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Biz secretary expects Royal Mail takeover to be called-in for government review
Jasper Jolly
Business secretary Jonathan Reynolds has said that he expects the government to call in the proposed £3.6bn takeover of Royal Mail by Czech billionaire Daniel Kretinsky for review .
Reynolds said he will talk to Kretinsky about the bid this week, speaking to reporters at the Farnborough International Airshow.
“I think it would be reasonable to expect it to be called in,” he said, pointing to the previous review when Kretinsky first increased his shareholding.
Reynolds said unions were holding talks with Kretinsky today.
He added that he would look at how he government could receive binding assurances from Kretinsky.
Fundamental to this is, what is the business plan, what does it mean for the UK’s core national interests.
Key events
European indexes are solidly in positive territory, having made further gains throughout the session.
We’re likely seeing a bit of relief as (a) the IT chaos starts to wind down, and (b) higher prospects of a potential Democratic win raise hopes that the US won’t hike trade tariffs and enter into a new era of Trump protectionism.
Here’s how we’re looking across Europe:
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FTSE 100 is up 0.9%
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FTSE 250 is u 0.75%
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Germany’s DAX is up 1.5%
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France’s CAC 40 is up 1.37%
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Italy’s FTSE MIB is up 1.07%
Vivendi plans to float its French TV business Canal+ in London, providing a shot in the arm for the capital’s stock exchange after a number of high-profile companies opted for rival international financial centres such as New York.
The move is part of a drive to break up the media conglomerate controlled by the billionaire Vincent Bolloré to realise value from its different operations.
Vivendi said the decision to list in London reflected the increasingly international operation of Canal+, which is in the process of a $2.9bn (£2.2bn) takeover of Africa’s largest pay-TV operator, Multichoice.
Vivendi said:
With close to two-thirds of its subscribers outside of France, a film and TV series distribution network present on all continents, and growth drivers resulting from its recent developments on the African, European and Asia-Pacific markets, a London-based listing would represent an attractive solution for international investors likely to be interested in the group.
Vivendi’s plan will be a welcome one after a series of setbacks for the London Stock Exchange in recent years.
The most high-profile company to snub the capital was theCambridge-based chip designer Arm, one of the UK’s few bona fide global tech success stories, which chose to float on the Nasdaq in New York last year in one of the biggest initial public offerings in recent years.
In February, Tui, Europe’s biggest package holiday operator, moved its stock exchange listing from the FTSE 250 to Frankfurt.
The building materials group CRH, one of the biggest companies on the FTSE 100, moved its primary listing to the US, following the UK-based plumbing equipment supplier Ferguson.
Read more:
Sarah Butler
The Carpetright brand and 54 of the flooring retailer’s stores are being bought by its rival Tapi Carpets and Floors in a deal that will save 300 jobs.
The multimillion-pound deal, which is expected to be finalised on Monday, does not include Carpetright’s head office in Purfleet, Essex, or 220 further shops, and will result in about 1,000 job losses.
The advisory firm PricewaterhouseCoopers has been looking for a buyer for Carpetright after it filed a notice of intention to appoint an administrator earlier in July.
Tapi has been a bitter rival to Carpetright since it was co-founded in 2015 by Martin Harris, the son of “carpet king” Lord Harris of Peckham. Harris launched Tapi a year after he and his father stepped down as directors of Carpetright, which Lord Harris founded in 1988.
Harris left Tapi earlier this year, while Lord Harris remains an investor and adviser to the business.
The acquisition of Carpetright would enable Tapi to expand into a number of new areas, the company said. Lord Harris continues to have a role on the board of Tapi, which he co-owns with about 1,000 investors, the largest of which is the executive chair, Will Barker of US investment firm Camelot Capital Partners.
Tapi, which has 170 stores, said in a statement that it was “desperately sad not to have been able to save more of the business and customer orders”.
Jeevan Karir, the managing director of Tapi, added:
Our goal, initially, was to try to save all of Carpetright. However, as we looked into the details of the situation, we quickly established that saving the entire business was unviable. The business has been materially loss making for a number of years and it has significant debt held by the owner.
