(qlmbusinessnews.com via bbc.co.uk – – Mon, 12th Nov 2018) London, Uk – –
The pound has fallen against the dollar amid political uncertainty as Prime Minister Theresa May struggles to broker an agreement on Brexit with her cabinet.
In early trading, sterling fell nearly 1% against the dollar to $1.2845.
Against the euro, it was down 0.2% at €1.1422.
Analysts said the fall was partly a reaction to the latest news concerning Brexit talks, but also reflected a stronger dollar.
Mrs May is trying to rally support among cabinet ministers for her Brexit proposal in time for a hoped-for summit in Brussels later this month.
However, media reports suggest that her efforts have been delayed by increasing disarray in her cabinet over the issue.
On Friday, Transport Minister Jo Johnson became the latest government figure to quit his post over Brexit, arguing that UK was “on the brink of the greatest crisis” since World War Two.
Simon Derrick, head of currency research at Bank of New York Mellon, said the pound's drop was “obviously related to the uncertainty over the weekend”, but noted that sterling had largely “held its own” against the euro.
He told the BBC: “At least half of it is actually about dollar strength and the expectation that the Federal Reserve will hike interest rates in December.”
Connor Campbell, financial analyst at Spreadex, said: “Sterling's early November rebound continued to unravel on Monday, the currency coming down with a nasty case of the Brexit blues.
“With her most ardent anti-EU MPs opposed to her customs arrangement plans, and a potential Remain rebellion brewing following the resignation of Jo Johnson, Theresa May appears to have been forced to abandon the emergency cabinet meeting that was pencilled in, after a supposed breakthrough last week.”
(qlmbusinessnews.com via uk.reuters.com — Mon, 12th Nov 2018) London, UK —
LONDON (Reuters) – Japan’s Takeda Pharmaceutical (4502.T) will hold an investor vote on its $62 billion acquisition of Shire (SHP.L) next month and aims to close the deal on Jan. 8, signaling its confidence in securing the required support.
Shares in London-listed Shire rose 3 percent on the news, hitting their highest level since Takeda first disclosed its interest in buying the rare diseases specialist in March.
The deal would be the biggest-ever overseas acquisition by a Japanese company – but it needs two-thirds support from shareholders, some of whom are worried about the enlarged company’s resulting debt burden.
Takeda said on Monday it would hold an extraordinary general meeting (EGM) of shareholders to vote on the transaction on Dec. 5.
Previously, Takeda had said it hoped to hold the EGM early in 2019, leaving uncertain the level of backing for the deal, which has been opposed by some members of the founding Takeda family.
“With the date of our extraordinary general meeting of shareholders now set, we are looking forward to continue our dialogue with shareholders regarding the compelling strategic and financial benefits of this transaction,” Chief Executive Christophe Weber said.
Weber — a Frenchman and the first non-Japanese CEO of the company — believes that buying Shire will accelerate Takeda’s growth and increase its international reach, boosting earnings.
The transaction is still awaiting approval from European regulators, although two people familiar with the matter told Reuters last week that Takeda was set to win conditional EU antitrust approval.
Takeda has offered to divest Shire’s experimental drug SHP647 to address concerns about overlap in inflammatory bowel disease treatments.
The takeover has already secured clearance from regulators in the United States, Japan, China and Brazil.
Weber said last week he was confident of securing investor backing for the purchase of Shire, but until now it has not been clear when exactly Takeda would call its EGM.
Takeda, which has a market value of around $32 billion, has secured a $30.9 billion bridge loan to help finance the Shire acquisition and some investors are concerned as to how well it will cope with debt repayments.
The Japanese company struck its agreement to take over Shire in May, in a deal that will propel it into the top 10 rankings of global drugmakers by sales.
However, the enlarged group faces significant challenges, particularly in hemophilia, where a new drug from Roche (ROG.S) and the prospect of new gene therapies now in development threaten a key part of Shire’s existing business.
(qlmbusinessnews.com via cityam.com – – Thur, 8th Nov 2018) London, Uk – –
Sainsbury’s posted a huge drop in profit for its half-year results today as it issued a warning about the impending Christmas period.
The supermarket delivered a mixed shopping bag of rising sales growth and pre-Christmas warnings in its half-year report for the six months to mid-September.
Like-for-like sales climbed 0.6 per cent year on year during the six months, rising from the 0.2 per cent growth it reported for the first quarter of the year. That helped revenue hit £16.8bn, up 3.5 per cent on the same period in 2017.
Sainsbury's also posted a 20 per cent rise in underlying pre-tax profits, which rose to £302m largely as a result its recent acquisition of Argos, which was delivered ahead of schedule.
But profit before tax plunged by 40 per cent to £132m.
Why it's interesting
The firm blamed store management restructuring and its planned merger with rival Asda for the fall in profit.
Sainsbury's, which is the second largest supermarket chain in the UK, added that consumer outlook remained “uncertain” in the run-up to the grocer’s crucial Christmas trading period, with the market remaining “highly competitive and very promotional”.
Lee Wild, head of equity strategy at Interactive Investor, said: “Sainsbury’s shares are not far off a 16-month high and up over 40 per cent since March, thanks in large part to April’s Asda announcement. Margins have suffered at the hands of the German discounters and, although the worst is over, business remains tough. Tesco was punished last month for missing half-year expectations, and Morrisons suffered a similar fate this week following a third-quarter slowdown.”
Wild added: “Sainsbury’s admits that consumer uncertainty will make the crucial second-half difficult, and that clothing is fiercely competitive. However, its confidence in meeting forecasts for underlying full-year profit of £634m is reassuring.”
