GlaxoSmithKline (GSK) and US rival Pfizer are bringing some of the world’s best-known healthcare brands under one roof – creating a powerhouse worth up to £50billion. The two firms will merge their consumer healthcare arms, paving the way for the break-up of Glaxo under chief executive Emma Walmsley. The new company will be based in the UK and specialise in over-the-counter products such as painkillers, vitamins and toothpastes. It will bring together brands such as Glaxo’s Sensodyne, Voltaren and Panadol with Pfizer’s Viagra and Advil, and have annual sales of £9.8billion. Analysts said the company, which will be 68%-owned by Glaxo with Pfizer taking the remaining 32%, will be worth between £30billion and £50billion. Within three years of the tie-up, the business will be spun off and listed on the stock market as a separate company, marking the break-up of Glaxo.
Brexit-supporting Wetherspoon boss Tim Martin blasts MPs for having ‘no knowledge’ of customs union cost to consumers. Tim Martin, the chairman of pub group Wetherspoon (J.D.) (JDW), has written a letter to every single MP in the country explaining his dismay that many politicians do not seem to know how the customs union works. Brexit-supporting Mr Martin claims a high proportion of politicians have ‘no knowledge’ of how the system operates. Mr Martin said: ‘The customs union is an undisguised protectionist system that imposes import taxes on 12,651 non-EU imports, including oranges, rice, bananas and children’s clothes and shoes. ‘The customs union pushes up prices for consumers and the tariff income is collected by the UK Government and is sent to Brussels. ‘It is worrying that MPs have no knowledge at all as to how the customs operates and how it costs their constituents every day.’
Oil giant BP (BP.) has fired the starting gun on the sale of some US assets to help pay for a swoop on this year. The sale of oil and gas fields across states including Texas, New Mexico, Colorado and Oklahoma could raise more than £2.4billion, to be put towards the £8.3billion acquisition of BHP’s US shale assets. It has previously said it would sell £4billion to £4.8billion worth of assets to fund the deal. BP paid around half the £8.3billion in October and said it planned to settle the bill over the next six months.US buyout funds Carlyle and Warburg Pincus are said to be interested. The London-listed oil major’s profits thundered to a five-year high in the third quarter.
Interserve (IRV) shares headed back towards record lows after it merged two units and said one of its managing directors will leave next month. The struggling government contractor merged its citizen services arm with its support services division, which is managed directly by chief executive Debbie White. Citizen services has a sprawling remit, handling everything from the rehabilitation of low-risk offenders to education and workplace training, while support services manages outsourced facilities. Interserve said that the current managing director of citizen services, Yvonne Thomas, will leave the company at the end of December to set up a new venture.
Gulf Marine Services (GMS), which provides giant vessels to help oil and gas companies build offshore rigs, plunged as it warned it could breach its debt obligations. Though results for the year would be broadly in line with its guidance, it said delays in signing contracts meant they would be pushed into 2019. This would cause it to breach lending conditions, it said, which would mean its bank could ask for money back or impose penalties.
Investors in airline Flybe Group (FLYB) received some festive cheer as Virgin Atlantic confirmed it was still interested in buying the company. Flybe shares soared by 10.5%, or 1.6p, to 16.8p after Virgin said it was holding discussions with a view to a potential takeover. Though Virgin emphasised there was no certainty a deal would ensue, investors seemed willing to take the chance. But interest from Virgin, and rumours that Southend Airport owner Stobart Group Ltd. (STOB) and British Airways’ parent International Consolidated Airlines Group SA (CDI) (IAG) could be sniffing around, have caused shares to climb 45% since it put itself up for sale in November.
Kier Group (KIE) sank ahead of the issue of its new shares today, which will probably leave the investment banks who supported it holding large chunks of stock. Kier was aiming to raise £250million from selling new shares for 409p each, to pay down its debt pile. Banks including Numis, Peel Hunt, Citi, HSBC and Santander acted as underwriters, meaning they agreed to shell out for any shares which they weren’t able to sell to investors. The banks will have to write hefty cheques says Sky News, which reported a lack of demand would leave them with around £75million worth of Kier shares.
Gambling firm 888 Holdings (888) was in the money, as it said growth was strong in all of its main markets and earnings for the year were on track. The business, which operates online casinos and bingo games, has recently launched its sports betting site in the US after lawmakers legalised the activity. Shares were up 6.9%, or 11.7p, to 181.7p as chief executive Itai Frieberger said he was ‘excited by 888’s long-term growth prospects’. The positivity pushed some traders to take a punt on Rank Group (RNK), which operates Grosvenor Casinos and Mecca bingo. Its shares climbed 6.1%, or 8.6p, to 150p.
Online clothing giant ASOS (ASC) continued to fall following Monday’s shock profit warning, despite another director buying shares. Chief executive Nick Beighton and chairman Adam Crozier tried to signal their confidence in the company by buying almost £200,000 worth of shares between them on Tuesday. Non-executive director Hilary Riva bought 557 shares yesterday worth £26.90 each, but that failed to boost their price. Asos sank another 12.3%, or 319p, to 2281p.
Broker Cenkos Securities (CNKS) looks to be ending the year on a positive note, after a torrid 12 months which has seen the resignation of its finance director, its chairman and its chief executive. After reporting falling revenues and only marginal profits in its half-year results in September, Cenkos said revenues have since improved and profits would beat current expectations.
