Takeaway.com appeared to seize the initiative in the £5 billion-plus bidding battle for Just Eat (JE.) yesterday as both suitors fired their last shots in the increasingly acrimonious struggle. Less than an hour after the technology group Naspers, bidding through its Prosus subsidiary, had submitted a final cash offer of 800p a share, valuing Just Eat at £5.5 billion, Takeaway.com sweetened its all-paper proposal by offering shareholders in Just Eat a bigger slice of the enlarged company. When Takeaway.com announced the revised offer, which raises the ratio going to Just Eat’s investors from 52% to 57.5%, the Dutch food delivery group’s offer was worth 916p. Its Amsterdam-listed shares lost almost 10% to €80.25, however, so the value of the bid fell to 830p. In a further boost to its chances, Takeaway.com reduced the acceptance level for its bid from 75% to a simple majority of 50% plus one share. It revealed last night that it had received acceptances and commitments from investors speaking for 41.1% of Just Eat shareholders, putting victory tantalisingly close.
Investors have rebuked Playtech (PTEC) over a bonus scheme that could hand the boss of the gambling software supplier shares worth more than £30 million. More than 45% of the votes cast at a shareholder meeting held yesterday to approve the bonus plan opposed granting the award. It is the latest investor revolt over executive pay at Playtech and is likely to raise further questions about its corporate governance. The bonus scheme is for nil-cost options over 1.9 million shares. It pays out if Playtech trades above certain levels for 30 business days running and is capped at £16. Mr Weizer will receive shares valued at £30.4 million if the ceiling is reached.
Royal Bank of Scotland Group (RBS) new chief executive has removed the management of its loss-making investment bank, raising expectations of deep cuts to the division. Chris Marks, 48, chief executive of Natwest Markets, and Richard Place, 54, chief financial officer, have stepped down. The bank has begun a search for successors, with two insiders replacing them on an interim basis. RBS’s investment bank has been shrunk dramatically since the financial crisis, as part of the bank’s drive to cut costs and in recognition of its government-backed agenda to move from high-risk trading into more straightforward activities financing businesses in the UK. There have been increasing signs that Alison Rose, 50, who took over the top job at RBS on November 1, intends to make further cuts to the division, in response to its struggle to make returns that justify costs.
NMC Health (NMC) has concluded that Muddy Waters highly critical report was “false and misleading”. NMC Health issued its findings from an internal review yesterday, three days after Muddy Waters made a series of allegations. Muddy Waters had taken a short position before publishing the 34-page report on Tuesday, which said that it had “serious doubts about NMC’s financial statements, including its asset values, cash balance and reported profits and debts”. It said that it had addressed the “main areas of focus from conversations with shareholders” and referred to “factual inaccuracies”.
An activist shareholder has turned up the pressure for a shake-up at Stock Spirits Group (STCK), calling for fellow investors in the Polish vodka-maker to force the board to pay a special dividend. Western Gate Private Investments, which represents the family office of Luís Amaral, a Portuguese cash-and-carry tycoon with a 10% stake in Stock, questioned its strategy. Shareholders were “stuck in the middle” between a management improving the group’s operating performance and a board that was “unwilling to return cash to patient investors”, it said. The result was “a mid-cap company that is neither growing or delivering returns”. It said that despite its low debt ratio, Stock offered one of the lowest cash returns to shareholders among its peers with a dividend payout of 60.5% compared with an average of 71.3% for the sector. Western Gate, the biggest shareholder, said three acquisitions totalling €47.5 million since 2017 would not produce any returns until 2023 and called for a special dividend of €0.1219 per share.
