Sunday Papers Roundup
Chutney maker Rubies in the Rubble secures Ocado deal, Office to expand as owners examine sale, Will King to step back from King of Shaves, Reckitt Benckiser to detail spin-off plan, Tesco chief buys time as chairman walks plank, Morrisons breaks pledge on low prices. Suite dreams, Tesco reveals big store woes, Starbucks hit by probe into sweetheart tax deal with Dutch, Irish seek partner to top up Spirit bid, Dominos and Xbox set to deliver couch potato heaven, Dave Lewis says pay deal is 'under review'.
Rubies in the Rubble, the company that turns unwanted fruit and vegetables into chutney and jam, has secured a contract with online grocer Ocado that could triple its turnover next year. The company, founded by former hedge fund manager Jenny Dawson in 2010, takes surplus or “ugly” produce from farmers and wholesale traders, helping them to reduce waste and preserve their margins.
Office, the high street shoe retailer, is stepping up plans to expand across Europe as its backers consider a sale or float of the company. Silverfleet, the private equity firm which owns Office, is understood to be considering selling the business four years after taking control, and has hired bankers at JP Morgan to provide advice on which route to take.
Will King, founder of the British shaving brand King of Shaves, is to relinquish his throne after 21 years. Mr King, one of the UK’s best known entrepreneurs, is standing down as chief executive of the Beaconsfield-based business. He will be succeeded as chief executive by Andy Hill, who has worked with Mr King since 1995 and will join the board.
Reckitt Benckiser, the maker of Cillit Bang, Vanish and Nurofen, is to reveal to shareholders details of its plans to spin off its pharmaceutical division into a separate stock listing. The chief executive, Rakesh Kapoor, is expected to send a circular to investors on November 17 laying out plans to hand them shares in the new London listing in a fixed proportion to their existing shareholdings in the consumer goods giant.
Lewis’s mandate is nothing less than transforming Tesco from a bloated 1990s relic into a company fit to lead the pack in the 21st century. It has £7.5bn of debt, £9.4bn of lease commitments and a £3.4bn pension deficit. He and his new right-hand man, former Marks & Spencer finance director Alan Stewart, need to bring in cash by selling assets or holding a rights issue, or both. The urgency of the situation became clear after the press conference when the rating agency Moody’s downgraded Tesco’s bonds because of the “huge operational challenges” that “put its investment-grade rating at risk”. Standard & Poor’s then followed, downgrading Tesco’s debt to one notch above junk.
Morrisons is pushing up prices on some of its “I’m Cheaper” lines — less than six months after it promised to lower prices permanently on more than 1,000 everyday products. An analysis seen by The Sunday Times shows the Bradford-based, FTSE 100 grocer has quietly cranked up prices on items like battered cod, which has gone from £2.50 to £3 for four fillets, and golden delicious apples, which have risen from £1.29 to £1.69 for a bag of five. Morrisons admitted it had increased the prices of 107 staples but insisted “they will still be lower than they would have been."
The entrepreneur behind a new mobile app that allows users to compare prices for hotels and book rooms is preparing to raise up to £10m to develop the service. Ines Djelassi, who launched Lodgeo last month, is working with advisers at Catalyst Corporate Finance on the fundraising. She has previously secured £2m in start-up funding. Lodgeo is Djelassi’s second hotel-related tech venture. In 2012 the 38-year-old French executive sold her previous business, Hotel Solutions Direct, to Eviivo
Tesco's new boss has admitted a third of its hypermarkets are failing, underlining the scale of the challenge facing Britain’s biggest grocer as it struggles with plummeting sales. Dave Lewis told analysts that two-thirds of the chain’s 250 giant Extra stores were “to die for”, indicating the rest were underperforming. Tesco has been battered as families have ditched the big weekly shop for smaller top-ups at convenience stores, and switched to discount rivals such as Aldi, Poundland and Lidl.
Starbucks will be accused of profiting from illegal state aid when Brussels unveils a formal investigation into the American coffee chain’s tax affairs. The European Commission is days away from publishing details of its probe into an alleged sweetheart deal between Starbucks and the Dutch government, sources said. It is thought that the commission’s anti-trust division will claim that the Netherlands and Starbucks struck a secret arrangement to lower the tax rate for the company’s subsidiary in Amsterdam.
The maker of Magners cider is considering teaming up with a partner to make a full cash bid for Spirit, the pub company behind Chef & Brewer. Last week it emerged that C&C, which also owns Tennent’s lager, had approached Spirit with a cash-and-shares £725m takeover offer. The pub operator, which had earlier given its backing to a rival bid from Greene King, maker of Old Speckled Hen beer, rejected the approach.
It is a dream come true for fans of video games. Soon they will be able to order a pizza without interrupting their game or leaving the sofa. Domino’s Pizza is set to team up with Microsoft to install its delivery app on the technology giant’s Xbox One console. Players will be able to call up the menu simply by saying “Domino’s, feed me”, while playing games or watching a film. Alternatively, gamers can access the app by waving their hands. They will also be able to monitor the progress of their order via an on-screen tracker.
Mail on Sunday
Tesco chief Dave Lewis is in talks over a new bonus deal with the company’s board as he battles to reverse the retailer’s falling profits and tackle the company’s recent £263 million accounting scandal. Lewis said he joined Tesco on a package similar to his predecessor Phil Clarke, but in an interview with The Mail on Sunday he said the details of his bonuses are now being reviewed by senior non-executives.
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