Marks & Spencer poised to seal Ocado deal to create £1.8 billion joint venture. Marks & Spencer Group (MKS) and online retailer Ocado Group (OCDO) on Tuesday confirmed plans for a ground-breaking joint venture first revealed by the Evening Standard. M&S will pay Ocado between £800 million and £900 million for a 50% stake in the new concern, giving it a food delivery service for the first time, according to sources close to the deal. The two firms – which have been in frantic talks for the past month over the tie-up – admitted the talks following the Standard’s story. Shares in Ocado spiked 10%, or 92p, tp 978p, with Marks & Spencer up 3% to 303p following the news. The two firms have been in frantic talks for the past month over the tie-up.
Babcock dives after a £10m Brexit restructuring hit. Babcock International Group (BAB) shares fell on Tuesday after revealing a £10 million-plus Brexit hit from restructuring its continental air-rescue business. The under-fire defence contractor, hit by aggressive short-seller Boatman Capital last year, will take the one-off tax charge in 2019 after setting up separate subsidiaries across Europe to carry on aerial firefighting and search-and-rescue missions. Costs to maintain the set-up are also likely to be £10 million from 2020. Chief executive Archie Bethel said the restructure was necessary to remain compliant with aviation regulations “post-Brexit, even in a no-deal scenario”.
We’re keeping the banks sweet to expand, says boss of Hotel Chocolat Group (HOTC). The boss of Hotel Chocolat on Tuesday said that he is prepared to ask its banks to advance extra cash to turbocharge the posh chocolatier’s expansion. Chief executive Angus Thirlwell, who is growing the business in America and Japan, said: “Cash generation is very strong, but if we need to find other ways to go faster, we will. “If it’s right to take on bank debt, we’ve got multiple sources to go to for that.” Revenue increased 13% to £80.7 million and underlying profits grew 10% to £17.3 million for the second half to December 30. Sales have been boosted by sales of its new hot chocolate machine — the Velvetiser, which costs £99.99.
Derwent London raises dividend as boss praises office market. The outgoing property veteran boss of Derwent London (DLN) on Tuesday shrugged off Brexit and praised the capital’s bullish office market as the firm hiked its 2018 dividend. The FTSE 250 firm, which John Burns has led since the 1980s, secured £26.8 million of new lettings last year. Burns, who steps down in May to become non-executive chairman, said the office market “is still pretty solid” despite political uncertainty. He pointed to the 240,000 square feet Brunel Building in Paddington, which Derwent London will have completed construction on later this year. Deals for 77% of the space have been signed and the rest of the property is under offer. Burns said a number of would-be tenants are “disappointed” to have missed out.
New Persimmon boss on the back foot over £1bn profits. New Persimmon (PSN) boss Dave Jenkinson was forced to defend the firm’s battered reputation on his first day in the job full time on Tuesday as the controversial housebuilder racked up £1 billion in profits for the first time. Recent reports have suggested the company could be ejected from the Government’s Help to Buy subsidy scheme amid concerns from the Communities Secretary James Brokenshire over its behaviour following a string of complaints. Persimmon has faced attacks over the quality of its homes as well as the sale of new-builds with exorbitant ground rents, while the row over the bonus scheme for former boss Jeff Fairburn, originally £100 million, overshadowed trading last year. The Government recently extended the support scheme until 2023 although ministers have yet to decide which firms will be allowed to offer Help to Buy homes from 2021. On the threat of being ejected from a scheme which accounted for 48% of Persimmon’s sales last year, Jenkinson said: “I don’t think there is a real prospect of that happening.” Persimmon has a meeting with the ministry and “I’m sure that this is an issue we will discuss with them”, he added. He said it was “very difficult to answer” on the potential impact of being banned from Help to Buy sales.
Tekmar Group (TGP), which makes protective kit for subsea cables, said it has signed a new contract worth £3 million. The firm refused to say who the contract is with other than that the customer is a UK offshore wind farm company.
Morses Club (MCL) the credit lender said it had acquired Curo Transatlantic out of administration for £8.5 million. The business, which trades as WageDayAdvance, was a provider of online loans in the non-standard credit market. Half of the consideration would be paid on the deal’s completion, with the other half to be paid over five months. ‘This acquisition fits well with the Company’s stated strategic priority to increase its online offering in response to a growing demand,’ Morses Club said.
Amur has one of the largest undeveloped nickel sulphide projects in the world. It has revealed details of a pre-feasibility study for its Kun-Manie nickel project in Russia’s Far East. The study outlines two production scenarios capable of processing six million tonnes of ore per annum. The first option is the toll smelt option which provides the swiftest path to revenue generation. In this scenario, it’s envisaged that concentrate will be sold to a purchaser. The second option is for Amur Minerals Corporation NPV (AMC) to construct and operate an electric furnace/flash smelter that will convert concentrate to low grade matte. This option allows for the capture of additional revenues from the by-product metals of copper, cobalt, platinum and palladium.
