LONDON (Reuters Breakingviews) - Heard the one about the City grandee atop a British bank run by a Wall Street investment banker? Barclays investors certainly have. They will remember that when UK corporate financier Marcus Agius had a double act with hard-charging Chief Executive Bob Diamond it ended in vaudeville, with both eventually resigning over the Libor scandal. Appointing Rothschild & Co’s Nigel Higgins to oversee Chief Executive Jes Staley should end less disastrously.
LONDON (Reuters Breakingviews) - RBS is still finding its state embrace uncomfortable. In the decade since the UK lender wound up with a majority government stake it has been dragged over the coals for its bonuses, its lending policies and allegedly driving healthy businesses to the wall. Friday’s 100 million pound provision to cover the risk of a messy UK exit from the EU is the latest sign of its awkward state/private sector hybrid.
LONDON (Reuters Breakingviews) - Giant consumer goods companies are testing their pricing power. Charging more for products helped Unilever and Nestlé boost underlying revenue by 3.8 percent and 2.8 percent, respectively, in the third quarter. Both need the hikes to offset rising costs. The risk is that price-conscious customers go elsewhere.
LONDON (Reuters Breakingviews) - Patisserie Valerie needs to find the cause of its sour dough – and fast. The cream cake chain will go under without fresh cash, and it revealed on Friday its Chief Financial Officer Chris Marsh had been arrested. The crucial issue affecting its chances of new investment is whether the group’s recent impressive operating performance contains the same level of hot air as its freshly baked eclairs.
LONDON (Reuters Breakingviews) - Pret A Manger’s owners are facing lean returns. Two customers died after eating contaminated products from the ubiquitous sandwich chain. That’s bad news for takeover specialist JAB, whose 1.5 billion pound buyout in May derives its force from the scope to expand Pret’s slim margins. The cost of putting things right messes that up.
LONDON (Reuters Breakingviews) - Royal Mail is having a ropey old year. Two weeks after Chairman Peter Long resigned in the wake of investor ire over a golden hello for Chief Executive Rico Back, the delivery service unveiled a profit warning that sent its share price down almost a fifth. The problem for workers and investors alike is that its strategy looks as questionable as its approach to remuneration.
LONDON (Reuters Breakingviews) - A bid for Wembley stadium is an open goal for Britain’s top football body. Pakistani-American billionaire Shahid Khan has offered a staggering 600 million pounds for the UK’s national stadium. Given that he is leaving behind its lucrative catering arm and naming rights, the UK Football Association should put the deal in the back of the net.
LONDON (Reuters Breakingviews) - Reinsurers are facing a perfect storm of higher losses and lower margins. The answer is likely to be a wave of dealmaking.
LONDON (Reuters Breakingviews) - British Airways is a test case for how harsh Europe’s new data rules are in practice. The airline said late on Thursday that some customer payment records had been stolen. Companies used to shrug off such attacks. But this breach comes after tough data protection laws were introduced in May. Now that non-compliance means fines, such lapses can hit investors as well as customers.
LONDON (Reuters Breakingviews) - The logic of an $83 billion gas mega-merger is quickly deflating. Linde needs to sell more assets than planned to pull off its tie-up with Praxair, meaning hurried disposals and fewer cost savings. Investors are already treating the deal’s benefits as a load of hot air.