| The economy will pick up speed by 2021 if headwinds from Brexit are lifted, according to the CBI’s latest forecast. It predicted that GDP could be 1.8% by 2021, after more modest expansion of 1.3% this year and 1.2% in 2020. The CBI forecasts are based on the “assumption that Britain leaves the EU by January 31 next year and has clear line of sight to an ambitious trade deal” and that such a deal must involve “alignment with EU rules where essential for frictionless trade”. In the event of prolonged uncertainty over Brexit next year followed by a no-deal the following year, the CBI said growth would be 0.4%. | |
 | American hedge funds are trying to halt one of Britain’s largest takeover deals this year. And like opponents of Brexit, their argument is that shareholders were not in possession of the full facts the first time around and deserve a second vote. The battle over Inmarsat (ISAT), the British satellite communications provider, reaches its denouement tomorrow when a court hearing begins that was supposed to rubberstamp the company’s £2.6 billion acquisition by a consortium that includes Warburg Pincus and Apax Partners. Investors approved the deal by 79% in May. However, hedge funds, including Oaktree Capital, a Los Angeles-based investor founded by billionaire Howard Marks, have objected. |
 | Hiscox Limited (DI) (HSX) is on course to be booted out of the FTSE 100 in the quarterly reshuffle this week. The company’s share price has fallen by 12% since the beginning of September. Last month it warned on its outlook after setting aside $165 million to cover claims arising from hurricane Dorian in the Bahamas and two typhoons in Japan. Its bosses got in trouble with the Financial Conduct Authority shortly after the warning because of concerns that a select group of analysts had been given price-sensitive information as they rushed to cut their estimates. |
| The buyout consortium attempting to take the satellite operator Inmarsat (ISAT) private faces an unprecedented legal challenge from hedge funds that threatens to shake up the City. A group of speculators have acquired significant stakes in Inmarsat since it agreed to a $6bn (£4.6bn) private equity takeover led by Apax Partners and Warburg Pincus in March. At a hearing on Tuesday, they will urge the High Court not to sanction the standard legal mechanism due to finalise the deal, known as a scheme of arrangement. The hedge funds claim that Inmarsat is being sold too cheaply because it is due to open a lucrative new revenue stream if its American partner wins a crucial regulatory approval later this month. |
 | Just Eat (JE.) has opened talks with the City’s takeover referee as expectations rise that its two suitors will face off in a rare head-to-head auction over Christmas. Sources said that representatives from the delivery giant and the Takeover Panel are in discussions to lay the groundwork if Takeaway.com and Prosus fail to submit best and final offers to investors by Dec 27. Thereafter, strict City rules stipulate that regulators will take control of a five-day auction potentially ending in sealed bids. Prosus, the Dutch arm of South African internet titan Naspers, gatecrashed Just Eat’s all-share merger with Takeaway.com by pitching a £5bn cash approach in October. |
 | is facing a backlash against its pay plans when shareholders meet to vote on its takeover of Galliford Try (GFRD) residential business. Leading shareholder advice group ISS has raised “significant concerns” about plans to increase potential bonus payouts. ISS is recommending shareholders vote against the changes at a meeting tomorrow. The new bonus plan is being put in place as Bovis Homes transforms into the country’s fourth largest housebuilder, producing up to 12,000 homes per year. It struck a £1bn deal in November to buy Galliford Try’s Linden Homes and Partnerships and Regeneration business, having sweetened an earlier all-share offer with £186m in cash. |
 | Questor: hold on to IMI (IMI) as the new boss unveils his ambitious targets for the business. Questor share tip: the engineering group aims to boost margins and sell off less promising parts of its business |
| Private equity barons trying to take Inmarsat (ISAT) private are facing a High Court legal challenge from hedge funds pushing for a higher price. A group of speculators has built stakes in the satellite operator since it agreed a $6bn (£4.5bn) take-private deal led by Apax Partners and Warburg Pincus in March. The group, led by Oaktree Capital, will urge the High Court not to approve the standard legal mechanism to finalise the deal, known as a scheme of arrangement. The challenge, first reported by The Sunday Telegraph, aims to force Apax and Warburg to up its offer to reflect potential income worth hundreds of millions of dollars from a separate venture, Ligado, which has sub-licensed radio frequencies from Inmarsat. |
 | Insurer Hiscox Limited (DI) (HSX) looks set to crash out of the FTSE 100 this week, to be replaced by rejuvenated budget airline easyJet (EZJ). The Lloyd’s of London insurer, which has been hit by storm damage claims and fears over ballooning casualty payouts, is expected to be demoted from the leading index of listed companies on Wednesday. Its shares have dropped by 23% since the summer, including a fall early last month when it revealed it had set aside $165m (£125m) for claims from hurricane Dorian, which hit the Bahamas, and typhoons Faxai and Hagibis, which devastated Japan. The reshuffle by FTSE Russell, which compiles the index, is likely to see a return to the top tier for easyJet after a six-month absence. |
