The Times
FTSE gains for year wiped out in slump: Britain’s blue-chip stocks have lost all the ground made this year after a five-day rout capped by a catastrophic collapse in Chinese shares.
New questions over armed robber’s funding: An oil company Chairman who concealed his underworld past by changing his name has links to a northern businessman that raise questions over his source of funding.
Basel lending rules ‘threaten to derail growth in Britain’: The Chancellor has been warned that Britain’s economic recovery could be derailed by a new credit squeeze on small companies if proposals from a Swiss committee that sets global lending standards are implemented.
UBS silences doom-mongers by rushing out results: Profits at UBS soared by more than 50% in the second quarter as the Swiss bank’s wealth management division recorded its best performance for the period in six years.
New facet hits diamond trade: Diamond prices are being weighed down by tighter banking compliance rules that are choking finance to the family-owned cutters and polishers that connect mines to jewellery stores, according to Petra Diamonds.
Hurricane warning batters Hiscox despite profits rise: Hiscox reported strong half year profits and edged its interim dividend higher, but the insurer’s shares retreated on concerns that the forthcoming hurricane season might jeopardise a special cash return to investors.
MySale Boss will share in recovery: A struggling online fashion retailer backed by Sir Philip Green has offered its new non-Executive Chairman more than 2.5 million shares — if he can restore the company’s share price to its flotation level.
Topshop ditches 6ft 2in mannequins after rebuke by shopper: Taylor Swift and Beyoncé are among the stars who have been known to follow its trends, but Topshop has found that its power extends only so far.
Prices set to fall with cap on card fees: Shoppers will enjoy lower prices next year, George Osborne claimed , as the government announced plans to cap credit and debit card fees that are charged by banks to businesses.
Owners unlock £4.2 million a day from their homes: Older homeOwners are releasing a record £4.2 million from their homes each day as dismal savings returns force them to look to their homes to fund their retirement plans.
U.K. must not be a haven for dirty cash: David Cameron will promise to unmask the corrupt offshore companies that are buying up luxury London properties using “plundered and laundered cash”.
The Independent
Payday lender Cash Genie to pay £20 million in compensation to customers: The payday lender Cash Genie has been forced to pay £20 million to ripped-off borrowers. The high-cost credit company – owned by Ariste Holding – has agreed with the Financial Conduct Authority (FCA) to hand over the cash to more than 92,000 customers for unfair practices.
Young people’s earning power ‘scarred’ by older workers staying longer in same job: The earnings prospects of younger people are being scarred permanently because older workers are staying longer in the same job, according to new research.
Google Ventures gives £39 million backing to London’s Secret Escapes: Secret Escapes, the London-based travel website, has won backing from Google’s venture capital arm, which has jointly led a £38.7 million fundraising for the flash sales site.
Varoufakis claims he has been accused of ‘treason’ over secret payment system plans: Yanis Varoufakis, the former Greek finance Minister, has said his critics want to accuse him of treason for hacking Greek tax office records containing the file number of every taxpayer.
Financial Times
U.K. food takeaway start-up Deliveroo raises $70 million: Deliveroo, an early-stage U.K. start-up that delivers takeaways from high-end restaurants, has raised $70 million in an attempt to expand internationally amid intense competition in the online food-delivery market.
GVC plays solo game in Bwin bid: GVC, the online gaming company, has split from Canadian counterpart Amaya to go it alone in the race for larger rival Bwin.party as it tries to trump a recommended offer from 888 Holdings.
Marwyn to launch vehicle on Aim to buy media companies: Marwyn, the investment group that brought companies including Peppa Pig rights Owner Entertainment One to the public markets, is launching an Aim-listed cash vehicle to buy media companies valued at up to £1 billion.
Lloyds expected to set aside a further £1 billion for PPI mishandling: Lloyds Banking Group is set to earmark £1 billion for payment protection insurance this week after being penalised a record amount for mishandling PPI complaints.
