Britain will be “the winner” after Brexit, with the pound rallying and stock markets rising once a workable exit deal has been secured, a leading American investor has predicted. Of all European markets, only Britain will outperform the United States and Asia, equity strategists at Blackstone, the asset manager, said. For 35 years, Byron Wien, 87, vice-chairman of Blackstone’s private wealth group, has published a list of “ten surprises” for the year ahead. The list, now co-authored with Joe Zidle, chief investment strategist, defines a “surprise” as an event that is more likely to occur than not but to which the average investor assigns only a one in three chance of happening. In this year’s list, the investors say: “Having secured a workable Brexit deal, the United Kingdom turns out to be the winner in its divorce from the European Union. “The UK benefits from a long transition period, and growth exceeds 2% as foreign direct investment resumes now the outlook is clarified.”
Another debilitating profit warning from Aston Martin Holdings (AML) has lifted the bonnet on the deepening financial crisis at the Warwickshire-based maker of luxury sports cars. In an unscheduled trading update yesterday, Aston Martin admitted that key operational and financial performance indicators were travelling down the wrong track. The number of cars it delivered to dealers fell by nearly 10 per cent to 5,809 last year, while its underlying operating performance almost halved, with earnings before tax, debt interest and depreciation set to slump to between £130 million and £140 million from £247 million in 2018.
The boss of Morrison (Wm) Supermarkets (MRW) has said that it will take “learnings” from a disappointing Christmas performance after a decision to scrap Black Friday-themed promotions hurt its sales. Morrison’s, which is the first of the big grocers to report how it fared over the festive period, announced a 1.7% drop in like-for-like sales excluding fuel and VAT in the 22 weeks to January 5, which include the third quarter. The decline was slightly better than the 2.2% that had been feared by analysts. During the third quarter to November 3, like-for-like sales were down by 1.2%, with analysts at Bernstein suggesting that this meant sales over Christmas had fallen by 2.6%.
Climate activist investors in Barclays (BARC) are bringing a formal shareholder challenge to try to force it to phase out the financing of fossil fuel companies, in the first move of its kind at a European bank. Eleven institutional investors with more than £130 billion under management have filed a resolution to be voted on at Barclays’ annual meeting in May. It asks the bank to “set and disclose targets to phase out the provision of financial services” to energy and utility companies that are not aligned with the Paris agreement on climate change. It is backed by shareholders including Brunel Pension Partnership and LGPS Central — which between them manage the assets of 18 British local government or public sector pension funds — Sarasin & Partners, Folksam and more than 100 individual shareholders. It was co-ordinated by Share Action, a charity that promotes responsible investment.
Two of the controlling shareholders of NMC Health (NMC) were seeking to offload about $500 million of shares in the beleaguered private healthcare group last night to cut their debts. In a statement after the market had closed in London, it emerged that Saeed Mohamed al-Qebaisi and Khalifa Butti al-Muhairi hoped to sell shares worth a combined $490 million in NMC and shares worth $75 million in Finablr PLC (FIN) via an accelerated bookbuilding by Credit Suisse, Deutsche Bank and Barclays. The nature of the share sale suggested that the pair were selling stock after a margin call on shares that they had pledged in return for debt. Muddy Waters’ report had claimed that Khalifa bin Butti and Dr Shetty had pledged about £700 million of shares.
Premier Oil (PMO) is facing opposition from its largest creditor to its plans to buy $870 million of North Sea assets. Asia Research and Capital Management has come out against the acquisitions, as well as opposing proposals for Premier to extend the maturity of its debt by more than two years to November 2023. Premier intends to pay $625 million to buy assets in the Andrew area and a stake in the Shearwater field from BP. It also wants to buy a 25% interest in the Tolmount area from Dana Petroleum, an Aberdeen-based subsidiary of Korea National Oil Corporation, for up to $246 million. The deals would be funded through existing cash facilities, a $500 million rights issue and a bridging facility of up to $300 million. The explorer has been talking to its lenders about the purchases and its refinancing options for several months and is confident that it has enough support. For the refinancing to succeed, Premier would need 75% of voting lenders to approve its proposals. It says that it has support from nearly 73% of senior lenders.
Silence Therapeutics (SLN) said that it had entered a technology evaluation agreement with Takeda, prompting its shares to rise by more than 8% yesterday. The London-based Silence is developing medicines using technology that can selectivity inhibit any gene in the genome, “silencing” the production of disease-causing proteins. Under its deal with Takeda, Silence said that it would “explore the potential of utilising Silence’s platform to generate siRNA molecules against a novel, undisclosed target discovered by Takeda”. Takeda — a Tokyo-listed company that bought Shire, a FTSE 100 pharmaceuticals rival, for $62 billion a year ago — will provide Silence with research funding and the two companies have agreed to negotiate the terms of a licence agreement should their initial evaluation study prove successful.
Burford Capital (BUR) is to push ahead with an American listing despite a short-selling attack knocking the London-quoted litigation funder’s shares by more than 40%. The company also announced a series of management changes and promised to increase transparency over executive pay as it sought to allay market concerns over governance. Burford confirmed that it was working towards a listing on the New York Stock Exchange or on Nasdaq or on a move from Aim to London’s main market. “The ultimate timing for any listing is difficult to predict and will depend on a variety of factors, including the [US Securities and Exchange Commission] comment process,” it said. The management changes include the joint appointment of Aviva Will and David Perla as co-chief operating officers. Christopher Bogart remains chief executive and joins the board. Burford also said that a US securities class action lawsuit filed against the company last August had been dismissed, leaving no litigation pending. However, Muddy Waters hit back against the statement, warning that the litigation dismissal should not be interpreted “as affirmation that there is no misleading conduct or wrongdoing at the company”.
Marks & Spencer Group (MKS) was on the end of another analyst upgrade yesterday, its fifth in a month. The latest bull to be welcomed through the high street stalwart’s doors was Berenberg, which lifted the stock from “sell” to “buy” and raised its price target by 90p to 250p. The German bank joins HSBC, JP Morgan, Goldman Sachs and RBC Capital, all of which have upped their recommendations, in the M&S love-in. Berenberg decided to make its move before the retailer’s trading update tomorrow, which it expects will show a “significant improvement” in the clothing and home business, while like-for-like sales in the food division should “remain positive”. The analysts are particularly enthused by the recent appointment of Richard Price, head of the M&S clothing and home division. “We are more optimistic following the appointment of Mr Price to lead the division, where we believe the buying and merchandising strategy has been a core issue,” Michelle Wilson, a retail analyst at the bank, said. Ocado Group (OCDO) jumped 54p to £13.26 and was further boosted by a comment from Berenberg that its joint venture with M&S representeds an “attractive long-term opportunity”.
Tempus – Rightmove (RMV): Hold. Demonstrating resilience and ability to diversify and grow in a highly competitive property market
Tempus – Dignity (DTY): Avoid. Too much uncertainty over the outcome of watchdog’s investigation
