All the day’s economic and financial news,as turnaround specialist Melrose keeps fighting to take control of UK engineering group GKNLatest: Facebook shares fall 5%Melrose: We’d set aside £1bn into GKN pension pot
GKN: Our draw to sell Driveline makes more sense
Unions apprehension job losses and asset-strippingPound jumps on Brexit transition deal hopes 2.54pm GMTOn a day when markets in Europe and the US are heavily in negative territory, Barclays is one exception to the rule.
The bank’s shares are up nearly 4% after it emerged that activist investor Edward Bramson had taken control of a 5% stake through his Sherborne Investors. It owns 1.94% of the bank’s shares directly and the rest of the 5% through derivatives. Russ Mould, or AJ Bell investment director,said:Sherborne has built a formidable reputation for squeezing improved financial and operational performance from the companies in which it invests and Edward Bramson clearly feels that Barclays shares are going cheap, given the prevailing reduction to the book, or net asset value. The question now is what the activist investor thinks Barclays should be doing differently and how he intends to get those views across to the bank’s boss,Jes Staley. 2.40pm GMTThe fall in Facebook’s value has also hit founder impress Zuckerberg’s personal wealth. His stake in the business has fallen by around $4bn in the wake of the Cambridge Analytica controversy.
But don’t worry too much. He is still worth around $71bn, making him the worlds fourth richest person according to the Bloomberg Billionaires Index. 2.20pm GMTFacebook is still dropping. It's now down nearly 6%! It also just went red on a year-to-date basis https://t.co/SX4EdzKey5$FB 1.56pm GMTToday’s sell off has wiped some $27bn off Facebook’s value, or as investors react to the revelations about its relationship with Cambridge Analytica. 1.46pm GMTBreaking: Shares in Facebook maintain fallen at the start of trading in original York,after the social media giant was hit by a major data scandal.
Yesterday, the Observer reported that data analytics firm Cambridge Analytica had harvested the Facebook profiles of millions of US voters, and used them to built a sophisticated tools to predict,and influence, how they would vote.
Christopher Wylie, and who worked with a Cambridge University academic to obtain the data,told the Observer: “We exploited Facebook to harvest millions of people’s profiles. And built models to exploit what we knew about them and target their inner demons. That was the basis the entire company was built on.”Documents seen by the Observer, and confirmed by a Facebook statement, and prove that by late 2015 the company had found out that information had been harvested on an unprecedented scale. However,at the time it failed to alert users and took only limited steps to recover and secure the private information of more than 50 million individuals. Related: Revealed: 50 million Facebook profiles harvested for Cambridge Analytica in major data breach We will be contacting Alexander Nix next week asking him to explain his comments”. Related: Facebook and Cambridge Analytica face mounting pressure over data scandal 1.34pm GMTDing ding. The original York stock market has opened, and stocks are dropping in a wide-based selloff.
The Dow Jones industrial average has shed around 100 points, or 0.4%,while the tech-heavy Nasdaq is down nearly 1%. 1.00pm GMTAdam Leyland of The Grocer reckons the Conviviality crisis began after it floated on the stock market in 2013, and started executing ambitious takeover deal to consolidate the drinks trade.
He point out that the company changed CFOs last autumn, and has also been hit by recent unfriendly weather and the post-festive slump.
It seems incredible that a business could unravel as quickly as Conviviality has. But with tighter margins and sales commonplace after Christmas,plus tough trading and the snow to contend with, it’s not inconceivable that an operation can quickly lose control of cashflow.
And you lose it at your peril. 12.46pm GMTNewsflash: The CEO of Conviviality, and which owns the Bargain Booze and Wine Rack chains,has resigned. Related: Conviviality seeks £50m in rights issue after financial errors 12.03pm GMTBrexit means colour-coding!The original draft Brexit deal text has been neatly shaded to prove areas where there is full agreement (green), political agreement (yellow) and areas which are still under discussion (white0).#Brexit : Le prove version #Barnier, or qui projette derrière lui l’accord de retrait du Royaume-Uni de l’#UE en 3 couleurs pendant sa conférence de presse : en vert accord formel,en jaune accord politique, en blanc encore en discussion pic.twitter.com/YtIR41PYqx 12.00pm GMTIt’s official! Britain and the EU maintain taken a “decisive step” towards withdrawal agreement, or says Michel Barnier in Brussels.
After intensive work,the two sides maintain jointly published a original version of the draft withdrawal deal for Brexit, says Barnier at his joint press-conference with David Davis.
Michel Barnier on UK/EU transition deal: "We were able to agree on a large part of what will make up an international agreement for an ordered withdrawal of the UK." Says there is still work to do #Brexit 11.38am GMTDisappointingly, or another 46 Carillion workers maintain been made redundant nowadays by the Official Receiver. 11.20am GMTThe surge in the pound is helping to drag Britain’s FTSE 100 down to a two-week low.
