Mothercare collapse; IAG deal; Marston’s; China; Just Eat
Thousands of jobs at risk at the UK chain
Babywear chain Mothercare intends to appoint administrators, putting 2,500 UK jobs at risk.
The decision, announced to the Stock Exchange, follows a failure to acquire a buyer for the UK business although the high street shops will continue trading normally for the time being.
In a statement it said: “The UK retail operations of the group, which today includes 79 stores, are not capable of returning to a level of structural profitability and returns that are sustainable for the group as it currently stands and/or attractive enough for a third party partner to operate on an arm’s length basis.
“Furthermore, the company is unable to continue to satisfy the ongoing cash needs of Mothercare UK.”
The company said it operates “a successful global brand business” generating more than £500m of revenue a year from in excess of 1,000 stores internationally in 40+ territories.
In the financial year ended March 2019, the company generated profits of £28.3m internationally while the UK retail operations lost £36.3m.
BA owner buys Europa
IAG, owner of British Aiways and Iberia, is paying €1 billion £860m to acquire the low cost airline Air Europa.
Willie Walsh, chief executive of IAG, said: “Acquiring Air Europa would add a new competitive, cost effective airline to IAG, consolidating Madrid as a leading European hub and resulting in IAG achieving South Atlantic leadership, therefore generating additional financial value for our shareholders.
“IAG has a strong track record of successful acquisitions, most recently with the acquisition of Aer Lingus in 2015 and we are convinced Air Europa presents a strong strategic fit for the group.”
Marston’s pub sale
Pubs group Marston’s is selling 137 outlets to Admiral Taverns for £44.9m.
The company said the disposal is in line with its plans to reduce its debt in part through the disposal of certain non-core assets.
Ralph Findlay, chief executive, said: “We are making good progress with our plans to reduce our net debt by £200m by 2023 in part through the disposal of non-core assets.
“We are encouraged by the level of market interest that this portfolio of pubs has attracted”Article share tools
Chinese stocks higher on US hopes
Hong Kong’s Hang Seng index gained 1.3% while the Shanghai Composite was 0.7% higher as hopes rise of a US-China trade deal.
US Commerce Secretary Wilbur Ross told Bloomber the US and China were making “good progress” in trade negotiations.
He said there was “no natural reason” why a deal could not be signed in November but “whether we will slip a little bit who knows, it’s always possible.”
Mr Ross said the licences for American companies to sell components to Huawei would be “forthcoming very shortly”.
Japanese markets were closed for a holiday.
Just Eat cancels meeting
Just Eat is cancelling the shareholder meeting on 4 December it had scheduled for investors to vote on the offer from Takeaway.com.
Instead, the deal will need acceptance from 75% of Just Eat’s shareholders.
The company said: “The Just Eat Board unanimously recommends that Just Eat Shareholders accept the Takeaway.com offer.”
The take away food company has received another approach from Prosus, which Takeaway.com said “significantly undervalues” Just Eat.