GVC slides after bosses sell shares in Ladbrokes owner. Investors in GVC Holdings (GVC) were nursing hefty losses yesterday after the chairman and chief executive dumped almost £20 million of stock. Shares of the Sportingbet and Ladbrokes owner dropped by 95½p to 588½p after Lee Feldman, the chairman, and Kenny Alexander, the chief executive, sold a total of almost three million shares at 666p. The lion’s share of the proceeds were collected by Mr Alexander, 49, who sold almost 2.1 million of his 2.7 million shares for £13.7 million. He retains shares and share options in the gambling operator worth £8.2 million at the price at which he sold, of which about a quarter are owned by his wife. Mr Feldman, chairman of GVC since 2008, collected just under £6 million from selling 900,000 shares. He retains 287,000 worth £1.9 million at the sale price.
Cineworld’s US venture with Regal Entertainment expected to fit the bill. A $5.8 billion foray into the United States is going better than expected, Cineworld Group (CINE) is likely to reveal next week. The company bought Regal Entertainment last year, becoming the world’s second biggest cinema company behind AMC, the owner of Odeon. The group is set to use its full-year results on Thursday to increase its forecast for cost savings from the deal from $100 million a year to $120 million. Cineworld also is expected to highlight a strong film line-up this year as a further balance against the risks from rising interest rates in America. The most hotly tipped films include The Lego Movie 2, Captain Marvel, Dumbo, Avengers: Endgame, Toy Story 4, Frozen 2, Godzilla: King of the Monsters and Star Wars: Episode IX.
Ocado ‘faces losing a quarter of customers’ over tie-up with M&S. Almost a quarter of Ocado Group (OCDO) customers will stop shopping with the online retailer if Waitrose products are not available, according to a new survey that highlights the challenges facing the company’s £1.5 billion tie-up with Marks & Spencer Group (MKS). Analysts at HSBC found in a survey of 250 Ocado customers that 22% would no longer remain with the company if did not sell Waitrose products, while 17% would not use it if the Waitrose products were replaced by Marks & Spencer. Thirty-seven per cent thought that Ocado was owned by Waitrose. David McCarthy, head of consumer retail research at HSBC, said that the findings were “worrying” for the new Ocado and M&S joint venture. “A meaningful proportion of customers said that their loyalty is to Waitrose and that M&S is not an adequate replacement,” he wrote in a research note.
Sports Direct’s boardroom bruiser up for another fight. Mike Ashley has taken on City grandees, MPs, union barons and fans of his Newcastle United football club in the 12 years since he brought to the London market, but that clearly hasn’t blunted his appetite for a scrap. The billionaire’s attempt this week to clear out almost the entire board of Debenhams (DEB) and to install himself in an executive role has pitched him into what may become one of his biggest battles yet. Mr Ashley, 54, has dramatically increased hostilities with Debenhams, in which his sportswear business Sports Direct holds a near-30% stake, by trying to seize power at the department store chain. This, in turn, has set him on a collision course with aggressive Wall Street hedge funds which hold part of the ailing retailer’s debts. Debenhams is locked in talks with its lenders and investors in a desperate bid to restructure its £500 million-plus debts and to offload stores to give it a future on the high street. Sports Direct, which has been building stakes in several struggling retailers, is estimated to be sitting on a paper loss in the region of £150 million from its investment in Debenhams. It is at risk of having its holding heavily diluted if Debenhams strikes a potential debt-for-equity deal with its lenders. At worst, the investment could be wiped out.
Norway will invest in oil giants after easing ban on sovereign wealth fund. Norway has watered down plans for its sovereign wealth fund to shun investing in all oil and gas companies, announcing that it will boycott only pure oil explorers. The change of plan means that the $1 trillion fund will be allowed to keep its huge stakes in integrated oil groups such as Royal Dutch Shell ‘B’ (RDSB), BP (BP.), Total and Exxon Mobil. The finance ministry said that pure oil and gas explorers would still be sold, but that integrated groups, which also refine crude oil and operate petrol stations, would not be included in the ban. Norway has the biggest sovereign fund in the world.
Goals takes a dive after errors are found in accounts. Britain’s biggest five-a-side football operator scored a spectacular own goal yesterday as the revelation of accounting mistakes sent its shares tumbling by more than 30%. Goals Soccer Centres (GOAL), based in East Kilbride, said that it was delaying Tuesday’s scheduled full-year results while it worked to “resolve certain accounting errors” and reviewed “some accounting practices and policies”. It added: “It is likely that the board will take a more prudent approach both for 2018 full-year results and going forward. As a result the board now expects the 2018 full-year results will be materially below expectations.” The group said that although the accounting adjustments were non-cash, they meant that Goals had breached one of its year-end banking covenants and was now seeking to renegotiate its facilities with Bank of Scotland.
Provident suitor Non-Standard Finance (NSF) defends guarantor loans. The head of the sub-prime lender that is trying to buy Provident Financial (PFG) for £1.3 billion has defended guarantor loans after the City regulator said that it was increasing scrutiny of the industry. Non-Standard Finance yesterday reported a 61% increase in its net loan book in guarantor lending to £83.1 million last year, helped by its acquisition of George Banco in August 2017. NSF was set up in 2014 by John van Kuffeler, who previously spent 22 years as chief executive and then chairman of Provident. It was listed in London in 2016 and has 850 staff. Guarantor lending is its second biggest and fastest-growing business and it wants to introduce the loans to Provident customers.
RPC Group (RPC) agrees to higher takeover bid from Berry Global. Europe’s biggest plastics packaging company has ditched its support for a takeover by private equity in favour of a higher offer from Berry Global after its American industry rival gatecrashed a deal. RPC Group said that its directors would recommend to shareholders a 793p-a-share offer from Berry Global, valuing the company at £3.34 billion. The offer is 1.4% higher than the 782p-a-share offer from Apollo, the American private equity firm, that RPC’s board had recommended in January. Shares in RPC closed last night down 11¾p at 784¼p, below the recommended price, with investors disgruntled at the “incredibly low valuation” and with the board’s handling of the offers. Analysts at Panmure Gordon, the stockbroker, said that investors had been hoping for a price north of 793p a share.
Shares in Saga (SAGA) travelled in the wrong direction after the insurer and tour operator for the over-50s was downgraded by analysts at JP Morgan Cazenove over worries about margins and Brexit pressure on travellers. More than £122 million was scrubbed from the value of the FTSE 250 company. Analysts said that it was facing pressure on margins at its insurance broking division after a string of underwriters said that policy prices were not keeping pace with rising claims. JP Morgan Cazenove also noted the amount of debt that Saga was taking on to pay for two new cruise ships. It cut its recommendation from “neutral” to “underweight” and dropped its price target for the shares from 140p to 120p.
In the wider market, large-cap and mid-market shares suffered because of weaker Chinese exports than many had expected and worries about the results of Sino-American talks on ending a dispute over trade tariffs. US figures, which showed that only 20,000 jobs outside agriculture were created last month, added to the bleak mood.
Energean Oil and Gas (ENOG) shook off a drop in the price of Brent crude through excitement about its new drilling project in Israel. Its stock rose 27p to 733¾p.
Vivo Energy (VVO), a fuel products distributor, picked up 2½p to 132½p, after Morgan Stanley lifted its target to 155p from 135p.
Elementis (ELM), the speciality chemicals group, gave back some of the gains it made in the week after better than expected results and the shares shed 5p to 154½p.
