Raider Coltrane Asset Management threatens Interserve (IRV) bosses. Hedge fund vows to sue outsourcer’s directors for losses. Interserve’s biggest shareholder has intensified its attack on the cleaning and catering giant by threatening to hold its bosses personally liable for millions of pounds of losses. Coltrane Asset Management is understood to have written to the ailing company’s directors to warn them that it will take legal action for what it claims are disclosure failings and unfairly favouring lenders over shareholders. The warning from the hedge fund, which has amassed a 28% stake in the former FTSE 250 company, comes ahead of a crucial shareholder vote on Friday. Interserve plans to hand lenders up to 95% of its equity in return for converting £480m of its debt into shares. Coltrane intends to vote against that deal — a move that could tip the company into administration. It argues that the plan would allow a pack of vulture funds that own debt to acquire the company on the cheap. The debt-for-equity swap needs the backing of at least 50% of voting shareholders.
Debenhams closes in on £110m deal to fend off Mike Ashley. Debenhams (DEB) is racing to secure a fresh capital injection of £110m, putting rebel shareholder Mike Ashley under pressure if he wants to seize control of the chain. The department store chain, whose future has been in doubt as credit insurers pull cover for suppliers and its share price plunges, grasped a £40m lifeline from banks and bondholders last month, giving it time to work on a deeper refinancing of its debts of more than £500m. The company — whose shares have dropped to 3.5p, valuing it at just £43m — is now understood to be weeks away from a deal with its lenders for a further £110m. Sources said this could explain why Ashley, whose has a 29.7% stake, launched a new attempt to shake up the board last week. Any refinancing involving a debt-for-equity swap with bondholders would almost certainly dilute his holding.
Tears in the boardroom at Mahmud Kamani’s Boohoo.com (BOO). Founder Mahmud Kamani isn’t going to let fellow directors stand in his way. Last September, Boohoo.com announced what it described as a “board realignment”. The online fast-fashion brand said Mahmud Kamani, the driving force behind its whirlwind success, would relinquish his role as joint chief executive after 13 years of hard graft. But the workaholic was not about to put his feet up and enjoy the £1bn fortune his family has amassed. Rather, the “realignment” enhanced his power. When the changes come into effect on Friday, the 54-year-old will become executive chairman of Boohoo. John Lyttle, formerly chief operating officer at Primark, will join the company and — unconventionally — slot in beneath him as chief executive. What was presented as an orderly succession sparked a dispute behind the scenes. Two weeks after the announcement, Boohoo’s non-executive chairman, Peter Williams, a boardroom veteran who once ran Selfridges, wrote a column for the trade magazine Retail Week that shone a light on the discord.
The boss of the tech company that swallowed part of Autonomy is facing an investor backlash after he was handed a hefty pay rise to return as chief executive. Stephen Murdoch of Micro Focus International (MCRO) has seen his salary rise to £850,000 — 66% more than he earned in 2017 before a reverse takeover of Hewlett Packard Enterprise’s (HPE) software business saw him replaced as boss. Micro handed the top job back to him last March after Chris Hsu quit amid problems with integrating the former Autonomy business that was spun out of HPE. Mike Lynch, Autonomy’s founder, is facing fraud proceedings in the US, where he denies wrongdoing. Shareholder advisory group Glass Lewis has “severe reservations” about Micro Focus’s remuneration report and has urged investors to oppose it at the annual meeting on March 29.
The billionaire owner of Betfred has accused ministers of ignoring thousands of people who will be put out of work when a clampdown on machines dubbed “the crack-cocaine” of gambling is enforced next month. Britain’s biggest bookmakers have warned they will close thousands of shops once the maximum stake on fixed-odds betting terminals (FOBTs), labelled a “social blight” by the former culture secretary Matt Hancock, is slashed from £100 to £2 next month. Fred Done has warned he will close up to 500 shops, while GVC Holdings (GVC) — owner of Ladbrokes Coral — has said it will scrap 1,000. William Hill (WMH) plans to close 900. “Fourteen thousand jobs are going in the betting industry and nobody seems to care,” said Done, 76. He added that 40% of Betfred’s profits came from FOBTs, which currently let punters wager up to £300 a minute. “It’s quite a devastating blow. My first love is with betting shops. We are fighting as hard as we can.”