Shares climbed 1.6 per cent in early morning trading.
What Sainsbury's said
Boss Mike Coupe said: “The market remains very competitive and we are transforming our business to meet rapidly changing customer needs. We have fundamentally changed how our 135,000 Sainsbury’s store managers and colleagues work and I would like to thank them for their ongoing hard work through this period.”
In comments to the Today programme, he added that he was positive about Sainsbury's merger with Asda getting the nod from the Competition and Markets Authority (CMA), which is currently probing the deal.
“They're going into a lot of detail and looking at all aspects of it but we are confident in our case,” he said.
“We believe that by bringing the two organisations together there is a unique opportunity to lower costs and ultimately those costs will be passed back to customers in the form of lower prices.”
The CMA is expected to publish its findings in late January.
(qlmbusinessnews.com via bbc.co.uk – – Tue, 9th Oct 2018) London, Uk – –
Investment giant Schroders has confirmed it is in discussions with Lloyds Banking Group over merging their wealth management businesses.
The tie-up will see two of the City’s biggest players join forces, with Lloyds benefiting from its new partner’s technology and investment management experience and Schroders gaining access to the vast customer network of the country’s biggest high-street bank.
A deal comes in the form of a joint venture 50.1pc owned by Lloyds, according to Sky News, which first reported the deal.
It is the first part of a three-pronged alliance between the two financial blue chips that would also include Schroders taking on a £109bn investment management contract from Lloyds’s insurance and pensions company Scottish Widows, which is currently held by Standard Life Aberdeen.
Schroders is also considering selling a 19.9pc stake in Cazenove Capital, its high-net-worth wealth manager, to Lloyds.
The combined deal was reported to be worth about £500m, with Lloyds’ wealth unit and the Cazenove stake both valued at roughly £250m each.
Schroders said the companies were in talks “with a view to working closely together in parts of the wealth sector”.
They added: “Discussions are ongoing and there can be no certainty that [they] will lead to any formal arrangement being entered into.”
A further announcement will be made when appropriate.
Expanding Lloyds’s wealth management credentials has been a key aim for António Horta Osório, who took charge of the banking group in 2011.
(qlmbusinessnews.com via theguardian.com – – Thur, 27th Sept 2018) London, Uk – –
Move is the eighth since 2015 as the central bank aims to unwind years of historically low rates
The US Federal Reserve raised short-term interest rates again on Wednesday, the eighth such move since 2015 as the central bank moves to unwind years of historically low rates.
After a two-day meeting the Fed announced a quarter percentage point rise in its benchmark rate to a range of 2% to 2.25%. The rate is used to set credit card, mortgage and loan rates and will trigger rises across the board for consumers.
The increase is the third rate rise this year and comes as US unemployment has hit new lows. In August the US added 201,000 new jobs – a record-breaking 95th consecutive month of jobs growth – as the unemployment rate remained steady at 3.9%.
The rise pushed the Fed’s rate above 2% for the first time since 2008, when the central bank stepped in and cut rates to close to zero as it sought to tackle the recession triggered by the last financial crisis.
In a statement the Fed signaled more rate hikes were imminent. “The committee expects that further gradual increases in the target range for the federal funds rate will be consistent with sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee’s symmetric 2% objective over the medium term. Risks to the economic outlook appear roughly balanced,” the statement read.
The rate hike came despite Donald Trump’s explicit – and unprecedented – criticism of the Fed’s decision to increase interest rates. “I’m not thrilled with his raising of interest rates, no. I’m not thrilled,” Trump said in an interview with Reuters last month.
Due to the independence of the Fed, it is highly unusual for a sitting president to criticize its decisions. The Fed chair, Jerome Powell, defended the policy at a meeting of central bank heads in Jackson Hole, Wyoming, last month.
At a press conference on Wednesday Powell once again defended the Fed’s independence. Asked about Trump’s criticisms, Powell said: “We’ve been given a really important job to do. We’re focused exclusively on carrying out that mission.” He said the Fed’s mission was “to set monetary policy to achieve maximum employment in the context of price stability. That’s what we do. We don’t consider political factors.”
Powell said the Fed had heard a “rising chorus on concerns” about the Trump administration’s trade disputes from businesses but added that it was “hard to see much happening at this point”.
(qlmbusinessnews.com via news.sky.com– Mon, 24th Sept 2018) London, Uk – –
Comcast's dramatic shoot-out with the US entertainment giant ends 21 months of uncertainty for Sky over its ownership.
Comcast has triumphed in the auction to buy Sky plc, the owner of Sky News, for £29.7bn in the biggest takeover ever seen in Europe's media industry.
Comcast's offer of £17.28 per share was £1.61 ahead of Fox's offer of £15.67.
The US giant's victory follows a dramatic shoot-out with US entertainment giant 21st Century Fox in a rare three-round auction overseen by the Takeover Panel.
The result ends 21 months of uncertainty for Sky over its ownership after the company's independent committee unanimously recommended the offer to shareholders.
In a statement Sky plc said: “As the price of the final Comcast Offer is materially superior, it is in the best interests of all Sky shareholders to accept the Comcast offer.
“Accordingly, the Independent Committee unanimously recommends that Sky shareholders accept the Comcast offer, and in order to ensure the successful closing of the Comcast offer, urges shareholders to accept immediately.”
Both companies want Sky to help them compete more effectively with the new wave of online entertainment providers, including streaming services provided by the likes of Netflix and Amazon Video, who sell their content directly to viewers.
