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Kingfisher eyes London high streets for roll-out of smaller B&Q Local DIY stores
B&Q could well be on its way to a London high street near you, as the FTSE 100 owner of the home improvement re-tools its retail offering to better suit post-pandemic urban living.
Kingfisher has identified sites for the roll-out of its B&Q Local brand of smaller outlets. There are eight of these stores already in London, with the latest two in Camden and Palmer’s Green and more on the way.
They offer a next-day click-and-collect service from the company’s full range as well as a selection of stock in store. Alongside the 300-outlet B&Q chain, the company also owns the Screwfix brand.
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SPACs are back as British biotech firm launches UK’s first 2023 Nasdaq listing
There are signs the SPAC could be making a comeback as a British biotech company will today use the unusual vehicle to become the first UK firm to list on the Nasdaq exchange in 2023.
Zura Bio, which develops medicines for immune system disorders, has raised $65 million (£53 million) via a special purpose acquisition company or SPAC called JATT.
There was a surge in the use of SPACs during the 2021 stock boom with over 600 companies created on the public markets, according to S&P Global data. But that number tumbled 85% to just 86 in 2022.
Jura CEO Dr Someit Sidhu told the Standard: “We’re going to be one of the few SPACs that closes in this period – the threshold for getting a successful transaction done has gone up massively.
“I don’t think this will bring back the SPACmania of previous years but it shows there is a utility for this type of vehicle.”
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S&P warns of increased bank default risk
Credit ratings giant S&P Global has warned that defaults for banks across the globe will rise, in a new report issued to address the turmoil facing the banking sector.
The report noted that while the sector should be more resilient than in 2008, risks still remain.
“Global banks are much better capitalized than in the past, but risks have not been eliminated and liquidity matters as well as solvency,” it said.
“Emergency liquidity measures by central banks and the expedited takeover have likely lowered the odds of broader banking system contagion, although the decision to write-off CS’ AT1 bonds may contribute to a higher cost of capital for banks.”
The report noted that, with interest rates likely to stay high for some time in order to bring down inflation, default risks will likely continue to rise.
Bank shares rally, FTSE 100 up 1%
Heavily-sold banking stocks rallied today as blue-chips including Barclays and NatWest jumped by as much as 5%.
The gains built on yesterday afternoon’s turnaround in sentiment after markets had initially been sceptical of UBS’s weekend rescue deal for stricken lender Credit Suisse.
Barclays rose 6p to 143p today but the lender is still 15% short of where it stood prior to the confidence-shaking failure of Silicon Valley Bank less than a fortnight ago.
NatWest added 13.2p to 272p and Lloyds Banking Group surged 1.9p to 48p, while insurer Prudential recouped some of its recent heavy losses with a gain of 40.5p to 1053p.
The revival of banking stocks after a crisis that had swiped £30 billion from the value of London top lenders helped the FTSE 100 index to surge 1.3% or 99.92 points to 7503.77.
There was also support from the energy sector after Brent crude futures steadied at just above $74 a barrel, sending BP shares up 3% or 15.4p to 502.4p.
Other beneficiaries of the improved risk appetite included JD Sports Fashion, which jumped 4% or 6.1p to 170.45p, while British Airways owner IAG cheered 4.5p to 142.2p. The FTSE 250 index added 1.5% or 283.30 points to 18,778.43, led by a 6% rise for mid-market private equity firm Bridgepoint.
Elsewhere, investors were given a reminder of the rise-and-fall for valuations in 2021’s stock market listings boom when Trustpilot and Oxford Nanopore posted results.
The consumer reviews platform made its debut at 265p but now stands at 93p, having risen by half a penny today. It narrowed losses to $14.6 million but warned over tough conditions in the current quarter, adding that founder Peter Holten Mühlmann is to step down as chief executive and become brand ambassador.
Gene sequencing firm Oxford Nanopore reported good momentum at the start of 2023, helping shares lift 2% or 3.9p to 180.5p, but still well short of its 425p starting price.
Pearson to sell lossmaking online degree management arm
Textbook publisher Pearson is to sell its lossmaking online degree programme management business, once seen as its great hope for the future, to private equity business Regent for a cut of future profits.