Pemex tied by accounting Catch 22: Mexico’s Pemex, battered by the oil price crash and on track to report its 11th consecutive quarterly loss on Tuesday, has found a way to improve its balance sheet.
French state faces €5 billion bill to rescue struggling Areva: The French government could be required pay as much as €5 billion to rescue the struggling state-controlled nuclear group Areva as part of a deal that is set to reshape the country’s energy sector.
KKR joins €500 million bet on Irish housing revival: KKR is to team up with an Irish government fund to lend to housebuilders, in a bet by the private equity Manager that Ireland’s recovery has further to run a year and a half after the country emerged from its bailout.
Mylan share price plunges after Teva abandons bid: Shares in drugmaker Mylan plunged almost 14% on Monday after Israeli group Teva Pharmaceutical abandoned its $40.1 billion hostile takeover attempt and instead announced an agreed deal to buy part of Allergan.
Baidu shares hit as results disappoint: Shares in China’s Nasdaq-listed search engine Baidu fell 8% on Monday after it missed key targets in its quarterly earnings, and amid renewed turmoil in China’s domestic stock markets.
Altice sets sights on NextRadioTV for share buyout: Altice, the acquisitive European telecoms group owned by Franco-Israeli billionaire Patrick Drahi, is seeking to take a stake in France’s NextRadioTV, valuing the company at about €600 million.
EE returns to sales growth for first time in more than 4 years: EE has returned to growth in sales for the first time in more than four years in its last set of half year results ahead of BT’s proposed £12.5 billion acquisition of the U.K.’s largest mobile telecoms company.
Lex:
Pharma M&A: portfolio theory: On Monday Teva, a leading generic drugmaker, announced the $40.5 billion acquisition of the generics unit of Allergan (formerly known as Actavis). Teva’s core business has slowed down significantly in recent years. And one of its branded drugs, Copaxone, will soon lose patent protection. Last November, drugmaker Actavis clinched a $66 billion deal for Allergan, best known for its Botox treatment but whose biggest business was eyecare products (Actavis later rebranded itself as Allergan). Since then, there have been questions as to how committed Allergan would be to the legacy Actavis generic portfolio. Even if Allergan liked that business, the battle for Mylan showed Teva’s appetite for a big deal. Yet even after a $40 billion deal, the pharma sector remains unsettled. Allergan will realise $36 billion in cash and shares (after taxes) that it could use for its own dealmaking. One of the hopes for the Allergan/Actavis deal last November was that the combined company’s valuation would be at the top end of the sector range. But Allergan’s multiple did not expand as hoped. By jettisoning generics, its growth profile is stronger and it might merit a higher multiple. At the same time, its shrinking size could make it more digestible for an acquirer like Pfizer.
Ryanair: fuel tanks: Behavioural economists, such as Daniel Kahneman, believe that most of us get more satisfaction from avoiding financial losses than from pocketing any gains. It would seem airlines such as Ryanair feel the same way. Like most airlines, fuel is a big part of the cost base. For Ryanair, no. As fuel accounts for more than 40% of its costs, the company wants to know how much it will need for fuel each year. For other airlines, which have higher costs elsewhere (such as staffing), fuel is less than a third of operating costs. So profits are less sensitive to oil price movements. On the other hand, Ryanair has more to gain as oil prices decline. For this year, fuel is hedged at $91 (against a market price of about $50). For next year, 70% of its fuel is hedged at $66 a barrel. So next year’s fuel costs will be lower than this year’s, regardless of what happens to the market price. Good news, then. That fact did not impress the market on Monday when it announced its first-quarter results. Ryanair’s shares fell 2%, partly because management voiced its worries about airline fares in the months ahead. Indeed, falling fuel prices in the past have led to lower revenues, believes RBC.