Read more:
Futures are pointing to a strong start for stocks when US markets open for trading in about an hours’ time:
Dan Coatsworth, an investment analyst at AJ Bell, said it was a sign that markets were welcoming President Biden’s decision to pull out of the running for a fresh term in office.
However, he warned over a fresh bout of volatility, despite Biden’s decision to endorse his VP Kamala Harris as the potential Democrat nominee:
We could see heightened volatility over the next few weeks, with assets quickly changing direction depending on the latest comments from Washington.
Kamala Harris looks likely to be the Democratic nominee and while she might score better than Biden in the polls ahead of the election, there is still considerable uncertainty for investors to navigate as the nomination process plays out and election campaigning enters its final stage.
Gains for Bitcoin, which jumped on the prospect of a Trump win after the presidential nominee’s attempted assassination, have eased slightly on the Biden news, though it is still up around 0.8% against the US dollar. The cyptocurrency is expected to benefit from a potential unwinding of regulation under a prospective Trump presidency.
Coatsworth said:
Many investors will have looked at Trump’s ratings boost in the polls last week and placed trades on assets that could benefit if he returned to the White House. That included cryptocurrency, explaining why bitcoin has now pulled back on the news of Biden stepping down in the presidential election.
The so-called ‘Trump trade’ assumed a boost for corporate profit but increased pressure on the US fiscal situation and a kicker for inflation if the former president won this year’s election. A victory also implied heightened geopolitical tension given Trump’s track record of being outspoken.
Biz secretary expects Royal Mail takeover to be called-in for government review
Jasper Jolly
Business secretary Jonathan Reynolds has said that he expects the government to call in the proposed £3.6bn takeover of Royal Mail by Czech billionaire Daniel Kretinsky for review .
Reynolds said he will talk to Kretinsky about the bid this week, speaking to reporters at the Farnborough International Airshow.
“I think it would be reasonable to expect it to be called in,” he said, pointing to the previous review when Kretinsky first increased his shareholding.
Reynolds said unions were holding talks with Kretinsky today.
He added that he would look at how he government could receive binding assurances from Kretinsky.
Fundamental to this is, what is the business plan, what does it mean for the UK’s core national interests.
The GMB union says the Harland and Wolff shipyard is “critical” to the UK’s future security.
GMB National Officer Matt Roberts said:
These are worrying times for workers and their families in Northern Ireland, Scotland and the South West.
These yards have been at the heart of UK manufacturing for centuries – from building the Titanic to the ships that defeated the Armada.
Now they are critical to our future security in building the Fleet Solid Support ships for our navy and in providing the renewables infrastructure needed to reach net zero.
These yards must be saved and their long-term sustainable future secured.
The Labour government says it is going to hold out for a “market” saviour to rescue Harland and Wolff, business secretary Jonathan Reynolds adds.
Extended comments from Reynolds released on the parliamentary website explain:
The Government believes, in this instance, that the market is best placed to resolve the commercial matters faced by Harland and Wolff.
Harland and Wolff indicates that these discussions on new financing should conclude in the next few days. This will involve the current CEO taking an immediate leave of absence and the onboarding of new management with a focus on recapitalisation and ensuring sustainable finances.
Reynolds adds that officials will work closely with the Ministry of Defence and National National Shipbuilding Office on the fleet solid support contract, for which Harland and Wolff remains a key subcontractor:
Officials in the Ministry of Defence are also well engaged with the prime contractor, Navantia, UK to monitor delivery of this important contract.
I welcome potential new financing for Harland and Wolff and the appointment of new management and wish them all the best in their continued efforts to build up this business.
UK biz secretary ‘confident’ that struggling shipyard Harland and Wolff will still build for Royal Navy
Jasper Jolly
Business secretary Jonathan Reynolds has said he is confident that the Harland and Wolff shipyard in Belfast will build ships for the Royal Navy.
Harland & Wolff is part of a consortium that is due to build three naval fleet solid support ships to supply aircraft carriers.