Comcast in particular wants Sky to give it a presence in Europe and reduce its dependence on the US and has also made clear its admiration for Sky's technological know-how.
Disney, meanwhile, has been looking for a way to make its content available directly to viewers without having to go via a third party like a cable company.
Sky agreed to be taken over by Fox, its biggest shareholder, in December 2016. Since then, Fox has agreed to sell most of its entertainment assets to Disney, including its Hollywood film studio and its 39.1% stake in Sky.
However, the bid was held up by a lengthy series of investigations by the Competition & Markets Authority and by Ofcom, the broadcasting and telecoms regulator.
That opened the door for Comcast to make a counter-bid for Sky. In July, it tabled a £14.75-a-share offer for Sky, valuing the company at £26bn.
That was the highest offer going into today's auction and compared with Friday night's closing price of £15.85.
Under the contest, Fox – as the lower bidder – was entitled to raise its offer first.
In the second round, only Comcast was allowed to raise its offer.
This meant the two sides went into a final “sudden death” round of bidding.
Such auctions are exceptionally rare. There have been only four since the rules were changed in 2002 and the most recent of these was in April 2008 when Enodis, a maker of kitchen equipment for McDonald's and Burger King, was acquired by the US company Manitowoc for £948m.
Brian Roberts, chairman and chief executive officer of Comcast, said it was a “great day”.
He added: “Sky is a wonderful company with a great platform, tremendous brand, and accomplished management team.
“This acquisition will allow us to quickly, efficiently and meaningfully increase our customer base and expand internationally.
“We couldn't be more excited by the opportunities in front of us.
“We now encourage Sky shareholders to accept our offer, which we look forward to completing before the end of October 2018.”
Jeremy Darroch, group chief executive for Sky, said: “This is the beginning of the next exciting chapter for Sky.
“Brian and his team have built a great business and we are looking forward to bringing our two companies together for the benefit of our customers and colleagues.
“As part of a broader Comcast we believe we will be able to continue to grow and strengthen our position as Europe's leading direct to consumer media company.
“Today's outcome is down to the hard work of tens of thousands of people who have built and developed this business together over the last 30 years. Sky has never stood still, and with Comcast our momentum will only increase.”
21st Century Fox said in a statement that it was “considering its options regarding its own 39% shareholding in Sky and will make a further announcement in due course”.
It added: “Sky is a remarkable story and we are proud to have played such a significant role in building the incredible value reflected today in Comcast's offer.”
Other companies whose fates have been decided by an auction overseen by the Panel include Corus, the owner of British Steel and Canary Wharf, the commercial property company.
However, in terms of the amount of money being paid, this auction is by far the biggest yet.
Sky, which was founded in 1989, is Europe's biggest pay television broadcaster.
It has 23 million household customers in the UK, Ireland, Germany, Austria and Italy, while it has recently launched “over the top” services in Spain and Switzerland.
It floated on the stock market in 1994 and, since flotation, has been a remarkably stable business, having had just five chief executives in the intervening 24 years – the late Sam Chisholm, Mark Booth, Tony Ball, James Murdoch – who is the current chairman of Sky and current chief executive of Fox – and Mr Darroch, the current incumbent.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 17th Sept, 2018) London, Uk – –
The International Monetary Fund has warned that a “no-deal” Brexit on World Trade Organization terms would entail substantial costs for the UK economy.
Such an outcome would affect “to a lesser extent” other EU economies.
It said challenges in getting a deal done were “daunting” and warned against further UK interest rate rises.
The IMF said it expected Britain's economy would grow by about 1.5% a year in 2018 and 2019 if a broad Brexit agreement was struck.
Christine Lagarde, the IMF's managing director, added: “Those projections assume a timely deal with the EU on a broad free trade agreement and a relatively orderly Brexit process after that.”
The IMF said that all likely Brexit scenarios would “entail costs for the UK economy”, but that a disorderly departure could lead to “a significantly worse outcome”.
Speaking at a news conference at the Treasury in London, Ms Lagarde said: “Any deal will not be as good as the smooth process under which goods, services, people and capital move around between the EU and the UK without impediments and obstacles.”
She said a “disorderly” or “crash” exit from the EU would have a series of consequences, including reduced growth, an increased deficit and depreciation of sterling, leading to a reduction in the size of the UK economy.
She pointed out that countries tended to trade mostly with their neighbours, adding: “I think geography talks very loudly.”
In July, the IMF said the UK economy would grow by 1.4% this year and 1.5% in 2019.
(qlmbusinessnews.com via uk.reuters.com — Mon, 17th Sept 2018) London, UK —
FRANKFURT (Reuters) – Deutsche Bank (DBKGn.DE) said on Monday that it would move assets from London to Frankfurt after Britain’s planned exit from the European Union next year, in line with British and EU regulators.
“The terms on which banks will operate in the EU and UK after Brexit remains unclear in the absence of a firm political agreement but our intention is to operate in the UK as a branch in line with the Prudential Regulation Authority’s guidance”, the lender said in a statement.
It added that it announced in 2017 that would make Frankfurt rather than London the primary booking hub for its investment banking clients.
According to a source close to the matter, Deutsche Bank is considering shifting large volumes of assets from London to Frankfurt and to transform its UK arm into a smaller, less complex and ringfenced subsidiary.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 10th Sept 2018) London, Uk – –
The UK economy grew by 0.3% in July after being helped by the heatwave and the World Cup, according to the Office for National Statistics.
In the three months to July, the economy expanded by 0.6%.