 | Barclays (BARC) could cut in half the pension payments made to its chief executive, Jes Staley, after investor pressure to bring them in line with the rest of the bank’s workforce. Staley received an annual cash payment of £396,000 last year in place of a pension in order to avoid taxes on pensions for higher earners. That could fall by as much as £200,000 under plans reportedly being shared with shareholders before a new remuneration policy due in February. Staley’s pension payments were equivalent to 17% of his total fixed salary in 2018, and under the proposals would fall to about the same level as the 10% paid to other Barclays staff. A Barclays source said pension contributions across the business would rise from 10% to 12.5% of salary. The changes, first reported by the Financial Times, would bring Barclays in line with the other major British banks, which have also faced pressure to stop outsized pension perks in the wake of an updated corporate governance code that said bosses’ pension contributions should be in line with the rest of the workforce. |
 | Virgin Money Holdings (UK) (VM.) has nearly doubled the pay of its chief executive to £3.4m after the bank was pushed to a second consecutive annual loss by a £385m charge for mis-sold payment protection insurance. David Duffy’s pay jumped by 84% from £1.8m in 2018, despite an investor revolt in January in which a third of shareholders opposed the bumper payout. The big increase was driven largely by a bonus of £1.3m linked to the 2015 demerger of Virgin Money’s predecessor bank, CYBG, from National Australia Bank, as well as incentives from 2016. Duffy’s base salary was worth £1m, according to the bank’s annual report, published late on Thursday. |
 | At least 30 Bonmarche Holdings (BON) stores are to close next month with the loss of about 240 jobs, as previous owner Philip Day prepares to buy back the remaining chain out of administration. The Peacocks chain, which is part of Day’s Edinburgh Woollen Mill group, has been named by administrators at FRP advisory as preferred bidder for Bonmarché, which continues to trade from 285 stores. The deal would hand back ownership to Day, whose Spectre investment vehicle took control of Bonmarché shortly before it fell into administration in October. FRP, which has been seeking a buyer for the fashion chain, said it had considered “numerous offers from a range of interested parties for all or parts of the business” but believed the Peacocks bid was the best on the table. |
| Virgin Money Holdings (UK) (VM.) CEO beats bigger rivals on pension payments. Main UK retail banks have been cutting back cash in lieu of bosses’ retirement benefits |
| Lex – Virgin Money Holdings (UK) (VM.): risin’ up. Better times lie ahead for profitable lending groups, albeit amid Brexit gloom |
| Amigo Holdings (AMGO) shares jump as customer numbers climb. Under pressure lender makes progress with regulatory concerns | |
 | Hedge fund founder grabs a slice of Domino’s Pizza Group (DOM). Nabi marks appointment as non-executive to the board |
 | Influential City investors have put pressure on 15 major companies, including Royal Mail (RMG) and Just Eat (JE.), to improve workers’ pay. Legal & General Investment Management, Hermes EOS and BMO are among the investors which have written to chief executives and urged them to pay staff the so-called ‘real living wage’. This is higher than the Government’s national living wage, which stands at £8.21 per hour for over-25s and £7.70 for those aged 21 to 24. The real living wage, which is a voluntary scheme, is based on calculations of what people actually need to live on. This is estimated at £9.30 an hour across the UK for anyone over 18 and £10.75 in London. The push for better pay has stepped up since the financial crisis, with British workers being hit by slowing wage growth while pay for executives has surged. |
 | Hobby specialist Hornby (HRN) is beginning to see the light at the end of the tunnel after enduring several years under poor management. The model train company and creator of Airfix models, which dates back to 1901, saw its revenue increase by 15% to £15.9m in the six months to September. As Hornby focused on pushing out new products, such as a Harry Potter train kit and an Airfix Hellcat fighter jet, its loss before tax narrowed to £2.4m from £3m during the same period last year. But the company is facing its eighth consecutive year in the red, and investment in new products pushed debt up from £1.7m to £8.4m. Hornby is hoping most of this should be paid off over the coming months following Christmas trading. |
| Shares in Virgin Money Holdings (UK) (VM.) have jumped over 22% after the group posted better than expected figures and showed shoots of growth. The shares have jumped even though the group, previously known as CYBG, unveiled a statutory pre-tax loss of £232million for the year to 30 September, up from £164million a year ago. The group has scrapped its plans to introduce a dividend for investors this year and taken a £385million hit from payment protection insurance payouts. On the dividend front, Virgin Money said its ‘progressive and sustainable dividend ambition remains and the Board will reconsider dividends for FY20 in line with normal practice.’ |
