Sunday News Roundup
Next reaps £150m in credit charges, Dixons and Carphone seek deal extension, Groupon's growing pains persist, Top cycling coach backs Athlete Lab, Bonhams under the hammer, Hot pants, Top staff at AO in line for £25m jackpot, Green vows to undercut Tesco by 10% with BHS food, Diageo slugs it out with Jack Daniels in whiskey war, The Co-op Group is in turmoil,B&Q appears to have nailed its recovery, Amazon, Apple and Google face clampdown over shielding profits, Pub landlords face tenfold rise in cost of licence, Sainsbury's wins right to judicial review in battle against Tesco's 'Price Promise' ad
Charge underlines how the retailer is using its Next Directory Card to help fuel growth. Next, the high street retailer, is banking around £150m a year in interest charges from customers using its online and catalogue service Next Directory. The size of the charge underlines how the retailer is using its Next Directory Card to help fuel its growth. Last week Next revealed that its annual profits have overtaken those of Marks & Spencer for the first time since it was created in 1982.
Retailers to ask Takeover Panel to extend deadline as they press on with merger. Dixons and Carphone Warehouse are poised to ask the Takeover Panel for an extension to the negotiations for their £4bn merger. The retailers revealed in February that they were in discussions about a merger and were given a deadline of 5pm on Monday to confirm whether they intended to press ahead with a deal. However, under the rules of the Takeover Panel’s code, companies can ask for an extension to the deadline if there is a prospect that a deal can be struck.
The discount voucher giant is producing results after failing to live up to early expectations but will it ever satisfy investors? When Groupon opened its offices in Korea, it hired 300 people in a week. That is no mean feat in a brand-new market, but the company simply pulled people in off the street. Groupon did not exist until November 2008, but by the time it was opening in Korea, two-and-a-half years later, it was operating in more than 40 countries. That same year, revenues soared from $700m (£424m) to $4bn. It was the fastest-growing company in the world – and the world was knocking on its door.
Founders set up business after growing tired of using spin bikes to top up triathlete training. Shane Sutton, the head coach of British Cycling, has become a shareholder in a new fitness business founded by a former Glencore oil trader and a director of Cordea Savills private equity group. Mr Sutton is backing Athlete Lab, which will open a £1m studio in London next week, targeting keen cyclists in the City who want to emulate the benefits of riding on the road in a studio.
The owners of Bonhams are considering selling or floating the 220-year-old auction house after notching up record profits. Robert Brooks, a former racing driver, and Dutch businessman Evert Louwman have hired investment bankers from Greenhill to carry out a review. The move, which was first reported by Sky News lead, to a cash injection from a private equity firm or sovereign fund, or a market listing.
The “knickers queen” who quit Marks & Spencer after just three months is plotting her comeback with a bid for Knickerbox. Janie Schaffer and her business partner, former husband Stephen, are trying to buy back the brand they created 28 years ago. The Schaffers met at M&S in the early 1980s and started Knickerbox in 1986, having spotted a gap for a lingerie specialist. Janie Schaffer returned to M&S last year, having worked for Victoria’s Secret after selling Knickerbox in 1996. She left three months later amid suggestions she was stifled by the bureaucracy.
Bonanza will be divided among 30 executives if white goods retailer’s market value doubles in three years. Senior Staff at AO World could earn almost £1m each under an incentive plan put in place by the online white- goods retailer after its listing. About 30 top staff at AO, formerly Appliances Online, stand to share £25m if the company more than doubles its market value over three years. According to the float prospectus published last month, the award will be capped at 150% of salary, meaning some will get much more or less than the £833,000 average.
Sir Philip Green has plunged into the supermarket price war, vowing to undercut rivals with the start of food sales at BHS department stores.The billionaire retailer, who also owns Topshop, claimed BHS would be about 10% cheaper on branded goods than the big four supermarkets.“There’s no point in opening up and getting torn apart because we haven’t got competitive prices,” he said. The first two shops, in Staines and Warrington, will open within days, with plans for about 140 food outlets.
The British drinks giant is taking on Tennessee’s No 1 in its heartland. Sitting on his sun-lit deck, Randy “Goose” Baxter, star of the Jack Daniel’s adverts, has come to epitomise the easy living in Lynchburg, home of the Tennessee whiskey. But there is nothing folksy about a fight that has erupted between Brown-Forman, the corporation that makes Jack Daniel’s, and Diageo, the world’s largest spirits maker. The two drinks giants are arguing over a state law introduced last year dictating how all Tennessee whiskey, including Jack Daniel’s and Diageo’s rival George Dickel brand, should be made.
The media is full of the travails at the mutual that tried to take on Tesco and Barclays. But Britain's many – and large – regional co-ops are growing, exporting and thriving. Another week, another five days of upheaval at the Co-operative Group: its management shaken up and its annual results delayed for three weeks – when £2bn of losses are expected. Britain's biggest mutual has been branded "ungovernable" (by its former boss Euan Sutherland when he quit) and accused of organisational chaos that has cost it billions (by its independent director Paul Myners).
Kingfisher promised a DIY job on reviving B&Q. Has it worked, or is it just a Screwfix fix? Britain's husbands (if you excuse the generalisation) are wearily accustomed to cynicism from their wives, after insisting a faltering do-it-yourself project will look great in the end. As most amateurs eventually admit, the incredulous reaction is usually shrewd, which is why botching your own plumbing is proving less and less popular compared with hiring a pro.Similarly, the City invoked disbelieving looks when execs from B&Q owner Kingfisher kept promising that, despite tricky markets, its "self-help" plan to revive the retailer would eventually look like a professional job.
Mail on Sunday
Global technology giants such as Apple, Google and Amazon could soon be charged a tax on their UK activities in an attempt to stop them sidestepping their responsibilities. Britain is working with nine other countries to draw up shared dossiers on the tax affairs of such groups, it was revealed in Treasury documents released with last week’s Budget. The Treasury warned that if no joint action could be agreed, it would take unilateral steps to squeeze companies it believed were paying too little tax in Britain.
Pub landlords could be hit by tenfold rises in the cost of their licences under plans put forward by the Government. The Home Office is proposing to hand the power to set licence fees – paid by bars, pubs and anywhere that serves alcohol – from Whitehall to local authorities. It also plans to scrap the banding scheme that links the price of the licence to the rateable value of the property.
Sainsbury's has won the right to a judicial review in its battle against an allegedly misleading advertising campaign that claimed Tesco’s products were cheaper. The legal move comes as Britain’s supermarkets stand at the threshold of a price war aimed at attracting Britain’s cost-conscious shoppers. The battle of the supermarket giants was sparked by Tesco’s ‘Price Promise’ advertising campaign of 2013, in which it compared a basket of goods to what it claimed were equivalent products at rivals.
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