“Services grew particularly strongly, with retail sales performing well, boosted by warm weather and the World Cup,” said Rob Kent-Smith from the ONS.
“The construction sector also bounced back after a weak start to the year,” he added, but production contracted.
“The dominant service sector again led economic growth in the month of July with engineers, accountants and lawyers all enjoying a busy period, backed up by growth in construction, which hit another record high level,” said Mr Kent-Smith.
The 0.6% growth rate for the three months to July was at the top end of forecasts, and marks a pick-up from the 0.4% rate seen in the three months to June.
(qlmbusinessnews.com via telegraph.co.uk – – Mon, 27 Aug 2018) London, Uk – –
Surging investment in shares is boosting stamp duty tax payments to levels not seen since the peak of the boom years in 2007 and the dotcom bubble in 2000.
British investors are being spurred on by the US market’s record-breaking bull run, which is driving investment in equities across much of the world.
It adds to evidence investor sentiment has fully recovered from the financial crisis. But it could be another warning sign that exuberant markets are at risk of entering a bubble.
So far this financial year the Treasury has raised £1.3bn from stamp duty on share purchases, up by 17pc on the same period last year. If this continues the Exchequer will bag a windfall haul of more than £4bn, a level not hit for more than a decade.
FTSE 350 share trading volumes are up by more than 20pc this year on their previous peaks in 2007 or 1999, according to data from Bloomberg.
However, past eras of such vigorous stock buying were followed by a crunch. There are already signs of wobbling markets in the US tech sector, where booming prices have left investors exposed to any bad news.
“Markets have been rising for such a long time, expectations are relatively high,” said Tom Stevenson at Fidelity Personal Investing. “When you get disappointing results in that environment then you get some pretty savage market reactions.”
US markets are likely to fall next year as boom turns to a crunch of around 20pc, according to John Higgins at Capital Economics. Such a bust would hit UK markets too, he believes.
“There is a good chance the UK stock market will suffer as a result of that,” he said. “When the US stock market falls sharply we invariably see other stock markets around the world doing likewise, irrespective of conditions in the local economy.
“Many of these stock markets, particularly the FTSE, are chock-full of international companies so are exposed to what is going on in the global economy as much as they are at home.” Britain is particularly exposed to any downturn in the world economy because it is home to so many giant companies. This could mean investors, who have not seen shares rise as much as those in the US, could be hit by a downturn that is just as severe.
“The UK is globally exposed, people use the UK’s markets as a proxy for buying into the upturn in global activity,” said Andrew Milligan at Aberdeen Standard Investments.
Risks to the market include the trade war, higher interest rates, China’s debts and the eurozone, Mr Milligan said, though these are midterm problems that are only likely to strike in 2020. “In the past 10 years people have been very fearful, there has been a lot of money parked on the sidelines for a very long time,” said Robert Burgeman at Brewin Dolphin.
“I get people who are worried about the level of stock markets and think that there is a crash around the corner, but that is music to my ears because it means we have not reached that final capitulation stage [of a bubble] when people say: ‘Stuff it, I am all in’. We haven’t got to that stage yet where the taxi driver is telling you about the latest stock he has been buying.”
(qlmbusinessnews.com via uk.reuters.com — Mon,20 Aug 2018) London, UK —
(Reuters) – PepsiCo (PEP.O) is buying household drink-machine maker SodaStream (SODA.TA) (SODA.O) in a $3.2 billion deal, it said on Monday, seeking an edge in health-conscious beverages as it battles chief rival Coca-Cola (KO.N).
PepsiCo will acquire SodaStream for $144 per share in cash, representing a 10.9 percent premium to the Friday closing price of SodaStream’s U.S.-listed stock.
SodaStream, which makes machines that turn tap water into carbonated water, will help diversify PepsiCo’s portfolio of snacks and beverages. The Purchase, New York-based group will use cash on hand to fund the acquisition.
SodaStream’s Israel-listed shares will be halted for trading until its Nasdaq-listed stock opens later on Monday, the Tel Aviv Stock Exchange said in a statement.
(qlmbusinessnews.com via uk.reuters.com — Mon, 30th July 2018) London, UK —
(Reuters) – GVC Holdings Plc (GVC.L) shares leapt to a record high on Monday after it agreed to set up an online betting platform in the United States with U.S. hotel and casino operator MGM Resorts International (MGM.N) .
The announcement comes ahead of the American football season and as British betting companies look to capitalize on the U.S. market after a U.S. Supreme court ruling in May lifted a ban on sports betting.
Bookmakers have also been assessing the impact of recently implemented UK gambling curbs after the government said in May it would cut the maximum stake on fixed-odds betting terminals (FOBTs) to two pounds from 100 pounds.
“GVC appears to have struck gold by signing a 50/50 JV with arguably the biggest gambling brand in the U.S.,” London-based broker Shorecap’s Greg Johnson said in a note.
GVC shares rose as much as 7.5 percent to a record high of 1,178 pence before retreating slightly to trade 5 percent by 0748 GMT.
The companies will initially invest $100 million each in the joint venture, which will have a U.S. headquarters, said GVC which owns the Coral, Ladbrokes and Sportingbet brands.
GVC said the joint venture would get access to 15 U.S. states with a population of 90 million, adding that the venture will get access to all U.S. land-based and online sports betting while integrating both companies’ customer loyalty programs.
“We are proud to join forces with GVC, the largest and most dynamic global online betting operator, with existing reputable and trusted operations in the U.S.,” MGM Resorts Chief Executive Jim Murren said.
