Sainsbury’s is set to raise bid as the Argos takeover deadline approaches today.
Investors expect Sainsbury’s to offer as much as £1.5bn for Argos on Friday, as the supermarket considers trumping a rival South African bid for the catalogue shop ahead of a 5pm deadline. (The Guardian)
“It’s decision time in Argos’ Mexican Standoff”, writes The Telegraph, adding: “Observers have compared the tactics with a “game of chicken” and said that it will be a question of “who blinks first”.” But The Daily Mail says the battle for Argos “could drag on for weeks” after the UK Takeover Panel said that if one of the potential bidders confirms its offer, the other will be automatically granted a 53-day extension.
The fallout from George Osborne’s sugar tax continue this morning, with The Guardian saying Coca-Cola has hit back at sugar tax plan. Coca-Cola’s UK boss, Leendert den Hollander, said: “We don’t believe the sugar tax is the right thing to be done. We are not debating the issue, we are debating the solution. The facts don’t suggest that a sugar tax works to change behaviour.” While analysts said prices were likely to rise for shoppers as a result of the tax.
Similarly, The Financial Times (£) said analysts expect to see fall in sales of sweet beverages. Ian Shackleton at Nomura, calculates that raising £520m implies a 15-20% increase to retail selling prices, but added: “Diet drinks tend to have higher profit margins — because the cost of sweeteners tends to be lower than that of sugar — it’s not all bad news for beverage companies.”
Britain’s surprise decision to follow Mexico, France, Finland and Hungary and impose a tax on sugary soft drinks immediately came under fire on Thursday as both nannying and impractical, writes The Financial Times (£). The move won support from Michael Bloomberg, but members of Mr Osborne’s own political party said it was an unwarranted interference in people’s lives. “The loser is Conservative liberalism,” said Jacob Rees-Mogg, a backbench MP.
One of the top executives at Amazon’s UK business is to leave the company. Christopher North has been employed at the online retail giant since 2006, most recently as managing director of its UK arm. He will join digital photo company Shutterfly as president and chief executive on May 31. (The Telegraph)
Salmon prices have jumped as a severe toxic sea algae bloom has wrought havoc on fish farms in Chile, the world’s second-largest producer. (The Financial Times £)
In wider retail, clothing retailer Next saw its shares tumble after ‘Godfather of Retail research’, Tony Shiret raises concerns about slow growth from its directory business. (The Daily Mail)
China Resources Beer, which bought out SABMiller’s joint venture stake in the company earlier this month to smooth the way for AB InBev’s takeover of the London-listed brewer, today announced a nearly 14% rise in profits on its beer operations last year, despite a soft Chinese beer market. (The Financial Times £)