Unilever (ULVR.L) has emerged as the leading bidder in a tight contest for GlaxoSmithKline’s (GSK.L) Indian Horlicks nutrition business, three people familiar with the situation told Reuters on Wednesday.
If it is able to clinch the deal, Unilever will trump fellow European consumer giant Nestle (NESN.S), the other main contender to buy Horlicks and other GSK consumer healthcare assets in India.
One source said Unilever had been given “preferential treatment” to complete the deal but did not have exclusivity in negotiations, so it was possible GSK might re-open talks with Nestle if it could not agree terms with Unilever.
The Financial Times reported on Tuesday that Unilever and GSK, which owns 72.5 percent of Indian business GlaxoSmithKline Consumer Healthcare (GLSM.NS), were in exclusive talks, citing people familiar with the sales process.
Energy firm SSE has admitted there is “some uncertainty” that its merger with rival Npower will go ahead.
The announcement comes after the companies delayed the tie-up due to the incoming energy bill price cap of £1,137 a year for “typical usage”.
It means suppliers will have to cut the price of their default tariffs to the level of the cap or below it.
The SSE-Npower merger, which has been cleared by the regulator, would create the UK’s second-biggest energy company.
However, Perth-based SSE has revealed it has been hit by widened losses for its household gas and electricity supplier.
It has also reported the loss of another 460,000 SSE customer accounts as competition takes its toll.
In its half-year results, SSE said: “There is now some uncertainty as to whether this transaction can be completed as originally contemplated.
“Nevertheless, the board believes that the best future for SSE energy services, including its customers and employees, will continue to lie outside the SSE group.”
The two firms had been hoping to seal the merger of their retail operations in the first quarter of 2019.
But they said talks over the new terms of the deal will take several weeks and will probably see the deal delayed beyond the first quarter.
They still insist, however, that work to complete the merger continues and they plan to update by mid-December.
SSE reported a 41% fall in underlying pre-tax profits to £246.4m, stripping out its energy services division.
On a bottom-line basis, SSE posted pre-tax losses of £265.3m for the six months to 30 September against profits of £409.3m a year earlier.
Its energy services arm, which is split out from the main numbers due to the Npower deal, saw operating losses widen to £62.1m from £7.1m a year ago.
Earlier this month, Nested, an online real estate agency which provides cash advances to help buyers purchase new homes before selling their old ones, hauled in £120 million in funding from investors including Northzone and Balderton Capital. This was the largest round the company has raised, and it’s also by far the biggest VC investment of the past five years in a European startup focused on real estate technology—or as it is increasingly being referred to, proptech.
Having watched startups disrupt old-fashioned industries like taxis and finance, venture capitalists have homed in on real estate as one of the next big opportunities. More and more companies are cropping up that use technology to buy and sell houses, not to mention tackling areas such as pricing, mortgages and building management.
This year, VC investors have participated in 52 deals worth a combined €335 million in European proptech startups, per the PitchBook Platform, with Nested’s aforementioned funding accounting for more than a third of the capital raised. This is more than 10x the amount raised in 2014, continuing a steady five-year rise.
Here’s a look at the 10 most active VC investors in the European proptech sector since the beginning of 2014, per PitchBook data, including their deal counts:
1. Global Founders Capital
2. Pi Labs
3. Seedcamp
4. Seaya Ventures
5. Bpifrance
6. HOWZAT Partners
7. Passion Capital
8. LocalGlobe
9. Picus Capital
10. Piton Capital
A merger between SSE and Npower’s retail operations has been cleared by the UK’s competition watchdog.
The Competition and Markets Authority (CMA) said it had given final clearance to the deal after concluding households would still have “plenty of choice” on standard variable tariffs (SVTs).
It found the two providers were “not close rivals” on the tariffs, which offer the most expensive deals.
The merger will create the UK’s second biggest energy supplier.
The CMA launched a full inquiry into the merger in May after its initial probe found the tie-up could reduce competition, potentially leading to higher prices for households.