GVC had said on Friday that it was in advanced talks regarding a joint venture with MGM. Sky News had also reported that the deal could pave the way for a merger between the two firms.
GVC, which has grown rapidly through acquisitions including the purchase of Ladbrokes late last year, has been looking to expand in the United States, after the U.S. Supreme Court paved the way to legalize sports betting.
The company said in July that it expected to post full-year results in line with expectations.
(qlmbusinessnews.com via uk.reuters.com — Fri, 6th July 2018) London, UK —
BEIJING/WASHINGTON (Reuters) – The United States and China slapped tit-for-tat duties on $34 billion worth of the other’s imports on Friday, with Beijing accusing Washington of triggering the “largest-scale trade war” ever in a sharp escalation of their months-long conflict.
Hours before Washington’s deadline for the tariffs to take effect, U.S. President Donald Trump upped the ante, warning that the United States may ultimately target over $500 billion worth of Chinese goods, or roughly the total amount of U.S. imports from China last year.
China’s commerce ministry, in a statement shortly after the U.S. deadline passed at 0401 GMT on Friday, said that it was forced to retaliate, meaning $34 billion worth of imported U.S. goods including autos and agricultural products also faced 25 percent tariffs.
However, an ensuing three-plus hour delay before Beijing confirmed that it had implemented retaliatory tariffs sowed confusion in markets.
“After the United States unfairly raised tariffs against China, China immediately put into effect raised tariffs on some U.S. goods,” foreign ministry spokesman Lu Kang told a daily media briefing on Friday afternoon.
China’s soymeal futures fell more than 2 percent on Friday afternoon before recovering most of those losses, amid market uncertainty over whether China had implemented tariffs on a list of U.S. goods, including soybeans.
Some Chinese ports had delayed clearing goods from the United States, four sources said on Friday. There did not appear to be any direct instructions to hold up cargoes, but some customs departments were waiting for official guidance on imposing added tariffs, the sources said.
Ford Motor Co said on Thursday that for now, it will not hike prices of imported Ford and higher-margin luxury Lincoln models in China.
An analysis of over four dozen imported U.S products facing higher duties showed that prices were little changed on Friday afternoon versus earlier in the week. The products, all sold on Chinese e-commerce platforms, ranged from pet food to mixed nuts and whiskey.
While Chinese state media have slammed Trump’s protectionism and on Friday likened his administration to a “gang of hoodlums,” the trade conflict has gained little traction on China’s tightly controlled social media, not cracking the 50 top-searched topics on the Twitter-like Weibo platform.
The dispute has roiled financial markets including stocks, currencies and the global trade of commodities from soybeans to coal in recent weeks.
Chinese shares, which have been battered in the run-up to the tariff deadline, reversed earlier losses to close higher, but the yuan remained weaker against the dollar. Asian equities wobbled but also managed to end up.
In the run-up to Friday’s tariff implementation, there was no sign of renewed negotiations between U.S. and Chinese officials, business sources in Washington and Beijing said.
“We can probably say that the trade war has officially started,” said Chen Feixiang, professor of applied economics at Shanghai Jiaotong University’s Antai Colege of Economics and Management.
“If this ends at $34 billion, it will have a marginal effect on both economies, but if it escalates to $500 billion like Trump said then it’s going to have a big impact for both countries,” Chen said.
‘GANG OF HOODLUMS’
China’s commerce ministry called the U.S. actions “a violation of world trade rules” and said that it had “initiated the largest-scale trade war in economic history.”
Trump has railed against Beijing for intellectual property theft and barriers to entry for U.S. businesses and a $375 billion U.S. trade deficit with China.
“You have another 16 (billion dollars) in two weeks, and then, as you know, we have $200 billion in abeyance and then after the $200 billion, we have $300 billion in abeyance. Ok? So we have 50 plus 200 plus almost 300,” Trump told reporters aboard Air Force One on Thursday.
Throughout the escalating conflict, China has sought to take the high road, positioning itself as a champion of free trade, but state media ramped-up criticism of Trump on Friday.
“In effect, the Trump administration is behaving like a gang of hoodlums with its shakedown of other countries, particularly China,” the state-run China Daily newspaper said in an English language editorial on Friday.
“Its unruliness looks set to have a profoundly damaging impact on the global economic landscape in the coming decades, unless countries stand together to oppose it.”
While the initial volley of tariffs was not expected to have major immediate economic impact, the fear is that a prolonged battle would disrupt makers and importers of affected goods in a blow to global trade, investment and growth.
“For companies with supply exposure to tariffs, they will move sourcing country of origin if they can; if they can’t, they’ll pass on as much of the tariff cost as they can, or see a cut in margins,” said Jacob Parker, vice president of China operations at the U.S.-China Business Council in Beijing.
A China central bank adviser said the planned U.S. import tariffs on $50 billion worth of Chinese goods – $34 billion plus a planned follow-on list worth $16 billion – will cut China’s economic growth by 0.2 percentage points, although the overall impact would be limited, the official Xinhua news agency reported Friday.
“This is not economic Armageddon. We will not have to hunt our food with pointy sticks. But it is applying the brakes to a global economy that has less durable momentum than appears to be the case,” Rob Carnell, chief economist at ING, said in a note.
U.S. Customs and Border Protection officials were due to collect 25 percent duties on a range of products including motor vehicles, computer disk drives, parts of pumps, valves and printers and many other industrial components.
