The City has sounded the alarm about the fate of Mike Ashley’s retail empire after it delayed releasing its financial results, blaming House of Fraser woes and further scrutiny of old accounts. The news came as New York hedge fund Coltrane Asset Management, which previously thwarted the rescue of outsourcer Interserve, as its largest shareholder, and made millions from the collapse of Carillion, revealed it had taken a 3.29% stake in the retail empire. Coltrane’s arrival piled pressure on , which includes a stable of other brands as well as the sportswear retailer, and had been due to publish results on Thursday. It could now take more than a month for the figures to be released. The high street giant, which made a £90m swoop for House of Fraser after it fell into administration last summer, blamed the delay on “complexities” in the integration of the department store chain. It warned that there was “uncertainty as to the future trading performance of this business”. It also pointed the finger at its auditor, Grant Thornton, for the delay, saying the accountancy firm faced increased scrutiny of its work for the retailer by the financial watchdog.
A rescue plan for embattled Thomas Cook Group (TCG) that would see its banks and biggest shareholder inject £750m in a debt for equity swap could be blocked by the holiday company’s bondholders. The claim comes from Citigroup analyst James Ainley – one of Thomas Cook’s most vocal critics – who calculated that if the plan goes ahead, the shares would be worth just 3p. Thomas Cook shares are worth just over 5p, having plunged 62% since it said it was in “advanced discussions” with Fosun about the deal that would see the Chinese business take a majority stake in Thomas Cook’s holidays unit and a minority in the airline operation. Fosun has an 18% stake in Thomas Cook. Meanwhile, banks and bondholders will take a majority stake in the company’s airline and a minority stake in the tour operator unit. But Mr Ainley – who sent shares in Thomas Cook plunging two months ago after setting a target price of zero, suggesting the business was worthless – questioned whether the rescue plan would get off the ground.
A 737 Max plane due to be delivered to Ryanair Holdings (RYA) has been photographed with a different name on its nose at Boeing’s factory in Seattle. All 737 Maxs were grounded in March following the crashes of Ethiopian Airlines and Lion Air flights that killed 346 passengers and crew. Photographs circulating on Twitter on Monday showed a 737 Max plane in Ryanair livery with the name 737-8200 instead. Ryanair has more than 100 of the aircraft on order, while British Airways owner IAG plans to buy 200. Donald Trump tweeted in April that he would rebrand the plane with a new name as “no product has suffered like this one”. Ryanair and Boeing both declined to comment.
The executive chairman of Micro Focus International (MCRO) has pocketed almost £12m after slashing his stake in the business by half for “personal financial reasons”. Kevin Loosemore, who has held the chairman post since 2011, sold 650,000 Micro Focus shares in two tranches last Wednesday and Thursday at a discount to the company’s share price, netting him £11.6m. The sale at the lower price had caused Micro Focus’s share price to fall almost 16% last week. Shares continued to slip on Monday as news of the disposal emerged, amid concerns over why Mr Loosemore had chosen to sell now. The chairman, however, suggested his decision was not to do with the performance of the company, but instead said that it was “time for me to diversify a little”, having recently turned 60. “Until now, all of my assets have been held in Micro Focus shares,” he said. “As executive chairman, I remain committed to the business as we continue to execute our established business model. Micro Focus has tremendous opportunity to prosper and to increase value and I will continue to work to deliver that.”
Two mining giants have won nearly $6bn (£4.7bn) in compensation from Pakistan after a long-running dispute but may never collect the cash, analysts warned. A joint venture owned by copper producer Antofagasta (ANTO) and Canadian gold miner Barrick was awarded $5.8bn by the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) over a mining lease that was denied by Pakistan’s government. The companies had sought to mine copper and gold in Reko Diq, a desert region in southwest Pakistan, but the scheme ran aground 2011 and the pair turned to the body for arbitration, initially seeking damages of $8.5bn. The total award is only slightly lower than the $6bn Pakistan received from the International Monetary Fund, the world’s lender of last resort, earlier this year to bail out its ailing economy. Pakistan’s prime minister Imran Khan has ordered an inquiry into the Reko Diq case. The government would consider the “financial and legal implications”, it added.
GlaxoSmithKline (GSK) has unveiled promising results from a late-stage trial of an important oncology drug in the first sign that its new approach to research and development is starting to pay off. Zejula was acquired by GSK when it bought US oncology biotech Tesaro for more than $5bn (£4bn) last year. The cost of the acquisition raised eyebrows as it was effectively a bet on Zejula, a class of cancer drug called a parp inhibitor that faces considerable competition. The success of Zejula is therefore critical for GSK to justify the high price it paid for Tesaro. The results suggest GSK’s decision to buy Tesaro was a good move and vindicates R&D chief Hal Barron’s approach to drug development. It is also the first major oncology drug in GSK’s small, but growing, pipeline to report results. Zejula is already approved for women with ovarian cancer who have had two treatments and who carry a certain genetic mutation.
Shares in Persimmon (PSN) slipped as investors’ nerves jangled ahead of an investigation into the quality of its homes due to be shown on Monday. The builder apologised “without reservation” at the weekend to homebuyers in a Channel 4 Dispatches documentary, which detailed problems with quality control and safety. Persimmon blamed actions taken to improve customer satisfaction for a 4.5% slump in revenues in its half-year results earlier this month.
Hostilities between FirstGroup (FGP) and a New York hedge fund have intensified after an attempt at peace talks ended in acrimony. Last week, Matthew Gregory, chief executive of First Group, and David Robbie, its interim chairman, flew to the US for an emergency summit with Coast, its biggest shareholder. But the parties clashed over plans for the embattled bus and train operator’s future. Coast is pushing for a break-up of First Group, which runs thousands of yellow school buses in America, and has tried to unseat half the boardroom in a dramatic coup. At the meeting, Coast urged First Group’s bosses to speed up plans to find a replacement for Wolfhart Hauser, who resigned as chairman after Coast and two other major shareholders voted for him to stand aside last month. But First Group insisted its timetable was fast enough and necessary to comply with governance rules.
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