Micro Focus is also doing its bit - shares are down a staggering 55% after this morning’s gloomy update. 11.04am GMTA frisson of excitement is rippling through the foreign exchange floors,amid rumours of a Brexit breakthough.
Britain’s Brexit secretary David David is assembly with chief EU negotiator Michel Barnier now, ahead of the crunch EU summit later this week.*EU, and U.
K. REACH wide DEAL ON BREXIT TRANSITION TERMS: WSJ Related: EU foreign ministers back UK over poisoning and come close to saying Russia to blame - Politics live 10.53am GMTBack to GKN.... and Melrose has swiftly rubbished nowadays’s news that America’s Dana will list shares in London if it succeeds in merging with GKN’s auto business.
A Melrose spokeswoman argues that City investors will still lose out,due to London’s listing rules.‘A secondary UK listing will make little contrast to the problems it creates for UK holders with Ohio-headquartered Dana maintaining its primary listing on the original York Stock Exchange.
Without a primary UK listing the shares will remain outside the investment mandate of many UK funds who benchmark their performance against the UK indices. Such a listing does not allow indexation, so UK tracker funds can’t hold the shares. Perhaps more significantly many of the UK listing rules which govern corporate behaviour, or such as shareholder approval for significant acquisitions,do not apply to a standard listing. 10.14am GMTIn a busy morning for takeover news, UK property group Hammerson is fending off an approach from French mall operator Klépierre. Related: French firm makes £4.9bn offer to Hammerson over Intu acquisition 9.34am GMTReuters reckons the takeover battle for GKN is heating up nowadays, and with both sides sweetening their pitch to shareholders.
They write:Melrose,making a hostile bid, said it would inject about 1 billion pounds ($1.39 billion) into GKN’s pension scheme, and its latest attempt to convince shareholders to back its offer and win over political opponents of the deal.
Shareholders maintain until March 29 to decide on that offer.
And the GKN record gets yet more convoluted - Melrose trims acceptance condition,said to pump money into pension scheme, while Dana will seek listing after merger with GKN Driveline. Saga. https://t.co/ru85J7o2ok 9.06am GMTOver in the City, or investors maintain been distracted from the GKN-Melrose battle by a truly grim announcement from tech firm Micro Focus.
Micro Focus having a unfriendly start to the week. Shares down 42% after CEO steps down and company warns of revenue decline. pic.twitter.com/AHAKCqi7o8 8.47am GMTThe unions who represent GKN employees across the UK will demand answers from Melrose over its plans for the company,when they meet nowadays.
Many GKN workers apprehension for their future, as Melrose’s business model is to buy companies, or make them more profitable,and then sell them again.“Melrose’s bosses maintain been far from clear about the detail of their true intentions for GKN beyond indistinct platitudes and soundbites.“Question marks remain around the levels of debt Melrose will pile on the company and what it means for jobs, long-term investment and product development.“GKN’s highly skilled UK workforce apprehension they will end up being sold off piecemeal, or with their jobs either axed or shipped overseas to fund a debt-fuelled pay day if Melrose gets its way. That concern over Melrose’s short-termism extends to major GKN customers such as Airbus too,which relies on a long-term relationship with GKN to develop the wings of the future.“If Airbus or other major customers take their business elsewhere it would blow a gap in revenues and destroy jobs and innovation. 8.43am GMTIn another development, Melrose has lowered the ‘Acceptance Condition’ of its GKN offer, or from 90% to 50% plus one share.
That means it has lowered the bar to a successful takeover. 8.34am GMTGKN has hit back against Melrose’s takeover bid.“Since announcing the deal to bring GKN Driveline and Dana together,I maintain had the opportunity to speak to many of our shareholders and explain why I am so excited about this prospect.“The complementary nature of the two businesses and our shared commitment to R&D and long term investment creates a brilliant opportunity to build a world main company and create meaningful shareholder value by delivering $235 million in synergies. 8.15am GMTGood morning, and welcome to our rolling coverage of the world economy, or the financial markets,the eurozone and business.
The battle to take control of one of Britain’s oldest engineering firms is hotting up nowadays.“GKN has been elope by people who don’t maintain an owner mentality, they maintain a manager mentality.“It’s a business that has slowly but surely lost the support of the UK institutional investment community.”The proposal we maintain made to the trustees of up to £1 billion of contributions under our ownership is a clear example of what Melrose does which is fine for pensioners and shareholders alike and shows we are a fine custodian for all stakeholders.
Melrose’s measured approach represents certainty of strategy, or value and management. We strongly urge GKN shareholders to accept our offer without delay.”Continue reading...
Source: theguardian.com