China’s tariffs on hundreds of U.S. goods include top exports such as soybeans, sorghum and cotton, threatening U.S. farmers in states that backed Trump in the 2016 U.S. election, such as Texas and Iowa.
By Adam Jourdan in SHANGHAI, Michael Martina, Christian Shepherd, Dominique Patton and Elias Glenn in BEIJING, David Lawder and Jeff Mason WASHINGTON; Writing by Tony Munroe;
(qlmbusinessnews.com via bbc.co.uk – – Mon, 2 July 2018) London, Uk – –
Tesco says it is planning a “strategic alliance” with French retail giant Carrefour, as the two try to use their joint buying power to cut costs and offer lower prices to customers.
The two plan a “strategic relationship” when dealing with global suppliers, and the tie-up will also mean joint purchasing of their own-brand products.
The move comes as retailers face an increasingly competitive environment.
Tesco is the UK's largest retailer while Carrefour is Europe's largest.
Last year, Tesco – which employs 440,000 people – reported profits of £1.3bn with sales of £57.5bn.
Carrefour operates 12,300 stores across more than 30 countries, employing about 375,000 people worldwide. Last year, it had sales of €88.2bn (£78bn).
The two have been talking for two years and, although no formal agreement has yet been signed, they said they were hoping to confirm a deal in the next two months.
Tesco chief executive Dave Lewis said: “By working together and making the most of our collective product expertise and sourcing capability, we will be able to serve our customers even better, further improving choice, quality and value.”
The grocery sector is currently going through a period of rapid change. Tesco itself recently completed the purchase of wholesaler Booker, and in April, Sainsbury's said that it was in advanced talks to buy Asda from US retail giant Walmart.
The traditional big four UK supermarket chains – Tesco, Sainsbury's, Asda and Morrisons – have faced increasing competition from the rapidly-expanding budget chains Lidl and Aldi over the past few years, and there is now the added threat of internet giant Amazon moving into the sector.
Last year, Amazon bought upmarket grocer Whole Foods. In the UK, Amazon offers food sales through its Amazon Fresh service, although currently that is still focused on Greater London and parts of the South East.
“Another price war is now looming in the UK supermarket sector,” said Laith Khalaf, senior analyst at Hargreaves Lansdown. “The latest Tesco partnership looks like a direct response to the threat posed by the proposed merger of Sainsbury's and Asda, who will have access to the global buying power of Walmart as a result.
“The sector is already fiercely competitive, in no small part thanks to the emergence of the discounters Aldi and Lidl, and that comes against a background of shifting shopping habits.
“Challenging trading conditions have sparked a wave of re-invention in the UK supermarket sector, and this new partnership between Tesco and Carrefour is yet another stage in that process.'
Tesco's performance has gradually improved since 2014, when it reported the worst results in its history with a record pre-tax loss of £6.4bn. However, it recently recorded its 10th consecutive quarter of rising sales and said its growth plans were on track.
In January, Carrefour announced a major transformation plan that involved making cost cuts of €2bn by 2020, and investing €2.8bn in e-commerce by 2022.
Announcing the planned tie-up with Tesco, Carrefour Group chief executive Alexandre Bompard said the agreement was, “a great opportunity to develop our two brands at the service of our customers”.
“This international alliance further strengthens Carrefour allowing it to reach a key milestone in the implementation of its strategy.”
(qlmbusinessnews.com via news.sky.com– Tue, 19 June, 2018) London, Uk – –
Stock markets react to the latest threats following last week's tit-for-tat imposition of tariffs between the two countries.
Investors are reacting nervously to a potential escalation in President Trump's trade war with China, with stock markets falling sharply in Asia.
China's Shanghai Composite lost up to 5% of its value at one stage after the US president asked officials to identify $200bn of Chinese goods to be subject to a 10% tariff.
It prompted Beijing to accuse Washington of “blackmail” – warning it would respond to any such measures.
That followed last Friday's decision to impose 25% tariffs on $50bn of Chinese products.
Then, Beijing immediately retaliated by matching the US levy, which prompted Mr Trump to up the ante once more in what he regards as an unfair balance in trade between the two superpowers.
In a statement he said: “This latest action by China clearly indicates its determination to keep the United States at a permanent and unfair disadvantage, which is reflected in our massive $376bn trade imbalance in goods. This is unacceptable.
“Further action must be taken to encourage China to change its unfair practices, open its market to United States goods, and accept a more balanced trade relationship with the United States.
“Therefore, today, I directed the United States Trade Representative to identify $200bn worth of Chinese goods for additional tariffs at a rate of 10%.
“After the legal process is complete, these tariffs will go into effect if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced.
“If China increases its tariffs yet again, we will meet that action by pursuing additional tariffs on another $200bn of goods. The trade relationship between the United States and China must be much more equitable.”
The increasingly bitter trading relationship between the US and China comes less than a fortnight after a fractious G7 summit where Mr Trump's use of tariffs, both against China and on steel and aluminium imports from the EU, Canada and Mexico, was roundly criticised.
The latest escalation was reflected in the value of shares in both Asia and Europe.
The Shanghai Composite closed almost 4% down while Hong Kong's Hang Seng lost 3%.
All major European markets were also trading lower – the FTSE 100 faring better than most with just a 1% decline in early trading.
Commenting on President Trump's latest threat, head of Asia-Pacific trading at OANDA Stephen Innes, said: “That was quick and sudden, reminding us just how quickly things can get right out of hand.
“Indeed, this is moving beyond ‘tit-for-tat' levels and, predictably, investors are running for cover under the haven umbrellas as global equity indices are crumbling under the weight of an escalating trade war.
