‘Conflict’ furore after M&S adviser worked for Waitrose on Ocado deal. Marks & Spencer Group (MKS) main adviser on its tie-up with Ocado Group (OCDO) was hired by arch-rival Waitrose to examine the same deal less than a year ago — raising concerns over a potential conflict of interest, the Evening Standard reveals on Tuesday. Investment bank Rothschild was M&S’s lead financial adviser on the £750 million Ocado tie-up unveiled last week. But Waitrose also hired the bank to examine the potential of a formal link between Waitrose.com and Ocado last spring. Sources at Waitrose are refusing to rule out the possibility of legal action against Rothschild after handing over fees last year. “‘Unusual’ is the word I would use — I do think it is unusual that they would have done that work for both parties,” said one source. But a second industry insider said Sir Charlie Mayfield, the chairman of Waitrose’s parent John Lewis Partnership, was “spitting feathers” over Rothschild and veteran dealmaker Nigel Higgins’s involvement. Higgins, whose name was on M&S’s deal announcement last week, is due to take over as chairman of Barclays in May.
Superdry set to cut 200 jobs in drive to save £20 million. Fashion chain Superdry (SDRY) is poised to wield the axe on hundreds of jobs in a cost-cutting drive amid a war with its co-founder, the Standard can reveal. The firm will slash up to 200 jobs, mainly at its HQ in Cheltenham where it has around 1000 staff, as part of short-term efforts to save £20 million. In an internal email to staff, seen by the Standard, chief executive Euan Sutherland said on Monday: “Jobs are likely to change and there will be some job losses.” Ex-Nike executive Phil Dickinson, who joined Superdry only six weeks ago as creative director to replace the business’s co-founder Julian Dunkerton, was given the task of delivering the news to the creative and marketing team. He said: “We need to secure £20 million of operational efficiencies and improvements.”
Debenhams could go into red after fresh profit alert. Ailing Debenhams (DEB) on Tuesday admitted it won’t make as much profit as it said it would just two months ago, casting fresh doubt over its turnaround prospects. The department store chain warned its guidance from January that it was on track to deliver profits for the year of around £8 million “is no longer valid”. It is Debenhams’ fourth profit warning in just over a year and means the company could now even plunge into the red. The retailer added that its same-store sales were down 5.3% for the 26 weeks to March 2. Debenhams secured a £40 million lifeline in February, which bought it some time to renegotiate its debt with lenders. It said today those talks “have now progressed” and expects a decision by the end of the second quarter.
Direct Line beefs up capital buffer ahead of Brexit deadline crunch. The UK’s largest car insurer Direct Line Insurance Group (DLG) beefed up Brexit contingency plans on Tuesday by putting more money aside to protect against a market meltdown. The company, which owns the Churchill and Green Flag brands, said it would raise capital buffers to a ratio of 170%, equivalent to an extra £120 million, calling it a “prudent” measure in the face of political uncertainty. The FTSE 100 giant is a significant investor in UK corporate debt and a plunge in the credit markets could hit the balance sheet. Incoming chief executive Penny James, who replaces Paul Geddes in May, said the company was “comfortable” with its Brexit preparations.
Investors in Vodafone Group (VOD) haven’t heard much good news coming down the line for at least a year. The market has been worried for a while that it won’t be able to afford to keep paying its dividend, the main reason to hold the stock given the slide in the shares. They have almost halved in the past year to levels at which, in the old days, would have seen traders on the blower to tell clients the stock was a raging buy. Today Vodafone said it would raise €4 billion (£3.4 billion) of convertible bonds to help pay for the acquisition of Liberty Global’s assets in Germany, the Czech Republic, Hungary and Romania. That increases the chances of share buybacks, traders bet. That earned Voda the rare honour, lately, of being the biggest riser on the FTSE 100, buzzing up 2.5p to 134p.
Bad news from the UK economy with the latest stats suggesting the economy is close to stalling. If that’s right, some market-watchers believe shares are well overpriced and heading one way only. Left to enjoy all this was insolvency expert Begbies Traynor Group (BEG), where the shares get going when the going gets miserable. It said a “good flow” of firms losing their shirts meant profits should be decent this year.
Walker Greenbank (WGB) today unveiled former Mulberry director Lisa Montague as its chief executive, a move it said completes “the reshaping” of the board. Montague, who was most recently at Aspinal, the leather goods outfit, has “particular strengths in brand development, commercial strategy and international growth”, said chairman Christopher Rogers.
