Debenhams may yet find Ashley’s offer hard to refuse. It’s not often that business figures are reimagined as farmyard animals, but as insults go, it was certainly original – not to mention festive. Last week, Mike Ashley said he would like to put the head of Debenhams chairman Ian Cheshire on a turkey. At least it wasn’t a donkey. The motive for this bizarre personal attack against one of the grandees of the corporate world? Ashley’s is sitting on a whacking great loss from yet another of its founder’s famous gambles on the fortunes of a struggling rival, in this case the near-30% stake in Debenhams (DEB). The department store chain has had a wretched year, and Ashley, it would appear, lays the blame squarely at Cheshire’s door, having turned down a £40m interest-free loan from the tycoon that would certainly help it through what could be a brutal Christmas. With the festive shopping season now in full swing, every light on the retail dashboard is flashing red, sending the high street into a state of blind panic. Shoppers are deserting stores in increasing numbers; the industry seems powerless to halt Amazon’s ascendancy; a string of established names including John Lewis, Superdry, and Dixons Carphone have published woeful numbers. Even Black Friday was a flop. Throw in yet more Brexit uncertainty, plus predictions of another cold snap, and there may be little to cheer this Christmas. But the one thing that should scare the living daylights out of the high street is Ashley’s claim that November trading was the worst he has ever experienced. It will “smash everyone to pieces”, he claims.
Sainsbury (J) (SBRY) and Asda are preparing a joint assault on the grocery industry’s biggest suppliers if their blockbuster merger is approved, in a move that will revive memories of the Marmitegate price row between Tesco and Unilever. The combination of the pair will create a new grocery powerhouse, with more than £50bn of sales and a quarter of the market, bringing to an end Tesco’s reign as Britain’s biggest supermarket chain. Sainsbury’s and Asda have claimed that the deal will benefit consumers by lowering prices by as much as 10% “on many of the products customers buy regularly”. A spokesman for Sainsbury’s denied that the two sides were “having discussions around hypothetical supplier negotiations” but senior sources at the company told The Sunday Telegraph they plan to use their bigger purchasing power to squeeze the large multinational suppliers, such as Unilever, Procter & Gamble and Nestle, into agreeing better terms.
Interserve (IRV), the outsourcing giant, has drawn up plans to offload one of its most profitable businesses to its lenders in its latest bid to save its future. Sky News reported that Interserve has been exploring the possibility of offloading RWD Kwikform – one of its construction units – to the company’s lenders. The plan is believed to be at its early stages and is subject to the approval of the company’s board. The building materials unit specialises in construction areas such as formwork, falsework and ground-shorting and operates globally. Analysts value the unit at between £250m and £300m. One city source told Sky News: “It would make the rest of the company, if it stayed listed, a much cleaner story for stock market investors.” The agreement, if approved, is likely to streamline the company to be more focused on support services.
Questor: on a bumpy track, video games veteran Codemasters (CDM) is still in the driving seat. Questor share tip: it has not had an entirely smooth ride, but it is worth investing in this early race leader