“Buckle up as this could get messy,” he concluded.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 18 June 2018) London, Uk – –
The owner of Clydesdale Bank and Yorkshire Bank, CYBG, has agreed to buy Virgin Money for £1.7bn.
Under the deal, all the group's retail customers will be moved to Virgin Money over the next three years.
It will be the UK's sixth-largest bank, with about six million customers, but 1,500 jobs are likely to go.
CYBG said it had agreed with Sir Richard Branson's Virgin Group to license the Virgin Money brand for £12m a year, rising to £15m later.
Virgin Group is Virgin Money's biggest shareholder with a 34.8% stake in the business.
Under the terms of the deal, Virgin Money shareholders will get 1.2125 new CYBG shares for every Virgin Money share they hold, and will end up owning about 38% of the combined business.
CYBG said the combined group would have about 9,500 employees, but it intended to reduce that total by about one-sixth, suggesting about 1,500 jobs would go.
It said some of those job losses would be achieved “via natural attrition”.
Virgin Money, which was founded in 1995, expanded its business in 2011 when it bought the remnants of Northern Rock for about £747m.
By Kevin Peachey, personal finance reporter
Nimbleness and the ability to attract customers through new technology have been seen as challenger banks' main attributes.
That is why the Open Banking scheme – opening traditional accounts to specialist services from smaller players – appeared to be a potential game changer for fintechs and banking upstarts.
But the TSB fiasco may well have damaged consumer confidence in these companies being able to provide more customer-friendly tech than the big banks.
With this deal, the focus shifts to a more traditional form of competition – growing a business to a sufficient size to take on the incumbents at their own game.
2.8 million customers
£2.6bn market capitalisation
3.3 million customers
£1.5bn market capitalisation
Competitor of scale'
CYBG said the takeover would “bring together the complementary strengths of two successful challenger banks to create the UK's first true national competitor to the large incumbent banks”.
Its chief executive, David Duffy, told the BBC's Today programme: “We're going to become a competitor of scale.”
He added that “technology and agility” were the factors that would decide the future of banking.
“I think we have sufficient scale – the brands, the product and the technology,” he said.
“We can be agile enough to deliver a much better deal for the customer.”
Mr Duffy will retain his current position in the combined group, as will CYBG chairman Jim Pettigrew.
Virgin Money chief executive Jayne-Anne Gadhia has agreed in principle to stay on as a consultant for a limited time after the deal goes through.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 1 June 2018) London, Uk – –
Europe, Canada and Mexico are planning retaliatory moves after President Trump imposed tariffs on steel and aluminium imports to the US.
The European Union issued a 10-page list of tariffs on US goods ranging from Harley-Davidson motorcycles to food products.
It also plans to challenge the move at the World Trade Organization.
Mr Trump claimed the tariffs would protect US steelmakers, which were vital to national security.
French President Emmanuel Macron called Mr Trump to tell him the tariffs were “illegal” – a term echoed by Bernd Lange, chair of the European Parliament's international trade committee.
The MEP hoped a trade war could be avoided but warned that Mr Trump's action demonstrated the US president was “not willing to stick to the rules”.
Germany's Economy Minister, Peter Altmaier, hoped a decisive EU response would make Mr Trump reconsider his decision.
UK International Trade Secretary Liam Fox said the 25% levy on steel was “patently absurd”, adding: “It would be a great pity if we ended up in a tit-for-tat trade dispute with our closest allies.”
Barry Gardiner, the Labour shadow trade secretary, told the BBC's Today programme the US measures were “based on a lie”, adding the UK should not be “bullied by the president … we believe in a rules-based system and Trump doesn't”.
Gareth Stace, head of trade body UK Steel, said the tariffs were “no way to treat your friend” and called on the government to safeguard the industry's 31,000 jobs.
Justin Trudeau, the Canadian Prime Minister, said the US move was “totally unacceptable” and rejected the claim that his country posed a national security threat to America.
Canada plans to impose tariffs of up to 25% on about $13bn worth of US exports from 1 July. Goods affected will include some American steel, as well as consumer products such as yoghurt, whiskey and coffee.
Mexican Foreign Minister Luis Videgaray said his country was planning new duties for imports of steel, pork, apples, grapes, blueberries and cheese from the US.
Opposition to the tariffs was also voiced by prominent Republicans. House Speaker Paul Ryan, the most influential Republican in Congress, said the move “targets America's allies when we should be working with them to address the unfair trading practices of countries like China”.
What do the US tariffs mean?
Mr Trump first announced plans for the tariffs in March, but granted some exemptions while countries negotiated.
On Thursday, US Commerce Secretary Wilbur Ross said talks with the EU, Canada and Mexico had not made enough progress to warrant a further reprieve, meaning tariffs of 25% on steel and 10% on aluminium have now come into effect.
They apply to items such as plated steel, slabs, coil, rolls of aluminium and tubes – raw materials that are used extensively across US manufacturing, construction and the oil industry.
Mr Ross said the president had the authority to lift the tariffs or alter them at any time, leaving room for “flexibility”.
“We continue to be quite willing and indeed eager to have discussions with all those parties,” he said.
Canada, Mexico and the EU together exported $23bn (£17bn) worth of steel and aluminium to the US in 2017 – nearly half of the $48bn of total steel and aluminium imports last year.
European firms have said they fear lower US demand for foreign steel will divert shipments to Europe.
Analysts at IHS Markit expect the effects to be distributed across a wide range of markets, limiting the effect on steel prices outside the US.