 | Go-Ahead Group (GOG) said revenues in this division grew by around 2.5% between June 30 and October 26, when compared with its performance during the same period of 2018. But difficulties integrating a bus company in Manchester and other trading hiccups forced Go-Ahead to lower its full-year expectations for that part of the business. Shares in the mid-cap transport group slid to 2208p. Its international and London bus arm sped ahead, with revenues up 8%. Go-Ahead also said it is in talks with the Government to extend its contract to run Southeastern rail beyond an extension it already has until March. |
 | Johnson Matthey (JMAT) was trading lower after it was downgraded from ‘neutral’ to ‘underweight’ by analysts at JP Morgan, as they trimmed back their earnings estimates for the chemicals giant. |
 | Gambling technology group Playtech (PTEC) was stung by a cut to a target number for its share price – from 550p to 390p by Morgan Stanley, hot on the heels of similar clips from Deutsche Bank, UBS and JP Morgan. |
 | Liberum analysts cast a favourable eye on Genus (GNS) ideal price, raising it from 2800p to 3450p, as it said the pig and cattle genetics specialist will be in demand from the Chinese as they look to rebuild their pork industry, which has been decimated by disease and subsequent culls. |
| Longboat Energy Plc (LBE) is led by the former leadership of Faroe Petroleum, which was snapped up by Norwegian energy giant DNO for £640m in a hostile takeover in January. Shares in Longboat, which does not have any assets but is on the hunt for some, were priced at 100p but closed at 99.5p. |
| Philip Day is poised to seize back control of troubled fashion chain Bonmarche Holdings (BON), months after his stake was wiped out when the firm crashed into administration. Mr Day’s business Peacocks is on the brink of taking over Bonmarche following its collapse last month amid a crisis sweeping the high street. The rescue – which will leave suppliers facing huge losses – could lead to drastic cuts in the firm’s debts and its rent bill. It will put the 54-year-old Dubai-based billionaire back in charge following a chaotic eight months in which he rammed through a £5.7m takeover of the company and became its largest lender, only to lose ownership when the business went bust. |
 | Pressure is mounting on the blue-chip companies still giving huge pension top-ups to their bosses as a top offender CRH (CRH) refuses to budge. The building materials giant last year paid chief executive Albert Manifold a pension contribution worth 46% of his salary or €684,000 (£585,000), among the highest pay-outs for any business in the index. However, a source said Tarmac owner CRH has no plans to review the amount. They said: “Shareholders have not been beating a path to their door to discuss the issue.” The refusal comes despite a rebellion by 15% of investors at CRH’s annual meeting in April. |
| Virgin Money Holdings (UK) (VM.) has slumped to a £232m annual loss and scrapped its dividend, but investors were left relieved that the numbers were not worse. The bank was hit by £385m of last-minute claims for PPI compensation as well as merger-related costs. Chief executive David Duffy said it was “frustrating” to swallow the extra PPI bill. As a result of the losses, the lender – which pays Sir Richard Branson £11m a year to use the Virgin name – said it would postpone its final payouts for shareholders. |
| The threat of recession has receded in the Eurozone but a growth bounce-back looks unlikely next year, a leading ratings agency warned on Thursday. S&P forecast that eurozone growth will shift down a gear in 2020, falling from 1.2% this year to 1%. Although the manufacturing slump that pushed Germany to the cusp of recession could be “bottoming out” according to the agency, its senior economist Marion Amiot added that it did not expect a sharp rebound in industrial activity. S&P puts the chances of recession at lower than one in 10, but added the European Central Bank could be forced to cut rates again in March. | |
| Hornby (HRN) is building up a head of steam as management get a turnaround at the troubled toy-train maker on track. Revenues rose 15% to £15.9m in the six months to Sept 30, while losses narrowed by £700,000 to £2.5m. Hornby last made a profit in 2012 and has been derailed by a string of problems including supply chain issues, a boardroom battle with investors and management shake-ups. Its troubles led to a bailout last year with a £12m overdraft from asset-based lender PNC and a £6m loan from biggest investor Phoenix Asset Management. Changing tastes in toys added to the business’s woes, and cut-price sales to deliver a short-term boost only pushed problems down the line for a short period. |
 | Questor: ‘smaller small’ stocks and value investing are both due a bounce, so hold Aberforth. Questor investment trust bargain: the team that runs Aberforth Smaller Companies Trust (ASL) does nothing but invest in smaller stocks according to the value style |
