This weeks news includes; Barclays sells its African unit, Uber posts $700 million loss, RBS reaches a settlement with shareholders.
On Saturday the 3rd of June 2017, 7 people lost their lives to a terrorist attack in central London after the attacks mowed victims down with a van and proceeded to exit the vehicle and stab victims in the surrounding area. Our thoughts and prayers go out to the friends and families of the victims.
Below are our top 10 stories that you need to know about. Be sure to check our twitter page and Facebook page for regular posts of important headlines. Click on the links for full stories.
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Opinion articles of the week:
- CNBC looks at analysts’ claim that Google is no longer ‘compellingly priced’ after 26% rise this year.
- Bloomberg reports that Investors are going all-in on tech giants.
- City A.M asks whether since a group of investors quit the tobacco industry, should others follow suit?
1. POUND FALLS OVER FEAR OF HUNG PARLIAMENT
The pound fell against the dollar last week after a YouGov poll predicted that the UK could face a hung parliament in the upcoming general election.
The survey was based on 50,000 voter interviews and this showed that the incumbent Conservative party could fall short of a majority by 16 seats, a loss of 20 seats. The pound fell to a low of $1.2791 and to 1.1452.
A hung parliament would create massive political uncertainty and is likely to send the pound into free fall. This is a perfect example illustrating the impact of politics on currency markets.
The International Business Times looks further at the election.
2. BARCLAYS SELLS AFRICAN UNIT
Barclays has received approval for its £1.6 billion sale of its African unit, Barclays Africa Group. The approval will allow Barclays to start selling off its remaining 50% in its African unit. This sale is part of Barclays plan to refocus the bank on high-growth areas.
The move will form part of its chief executive’s efforts to refocus the British lender on higher-growth areas. South African bank, ABSA Bank, is the main business inside Barclays Africa Group. Barclays Bank Egypt and Barclays Bank of Zimbabwe, which sit outside Barclays Africa Group, will also be sold.
To find out more about the sale click here. (Sky News)
3. IRISH GOV TO FLOAT ALLIED IRISH BANK IN £12bn IPO
The Irish government has announced that it will float Allied Irish Banks, disposing 25% of its shares in the bank state owned bank.
It is looking to launch its IPO both in London and in Dublin and could be valued at up to €12 billion. This would be the largest float on the London Stock Exchange since Glencores £36 billion float in 2011.
To find out more about the floatation, have a look at City A.M’s analysis of the deal.
4. UK FALLS TO BOTTOM OF G7 GROWTH RATE LEAGUE
In the economic growth rate league of the G7 the UK has now fallen to bottom of the league. The UK’s economic growth fallen to 0.2%, equal with Italy. Canada topped the league with a growth rate of 0.9%, with Germany in second place with growth of 0.6%.
To find out more about this have a look at The Guardian’s article.
5. UBER POSTS $708m LOSS
Uber released its financial figures which showed it made a loss of $708 million for the last quarter. This was a reduction from the loss of $991 million in the last quarter but still doesn’t make good reading for investors. In addition, the loss of their recent legal case against Waymo over self-driving technology is likely to cause more financial problems going forward.
Uber’s head of finance is also set to leave the company in July, joining another San-Francisco start up. This is the latest in a string of high profile departures at Uber, with over 10 top people having left since February.
To find out more about Uber and its finances have a look at the Independent’s article.
6. LONDON STOCK EXCHANGE IN £535m DEAL WITH CITI BANK
After the failed £24 billion merger with the German Stock exchange, the Deutsche Borse, the London Stock Exchange has bought an American analytical business from Citi.
The LSE will buy the yield book, fixed income indices and world government bond index from US investment bank Citi for £535 million.
Read more about the deal here. (Business Reporter)
7. RBS REACHES SETTLEMENT WITH SHAREHOLDERS
RBS has reached a settlement with its shareholders regarding claims they were misled about the health of bank in 2008. The bank asked investors for £12 billion during the financial. The 9000 shareholders accepted a £200 million settlement offer of 82p per share, double the initial offer put forward by RBS.
The case is now set to return to High Court after being adjourned and now the judge will hear whether the case will proceed or not.
To find out more about the case click here. (The Guardian)
8. INSURERS ANNOUNCED PLANS TO MOVE POST-BREXIT
Aviva and Legal & General have announced they will be moving operations out of the UK because of Brexit. The insurers will move part of their businesses to Dublin to maintain unhindered single market access single after Brexit.
Legal & General Investment Management is responsible for just under £900bn of assets, making it one of Europeans largest lenders.
These are the latest firms in what appears to be the beginning of an exodus of financial services firms with JP Morgan, M&G Investments and Standard Life all planning moves to EU jurisdictions.
The Independent looks further at these moves.
9. INVESTORS TOLD TO STOP TOBACCO INDUSTRY INVESTMENT
Four major investment groups have told investors to stop investing in tobacco companies. Axa, Calpers, Scor and AMP Capital have already sold or are selling their tobacco investments.
The companies fittingly announced their appeals on the annual World No Tobacco Day (WNTD).
Along with 50 other firms with investments totalling $3.8tn, they have pledged “to openly support the tobacco control measures being taken by governments around the world”.
To find out more about the pledge click here. (BBC News)
10. DULUX OWNER WINS TAKEOVER COURT CASE
The Dutch owner of Dulux Paint, Akzo Nobel has won a legal battle against shareholders who want to accept PPG industries takeover offer.
A court in the Netherlands rejected the attempt by shareholders to force Nobel, who does not want to accept the offer, out of the position of chairman.
Akzo has rejected three successive takeover offers from PPG since March. Akzo says the €26.9bn (£22.8bn) offer undervalued the firm and showed a “lack of cultural understanding of the brand”.
The Dutch company, which claims its own plans for growth are superior, has also been urged to reject the merger by the Dutch government and its own workers. PPG will now need to decide whether to abandon the deal Nobel, or go straight to shareholders with a hostile takeover offer.
To find out more about this deal have a look at the BBC’s analysis.