Shares in Circassia Pharmaceuticals (CIR) spluttered yesterday after one of its partners terminated a key licensing agreement. Circassia struck a $32.5 million deal with Beyond Air in January that gave it the right to sell Beyond Air’s Lung Fit PH respiratory treatment in the United States and China once it had been approved by regulators. Beyond Air said yesterday that it had cancelled the agreement, citing a “material breach” of contract. Circassia declined to elaborate further on the dispute, but said: “[The company] refutes the allegations in the strongest terms and believes there are no grounds to terminate the agreement. The company will enforce its rights under the agreement and defend its position vigorously.” Beyond Air, based in New York, said that the matter was with its lawyers and that it was looking for a new partner to replace Circassia. Analysts at Peel Hunt, the broker, described the decision as “surprising” but added that any short-term impact on Circassia was likely to be limited. “We estimate that even under a worst-case scenario where we fully remove Lung Fit from our model with no cost offset, Circassia’s [underlying profitability] still turns positive in 2020,” the broker said.
A takeover approach for Centamin (DI) (CEY) appears to have stalled with the gold miner and its suitor both unwilling to make the next move. Endeavour wants Centamin to request an extension to a “put up or shut up” deadline of December 31. It argues that the deadline for making an offer or walking away leaves insufficient time to complete due diligence. Centamin has, however, said it will only request an extension if Endeavour begins due diligence by disclosing information. Endeavour has said it went public to appeal to shareholders in Centamin after it refused to engage in talks. The chairman of Centamin met the chief executive of Endeavour last weekend and non-disclosure agreements were signed as a precursor to due diligence. However, progress has stalled over the issue of whether due diligence should begin before or after an extension request is submitted. Centamin complains that Endeavour has “repeatedly refused to engage in a proper manner”, while Endeavour accuses Centamin of a “lack of meaningful engagement”.
Residents of Shanghai are being encouraged to opt for a drop of Irish stout. Diageo (DGE) yesterday launched a Guinness Gatehouse “brand experience” in the city to introduce locals and visitors to the black stuff. The 1,000 sq m attraction in the Jing’an district, offering visitors a wide range of Guinness brews and merchandise, is the first adaptation of the Guinness Storehouse in Dublin, a popular tourist attraction. The launch comes on the back of a steady rise in Chinese visitors to the Dublin venue over the past decade. More than 80,000 Asian tourists visited the Storehouse last year, more than half of them Chinese.
Analysts have speculated that Capita (CPI) bosses might be better off breaking up the outsourced services contractor. The company has struggled of late and was forced into a £700 million rescue rights issue last year. It has been criticised by some in the City for having its thumbs in too many pies, as well as for strategic drift and mismanagement, and Deutsche Bank reckons it would be better off carving up the business. “Ultimately, we would see more upside in breaking the company up than keeping it together,” said Tom Sykes, an analyst at the bank. Sykes is telling clients to sell Capita shares, saying the market got a little too excited after Boris Johnson’s election win last week, with its share price jumping by 15%.
Wetherspoon (J.D.) (JDW) shares dropped after HSBC who has long been a buyer of the stock, now has it as a “hold”. The shares have risen by 50% this year and the bank isn’t convinced there is much more upside. “Costs are under control but the sales momentum doesn’t look as powerful as it once was,” HSBC said.
Watches of Switzerland (WOSG) ticked 25¼p higher to 346p after the retailer confirmed that Rolex is to raise the price of its luxury timepieces from the beginning of January. The average price of a Rolex in the US will rise by about 3%, although it will be closer to 7.5% in the UK, where the weak pound has given buyers an advantage over other countries.
PureTech Health (PRTC) shares shone yesterday as the biotech’s male hair loss treatment breezed through a mid-stage clinical study. After three months, people using the device saw a 44% increase in visible hair count, about three times more than existing treatments achieve. A phase III study has been pencilled in for the first half of next year, and analysts at Peel Hunt, the City stockbroker, think the treatment has a 70% chance of success. Should the product make it to market, they reckon a peak sales target of $360 million a year is “undemanding”.
GCP Student Living (DIGS) announced a surprise £75 million fundraising, in response to “specific market demand” from the Dutch pension fund manager APG Asset Management. APG is buying shares for 168½p each, a 6.3% discount to Wednesday’s closing price. GCP will use the funds to buy Scape Canalside, a block of flats in east London.
Tempus – Intertek Group (ITRK): Buy. High-quality group with strong growth potential, reliable earnings and consistent dividend
Tempus – Softcat (SCT): Take profits. The shares have had a storming run and would release good value