Anthem/Cigna/Aetna/Humana: Health risk: Anthem has an agreed deal to buy Cigna for $188 a share; Aetna and Humana have shaken hands on $230 for each of the latter’s shares. All four health insurers have expressed confidence that the deals will be good for their customers. The market is worried that U.S. antitrust regulators might not see it that way. Cigna’s shares are at $146 and Humana’s at $182. The targets, in other words, are trading at discounts of over 20% to the deal prices. This logic, which has been offered up by at least one cheery sellside analyst, is reassuring and wrong. Anthem thinks it can wring $2 billion of annual cost savings from the Cigna deal. Taxed and capitalised those are worth about $13 billion. If regulators block the deal, Anthem will owe Cigna a $2 billion break-up fee. Even throwing a few hundred millions in fees for bankers and the lawyers, and assigning a cost to lost management time, it would be rational for the two companies to give the deal a whirl even if they thought it had a 50/50 chance of getting through. The same logic applies to the Aetna/Humana deal, where the targeted synergies are worth perhaps $8 billion and the break-up fee is $1 billion. There may be good reason to believe that both deals will sail through. But investors should not assume that the leaders of the companies involved have made an unbiased, optimistic assessment of the odds.
Lombard:
Reckitt’s Boss is nicely focused on raising revenues and margins: Reckitt Benckiser, which boasts of how its health and hygiene products benefited from pestilence and disease in the first half, has a strange grasp of the word “nice”. But no, the group describes its target for operating margin expansion in the second half as simply “nice”. It smacks of obfuscation by a company that has been cutting costs aggressively and managed to boost revenues and operating margins, the latter by 1.6 percentage points in the first half. That is on top of sharp margin growth last year. However, “nice”, according to the English dictionary, primarily means punctilious, precise, fastidious and hard to please. Its colloquial meaning is agreeable. And Rakesh Kapoor, Reckitt’s courteous Chief Executive, is very precise about the need to keep the company sharp and focused. He wants the company to be the most competitive in the world, continuing to pump up revenues and profitability while ensuring the business remains fast on its feet and resists a natural urge to slow down as it gets bigger.
Merlin’s fragility: Visitors are always looking for new thrills and attractions. This is offset by strong cash generation. However, when times are bad, maintaining a strict balance between capex, depreciation, revenues and cash is much trickier. That is clear in Merlin Entertainments’ warning on Monday. Earnings before tax, interest, depreciation and amortisation from its theme park division will, it seems, be about £45 million shy of expectations for the full year. This follows the accident at Alton Towers in June that left people badly injured. Merlin’s attractions in the U.K., which range from Madame Tussauds to Legoland, were already wobbling slightly as the strong pound stopped overseas tourists visiting the U.K. and lured Britons abroad. Then it had to close Alton Towers following the accident as well as rides at other theme parks. Worse, the accident occurred just as Merlin had staffed up for the short summer season and was preparing to go all out to promote its theme parks. That didn’t happen and visitor numbers plunged. It is hard to be certain, though. Rival SeaWorld in the U.S. is still struggling under the adverse publicity following a documentary in 2013 on the treatment of its captive orcas. The problem for Merlin is not just the immediate effect of having to close the theme park down and the hit to profits this year. It also has to restore the faith of visitors in Alton Towers while offering them bigger and better thrills without spills. And that will be in the teeth of the British weather and whatever currency headwinds blow next year.
The Daily Telegraph
Number of people hunting for a house hits 11-year high: The number of people hunting for a new home has hit an 11-year high, according to new figures released on Monday.
Barclays ‘may have to raise £5 billion to keep up with rivals’: Barclays may have to ask investors for more money to bolster its capital levels, just two years after last tapping shareholders for funds.
Libor trial: Jury considers verdict on Tom Hayes: The jury in the London trial of former trader Tom Hayes, who is charged with eight counts of conspiracy to defraud by manipulating global Libor interest rates, retired on Monday to consider its verdict after hearing nine weeks of evidence.
Pizza Hut Owners to consider sale later this year: The private equity Owner of Pizza Hut will start to look at a sale of the business later this year, according to the Chief Executive of the casual dining chain.
