BUSINESS LIVE: Currys takeover bid; Hipgnosis makes claim against adviser; Morrisons plots price cuts

The FTSE 100 closed up 16.79 points at 7728.50. Among the companies with reports and trading updates today are Currys, Hipgnosis, Morrisons and Group. Read the Monday 19 February Business Live blog below.

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FTSE 100 closes up 16.79 points at 7728.50

The Footsie closes soon

Just before close, the FTSE 100 was 0.26% up at 7,731.85.

Meanwhile, the FTSE 250 was 0.09% higher at 19,209.29.

Rightmove: Property asking prices rise for second month in a row

Average asking prices rose by 0.9 per cent this month to £362,839, according to the latest data from Rightmove.

The data, which looks at the prices of newly-listed homes, reported a 1.3 per cent rise in January. This means the typical asking price has risen by almost £8,000 since December.

Rental prices fall for third month in a row

After three years of double digit rent rises, the rental market finally appears to be cooling.

Rental prices in the UK have dropped for a third consecutive month, according to the HomeLet Rental Index. This index uses tenant referencing data from more than one million renters every year.

Putin gives green light to sale of HSBC’s Russian business

Russian President Vladimir Putin gave approval on Monday for HSBC to sell its Russian unit to privately-owned Expobank, according to a government decree.

HSBC said in June 2022 that it had agreed to sell a 100 per cent stake in the unit, HSBC Bank (RR), to Expobank.

Moscow has steadily tightened restrictions on foreign asset sales since then, with banks requiring Putin’s approval for any deal.

Esken considers deal to give up control of Southend Airport

(PA) – The owner of Southend Airport could cede control over the site in a deal with one of its major lenders which it said secures the future of the airport.

Esken, formerly known as Stobart Group, said that it was mulling a deal which would settle a dispute with a US private equity giant over a loan.

Amid the Covid pandemic in 2021, a highly difficult time for travel companies, Esken borrowed £125million from Carlyle to secure its finances.

Southend had performed well before the pandemic, but it has struggled to regain its shine since then, with recovery lagging behind London’s other airports. In 2020 easyJet announced it would close its base at the airport.

Carlyle claimed that Esken had broken the terms of its loan and asked for £200million back in a court case filed last year.

On Monday Esken said that it had “negotiated a recapitalisation proposal with Carlyle”, which would serve “as a solution to the dispute.”

Esken now has until March 4 to decide whether it wants to accept the solution.

SMALL CAP IDEA: Newmark’s Safetell secures strategy success

‘As higher gross margins and operational gearing come through, we would anticipate a rapid growth in profits,’ Allenby said in a 14-page research note.

Newmark‘s Safetell operation specialises in physical assets such as security doors, screens, safes, and cash-handling devices, while its Grosvenor Technology arm focuses on human capital management (HCM) and access control.

AstraZeneca shares rise on US approval of lung cancer treatment

AstraZeneca shares were the FTSE 100 Index’s top riser on Monday morning after one of its medicines was authorised for use by US regulators.

The pharmaceutical giant’s shares climbed 3.15 per cent, or 318p, to £104.12 as it revealed that the lung cancer drug Tagrisso, together with chemotherapy, has been approved by the US Food and Drug Administration.

Apple faces £427million EU anti-trust fine

Apple is facing a £427million EU anti-trust fine for blocking iPhone apps from telling users about cheaper music services as Spotify lashes out at the tech giant’s software changes.

The fine, which is expected to be announced next month according to sources close to the investigation, is the result of a year-long probe by the European Commission iniated after Spotify raised a complaint back in 2019, the Financial Times reports.

Ex-BoE chief Andy Haldane warns interest rates must start coming down

The UK economy could be ‘crushed’ unless the Bank of England starts cutting rates soon, its former chief economist warned today.

Andy Haldane sounded the alarm on delaying reductions in rates, saying Threadneedle Street risks compounding its mistake in failing to tackle inflation early.

Quarter of UK hospitality firms say they have no cash reserves left

A quarter of UK hospitality firms say they have no cash reserves left, research suggests, as industry bosses plead for tax cuts at the upcoming Spring Budget.

A joint survey by UKHospitality, the British Beer and Pub Association, British Institute of Innkeeping and Hospitality Ulster reveals the increased cost pressures facing the sector across the country.

Currys shares skyrocket as considers bid

Currys shares soared on Monday morning after Chinese online retail giant confirmed it was mulling an approach for the electricals retailer. said it was in the ‘very preliminary stages’ of considering a takeover offer for the company, which operates over 800 stores and employs around 28,000 people across eight countries.

Hipgnosis Songs Fund launches High Court claim against Mercuriadis

Hipgnosis Songs Fund (HSF) has launched a High Court claim against its investment advisor Hipgnosis Songs Management (HSM) and former chief executive Merck Mercuriadis.

The investment trust told investors on Monday that Mercuriadis and HSM have refused to indemnify HSF against liabilities ‘which may arise from Mr Mercuriadis’ alleged misconduct’.