It provisionally cleared the deal in August.
Anne Lambert, chairwoman of the inquiry group examining the deal, said: “With many energy companies out there, people switching away from expensive standard variable tariffs (SVT) will still have plenty of choice when they shop around after this merger.
“But we know that the energy market still isn’t working well for many people who don’t switch, so we looked carefully at how the merger would affect SVT prices.
“Following a thorough investigation and consultation, we are confident that SSE and Npower are not close rivals for these customers and so the deal will not change how they set SVT prices.”
Japan’s Fujifilm has won an appeal in a legal fight with Xerox that had halted a planned merger between the firms.
Fujifilm now plans to push ahead with talks on the $6.1bn (£4.6bn) merger with the US printer maker, according to Japan’s Kyodo news agency.
In May, Xerox ended its controversial sale to Fujifilm after reaching a settlement with activist investors Carl Icahn and Darwin Deason.
But Fujifilm says its original deal remains the best option for shareholders in both companies.
“(The) Court’s decision will allow us to discuss with Xerox the fulfillment of the original agreement. All Xerox shareholders ought to be able to decide for themselves the operational, financial, and strategic merits of the transaction to combine Fuji Xerox and Xerox,” it said.
The noodle chain Wagamama has been bought by the owner of the Garfunkel’s and Frankie and Benny’s restaurant chains for £357m in cash.
The deal marks a shift for Restaurant Group, most of whose restaurants and gastropubs focus on US, TexMex and traditional British cuisine, and is expected to generate cost synergies of about £22m.
Restaurant Group, which also owns the Chiquito chain, will launch a £315m rights issue to fund the deal, which it expects to be earnings enhancing in the first full year and accretive thereafter.
The company said the deal had an enterprise value of £559m, and included 138 directly operated Wagamama restaurants in the UK and the US as well as 58 franchised restaurants in Europe, the Middle East and New Zealand.
Wagamama began in 1992 in Bloomsbury, central London, by Alan Yau, who subsequently created the Michelin-starred Chinese restaurants Hakkasan and Yauatcha. It has expanded steadily to a national presence since, becoming a familiar feature on British high streets.
The deal will be funded through a combination of cash, debt and the rights issue.
Wagamama’s current owner, the private equity firm Duke Street Capital, bought the chain in 2011 for a reported £215m.
The number of retail sector mergers and acquisitions has grown by 15 per cent in the last year as companies try to make up for struggling sales, a new study reveals.
Figures compiled by law firm RPC show there have been 37 retail mergers and acquisitions (M&A) deals in the year to 31 March, compared with 32 in 2016-17.
RPC said the recently announced Asda and Sainsbury’s merger was a good example of the recent trend for businesses in the food side of the retail sector to “add economies of scale to make up for slowing organic sales growth”.
Firms are also favouring M&A over flotations, due to weak demand from investors. Selling up to a competitor is seen as a more secure way for existing investors to exit a smaller retailer than an IPO which could be cancelled at any point “due to short-term volatility or poor sentiment towards the sector”.
“Through mergers such as Asda and Sainsbury’s, market leaders are looking beyond all the hype about the ‘meltdown of the high street’ and getting on with building breadth of offering and scale,” said RPC corporate partner Karen Hendy.
However, while the number of deals has jumped, the overall value of those transactions has fallen 16 per cent to £3.7bn, from £4.3bn the year before. Ms Hendy said: “It is important that sellers and creditors are sensible over the prices they are expecting from M&A deals in the current climate.”
Meanwhile, RPC said there is still interest in buying distressed retailers’ assets but buyers are looking for substantial discounts, and the number of retailers entering insolvency has risen by 7 per cent in the last year.
UK M&A deals announced in 2017-18 include:
The Co-op’s approach for Nisa, valued at £143m
Tesco Opticians’ acquisition by Vision Express owner Grandvision
The Bestival and Camp Bestival music festivals have been snapped up by a multi-millionaire Dorset entrepreneur just days after a collapse into administration.