Gold price recovers from five-year lows: Gold mining stocks bounced back on Monday morning after gold prices recovered from five-and-a-half year lows.
EE declares merger of Orange and T-Mobile ‘complete’ after five years: After five years, thousands of job cuts and heavy investment in a new network, EE has finally declared the merger of Orange and T-Mobile complete.
Payday loans customers win back £10 million as lender caves in over unfair fees: A payday loan company is to hand over £10 million to 92,000 customers who were pressured with automatic rollover loans, unfair fees and a sister debt collection firm that piled more charges onto the debts.
ECB warned to pump more money to save Eurozone as Varoufakis denies hacking into Greek tax system: The European Central Bank should stand ready to use the full force of its financial firepower to stop the Eurozone from falling into renewed turmoil in the wake of the Greek crisis, according to the International Monetary Fund.
Botox Owner Allergan sells generic drugs unit to Teva for $41 billion: Teva, the world’s largest maker of cheap medicines, has agreed a $40.5 billion takeover of Dublin-based Allergan’s generics business in the latest twist to grip the deal-obsessed drugs sector.
Taxi app Gett to deliver champagne as Uber battle intensifies: Gett, the app for hailing black taxis, is broadening its offering as competition intensifies in the taxi technology sector by launching an on-demand delivery service that will allow users to order a wider range of goods and services.
The Questor Column:
Hold Hiscox in the calm before the storm: The whole point of insurance is to protect against unpredictable risks, and so it’s only right that the Hiscox team are scanning the horizon for the next big claim. Robert Childs, the firm’s Chairman, warned that “a prevailing mood of suspicion and scepticism towards the financial services industry” could mean that the state support that kept the wheels on the sector in the aftermath of 9/11 might not be repeated in future. The FTSE 250 company wrote 12% more premiums in the period, totalling almost £1.1 billion, and group pretax profits rose 8.4% to £135.1 million. The interim dividend rose 6.7% to 8p per share, although the firm cautioned that next year’s Solvency II capital requirements for insurers, along with the looming hurricane season, could swerve into the path of its returns policy. Hiscox is one of the most diversified and well-run in the business, but it is liable to fall to earth along with the rest of the market once claims rise. Hold, for as long as you think the sector can outrun Mother Nature. Hiscox at 890.5p -40.5p. Questor says “Hold.”
The Guardian
Chinese stock markets slide as investors panic (again): Turmoil has returned to the Chinese stock market as shares suffered their worst fall in eight years, knocking commodity prices and fuelling jitters among investors in London.
IMF warns of gloomy Eurozone outlook: The International Monetary Fund has warned the Eurozone faces a gloomy economic outlook thanks to lingering worries over Greece, high unemployment and a banking sector still battling to shake off the financial crisis.
Construction-sector recovery at risk from skills shortage, say building firms: A shortage of bricklayers, carpenters and site Managers threatens to derail the construction sector’s recovery, an industry group has warned after fresh evidence of recruitment struggles at building companies.
U.K. advertising spends hits record £4.7 billion in first quarter of 2015: U.K. advertising spend reached £4.7 billion in the first three months of 2015, a record for the tradtionally weak first quarter, driven by a surge in TV advertising.
Daily Mail
Alton Towers Owner Merlin Entertainments is rocked by visitor ‘fear factor’: The firm that owns Alton Towers saw £180 million wiped off its value after warning that some customers were too scared to go on its rides following a rollercoaster accident last month.
Ex-UBS and Citigroup trader in Libor rates trial waits for verdict: The jury in the trial of a former UBS and Citigroup trader accused of conspiracy to defraud by manipulating interest rates has retired to consider its verdict.
Gucci sales bounce back on trend as major overhaul pays off for Owner Kering: A major overhaul of Italian designer brand Gucci has paid off for Owner Kering as it reported a surge in sales.
Tesco reveals lavish plans to shower its senior Boss with shares worth £25 million: Tesco has announced lavish plans to shower its senior Executives with shares worth £25 million.