But the guarantee would have put taxpayer money at risk if the shipyard fails.
Speaking to reporters at the Farnborough air show, Reynolds said:
It was clear that would not have been a prudent use of government money.
However, asked if he was confident that Royal Navy ships would be built in Belfast, he answered simply:
Yes.
His confidence will be a boost to the workforce in Belfast and at H&W’s other shipyards in Devon and Scotland. However, he said he expected a “market-led solution” to refinancing the company’s large debt load.
The shipbuilder was forced to suspend its London-listed shares a fortnight ago, raising concerns about its future. It has missed two deadlines to file audited accounts, raising questions over its finances and its ability to fulfil a £1.6bn contract to build the three “fleet solid support” ships that will carry supplies such as ammunition and food to the navy’s aircraft carriers.
The crisis is viewed as the first significant test of industrial policy for the new Labour government in London.
You can read more background from our story last week:
Ex-Tory chancellor Nadim Zahawi preparing £600m bid for Telegraph – Sky News
EXCLUSIVE: Nadhim Zahawi, the former Tory chancellor, is sounding out billionaire investors about backing a bid for The Daily Telegraph and The Spectator magazine in a move which could up-end the auction of some of Britain’s most influential media assets. https://t.co/MGCxbZIB9I
— Mark Kleinman (@MarkKleinmanSky) July 22, 2024
Citing City sources, Sky says the Reuben family, which owns a vast swathe of property assets and a stake in Newcastle United Football Club, was among those to have been sounded out by Mr Zahawi in recent weeks.
The identity of Mr Zahawi’s other prospective backers was unclear, it said.
Zahawi is understood to believe that the Telegraph has significant scope to boost its profitability by expanding in the US, Sky added.
While is not yet thought to have submitted a formal offer, the report says he is confident of securing sufficient financing firepower to table a competitive bid.
CEOs from BA-owner IAG and Air India have been commenting on their own performance, surely in a bid to reassure shareholders, after the drop in Ryanair profits spooked investors.
IAG’s CEO Luis Gallego has said – according to Reuters – that corporate travel i still recovering but that demand is strong in its core north and south Atlantic markets.
Air India’s CEO Campbell Wilson, meanwhile, has said that the international market was ‘moderating’ for th next six months, but that the domestic market was strong.
More warnings about recovery time for the health sector after the CrowdStrike IT outages.
The British Medical Association (BMA) said GPs will “need time to catch up from lost work over the weekend”, adding that NHS England should “make clear to patients” this is the case.
The BMA said its GP committee will continue to talk to NHS England and patient record system supplier EMIS to secure a “better system of IT back-up” to ensure the “disaster” is not repeated.
Dr David Wrigley, deputy chairman of GPC England, the representative body for GPs at the BMA, said:
Friday was one of the toughest single days in recent times for GPs across England. Without a clinical IT system many were forced to return to pen and paper to be able to serve their patients.
While GPs and their teams worked hard to look after as many as they could, without access to the information they needed much of the work has had to be shifted into the coming week.
GPs have been pulling out all the stops this weekend to deal with the effects of Friday’s catastrophic loss of service and, as their IT systems come back online, we thank them and their staff for their hard work under exceptionally trying circumstances.
We also thank patients for bearing with general practice in this unprecedented situation.
Pharmacy services are expected to be “slower than usual” today as the recovery from the major global IT outage caused by the CrowdStrike update failures continues.
Nick Kaye, chairman of the National Pharmacy Association (NPA), said:
As pharmacists recover from last week’s IT outage and catch up on the backlog of prescriptions, we expect service in some community pharmacies to be slower than usual today.
Please be patient with your local pharmacy team if you are visiting them, as they may still be prioritising emergency prescriptions from their local GP surgeries as well as experiencing increased demand as services return to normal.
As ever, community pharmacies have worked hard to provide support for those who need them during this period.
Commenting on the global travel chaos caused by the CrowdStrike IT failures, Ryanair CEO Michael O’Leary said the airline had 400 cancellations this weekend, mainly due to the fallout from Friday’s IT issues.
