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FACTBOX - British business navigates rocky path to Brexit
March 29, 2017 / 11:54 AM / 6 months ago

FACTBOX - British business navigates rocky path to Brexit

Britain's Prime Minister Theresa May leaves 10 Downing Street in London, March 29, 2017. REUTERS/Hannah Mckay

LONDON (Reuters) - British businesses have endured a roller coaster ride since the vote to leave the European Union, with some ramping up their investment in the country and others pulling market flotations and ditching takeover deals.

Britain avoided a full collapse in mergers and acquisitions when some foreign companies took advantage of sterling’s sudden devaluation to snap up British names such as tech company ARM and pay-TV group Sky.

Other multi-national firms from Amazon to Nissan and top tech groups Google and Facebook have also increased their presence in Britain, while Qatar has vowed to invest 5 billion pounds.

But in total, inbound British corporate takeover deals are down 58 percent since the start of the year, according to Thomson Reuters data, adding to the 48 percent drop recorded in the six months after the June vote.

Demand for initial public offerings has also dropped, with the volumes raised so far in 2017 down 28 percent on last year, while business investment fell 0.9 percent year on year in the final quarter of 2016.

In terms of British government bonds, overseas investors such as central banks and sovereign wealth funds bought record amounts of gilts in the three months to the end of November, but there has since been a partial sell off.

Below are the major corporate announcements since Britain voted to leave the European Union on June 23 last year.

MAJOR BRITISH M&A DEALS

July 18 - Japan’s SoftBank agrees a deal to buy Britain’s most valuable technology company ARM for $32 billion in cash after winning the backing of Prime Minister Theresa May who said it showed that the country was open for business after Brexit.

Dec 15 - Rupert Murdoch’s Twenty-First Century Fox strikes a $14.6 billion deal to take control of European pay-TV firm Sky, pouncing after the Brexit vote sparked a plunge in the pound. The deal is still being examined by regulators.

Jan 27 - Britain’s biggest retailer Tesco agrees a surprise $4.6 billion takeover of food supplier Booker to increase its exposure to a faster growing sector.

Feb 17 - Kraft Heinz Co launches an audacious $143 billion bid for Unilever, but abandons the plan just two days later, with sources saying it had been taken aback by the vehemence of the response and fears of a political backlash.

Feb 27 - The London Stock Exchange all but ends a 29 billion euro planned merger with Deutsche Boerse to create Europe’s biggest exchange after facing growing opposition since the Brexit vote. The deal was vetoed by EU antitrust regulators on Wednesday.

March 6 - Standard Life reaches agreement to buy Aberdeen Asset Management in a $13.5 billion merger that could generate deep cost cuts.

MAJOR INVESTMENT ANNOUNCEMENTS

July 27 - GlaxoSmithKline plans $361 million of new investments at three drug manufacturing sites in Britain.

Sept 28 - Tech giant Apple announces plan to move its London headquarters to the landmark Battersea Power Station, occupying around 11.5 acres across six floors.

Oct 27 - Japanese carmaker Nissan agrees to build two new models in Britain after what a source said was a government promise of extra support to counter any loss of competitiveness caused by Britain leaving the EU. Nissan has not fully detailed how much it will spend on the new models.

Nov 15 - Google announces plans for a new flagship building in London that will have room to house 3,000 extra engineers.

Nov 21 - Facebook said it would expand its presence in Britain by 50 percent in 2017, hiring 500 new staff to add to the 1,000 people it already employs in the country.

Dec 8 - McDonald’s Corp said it would move its international tax base to Britain from Luxembourg, creating a new international holding company that will receive the majority of royalties from licensing deals outside the U.S.

Jan 10 - Messaging app Snapchat said it would make London the home of its international operations, booking sales in countries where it has no local entity in Britain rather than routing them through lower tax jurisdictions as some other U.S. tech companies do.

Jan 30 - Novo Nordisk, the world’s top maker of diabetes drugs, is investing 115 million pounds over 10 years in a new research centre in Britain, and will employ 100 scientists hunting for new ways to treat type 2 diabetes.

Feb 20 - Online retailer Amazon says it plans to create more than 5,000 jobs in Britain in 2017, taking the number of jobs it has announced in the country since the Brexit vote to 6,000.

March 6 - France’s Peugeot acquires two Vauxhall plants in Britain as part of its deal to buy the European business of General Motors. It has said it will honour existing job commitments but unions have raised concerns about the long-term future of the plants.

March 16 - Japanese carmaker Toyota said it plans to invest 240 million pounds to upgrade its car plant in central England for future output, but warned that retaining tariff-free access to EU markets after Brexit remained crucial.

March 24 - South Africa’s Brait SE, which has majority stakes in clothing retailer New Look, grocer Iceland Foods and gym chain Virgin Active, suspends plans to list on the London Stock Exchange due to the uncertainty around Brexit.

March 27 - Qatar, which has invested 40 billion pounds in Britain to buy such high-profile London landmarks as the Shard skyscraper and Harrods department store, pledges to invest another 5 billion pounds over the next five years.

Additional reporting by Costas Pitas and David Milliken; editing by Anna Willard

Our Standards:The Thomson Reuters Trust Principles.
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