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Monday Update

DB Live: Calnex AIM debut; Odeon cuts back; Snowflake boost


6pm: Chambers chief warning

A senior business leader has warned that a second national lockdown is “unacceptable” and said the focus should be on targeting problem areas.

Full story here

4.30pm: Calnex closes below opening price

Linlithgow technology firm Calnex Solutions saw its shares trade below the opening price as the company became the first Scottish IPO for two years.

Floated on AIM at an offering price of 48p they opened at 53p and peaked at 54p before closing at 51.5p. More than 2.2m shares were traded.

Cineworld plunged 36.15% after saying it would temporarily suspend operations at all of its UK and US theatres from Thursday due to the Covid-19 pandemic.

Scottish engineer Weir Group added 15.9% after agreeing the sale of its oil and gas unit for $405m. 

The FTSE 100 steadied as US President Donald Trump’s condition appeared to improve and stimulus for the economy came back into focus. The index closed 40.82 points higher (0.69%) at 5,942.94.

4pm: Odeon moves to weekend model

Cinema chain Odeon is to open a third of its branches on a ‘weekend only’ basis.

The company said that from this weekend a quarter of its 120 venues will operate Friday to Sunday.

Its decision comes after Britain’s biggest cinema chain, Cineworld, announced plans to shut 127 outlets in the UK until further notice – affecting 5,500 workers (see below).

Odeon, owned by AMC Theaters, the world’s largest cinema chain, echoed Cineworld’s statement that the industry is struggling with limited new releases.

1.30pm: Chancellor addresses Tory conference

Chancellor Rishi Sunak today said he won’t stop trying to find ways to support people and businesses, but added that his party remains committed to balancing the books.

Full story here

12.30pm: Snowflake partnership for Edinburgh firm

Edinburgh-based digital transformation consultancy, Infinity Works, has become the UK & Ireland’s first services partner to be awarded elite partner status with Silicon Valley-based Snowflake, the data cloud platform – which recently completed the world’s largest-ever software IPO.

Further details here

11.30am: Funding for distillery expansion

Kilchoman, an independent, family-run whisky distillery based on the Isle of Islay, has secured a £10 million asset based lending facility from HSBC UK to support the building of new warehousing and fund additional marketing.

Further details here

11am: Virgin Media-O2 deal to create 4,000 jobs

A merger between Virgin Media and O2 will create more than 4,000 jobs in the UK if the deal is approved, according to the parent companies of both firms.

The £31 billion deal was announced in May by Liberty Global and Telefonica, the owners of Virgin Media and O2 respectively.

It will combine O2’s 34 million customers on its mobile network with Virgin’s 5.3 million broadband, pay-TV and mobile users.

Both businesses have pledged to not only bring new jobs to the UK but also create 1,000 new apprenticeships for young people.

The tie-up is expected to close in the middle of 2021.

9.30am: Codeclan chairman

A new has been appointed to succeed Polly Purvis at the digital skills academy CodeClan which she set up in 2015.

Full story here

9am: Home improvements rise

Conservatories and windows firm CR Smith has seen a surge in enquiries as lockdown focuses consumers on improving their homes.  

Further details here

8.45am: London higher

The FTSE 100 opened 30 points (0.5%) higher at 5,932.42 on news that US President Donald Trump’s health is improving after testing positive for coronavirus last week.

Weir shares gained 18%, pushing the stock to the top of the FTSE 250 after the Glasgow-based engineer agreed to sell its Oil & Gas division.

7.45am: Calnex Solutions to begin trading on AIM

Tommy Cook of Calnex

Shares in Calnex Solutions begin trading on AIM at 8am. The company has raised £22.5 million (before expenses) by way of a significantly oversubscribed placing of 46,875,000 shares at a price of 48p per share. Calnex’s market capitalisation on admission will be £42 million.

Tommy Cook, chief executive and founder of Calnex, said: “Joining AIM today is a significant landmark for Calnex.

“The successful fundraise and move onto the public markets provides us with the resources to expand our product portfolio, both organically and through acquisition, to take advantage of the significant structural changes taking place in the global telecoms industry.

“With many of the world’s leading players in the telecoms market on our client roster, a proven track record in innovation, strong financial position and global distribution capability, we are confident in our ability to capitalise on the opportunities ahead.”

7.30am: Peloton in Edinburgh

Cycling fitness company Peloton is to open a showroom at Edinburgh’s new St James Quarter next year.

Full story here

7am: Weir selling oil and gas division

Weir Group has announced the all-cash sale of its entire oil & gas division to Caterpillar for an enterprise value of $405 million (£314m).

Full story here

Independent withdraws Deltic interest

Independent Oil & Gas has withdrawn its interest in an all-share offer for Deltic Energy due to the absence of Deltic board engagement both on an initial approach made on 26 August (which was rejected on 2 September) as well as on a second approach made on 25 September on improved terms which was rejected on 2 October.

IOG said that a transaction would have “considerable industrial logic”, consolidating and scaling up two complementary portfolios.

However, the board of IOG said it is clear that it will “remain disciplined in its approach to consolidation opportunities and will not pay over risked fair value for assets, not least given the quality of its own existing portfolio and near-term development opportunities.”

Mulberry Group

Top end fashion retailer Mulberry said adjusted loss before tax for the year to the end of March came in at £14.2m (2019: adjusted profit £1.0m) before adjusting items of £33.7m (2019: £6.0m) largely resulting from the expected impact of COVID-19 on future trading. 

Group revenue was down 10% to £149.3m (2019: £166.3m), primarily reflecting a challenging UK market and the impact of COVID-19 towards the end of the financial period.  Group revenue down 6% before the start of COVID-19.

Cineworld confirms shutdown

Cineworld has confirmed that it will be temporarily suspending operations at all of its 536 Regal theatres in the US and its 127 Cineworld and Picturehouse theatres in the UK from Thursday, 8 October.

In a statement, it said: “Studios have been reluctant to release their pipeline of new films. In turn, without these new releases, Cineworld cannot provide customers in both the US and the UK – the company’s primary markets – with the breadth of strong commercial films necessary for them to consider coming back to theatres against the backdrop of COVID-19. These closures will impact approximately 45,000 employees.

Mooky Greidinger, CEO of Cineworld, commented: “Cineworld  will continue to monitor the situation closely and will communicate any future plans to resume operations in these markets at the appropriate time, when key markets have more concrete guidance on their reopening status and, in turn, studios are able to bring their pipeline of major releases back to the big screen.”

Today’s agenda

* Shares in Calnex Solutions begin trading on AIM.

* Omega Diagnostics delivers investor presentation

Today’s top Daily Business headlines

Call for mediation to ease pressure on legal system

Johnson warns of ‘bumpy ride’ until Christmas

Ross blasts party ‘defeatists’ who believe election is lost

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