This week’s news includes; Carillion crisis, Apple pays back taxes to UK, Dropbox files for IPO, Oil prices on the rise
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. Get all the important stories and insights straight into your inbox by subscribing to our mailing list here.
Opinion articles of the week;
- Business Insider explains why Spotify is bypassing the normal IPO process — and why more companies don’t do it.
- Lawyer2b explores how the law is changing in the oil and gas sector.
- Business Insider claims that the crazy-good days for crypto traders may already be over.
1. CARILLION CRISIS
Government contractor Carillion is on the brink of collapse. The firm owes roughly £900 million to major banks is struggling with repayments. The firm has reached out to the government for support. The creditor banks have now enter talks with Carillion to discuss a solution for the issue. Creditors hope the government do get involved in some way to provide financial assistance. This could eventually mean the taxpayer acting as guarantor for future repayments.
Carillion is one of the largest government contractor in the UK. It employs over 20,000 people in the UK alone. It manages over 900 UK schools, has over 200 prison contracts and is responsible for building part of HS2.
BBC News explores the crisis.
2. UK BANS MICROBEADS
The United Kingdom government has prohibited the manufacturing of products containing microbeads. Products containing microbeads pollute oceans when they are washed down drains. Microbeads are tiny plastic pieces and have a serious impact on marine life. Microbeads are usually found in toothpastes and shower gels but these products containing microbeads will now banned in the UK. This has been deemed one of the most draconian measures in the world.
Business Insider looks closer at the ban.
3. APPLE PAYS BACK TAXES TO UK
Apple has been forced to pay back £136 million to HMRC. HMRC undertook an extensive audit and found that Apple Europe (Apple’s UK subsidiary) had not been paying enough tax. Apple Europe has now agreed to pay a “corporate income tax adjustment” to reflect its increased activity.
Apple has not had a very smooth ride with its tax affairs. This comes only weeks after the European Commission ordered Apple to pay back 13 billion euros in back taxes to Ireland. Ireland is currently challenging the decision.
BBC News looks closer at the tax arrangements.
4. DROPBOX IPO
Dropbox has filed for an initial public offering. There was no official announcement made but the documents have been submitted and reports such that Dropbox will float in the US within the first half of the year.
The file sharing & cloud data storage website is expected to be a valued at $10 billion and adds to the growing number of recent tech floatations. Investors are expected to be cautious as tech IPO’s have not yielded great returns over the past year. The most notable disappointment was Snap’s poor results and falling share price after its $24 billion IPO.
Only last week however, Spotify announced its plans to float later this year so Dropbox adds to an already positive IPO start to 2018. City A.M explores the plans further and explains how Dropbox has grown in recent year.
Bitcoin took a large slide after South Korean regulators clamped down on cryptocurrencies. Bitcoin fell below $15,000 as the financial regulators said it was considering shutting down all local cryptocurrency exchanges. On Monday they also announced plans to shut down Korean banks plans to offer virtual currency accounts. In recent weeks, they have also banned anonymous trading as well as imposing other measures.
The regulator soon clarified its position, says that shutting down local exchanges was only an option to consider and nothing had been finalised.
South Korea makes up a large proportion of the global market. The frenzy in South Korea is so extreme that Bitcoin prices traded almost $7,000 higher in local exchanges compared to global exchanges. Coinmarketcap removed South Korean exchanges from their site due to this difference. This frenzy has also sparked a draconian response from regulators.
Jamie Dimon, one of the most ardent critics of Bitcoin, has stated that he regrets his previous comments. In 2017 he claimed that anyone who traded Bitcoin was “stupid” and that the currency was “a fraud”. He now backtracks as he claims he sees the potential growth of underlying Blockchain software. (Bloomberg)
6. OIL PRICES
Oil prices keep soaring and have nearly hit a 4 year high. Brent crude rose to $70 a barrel after OPEC agreed to continue their plans to limit oil supplies. These prices have not been seen since December 2014. To put this rapid growth in perspective, in July 2017, Brent crude was still only $42.5 a barrel.
These rising prices will bring much needed growth for oil producing countries but spell bad news for consumers. The rising prices will increase the costs of fuel and imports and in turn the prices of retail goods.
BBC News analyses the recent rise in oil prices.
7. CMS & SHOOSMITHS PUBLISH GENDER PAY GAP DATA
CMS and Shoosmiths are the first top 50 UK firms to publish their gender pay gap data. At CMS women earn 17.3% than men per hour, while at Shoosmiths women earn 15.4% less than men. Both firms are implementing strategies to address the gaps.
All UK companies who employ more than 250 people are required to publish gender pay gap data by 6th April 2018. Over 500 companies have published their data to date. The average UK gender pay gap stands at 18%
Legal Week explores the gender pay gap in the legal sector.
8. KODAK REVEAL BLOCKCHAIN PLANS
Kodak has announced its plans to create a Blockchain product. The project, KodakOne, will allow photographers to track the use of copyrighted images on the internet and verify the ownership information using the Blockchain system. An accompanying cryptocurrency called KodakCoin will be released and photographers who license their images through the services will be paid in this currency. KodakCoin will launch its fundraising ICO on January 31st 2018.
Kodak is notoriously a stubborn company when it comes to technological development, they have now decided not to miss the Blockchain train. For many years they refused to get involved with digital photograph and were nearly confined to the past.
Their share price doubled in response to the announcement, bringing much needed good news to shareholders. The full commercial version of KodakOne is expected to be released mid 2019.
Business Insider looks closer at their plans.
9. TESCO REVEALED AS BIGGEST CHRISTMAS WINNER
Tesco performed best amongst the big supermarkets over the Christmas period. The supermarket posted a 3.1% rise in sales in the last quarter. All other competitors (Asda, Sainsbury’s and Morrisons) saw increases of 2% each over the same time frame. An additional £1 billion was spent by consumers in the run up to Christmas.
The most significant rises however, were seen at Aldi and Lidl. Both companies saw 16.8% rises in sales in the final quarter of 2017. Sky News looks closer at the sector.
10. GO PRO SHARES GOING LOW
GoPro has suffered a 37% fall in revenues and share prices have plummeted by 20%. The company is now restructuring and will exit the drone market largely due to increased regulation leading to declining sales. They will also cut 250 jobs to reducing their total staff numbers to under 1,000.
In an interview, CEO said while he said the firm had not secured a deal to be acquired by a larger firm but admitted he was open to a takeover. In response to the poor figures, the CEO has reduced his cash payment for 2018 to just $1.
Sky News looks closer at the figures.