Buyout baron Orion Capital Managers shops for stake in Intu Properties (INTU). A private equity giant has amassed a significant stake in the troubled shopping centre owner Intu, putting it in a position to take part in any future takeover. Orion Capital Managers has built a 4.1% stake in Intu worth about £62m over the past few months, making it one of the main shareholders in the owner of the Trafford Centre. Secretive billionaire John Whittaker, Intu’s largest investor with a 29.3% stake, led a consortium bid to take the company private last year, only for the deal to fall apart when Canadian investor Brookfield failed to raise financing. Intu wrote down the value of its properties by £1.4bn last year and its high level of debt leaves it exposed to declining asset values. As part of efforts to balance the books, it is close to selling a 50% stake in its Derby shopping centre to Cale Street Partners, an investor backed by Kuwait’s sovereign wealth fund.
Challenger banks OneSavings Bank (OSB) and Charter Court Financial Services Group (CCFS) unveil £1.6bn merger. OneSavings Bank and Charter Court Financial Services confirmed the imminent deal yesterday in response to a Sky News report. They said OneSavings shareholders would emerge with 55% of the enlarged group, with Andy Golding, OneSavings boss, becoming chief executive. The companies said the merger would “create a leading specialist mortgage lender”. The talks come hot on the heels of the £1.7bn acquisition by Clydesdale and Yorkshire Banking Group of rival challenger Virgin Money. Challenger banks, which rose from the wreckage of the financial crisis, are under pressure to merge or grow to compete with the big banks.
‘Spivvy’ Provident bid blast by Sir Gerry Grimstone. The former chairman of Barclays’ investment bank has waded into the £1.3bn takeover battle for Provident Financial (PFG), accusing the lender’s suitor of coming from a “spivvy generation”. Sir Gerry Grimstone, a friend of Provident chairman Patrick Snowball, said John van Kuffeler — the 70-year-old boss of Non-Standard Finance (NSF) and former Provident chief — did not understand how doorstep lending had evolved and had persuaded the three biggest shareholders to back the deal on a “false premise” because the City watchdog might not allow it. His comments came as van Kuffeler tried to accelerate his all-share bid by publishing his offer document early, yesterday. It said Provident was “incapable” of fixing its “multitude of problems”.
Domino’s Pizza Group (DOM) is poised to reveal that it has opened just a handful of stores this year, as it fights to reverse its fortunes overseas. The FTSE 250 company, which is facing a growing rebellion from franchisees over profits, has come under pressure amid doubts that it will hit its ambitious target for new UK stores. Analysts at Liberum say it has opened just three so far this year — in Carlisle, Bedford and Belfast. By April 1 last year, it had opened nine, according to Liberum. Domino’s has warned that profits for last year will be at the lower end of estimates, because of “growing pains” in international markets. It is struggling to integrate the Dolly Dimple’s chain it bought in Norway two years ago. Operations in Iceland and Switzerland have also suffered.
Persimmon (PSN) has launched a lawsuit against the telecoms giant BT Group (BT.A) over unpaid work on hundreds of its sites. The FTSE 100 housebuilder installed phone lines and internet cables on 759 of its developments between 2008 and 2016. These were to be inspected by engineers from BT, which should have also paid for the work as it is obliged to provide the services. It is normal in the industry for housebuilders to pay for installations and recoup the costs from BT and its subsidiary, Openreach. Persimmon — which has come under fire for the poor quality of its homes while posting record profits of £1bn thanks to the taxpayer-funded Help to Buy scheme — said: “BT has frustrated the process of inspection and certification.” BT’s breaches of contract include failure or refusal to inspect the installation of infrastructure, certify its quality or pay invoices, it said.
Peer inside the NHS records goldmine. The NHS is an inefficient beast that, in England, guzzles £127bn of taxpayers’ money every year. It also holds the medical records of 65m patients — data that could be priceless to drug manufacturers. One company hoping to put a price on the data — and reap rewards — is Sensyne Health (SENS), led by former science minister Paul Drayson, who is also co-founder of the vaccine maker PowderJect (and an amateur racing driver). By acting as a middleman between the health service and drug developers, Sensyne promises to allow pharma companies access to anonymised patient data, handing the NHS a share of any royalties. Sensyne has also developed apps that can monitor heart conditions, lung disease and diabetes in pregnant women. However, although the NHS is in theory a single system, it is highly fragmented — so Sensyne must use sophisticated technology to find patterns in the information, and can access records only once it has signed deals with relevant hospital trusts. “There is no single database,” said David Cox, an analyst at Panmure Gordon. “This creates significant barriers to entry.”The shares have had a rocky ride, falling to a low of 155.5p in January, although they closed on Friday at 190p, valuing it at £244.3m. Investors will no doubt look to America, where Flatiron Health was bought by the Swiss pharma giant Roche last year for $1.9bn (£1.5bn). Shareholders in Sensyne, which opted for a UK listing, may need to be more patient. Those looking for long-term investments should take a closer look. For a quick return, however, place your bets elsewhere.
