Tesco appeared in several papers over the weekend as its Booker merger continues to enthral the media. The Times this morning writes that Hermes Fund Managers, “one of the most influential shareholder groups in the City”, has raised doubts about Tesco’s proposed Booker deal, saying it could put corner shops out of business and trigger a backlash against the retail giant. The paper adds that Hermes plans to raise the issue with Tesco before the vote on the deal.
The Telegraph again looked on Saturday at competition concerns thrown up by the deal. The paper writes that Tesco could be forced to sell hundreds of small high-street stores amid rising concern from rivals that its combination with Booker will give it a stranglehold on the grocery industry. Senior industry sources said any disposals to get around this would have to come from the supermarket, in the shape of its Tesco Express stores, because the wholesaler Booker doesn’t actually own the large bulk of shops in its huge network, the paper adds.
The Sunday Times reports that several of Booker’s biggest shareholders have sold down their stakes since the food and drink wholesaler announced the £3.7bn takeover by Tesco, amid mounting doubts over the deal. The hedge fund Lansdowne Partners and the fund managers Axa and Jupiter are among institutions that have aggressively reduced their holdings in Booker.
A piece in The Financial Times this weekend says that Dave Lewis’s attempt to buy Booker Group is the first flashpoint of his tenure at the UK grocer.
The Times also picked up Sky News story on Saturday that Tesco has struck a deal with Palmer & Harvey to help to stabilise the grocery wholesaler’s financial position.
Reckitt Benckiser is lining up a sale of its food business to help fund the £14.3bn takeover of baby food maker Mead Johnson Nutrition, The Sunday Times reports. City sources told the paper that the disposal of the division, which includes French’s and Frank’s Red Hot sauces, could bring in more than $3bn (£2.3bn) and is likely to attract the interest of US food giant Kraft Heinz after its failed tilt at Unilever.
The Times also picked up the story reported in The Grocer on Friday that Reckitt chief executive Rakesh Kapoor has had his pay slashed by more than 40% to just under £15m. Read the full story in The Grocer here.
The Sunday Times looks at the challenges at Premier Foods ahead of annual results next month. The paper says Premier’s task is to cut sugar and while keeping the City sweet.
Sky Newswrites that the Co-op Group will reveal it has plunged to a loss in 2016 in annual accounts this week as its 20% stake in the Bank is written off. The Guardian follows up this morning, writing The Co-operative Group will reveal this week it has fallen back into the red for the first time since its “tumultuous” 2013 year, after writing off the value of its investment in the Co-operative Bank.
The Financial Times examines the retreat from mainland China by Marks & Spencer.
After the scandal surrounding the collapse of BHS, Sir Philip Green is back in the headlines again as documents released by parliament show his Arcadia fashion empire is battling a 24% increase in its pension deficit (The Financial Times). It comes weeks after he handed over £363m to cover retirement benefits of former workers at the BHS chain he used to own. Oliver Shah of The Sunday Times, who won a Press Award recently for his reporting on Green and BHS, writes that the total pension deficit at Arcadia is close to £1bn.
Britons are counting the cost of the inflation rise as growth in spending power “has nearly evaporated”, according to Asda’s monthly Income Tracker (The Times - Saturday).
The failure of local delivery service Hubbub has lessons for investors, The Sunday Times says in a piece asking ‘what happens when a good start-up goes wrong?’.
The growing appetite for takeaway food in the UK could trigger a delivery driver crunch as businesses struggle to hire the workers they need, The Telegraph reported on Saturday.