MPs are calling on AstraZeneca (AZN) to pay former staff £12 million in redundancy after the collapse of the Avlon manufacturing site just over two years after it had been sold for £1 by the pharmaceuticals company. They include Frank Field, chairman of the Commons’ work and pensions select committee, who yesterday said that Astrazeneca should “cough up” and compared the situation with the failure of BHS after it was sold for £1 by Sir Philip Green. Former employees of Astrazeneca are embroiled in a dispute with the company after the appointment of administrators to the 48-year-old, 100-acre site in Avonmouth, near Bristol, in February. They have accused the group of betrayal through failing to ensure payment of £12 million in enhanced redundancy pay, a lack of due diligence on the sale and circulating misleading information to staff beforehand.
In the aftermath of the two fatal crashes of Boeing’s 737 Max, President Trump tweeted in April that he would “rebrand the aircraft with a new name”. Now an eagle-eyed plane spotter appears to have discovered that the world’s largest aerospace group might be following the president’s suggestion by posting pictures of two 737 Max jets in Ryanair Holdings (RYA) livery outside Boeing’s Seattle base, but with different designations. One is still the 737 Max, but another carries the designation 737-8200. Ryanair has 135 of the 737 Max models on order, the first five of which are due for delivery in the autumn, or once regulators have declared it safe. The airline’s fleet order is comprised entirely of a larger version of the Max 8, with 197 seats, which until now it has referred to in official Ryanair announcements as the 737 Max 200.
An American hedge fund with a record of intervention at British companies was revealed yesterday as a substantial investor in , only hours after the retailer had rattled investors by delaying its annual results. Coltrane Asset Management has built a 3.29% stake in Mike Ashley’s Sports Direct using derivatives, the retailer disclosed last night. The stake was revealed on a torrid day for the billionaire after Sports Direct said that publication of its full-year figures, which had been due on Thursday, was postponed and warned that it could miss market forecasts. The company blamed the problems on House of Fraser, the department stores chain it bought out of administration for £90 million last August, and heightened scrutiny of accounting firms including Grant Thornton, which is being investigated already by the Financial Reporting Council over its 2018 audit work for Sports Direct. The retailer warned that some “key areas” of its audit were yet to be completed that could “materially affect the guidance” it gave investors in December, when it forecast underlying earnings growth of between 5% and 15%, excluding House of Fraser.
The boss of Micro Focus International (MCRO) has made more than £11 million after offloading half of his stake in the software developer, heaping further pressure on its creaking share price. The disposal by Kevin Loosemore came less than a week after disappointing half-year results amplified concerns over its takeover of Hewlett Packard’s software division. The 2017 acquisition propelled Micro Focus into the FTSE 100, but has proved much tougher to digest than expected. Mr Loosemore, executive chairman, sold 650,000 shares yesterday at an average of £17.77 each, scooping £11.55 million. The 60-year-old, who was divorced last year, said that he wanted to “diversify” his fortune, which is bound up in the Berkshire-based software company. “Until now, all of my assets have been held in Micro Focus shares,” he said. Mr Loosemore, who has headed the company since 2005, retains 640,000 shares.
When, four years ago, Morgan Stanley analysts expressed concern about corporate governance at and slashed their estimate of its share value by 20% to 700p, those shares stood at 620½p. In the event, even that cautious assessment has proved optimistic. Last night the stock closed at 238¼p, down 25¼p on the day, after Mike Ashley’s company rattled investors by delaying publication of its annual results. The postponement adds to a litany of shareholder worries about governance since Morgan Stanley’s team gave their assessment. It also deals another blow to Mr Ashley’s reputation as a master retailer. The tycoon has turned a single shop in Maidenhead that opened in 1982 into a dominant player on Britain’s high streets, one that generated revenues of £3.4 billion last year. He has become a billionaire along the way and has used the leisurewear group to snap up a host of struggling retail chains, including House of Fraser — the department stores that Sports Direct bought out of administration last August — Evans Cycles and Sofa.com.
