21 Aug 2017 Telecom operators BT and CK Hutchison’s Three are threatening legal action over planned auctions of mobile spectrum. The rules are sturdy enough to promote competition and a court fight could delay the rollout of superfast 5G internet. Rival O2 and Britons have the most to lose.
Unilever can butter up price for margarine unit 18 Aug 2017 Private equity consortiums are reported to be circling the Anglo-Dutch giant’s spreads business. A bidding war and the rich price paid for Reckitt’s food brands may help Unilever pocket more money. But unappetising returns await any buyer who pays more than 7 billion pounds.
Britain tries Trojan Horse trade tactic in Ireland 17 Aug 2017 The EU wants the Northern Ireland border issue resolved before the UK’s wider exit terms can be agreed. New proposals from London effectively couch Britain’s trade agenda in concern for the peace process. Having Dublin onside raises the chances of Britain getting what it wants.
UK bank upstarts are already priced for downturn 17 Aug 2017 Shares in buy-to-let lenders, such as Aldermore, have fallen in the past three months due to fears about the housing market. Even if more loans sour, these newcomers can grow earnings by wresting market share from older high-street peers. The drop in their valuation is overdone.
Hadas: A lesson for the Brexit mess from Obamacare 16 Aug 2017 The British vote to leave Europe and the vow by Republicans to cut back government health insurance were triumphs of dreams over reality. Facing the unpopular prospect of actually reducing benefits, the Americans blinked. The UK, with even worse choices, could do the same.
British wage mystery has non-British explanation 16 Aug 2017 The jobless rate has fallen to 4.4 percent, its lowest in over four decades, yet wage growth is tepid. Two things help explain the anomaly: a pool of people on zero-hour contracts available to switch into permanent jobs, and a surprising rise in EU nationals working in the UK.
Lloyds has a good get-rich plan 15 Aug 2017 The lender is considering a push into wealth and savings products. A capital idea. Lloyds’ 2,000-strong branch network gives it a head start over rivals. And while CEO Antonio Horta Osorio has done a good job at cutting costs, it’s high time he did more to grow revenues.