British and Dutch ministers are facing a rail showdown after it emerged the Netherlands has led an £80m rescue package to bankroll the loss-making activities of one of Britain’s biggest train networks. Greater Anglia, which operates one in every 12 UK rail journeys and is majority owned by the Dutch state rail operator, is being forced to make crippling payments to the Department for Transport (DfT) – pushing its finances into the red. The payments, which sources said could end up costing Greater Anglia hundreds of millions of pounds, are linked to a complicated clause contained within the franchise agreement.
Banking chiefs at HSBC Holdings (HSBA) and Standard Chartered (STAN) pull out of Saudi conference. A number of big-name City chief executives have bowed to pressure and pulled out of a major investment conference in Saudi Arabia in protest at the Kingdom’s alleged involvement in the disappearance of journalist Jamal Khashoggi. HSBC boss John Flint, whose bank is a major sponsor of the so-called ‘Davos in the desert’ event, will now not attend the conference, which is meant to show off Saudi Arabia’s credentials as an investment destination and begins next Tuesday. Standard Chartered chief Bill Winters and London Stock Exchange Group (LSE) boss David Schwimmer have also pulled out of the Future Investment Initiative (FII), while Tidjane Thiam, boss of Swiss bank Credit Suisse, another “strategic partner”, is also understood to have backed out.
MPs attack Royal Mail (RMG) boss’s ‘appalling’ £5.8m payout. MPs have hit out at Royal Mail’s decision to hand new chief executive Rico Back a €6.6m (£5.8m) payout last year and panned its failure to engage with shareholders ahead of a massive revolt at its annual general meeting in July. The sum was paid as part of a renegotiation of Mr Back’s contract in his previous role running the company’s international parcel subsidiary GLS and did not incur UK tax as the the division is headquartered in the Netherlands. Business committee chair Rachel Reeves MP said: “We heard that no UK tax was paid on this astounding multi-million-pound deal, a sum paid for by UK customers as they post their letters and parcels, and an amount which would appal postmen and postwomen, and the wider public.”
Paddy Power fined £2.2m for ‘failing to protect customers’. has been fined £2.2m for “failing to protect customers and stop stolen money being gambled”, a Gambling Commission investigation has revealed. The Irish bookmaker was hit with a penalty for social responsibility and money laundering after it “failed to adequately interact with customers who were displaying signs of problem gambling and failed to adequately carry out anti-money laundering checks”. The watchdog said two customers were found using Paddy Power’s betting exchange and another three were gambling using its online platform and retail premises.
Bellway boss backs calls to trim back Help to Buy as profits rise. The boss of Bellway (BWY), one of the country’s largest housebuilders, has backed calls for Philip Hammond to scale back the Help to Buy scheme, despite it helping propel his company to record profits and a bumper dividend. The FTSE 250 company made £641m in pre-tax profits in the year to July, up 14.3%, as revenues leapt 15.6pc to £3bn. Almost 40% of the 10,300 homes it sold were aided by Help to Buy, which offers customers an equity loan worth up to 40% of a home’s value to minimise the need for a large deposit.
Aldi and Lidl are continuing to pull away from Tesco (TSCO) and Sainsbury (J) (SBRY) as the latest figures revealed growth at the traditional supermarkets is lagging. Britain’s three biggest grocers, Tesco, Sainsbury’s and Asda, lost market share in the 12 weeks to Oct 7 as consumers increasingly shopped at the discounters, research firm Kantar Worldpanel said. Aldi increased sales by 15.1%, its fastest rate of growth since January, and Lidl attracted more shoppers through its doors, helping sales rise 10%. Some 6% of Aldi’s sales came from premium own-label lines including its Specially Selected range – a higher proportion than any other supermarket – and its growing number of stores helped it increase its market share by 0.8% to 7.6%. Meanwhile, customers at Lidl spent an average of 55p more each trip, a greater increase than any of its rivals, helping the store increase its market share to 5.6%. The ‘big four’ supermarkets are struggling to make up ground. Sainsbury’s, which has agreed a takeover deal with Asda, was the laggard of the group, with growth of 0.6% in the three-month period. Sales at market leader Tesco rose 0.9%, while Asda and Morrison (Wm) Supermarkets (MRW) increased their sales by 2.4% each.
Scottish Power will turn its back on fossil fuels in a deal worth over £700m to sell off its gas-fired power plants to coal giant Drax Group (DRX), before pouring billions of pounds into renewable energy. The Big Six energy company confirmed a Sunday Telegraph report last month which first revealed that Drax hoped to buy a string of gas and hydro power plants in a bid to survive the UK’s shift to cleaner power. Scottish Power’s chief executive Keith Anderson said the group will undertake a “pivotal shift” by investing £5.2bn in renewable energy and smart grids over the next four years. “We are leaving carbon generation behind for a renewable future powered by cheaper green energy. We have closed coal, sold gas and built enough wind to power 1.2 million homes,” he said.
WPP is on the verge of buying the headquarters of the Financial Times on London’s South Bank for a reported £93m in the latest sign of new boss Mark Read’s attempts to stamp his mark on the marketing giant. Plans by the building’s current owner Pearson (PSON) to put it up for sale this month were delayed after WPP (WPP) expressed an interest, according to a source who spoke to trade magazine Property Week, which first reported the talks. It is unclear what elements of WPP, which owns a sprawling empire of advertising agencies, public relations firms and data companies, would occupy the building should the sale come off.
A competition investigation into the proposed £15bn merger of Sainsbury (J) (SBRY) and Asda will explore its impact on suppliers and the rise of rival retailers Aldi, Lidl and Amazon. The Competition & Markets Authority will investigate whether the deal will increase Sainsbury’s and Asda’s buying power to such an extent that it will harm the grocery supply chain. It will also factor in the “strength of retailers such as Aldi and Lidl”, online-only grocers Ocado and Amazon, and non-food retailers such as John Lewis & Partners, during the second stage of its investigation.
The boss of theme park giant Merlin Entertainments (MERL) has hit back at a “pretty ridiculous” stock market reaction after investors took a dim view of visitor numbers at its key Legoland parks. Like-for-like revenue growth during the nine months to October 6 was 1.4%, the company said in a third quarter trading update on Tuesday. While the results were “in line with expectations”, the City was spooked by flat like-for-likes across Merlin’s Legoland parks.
Questor: hang on to Serco Group (SRP), its debt is falling while profits climb