For centuries, the textbook has been the bedrock of a university degree. Now, however, the world’s largest education publisher has heralded the demise of printed coursework by making a pitch for a generation of American college students weaned on Netflix and Spotify. Pearson (PSON) said yesterday that it was switching to a “digital-first” publishing model at its American college division and would update its 1,500 US higher level textbooks on a continual basis. The FTSE 100 company, which is the largest publisher of textbooks in North America, is aiming to coax students into digital subscriptions. “It’s like Spotify or Netflix in terms of how you pay. You don’t own it, you rent it,” John Fallon, Pearson’s chief executive, said.
Britain’s biggest pet retailer has bought a stake in an online pet-sitting service. More than four million customers of Pets at Home Group (PETS), who are members of its VIP loyalty scheme, will have access to Tailster’s 26,000 registered minders across the country. They will be able to track their pets’ activity via GPS and the Tailster mobile app. The purchase for an undisclosed amount marks Pets at Home’s first step into the pet-sitting business, which it estimates to be worth more than £1 billion a year — more than the market for pet accessories such as collars, beds and toys. Dog care represents 75% of the sector and dog walking is said to be worth more than £500 million.
A drug bought by GlaxoSmithKline (GSK) in a contentious £4 billion deal has achieved encouraging results in the treatment of ovarian cancer, helping to assuage unease among investors over the deal. Glaxo said yesterday that results for Zejula, which it bought in December as part of its acquisition of Tesaro, an American company, showed that it could be used earlier in treatment to help to prevent the cancer returning and in a broader patient population. The results are a boost to Glaxo, which has been making a priority of the revival of its core pharmaceuticals division under Emma Walmsley, chief executive, and Hal Barron, its chief scientific officer and head of research and development. The company views the results of the Prima phase-III trial as the biggest set of data to emerge thus far under its new leadership team and vindication of its decision to buy Tesaro.
Britain’s second biggest defence supplier has “been through the mill”, but its shares are worth buying, analysts said yesterday. Babcock International Group (BAB) is understood to have received two takeover offers from Serco Group (SRP), its rival, during the winter that would have created an outsourcing group with £8 billion of annual revenues. It may have rejected them, Liberum, the broker, said yesterday, but the fact that they were made at all suggests that Rupert Soames, chief executive of Serco, sees attractive strategic assets in Babcock. The approaches came when Babcock’s share price was destabilised by reports from a mysterious outfit called Boatman Capital that questioned the company’s accounting and communications, as well as the leadership of its chairman.
Miners were given “signs of encouragement” by China, to which they are significantly exposed, Neil Wilson, an analyst at Markets.com, said. Although China, the world’s biggest metals consumer, reported its slowest economic growth in at least 27 years, its industrial output and retail sales beat forecasts. Antofagasta (ANTO) climbed 34½p to 897½p, Evraz (EVR) added 15¼p to 633½p and Glencore (GLEN) rose 2½p to 268¾p. Antofagasta enjoyed an extra boost from the World Bank, which ordered Pakistan’s government to pay damages of $5.8 billion to Tethyan Copper, a joint venture between Antofagasta and Barrick Gold, in a dispute over a copper mine.
Persimmon (PSN) lost 57½p to £19.32 as investors anticipated a Dispatches documentary on Channel 4 last night that was expected to reveal more concerns about the quality of the company’s properties and customer service. Analysts at Liberum said that the issues highlighted in the film were likely to be historical, however, adding that Dave Jenkinson, 51, the new chief executive, had made resolving such problems his top priority. Any weakness “should be seen as a buying opportunity”, they said. “We are convinced that quality will be improved at relatively low cost and that prospective buyers are unlikely to be unduly concerned (far worse issues were quickly forgotten at Bovis).”
Travis Perkins (TPK) fell 7½p to £12.53 after saying that it was preparing to sell its Wickes chain by the middle of next year in a £500 million spin-off. Travis Perkins has started to separate Wickes’s IT systems from those used by the rest of the group, according to The Sunday Times. Wickes’s operating profits have fallen by almost a third over the past two years to £69 million.
MX Oil (MXO), an Aim-listed oil and gas investing company, surged after the announcement that Osamede Okhomina, 48, will be its chief executive, replacing Stefan Olivier, who will remain on the board.
Tempus – Antofagasta (ANTO): Hold. Pakistan ruling could provide bonus but is a distraction from the core Chilean investment case
Tempus – Craneware (CRW): Buy. Long-term roadmap looks promising with the prospect of further healthy dividend increases