 | Brexit will not hinder AstraZeneca (AZN) ability to attract the world’s best scientific talent to its new £750 million research and development centre in Cambridge, Pascal Soriot, chief executive of the drugs giant, has claimed. “Cambridge has attracted the best brains in the world for the last 800 years. It is going to continue to for a few more,” he told The Times/KPMG regional summit in Cambridge. Mr Soriot said that the imminent exit from the EU had, however, created “more of a challenge”, with staff worried about pension rights, for example. But these were relatively “minor issues”. He added: “We attract American and Chinese scientists, why not Spanish even if the UK [has left]?” |
| Business confidence has recovered to its highest levels since January because of growing optimism about the outlook for the economy and the prospect of Brexit clarity after the general election. While consumer confidence is stuck in negative territory, business confidence has risen for the third consecutive month, according to the Lloyds Bank Commercial Banking Business Barometer. Confidence rose by three percentage points to 9%. The survey, based on responses from 1,200 companies, suggests that firms are hoping that the election will bring some clarity on Brexit. Business concerns about leaving the EU eased to -16% in November, the least negative since January. | |
  | Andrew Tinkler, the controversial former head of Stobart Group Ltd. (STOB), claims that he has garnered support for a £70 million takeover of Eddie Stobart Logistics (ESL), the stricken trucking group, which he also used to lead. Mr Tinkler, 56, who spent much of last year in an unsuccessful High Court battle with the current management of Stobart Group, a business he diversified into aviation and renewable energy, says he has support for a rescue bid. This rivals a plan by another former owner of the haulage group, DBay, a private equity firm formerly known as Laxey Partners. |
| Britain provides a better environment for small and medium-sized companies than France and Germany, according to research. UK businesses have the best market for credit in Europe, according to analysis of 13 economies by Euler Hermes, while a flexible labour market and low levels of red tape also makes Britain a more attractive place to start and grow a business than some of its prominent competitors. The credit insurance provider analysed six factors, including tax policy, export opportunities and the level of competition, to produce the ranking. Canada was rated the best place to run a small or medium-sized business, followed by Hong Kong and the United States. Germany was placed eighth and France 11th. | |
| Britain’s biggest provider of guarantor loans has been forced to row back on suggestions that the City watchdog had given its business the all-clear. Amigo Holdings (AMGO) corrected a statement it had issued, in which it had reassured investors about the outcome of a Financial Conduct Authority review into the guarantor loans industry. The clarification yesterday came after the authority intervened on Wednesday evening. Amigo issues unsecured personal loans of between £500 and £10,000 with annual interest rates of 49.9% to people who otherwise have difficulty accessing credit. These loans are guaranteed by a family member or friend, who is liable for them if the borrower misses a repayment. | |
| The value of Virgin Money Holdings (UK) (VM.) rose by almost a fifth yesterday after investors bet that the bank is on a sounder footing than previously thought despite racking up an annual loss of £194 million. The bank will not pay a dividend this year after falling to a deeper annual loss owing to a £385 million provision for payment protection insurance mis-selling made in the final three months. Ian Smith, the chief financial officer, said the decision to suspend the dividend was a disappointment, but was taken to conserve capital. The bank will consider resuming payments next year. Virgin Money also owns the Clydesdale and Yorkshire Bank brands. CYBG, the parent company of the pair, paid £1.7 billion for Virgin Money last year. |
| Problems in Manchester, Oxford and Stuttgart will hold back Go-Ahead Group (GOG) this year. David Brown, chief executive of the bus and train group, warned that profit expectations from its bus division should be “slightly lowered”. The cocktail of problems affecting the trading update yesterday, which covered the first four months of its financial year ending in June, include a slowdown in the rate of growth of bus patronage, traditionally linked to the health of the economy, and larger problems than expected in its takeover of a bus depot in Manchester from First Group. Go-Ahead has also been hit by rising driver costs amid record levels of employment and regulatory changes that forced bus companies to give better holiday pay. |
| Royal Mail (RMG) biggest union has lost an appeal against a High Court injunction to stop a strike before the general election and holiday season next month. The Communication Workers Union lodged an appeal after the former postal monopoly won the injunction to avert the first national strike by its workers in a decade. Royal Mail, which employs more than 140,000 people in the UK, has been involved in a legal dispute with the union since September over a strike that would disrupt operations at its busiest time of the year. The union said on Twitter yesterday: “The justice system in this country is an absolute farce.” |
