The Government has moved a step closer to waving through the £4billion private equity takeover of Cobham (COB). Business Secretary Andrea Leadsom said she is ‘minded to accept’ a number of pledges put forward by the British defence firm’s US suitor Advent International to ease concerns that the deal poses a threat to national security. But critics hit back at the move, warning it was ‘bargaining away’ Britain’s security and that allowing the deal to go through will do ‘long-term damage’ to the defence sector. In order to get the green light, Leadsom said Advent must ‘continue and strengthen’ existing security arrangements that are designed to protect ‘sensitive government information’. It will have to put Britons in charge of sensitive contracts, as well as maintain and honour any existing contracts for the next five years. And Advent must also inform the Ministry of Defence if it wants to sell all or even just part of Cobham.
easyJet (EZJ) has raked in almost £1.4billion from extra charges over the past year after introducing ‘surge pricing’, which ramps up the cost of booking a seat during busy periods. The budget airline said its so-called ‘ancillary revenues’ jumped by almost 14% to £1.38billion in the year to the end of September. This is equivalent to just under £3.8million a day, and includes income from baggage and seat reservation fees. The carrier said the bonanza was fuelled by the introduction of ‘seasonal pricing on allocated seating’. It has upgraded its system to introduce computer algorithms to regulate its seat reservation fees. This monitors supply and demand, meaning passengers pay more during peak times such as the school holidays and less during quieter periods. Surge pricing is widely used in the travel industry, meaning the cost of holidays can soar when there is high demand.
G4S (GFS) could be booted out of a leading ethical index as soon as next month after it was blacklisted by Norway’s state wealth fund for its human rights track record. The security services group has been a member of the FTSE 4 Good Index – run by the London Stock Exchange Group’s FTSE Russell subsidiary – for the past three years. The index puts an ethical stamp on companies that are judged to be environmentally and socially responsible. But G4S’s inclusion has come under fire after the £780billion Norwegian government pension fund last week excluded it from its investments over an ‘unacceptable risk’ it contributed to abuses against its staff in the Middle East.
Aston Martin Holdings (AML) launches its £158,000 SUV today – hoping the vehicle will revive its fortunes after a disastrous stock market float last year. The 106-year-old car maker will unveil the DBX, which it is aiming at families, at simultaneous events in China and the US. The car features ‘ambient lighting’, ample room in the boot for golf clubs… and can go from zero to 62 mph in 4.5 seconds. Customers will be able to put in orders for the SUV – which has a top speed of 181mph – but they will not receive it until the spring. Aston will make the DBX at its St Athan factory in South Wales. Commercial production will start in the new year.
Shares in AO World (AO.) rose in early trading yesterday despite the retailer’s earnings remaining firmly in the red. The stock, which has taken a bruising in recent months, gained more than 13% to reach 65p on Tuesday after the electricals seller said it is pulling out of the Netherlands after less than four years in the country amid ongoing woes at its European arm. Although the company’s overseas venture racked up widening losses of £13.6million in the six months to October, AO said it will plough on with attempting to turn around its business in Germany until at least the summer of next year. Sales at the ailing European division fell 3.4%. The retailer hailed ‘green shoots’ in the UK, where comparable sales jumped 4.5% and half-year profits nudged up 13% to £7.8million.
easyJet (EZJ) has shaken up the air travel business with a pledge to offset the carbon emissions from the fuel of all of its flights by planting trees and investing in green energy. The budget airline said today it will invest in forestry, renewables and community-based projects to offset its carbon impact. The firm highlighted that it is ‘only an interim measure’ while new technologies are being developed, including efforts to make hybrid and electric planes. ‘Regular fliers often fret about their carbon footprint so EasyJet’s move, at a significant but not unmanageable cost of £25m a year, could pay off, ‘ said Russ Mould, investment director at AJ bell. ‘Well, at least if it is seen as a genuine strategy and not just window dressing.’
Kape Technologies Plc (KAPE) has bought an American online privacy specialist in a £74million deal. The mixed cash and share takeover of Private Internet Access is expected to complete early next year, if regulators give it the green light. Kape’s customer base will almost double to 2m if the deal goes through, and several executives from PIA are expected to stay on the board or in consulting roles.
Shares in Homeserve (HSV) touched a record high after the company told investors it expects to make more money this year. Revenues in the six months to the end of September rose 13% to £458million. Profits edged 2% higher, as business boomed in the US. It also revealed it is plotting an even bigger push into the North American market, where it picked up 13% more customers in the first-half, by spending £108million on a controlling stake in US group Elocal. Homeserve has bought 79% of Elocal, which connects customers with tradespeople, and can buy the rest of the company at a later date. Homeserve said it expects Elocal to add £3.9million to its profits this year, which sent its stock to a record high of 1282p.
Halma (HLMA) barrelled to the top of the Footsie’s leaderboard after it reported a better-than-forecast rise in half-year profits and a revenue jump of 12% on the back of five acquisitions. The company pumped up its first-half dividend to 6.54p per share, up from 6.11p in the same period of last year. Halma’s performance lifted fellow safety group Intertek Group (ITRK), which specialises in product testing and certification. Intertek shares rallied and were also boosted by an upgrade from ‘hold’ to ‘buy’ by Jefferies analysts.
Hammerson (HMSO) was on the up after it sold a retail park in Gloucester for £54million to a local council. It is assumed this is Gloucester City Council, as other local councils have denied they were the buyer, but Hammerson did not name it directly.
The US-China trade war took a bite out of LED maker Dialight (DIA), whose shares crashed as it too released a profit warning and said the uncertainty around its trading relationship with China was a major drag on its performance.
