Mike Ashley plots 11th-hour offer to buy Debenhams. Sports Direct tycoon Mike Ashley is this weekend plotting a last-ditch £60m takeover bid for Debenhams (DEB). He is understood to be putting together a formal offer for the retail chain after weeks of heated arguments with its directors over a refinancing plan that would wipe out investors, including Sports Direct, the biggest shareholder with 29.7%. A source said that any bid from Ashley would come with conditions. The move could derail the rescue refinancing of Debenhams, which had been due to be put into pre-pack administration tomorrow by its lenders in exchange for a further £100m of emergency funds.
Brussels lands FTSE giants, including Diageo (DGE) and WPP (WPP), with £1bn tax bill. Brussels has slapped British companies with a pre-Brexit tax bill that could top £1bn after ruling that an obscure loophole in the UK tax system is against EU rules. An 18-month investigation by the European Commission has found that a tax scheme introduced by the then-chancellor George Osborne in 2012 gave an unfair advantage to multinationals based in the UK . It ordered the government to claw back the lost tax last week. The total size of the bill is unclear, but almost 50 companies, including Diageo, Pearson (PSON), Euromoney Institutional Investor (ERM), Daily Mail and General Trust A (Non.V) (DMGT), and WPP have warned in recent financial statements of the potential costs arising from the investigation. The maximum combined exposure of just 12 companies that have provided figures comes to more than £750m.
Tesco eyes revival of Clubcard along lines of Amazon Prime. Supermarket plans Amazon-style loyalty scheme to bring services together. Tesco (TSCO) is working on a new loyalty scheme in the mould of Amazon Prime, which would give its tens of millions of shoppers greater incentives to sign up to the company’s bank and mobile phone services. It is understood that the scheme could be linked to the Tesco Pay+ app, operated by Tesco Bank, which allows customers to collect Clubcard points while making payments. Clubcard, introduced in 1995 under Ian (now Lord) MacLaurin, was a key force behind Tesco’s march to the top of the supermarket industry. An estimated 15m people in Britain are members of Amazon Prime, which offers them faster, cheaper delivery as well as the ability to stream films and boxsets while giving the online giant a wealth of knowledge about customers’ shopping habits. Tesco serves about 80m shoppers a week and generates annual sales of more than £50bn.
Asos in a spin over profits. ASOS (ASC) is set to report that its profits all but evaporated over the past six months, as the online retailer cracks down on shoppers abusing its returns policy. Asos issued a shock profit warning days before Christmas after a sharp sales slowdown, before a misjudgment over demand in America caused a backlog at its new Atlanta warehouse at the start of the year. Analysts estimate that the business, run by Nick Beighton, will report interim pre-tax profits of just £3.2m on Wednesday, down from £30m on sales of £1.2bn a year ago.
Jobs under threat as SSE cuts costs. Fears of job losses at SSE (SSE) are rising as the blue-chip electricity and gas supplier seeks to save money. Bosses are believed to have signalled cost-cutting plans for the retail division during investor roadshows in recent weeks, citing challenges such as the energy price cap and a drop in customer numbers.An industry source said: “You are not going to be able to make significant savings unless you lose some people. The issue is whether they can meet that target through attrition, or whether they will have to look at redundancies.”
Retirement housebuilder McCarthy & Stone (MCS) is set to unveil a host of modernising efforts this week, including the launch of a wine club for residents and online GP appointments, as its new boss seeks to revive the business. The FTSE 250 company will reveal half-year results on Wednesday, with chief executive John Tonkiss hoping to show his recovery plan is working after pre-tax profits slumped by more than a third to £58m last year. Tonkiss, 51, who was previously chief operating officer of the student accommodation provider Unite, has been trying to make retirement living more attractive. He is set to announce the creation of a wine club, as well as the launch of cost-saving tech initiatives such as virtual GP appointments and ways for families to monitor their relatives remotely.
The arrival of Aoka Mizu in the choppy waters north of Scotland cheered investors in Hurricane Energy (HUR) late last year. The AIM stock Hurricane is reaching the stage where it needs to prove itself. Will its maverick boss Robert Trice confound the doubters and strike big oil, or will he go the way of plenty of AIM dreamers before him and fizzle out? He is trying to do something that has not been done before in British waters: extract oil from the fractures in hard, brittle rock on the sea bed, known as basement reservoirs. Hurricane has huge potential. It has built up licences covering a possible 2.3bn barrels of oil and gas. These are in Rona Ridge in the west of Shetland area, an increasingly competitive spot where majors such as Shell and BP are starting to cluster. Trice is under pressure to prove his prediction that crude oil will be able to flow freely to the surface for sustained periods, despite the brittle rock. BP is said to be watching closely. In a big boost last year, Hurricane struck a partnership with Centrica’s oil and gas business Spirit Energy, netting Hurricane $400m in exchange for half its Lincoln and Warwick licences. Its bosses are also positioning the company for a premium stock market listing. Trice, 58, who has reportedly compared himself to George Mitchell, the late billionaire father of the US shale drilling boom, is not one to be put off easily. Trice said of the naysayers late last year: “I’ve stopped arguing with them. They’ll see.” Only a pessimist would bet against him. Buy.
