British drugs giant GlaxoSmithKline (GSK) has agreed a tie-up with US rival Pfizer to merge their consumer healthcare divisions to create a business with combined sales of £9.8bn. The deal paves the way for Glaxo to break itself up to form two separate UK-based companies – one focused on pharmaceuticals and vaccines, and the other on consumer healthcare. The UK drugmaker said it was aiming to do this within three years of completing the joint venture and will list the consumer health business on the stock market. It comes after pressure from shareholders for Glaxo to spin off its consumer division. Glaxo will own a 68% controlling stake of the new entity, while US firm Pfizer will own the remaining 32% stake, bringing together an “exciting pipeline of new medicines”, including Glaxo’s Sensodyne, Voltaren and Panadol brands and Pfizer’s Advil and Centrum.
Consumers are losing out on £4bn per year by staying loyal to the same service provider, according to the Competition and Markets Authority (CMA). The competition watchdog investigated a “super-complaint” raised by Citizens Advice and found “damaging practices” in the cash savings, mortgages, household insurance, mobile phone contracts and broadband markets. It also revealed that vulnerable people, including the elderly and those on a low income, may be more at risk of being exploited. Nearly 12m customers are affected each year in the insurance market from continual year-on-year stealth price rises, costly exit fees, difficult processes to cancel or switch contracts, and requirements to auto-renew. A number of recommendations are being made to regulators and Government to stop loyal consumers being ripped off, including cracking down on harmful business practices, targeted price caps to protect the people worst hit and publicly holding firms to account. The regulator also demanded that mobile providers stop charging pay-monthly customers the same rate once they have paid off their handsets at the end of the contract period, and announced an investigation into the anti-virus software sector. It will probe whether some anti-virus businesses are not complying with the law by automatically renewing customers’ subscriptions without notifying them.
BT plans to overhaul executive pay after shareholder protest. BT Group (BT.A) is planning to make changes to the way it pays its senior managers after shareholders staged a protest over the bonus awarded to outgoing chief executive Gavin Patterson earlier this year. The telecoms company said on Tuesday that its remuneration committee would now take steps to implement a “more structured process” that will take into consideration a “broader range of performance factors and wider circumstances” when setting pay.
Ofgem threatens to wipe £6.5bn from energy networks earnings. The energy regulator is poised to squeeze £6.5bn from the companies operating Britain’s electricity networks as they prepare to plug in to a boom in renewable power and electric vehicle charging. Under Ofgem’s plans companies including National Grid (NG.), Scottish Power and SSE (SSE) will need to drive billions worth of investment into updating their energy grids for a ‘smart’ energy future, while charging customers less from 2021.
Glencore subsidiary Katanga settles over Congo claims. A subsidiary of FTSE 100 mining giant Glencore (GLEN) has paid CA$30m (£17.6m) to Canadian regulators for misstating the financial position of its copper mines in the Democratic Republic of Congo. The Ontario Securities Commission also sanctioned a number of current and former directors of Katanga Mining, including Glencore’s billionaire head of copper trading, Aristotelis Mistakidis. Mr Mistakidis, who was on the board of Katanga until 2017 and remains the sixth biggest shareholder in Glencore, was fined C$2.5m and handed a four-year director ban. He will step down from Glencore later this month.
Financial Conduct Authority (FCA) has expanded the scope of its ongoing investigation into stock market announcements made by scandal-hit technology company Telit Communications (TCM). The FCA’s initial probe came to light in March when Telit, which specialises in linking everyday infrastructure to the internet, notified investors that the financial watchdog was looking into a major profit warning which it made in 2017. Telit said that the FCA was investigating the “timeliness of announcing certain matters” contained within its half-year results last August, but it has now indicated that it will also assess the accuracy of the announcements. The FCA will investigate a trading update released in April 2017 and the announcement of a placing of shares, which occurred a month later.
Barclays fined £12m over chief executive’s bid to unmask whistleblower. Barclays (BARC) has been hit with a £11.9m ($15m) fine after its chief executive Jes Staley broke the bank’s rules by trying to unmask a whistleblower in an attempt to protect a personal friend and colleague from criticism. In undermining the process by which staff can anonymously report wrongdoing Mr Staley “exposed the bank to risk and created an atmosphere in which employees might doubt that it was safe to escalate issues of concern to the bank”, said US regulator Maria Vullo. In June and July 2016 Mr Staley personally asked the bank’s head of security to uncover the identity of the author of two letters which criticised him and another senior executive.
A subsidiary of FTSE 100 mining giant Glencore (GLEN) has paid CA$30m (£17.6m) to Canadian regulators for misstating the financial position of its copper mines in the Democratic Republic of Congo. The Ontario Securities Commission also sanctioned a number of current and former directors of Katanga Mining, including Glencore’s billionaire head of copper trading, Aristotelis Mistakidis. Mr Mistakidis, who was on the board of Katanga until 2017 and remains the sixth biggest shareholder in Glencore, was fined C$2.5m and handed a four-year director ban. He will step down from Glencore later this month.