Reckitt Benckiser Boss eyes expansion in U.S. as sales and profits soar: The healthcare giant behind Nurofen and Durex used better than expected half year figures to hint that it is back on the acquisition trail.
Daily Express
Airlines should stand together says Ryanair: Ryanair has urged airline rivals to work together to drive price comparison websites out of business as its more customer-friendly approach paid off with a 25% lift-off in quarterly profit.
Panic as China suffers another stock market crash with largest shares fall in eight years: Investors in Britain and around the world have been sent into panic after China’s stocks plummeted by 8.5% – the largest one-day fall in almost eight years.
Drivers warned filling up at rip-off motorway services costs extra £25 per month: Drivers have been urged to avoid filling up their car at motorway service areas where the price of fuel has jumped to more than 11p a litre more expensive than the national average.
Britain in the red: property debt grows to £1trillion amid warning over interest rate rise: Britain’s property debt has hit an eye-watering £1trillion and experts have warned that many homeowners could struggle when interest rates rise.
The Scottish Herald
Plastic bag tax boosts Lanarkshire manufacturer: Jutexpo, the maker of reusable bags, has expanded into new premises at Lanarkshire thanks to a growth in business since the introduction of the Scottish plastic bag levy.
Law firm Pinsent Masons takes control of compliance business Cerico: Pinsent Masons has taken majority control of Cerico in a deal which will see experienced Scottish based lawyer Richard Masters become Executive Chairman at the online compliance business.
Shearer Candles seals export deal for South Korea: Family owned Shearer Candles has struck a deal which will see its products sold in South Korea for the first time.
Law firm Brodies sees growth in turnover and profit: Law firm Brodies has recorded an 11.2% rise in turnover from £52.1 million to almost £58 million while also booking strong underlying profit growth.
Bancon expands board with new finance Director: Housing and construction firm Bancon Group has hired a finance Director from Stewart Milne Group.
Select Pharma snapped up in £7.3 million deal: Select Pharma, the Dunblane-based laboratory testing company, has been acquired for up to £7.3 million by main market-listed Source Bioscience.
Arla cuts milk price: Arla Foods amba, which operates a dairy processing plant at Lockerbie, Dumfriesshire, has confirmed that its on-account price will reduce by one eurocent per kilogramme (0.8 pence when applied to the U.K. standard litre), with effect from August 3.
The Scotsman
Buyer gives new life to Bladnoch Distillery: The mothballed Bladnoch Distillery in south-west Scotland is to reopen and restart distilling after a six-year gap following its acquisition for an undisclosed price by an Australian entrepreneur.
New shipping service link to boost exports: Scotland’s food and drink, chemical and manufacturing industries are set for a boost thanks to a new shipping service that will link Greenock with deep-water ports in Liverpool and Rotterdam.
Power firm Aggreko pumps up in Indonesia: Aggreko, the Glasgow-based temporary power and cooling specialist, is pumping further investment into Indonesia totalling some $40 million (£25 million).
Iomart nets £60 million fund to fuel more acquisitions: Cloud computing and web hosting specialist Iomart is on the hunt for more acquisitions after securing a £60 million funding package.
City A.M.
Former Virgin execs swoop for Spanish outfit: Two former Virgin Media Executives struck a €640 million agreement to buy a Spanish telecoms firm, the maiden investment for their newly launched takeover vehicle.
EE Boss takes rivals to task over complaints about BT’s takeover: EE BOSS Olaf Swantee hit back at rivals attacking a proposed £12.5 billion takeover by telecoms giant BT amid fears the deal will dilute competition in the sector.
Climb in confidence of German business as Greek crisis subsides: German business confidence climbed in July, survey data showed, as fears over Greece leaving the Eurozone subsided.
Moscow Mule trend lifts profits at U.K. drinks maker Fever-Tree: Upmarket carbonated drinks producer Fever-Tree is toasting a fizzing set of financial results that have seen revenues climb 62% since the firm floated in November.