Regent will pay Pearson 27.5% of the division’s profits for the next six years, though with the arm making a £26 million loss last year, that cut may be minimal. Regent will also pay a 27.5% share of its proceeds from “any monetisation event” of the online programme management arm.
In 2018, Pearson had called the online programme management arm “one of our biggest structural growth markets”, and revenue grew rapidly under Covid-19. However, after a contract with Arizona State University – one of America’s largest colleges – came to an end last year, Pearson put the arm under review.
“The sale of this business concludes the strategic review and demonstrates further progress in reshaping Pearson’s portfolio towards future growth opportunities centered around lifelong learning,” Pearson said.
Early start for new Starbucks boss
The CEO at the centre of one of the biggest trans-Atlantic moves in recent years will be starting his new role a little earlier than expected.
Laxman Narasimhan has taken over running global coffee giant Starbucks from its veteran leader, Howard Schulz, two weeks ahead of schedule, having been shadowing the famous executive, who has served as the Seattle giant’s chief three-times, since October.
Starbucks poached Narasimhan from the top job at Reckitt Benckiser, the FTSE 100 consumer products giant, which he had joined after a successful career at PepsiCo. His departure knocked shares in the maker of Gaviscon and Cillit Bang, having surprised the City because he had been in charge for just three years.
Narasimhan will now be in post in time for this week’s annual meeting of the company.
Banking sector turmoil could “blow away” public finance improvements
The latest public borrowing figures could give Jeremy Hunt room for manouvre in spending, an economist noted, but “turmoil” in the banking sector could put all of that recent improvement at risk.
Cumulative borrowing for the financial year so far is £132.2 billion, which is a long way below the £152.4 billion projected by the Office of Budget Responsibility as part of last week’s Budget.
Ruth Gregory, deputy chief UK economist at Capital Economics, noted that this should have “raised the Chancellor’s hopes that he will be able to announce a pre-election giveaway later this year”.
“But the big risk is that the turmoil in the banking sector deepens the economic downturn and the recent improvement in the public finances is blown away,” she added.
Sticky end for British Honey Company
The British Honey Company – a maker of spirits as well as honey – is set to enter administration.
The business had been looking into ways to keep itself alive since October of last year, and while it received a loan in December to help fund its working capital requirements, it failed to secure any further funding.
“Regrettably, the Board has concluded that it is required to take the necessary steps to preserve value for creditors,” the company said.
As a result, it has appointed partners at FRP Advisory Trading Limited as its administrators and suspended trading of its shares on AQUIS.
ExpressVPN directors: Sagi could force shareholders to accept “undervalued” bid
Directors of ExpressVPN owner Kape have warned shareholders that gambling tycoon Teddy Sagi may leave them no choice but to accept his bid despite their “firm view that it materially undervalues Kape” by taking company private.
Sagi’s Unikmind Holdings – which already holds 54.8% of Kape – submitted a bid to acquire the remainder of the business in February. If accepted, Kape will delist from the London Stock Exchange’s Alternative Investment Market. Sagi said delisting would be the best decision for the current financial climate.
Unikmind added that, “regardless of the outcome of the offer”, it would aim to pass a resolution to take Kape private.
However, the independent members of Kape’s board said that the deal “undervalues” their business, which started in the adtech sector before acquiring one of the world’s top VPN services.
But in a full letter explaining their decision, the independent directors said the resolution to take Kape private could scupper any resistance to the deal.
“Were Unikmind to become successful in obtaining sufficient voting rights in Kape to make the passing of a delisting resolution likely, Kape Shareholders would have to seriously consider accepting the offer despite the independent directors’ firm view that it materially undervalues Kape,” they said.
FTSE 100 improves, Barclays and Kingfisher shares higher
The FTSE 100 index is 0.6% or 43.58 points higher at 7447.43, with stock market benchmarks in Paris and Frankfurt up by around 1%.
Among London-listed banking shares, Barclays rose 2% or 3p to 139p and NatWest improved 5p to 262.9p but HSBC bucked the trend by easing 0.7p to 541p.
Elsewhere in the FTSE 100 index, shares in B&Q owner Kingfisher lifted 6.7p to 280p after its results-day guidance on the outlook for the current year reassured investors.
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