Richmond Group, controlled by the loan broker James Benamor, is buying the festival business after offering £1.1m for Bestival’s assets and brand. Richmond had lent Bestival Group £1.6m in February last year.
Benamor founded Amigo Loans, a Bournemouth-based company that offers quick guarantor-backed loans, which was floated on the stock exchange in July. The business is valued at more than £1bn and Benamor’s Richmond Group has a stake of 61%.
Julie Palmer, of the advisory firm Begbies Traynor, who was appointed administrator on 20 September, said she had received more than one offer for the business but Richmond’s was the best bid.
Bestival was launched in 2004 by DJ Rob Da Bank and this year was headlined by the performers Chaka Khan, Grace Jones and Thundercat. It began on the Isle of Wight but relocated to Lulworth Castle in Dorset in 2017.
Its sister festival, Camp Bestival, which launched in Dorset in 2006, is aimed at a family audience and this year featured Simple Minds and Rick Astley alongside Peppa Pig and Paddington.
In a statement Benamor said: “We have been fans and supporters of Bestival since the beginning. Our children have grown up with wonderful memories of these festivals. Bestival is an example of Dorset being world class and we are keen to ensure that this fantastic institution goes on to delight families and local businesses for many years to come.”
On the Camp Bestival website it said that tickets for the 2019 festival remained valid and there was “no reason to believe Camp Bestival won’t go ahead as planned”.
Hundreds of 2018 Camp Bestival attendees are still hoping for a refund after the festival was forced to close a day early in July because of poor weather. The company said the cancellation of the festival’s Sunday line-up this year was not the reason for its financial difficulties but said it had not been “a positive factor for the business”.
Richmond Group said that under the terms of its offer all Camp Bestival 2019 tickets sold so far would be honoured.
Asda has said 2,500 jobs are at risk as the supermarket giant embarks on a fresh round of cost-cutting ahead of its proposed merger with rival Sainsbury’s.
The Walmart-owned grocer is looking to reduce costs across its store operations, with staff working in its bakeries, petrol stations and back office among those under scrutiny. The retailer is also considering closing counters used by customers to return items from its George clothing ranges.
“In a competitive retail market, where customers rightly expect great value and ease of service, we must always look at how we can work more quickly and efficiently for them – and inevitably, that means we need to consider changing the roles we need our colleagues to do or the hours needed in particular parts of our stores,” said Asda in a statement.
The proposals are thought to include combining back office functions such as administration, making some its petrol stations self-service, and reducing the hours of bakery staff and those employed as “front-end hosts”. No redundancies are expected before Christmas.
KKR’s conversion to a corporation is paying off for stockholders.
The New York-based buyout shop announced its 3Q earnings on Thursday, including after-tax distributable earnings of $496.7 million, or 60 cents per share, a YoY increase of 21.3% and about in line with analyst predictions. The firm also reported $640.2 million in profit attributable to shareholders, up more than 300% YoY. KKR’s stock responded positively, closing Thursday up more than 6% on a day the market rebounded from a recent sell-off, thanks in part to several strong earnings reports across the corporate spectrum.
KKR changed its tax structure from a partnership to a corporation on July 1 in hopes of making its shares more accessible on indices. As a result, the firm has stopped reporting its economic net income, an opaque metric that publicly traded peers such as Blackstone, The Carlyle Group and Apollo Global Management use to grade performance.
So far, KKR management likes the results.
“We’re encouraged by the earnings we are having,” said Craig Larson, the firm’s head of investor relations. “We feel like we’re seeing an increase in the breadth of our shareholders.”
Co-COO and co-president Scott Nuttall took away positives both from KKR’s results and the wider market downturn, saying the firm will be able to grow at a faster pace if valuations drop.
“We saw this coming out of the financial crisis a decade ago,” Nuttall said. “We can also buy back our stock at lower prices. From our seat, our stock is worth even more today and our firm has even more opportunities and better prospects than a month ago.”