  | Robbie Rayne has won a battle over the management of the listed company that manages some his family’s wealth, triggering the resignation of three independent directors. A majority of shareholders in LMS Capital (LMS) yesterday backed his call for the outside fund manager which was in charge of its funds, to be sacked. Some 58% of LMS investors backed a resolution by Mr Rayne to serve notice on Gresham House (GHE). After the vote Martin Knight, chairman, who had argued that it was in the best interest of shareholders to retain Gresham, resigned together with Neil Lerner and Rod Birkett. Mr Rayne is set to be elevated to be LMS’s chairman, as The Times reported on Monday. |
| Sparkling tea and gluten-free beer have helped Fortnum & Mason, the luxury grocer, defy the retail gloom. The 312-year-old retailer has posted its seventh consecutive year of growth, with sales rising by 12% to £138 million and pre-tax profits increasing by more than a quarter to £12.1 million. Ewan Venters, chief executive, said: “We are very pleased to report another year of strong growth across our business, particularly within the context of the significant challenges facing the retail sector.” Sales at its Piccadilly store rose by 6%, while sales in Hong Kong and Japan were up 16% and 28% respectively. | |
 | CVS Group (CVSG) has continued its return to health after a difficult start to the year, prompting analysts to upgrade their full-year forecasts. Like-for-like sales at CVS Group grew by 8%, with its core veterinary practices division up 7.4%. Richard Connell, chairman, said at the annual meeting that the “encouraging start” to the financial year reported at its annual results had continued in September and October, with total sales for the four months to October 31 up 16.8%. Shares of CVS Group, which fell by a third after a profit warning in January, rose a further 72p to £11.05 after the strong update. |
| A slowdown in global trade is weighing most heavily on the European Union, with exports falling across all major economies, according to the Organisation for Economic Co-operation and Development. Anxieties about Brexit, a downturn in manufacturing and the US-China trade war knocked eurozone exports by 1.8% in the third quarter of this year and imports by 0.4%. France led the slump with a 3.6% drop in exports and a 1.7% fall in imports, according to figures from the OECD, which is based in Paris. Germany experienced a respective 0.4% and 1.8% fall, while Italian trade shrank for the sixth consecutive quarter. | |
 | Phoenix Group Holdings (DI) (PHNX) has generated £707 million of cash this year, just above its annual target. It estimates that £540 billion of people’s savings is tied up in books of business that insurance companies no longer have open to new customers. Of that, about £380 billion is believed to be in the UK. The aim of its model is to throw off cash as capital held against policies freed up when they expire. It delivered £1.3 billion cash generation in 2017 and 2018 and says it is well placed to grow. Phoenix’s target for 2019 had been between £600 million and £700 million in cash. |
 | Lloyds Banking Group (LLOY) is proposing to slash its chief executive’s pay by £220,000 and spend £20m to raise retirement benefits for the rest of staff – only months after defending the boss’s bumper remuneration package. The bank is consulting shareholders over plans to cut António Horta-Osório’s pension package, which earlier this year was worth nearly half of his £1.3m base salary before being trimmed to 33%. That compared with 13% offered to the rest of staff. The proposals would mean the banks’s contribution to the chief executive’s pension being cut further, to 15% of salary from July 2020. Retirement benefits for the group’s 65,000 workforce would be raised to the same level, costing roughly £20m a year. |
 | A backlash against vaping in US has dented revenue growth at the cigarette-maker British American Tobacco (BATS). BAT said revenues in its “new category” arm – which includes vaping – would grow at the lower end of its previously announced range of 30% to 50% for the 2019 financial year. The overall US vaping market has declined by about a quarter, according to Tadeu Marroco, BAT’s finance director, since the health concerns emerged centred on sometimes fatal lung injuries. Those concerns, as well as others about underage vaping, were enough to catch the attention of Donald Trump. |
| Barclays (BARC) to cut chief executive’s pension allowance. Bank falls into line with other big UK lenders as investors apply pressure |
| Lombard – British American Tobacco (BATS) tobacco strength buys some time in smoking’s decline. Margins are healthy but products meant to take cigarettes’ place are not growing fast enough |
 | Royal Bank of Scotland Group (RBS) launches Bó as rival to digital bank start-ups. Established lender spends £100m developing response to rapid growth of challengers |
 | Thomas Cook collapse hits profits at On The Beach Group (OTB). Online travel agent struggles to contain impact of UK holiday company’s demise |
| Lloyds Banking Group (LLOY) to cut chief executive’s pay by £220,000. Pension reduction comes as bank offers £20m boost for rest of staff |
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