Centrica shares top FTSE 350 fallers

Top 15 falling FTSE 350 firms 19022024

Currys shares top FTSE 350 risers

Top 15 rising FTSE 350 firms 19022024

Currys poised for bidding war

Richard Hunter, Head of Markets at interactive investor:

‘Early news in the UK centred around Currys, with the possibility of a bid from Chinese e-commerce company propelling the shares higher by 34%. This follows a report that Currys had rejected an approach from US private equity firm Elliott Investment Management at the weekend., prompting the possibility of a bidding war.

‘Most recently, Currys has been maintaining its strong focus on factors within its control as it continues to bear down on costs, where there have been additional savings in several of its expenditure lines, such as capex, depreciation, and debt and interest payments.

‘At the same time, the sale of its Greek business remains on track to complete before the end of its fiscal year and probably during this quarter. The disposal is expected to result in net proceeds of £156 million, which is largely likely to be used to reduce the group’s current net debt position of £129 million.

‘As such, Currys therefore expects to have a net cash position by the end of its financial year, while also giving it some extra flexibility with regards to a further reduction of the pension deficit. Elsewhere, the Nordics region, a particular thorn in the side for Currys which accounts for around 40% of overall revenues, has shown some signs of marginal improvement in the period.’

Quarter of hospitality firms out of cash as ‘urgent support’ needed

(PA) – A quarter of UK hospitality firms say they have no cash reserves left, according to new research, as industry bosses have urged the Treasury to prioritise cutting tax for the sector.

The joint survey by UKHospitality, the British Beer and Pub Association, British Institute of Innkeeping and Hospitality Ulster revealed the increased cost pressures facing venues across the country.

The trade groups said UK pubs, restaurants, hotels and cafes are in a “perilous state” and in need of “urgent support” to avoid local businesses shutting for good.

The new data, compiled across hospitality firms between January 15 and February 1, showed that 25% of surveyed business have no cash reserves and another 29% said they only have enough for three months.

The rising costs experienced by businesses left almost two-thirds (64%) not optimistic about their business’s prospects for the next 12 months, up 6 percentage points compared to October 2023.

In response, 94% of businesses said a reduction in VAT should be a priority for the Government.

In a joint statement, the industry groups said: “These results clearly show the perilous state our pubs, restaurants, hotels and cafes find themselves in.

“The fact that a quarter have run out of cash reserves completely is a real cause for concern.”

Market open: FTSE 100 flat; FTSE 250 up 0.1%

UK stocks are treading water this morning as fading hopes of interest rate cuts by global central banks weigh on sentiment.

Market sentiment is down as investors reassessed their rate cut bets, with money markets now pricing in around 65 basis point (bp) cut from the Bank of England (BoE) this year, compared with around 72 bps last week.

BoE chief economist Huw Pill said on Friday that so far he had seen only ‘quite modest and tentative evidence’ that inflation would fall back to and stay at the central bank’s 2 per cent target.

AstraZeneca, however, is up 3 per cent after a combination of the drugmaker’s cancer drug Tagrisso with chemotherapy to treat a type of lung cancer was approved by the U.S. Food and Drug Administration on Friday

The FTSE 250 has added 0.1 per cent, led by a 31.5 per cent advance in Currys after Chinese e-commerce group said it is in the ‘very preliminary stages’ of evaluating a possible offer for the British electricals retailer.

Oil and gas giants in crisis talks over Labour’s windfall tax

Oil and gas bosses will attend crisis talks this week over Labour’s plan to extend the windfall tax.

Industry group Offshore Energies UK (OEUK) said Labour leader Sir Keir Starmer’s policy would be a ‘hammer blow’.

Rolls-Royce turnaround takes off with £1.4bn profits

Rolls-Royce is expected to report bumper profits of £1.4billion this week as a turnaround plan led by boss Tufan Erginbilgic continues.

City analysts forecast that the British engineering firm, which makes aircraft engines, will see profit more than double in 2023, compared with the previous year.

Hipgnosis makes claim against adviser

Hipgnosis Songs Fund’s ex-CEO Merck Mercuriadis and investment adviser HSM have refused to provide protection against any liability arising from an on-going legal battle with a former business of Mercuriadis.

‘The company is concerned, having been assured by Mr Mercuriadis and the investment adviser that these claims are without merit and that they intend to vigorously defend them, that the request for an indemnity was refused,’ HSF said in a statement.

‘The Company now intends to bring a Part 20 Claim in the High Court against the Investment Adviser in which it will seek a full indemnity.’

Morrisons eyes Aldi and Lidl shoppers with price cuts

The boss of Morrisons has stepped up the supermarket’s price war with Aldi and Lidl to win back customers.

Morrisons lost its status as Britain’s fourth-biggest grocer nearly two years ago because shoppers have been switching to the German discounters.

Last month new chief executive Rami Baitieh pledged to tempt back disillusioned consumers, admitting there was ‘work to do’.

Currys rejects takeover bid

Currys has rejected a 62p per share takeover offer from Elliot Advisors as the electronics retailer’s board dismissed the US activist fund group’s bid as having ‘significantly undervalued the company and its future prospect’.

The bid was at a significant premium to Currys’ closing share price of 42.07p on Friday.


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