That leaves America to bear the brunt of the economic impact, which economists say will appear in the form of higher prices and job losses – as many as 470,000 by one estimate.
Steel prices in the US have already risen due to the uncertainty and may increase as the tariffs hit imports.
Consumers outside the US could see prices of some goods fall, while those in America may end up paying more.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 9 May 2018) London, Uk – –
Vodafone will pay €18.4bn (£16.1bn) for cable networks in Germany and eastern Europe owned by US firm Liberty Global.
The deal will allow Vodafone to expand its mobile, TV and broadband services in Hungary, Romania and Czech Republic.
It will also create a stronger “quad play” competitor for Deutsche Telekom in Germany.
The long-expected deal with Liberty Global, which also owns Virgin Media, is Vodafone's biggest since its £112bn takeover of Mannesmann in 2000.
Vodafone said the transaction, which includes Unitymedia in Germany, would create a “converged national challenger” in the country.
Deutsche Telekom, which is Europe's biggest telecoms operator by revenue and owns T-Mobile, has voiced strong objections to the move.
Its chief executive, Timotheus Höttges, said it would distort competition: “I personally will fight for fair competition for our customers, to ensure that we do not face a disadvantage.”
He has also questioned whether regulators would approve the tie-up.
However, Vodafone chief executive Vittorio Colao said that deal “creates a strong competitor to Deutsche”.
Vodafone already owns the largest cable business in Germany after it acquired Kabel Deutschland for €7.7bn five years ago.
Unitymedia is the second-largest cable network, operating in the three of Germany's 16 states that Vodafone does not already cover.
Mr Colao said that there was “no geographical overlap” between the two businesses.
Mike Fries, chief executive of Liberty Global, said: “Even together, Liberty Global and Vodafone, whose cable networks don't compete or overlap, will be half the size of the incumbent operator. It's time to alter market dynamics by unleashing greater investment and competition.”
Vodafone offers only mobile services in Hungary, Romania and the Czech Republic, but buying Liberty's cable business will allow to expand into TV and broadband in those markets.
As part of the deal, the company will pay Liberty Global €10.6bn in cash, which the US business said would “provide significant additional flexibility to optimise growth and shareholder returns”.
Vodafone has also agreed to a €250m break fee if the acquisition does not complete.
Shares in Vodafone rose 1.2% to 210.1p in morning trading in London.
(qlmbusinessnews.com via telegraph.co.uk – – Tue, 6 Feb 2018 London, Uk – –
BP has unveiled the clearest sign yet that the oil major is emerging from the gloom of the Deepwater Horizon disaster and the global market downturn, with a $6.2bn (£4.4bn) profit boom for 2017.
The FTSE 100 energy giant’s better than expected full-year results revealed strong operating cash flows, which were driven higher by the recovery in global oil prices and a 12pc growth in BP’s oil and gas business.
BP made $6.2bn in replacement cost profits, its standard measure of profitability, for the full year compared to just $2.6bn in 2016 when oil prices were at their lowest ebb. In the final quarter of last year alone BP made $2.1bn, up from just $400m in the last quarter of 2016.
BP boss Bob Dudley said last year was “one of the strongest years in BP’s recent history”, which will accelerate the momentum of the the group’s five-year plan as it enters its second year.
Brian Gilvary, BP’s chief financial officer, added that the group’s cash flows were now “back in balance” as it undertakes the start of its programme to buy back the shares it paid out to shareholders in lieu of dividends during the oil market rout.
BP spent $343m on share buy backs in the final quarter, which Mr Gilvary said more than offset the scrip dividends offered in September.
The group’s rigorous discipline on spending has brought BP’s costs down from $60 a barrel to $53 a barrel and will remain in place for 2018 to allow further buybacks, Mr Gilvary added.
But the tight reign on spending has nonetheless driven “the most activity we’ve seen in recent years if not in the history of the company”, he said.
BP is working hard to grow its production portfolio after years of austerity. It will start up five new oil and gas projects this year and also undertake “measured” investments in new energies including biofuels and electricity.
(qlmbusinessnews.com via telegraph.co.uk – – Tue, 16 Jan 2018) London, Uk –
Tate & Lyle’s chief financial officer Nick Hampton, a former Pepsico executive, is set to take over as boss of the UK ingredients giant when its current chief executive Javed Ahmed steps down in April.
The company, a member of the FTSE 250, is best known as a sugar producer, despite spinning off that division in 2010. It is now focused on producing other ingredients including sweeteners, starches and fibres and has been boosted in recent years by growing demand for sugar-free alternatives.
Gerry Murphy, the firm’s chairman, today thanked Mr Ahmed for his “exceptional leadership” of the business since 2009.
He said: “During his tenure, Tate & Lyle has been through a very significant strategic, operational and organisational transformation from a largely commodity business into the high-quality global food ingredients business it is today.”
Mr Hampton joined Tate & Lyle in 2014 after a 20-year career a Pepsico, which owns hundreds of food and drink brands including Walkers Crisps, Quaker Oats and Tropicana juice.
He said: “As global demand for healthier and tastier food continues to grow, this business has the opportunity to deliver meaningful benefits for our customers, employees, shareholders, and society at large, in the years ahead.”
Mr Murphy added: “Nick has been an outstanding chief financial officer with a strong track record of driving performance, building teams and capabilities, and focusing on key customers and markets. We are confident he has the experience, energy and vision to lead Tate & Lyle through the next phase of its development.”
Tate & Lyle’s shares were flat at 691p in morning trade.
By Jack Torrance