LONDON (Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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Irish flag carrier Aer Lingus Group late Tuesday said it has moved a step closer to being taken over by British Airways owner International Consolidated Airlines Group in a EUR1.4 billion deal, after the Irish government gave its backing to the deal. The offer remains conditional on securing the approval of both the Irish government and budget carrier Ryanair Holdings, both of which hold substantial stakes in Aer Lingus, along with it securing regulatory approval in Europe and the UK. The Irish government, however, said it supports the takeover bid from IAG after it was confirmed that Aer Lingus would keep its existing slots at Heathrow airport. The Irish Parliament, the Dáil, still has to vote on the approval.
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Imperial Tobacco Group shares are among the top FTSE 100 gainers after the US Federal Trade Commission approved the acquisition of Lorillard by Reynolds American. As part of that US merger, Imperial Tobacco previously had agreed to acquire from the pair a portfolio of US cigarette brands, e-cigarette brand blu, and Lorillard's cigarette factory and national sales force.
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Rolls-Royce Holdings said it has secured a contract from US aerospace and defence company General Dynamics' European Land Systems unit for 589 MTU Seris 199 diesel engines. The order is worth around EUR80 million and the engines are to be used in the SCOUT Specialist Vehicle General Dynamics has built for the British Army. It will be the first time MTU engines have been used by the British Army.
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Royal Bank of Scotland Group late Tuesday said it has agreed to sell a loan portfolio to Cerberus Capital Management at a loss, with the sale being the last "material" transaction for the part of the group running down bad or unwanted assets in Northern Ireland. In a statement, RBS said it will receive GBP205 million at current exchange rates for the sale, with the deal expected to complete in June, as RBS Capital Resolution continues to sell billions of pounds in assets with high capital intensity or risks. RBS said the sale of the loan portfolios was in addition to the disposal of a portfolio of Irish real estate loans to Cerberus in December.
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CRH late Tuesday said Lafarge and Holcim have accepted its offer to buy assets from them for EUR6.5 billion including debt and are now legally bound to the terms of the acquisition. "The acquisition remains conditional upon successful completion of the merger of Lafarge and Holcim as well as the completion of local asset reorganisations. The acquisition is expected to complete in the second half of 2015," CRH said in a statement.
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Brewin Dolphin's chief executive said the wealth manager is entering the final stages of the transformation programme launched in 2012, as the company reported higher first-half pretax profit and discretionary funds under management. In a statement, Brewin Dolphin said its discretionary funds under management amounted to GBP26.2 billion at the end of March, up from GBP24.0 billion at the end of its last financial year and from GBP22.7 billion at the end of the first half of that year. The wealth manager's GBP37.9 million pretax profit in the first half ended March 31 was higher than the GBP22.0 million recorded in the corresponding period of the prior year.
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De La Rue reported a drop in pretax profit in its recently completed financial year, as margins were squeezed by pricing pressure and the company achieved lowers levels of new business than expected in its identity systems and security products. Weakness in the euro has put further pressure on its profitability in the new financial year, the company said. The banknote printer and security paper maker said it made a GBP38.9 million pretax profit in the year ended March 28, compared with GBP59.8 million in the prior year. Revenue was down to GBP472.1 million from GBP513.3 million. De La Rue cut its dividend for the year to 25.0 pence per share from 42.3p, saying it will aim to maintain dividends at the 2014/15 level as it is "mindful" of how important the dividend is to shareholders.
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AG Barr said its sales declined in the first 15 weeks of its financial year, in line with its expectations, as sales stabilise following a strong first half performance a year earlier. The soft drinks company said it remains on track to meet market forecasts for the year. FTSE 250-listed AG Barr said total group sales in the fifteen weeks from January 26 to May 9 were down by 1.1% year-on-year. It said the sales decline reflects a return to a more normal sales performance following a strong first half a year earlier, related to marketing and promotional activity around the Glasgow 2014 Commonwealth Games.
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Greeting cards and gifts retailer Card Factory affirmed its expectations for the full year to the end of January 2016 as it said like-for-like sales growth in the first quarter of its financial year was in line with targets. FTSE 250-listed Card Factory said revenue in the first three months of its financial year to the end of April rose by 7.5%, slightly weaker than the 8.5% growth in the first quarter of its 2015 financial year, but flat on the growth seen in the second half of that financial year.
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Swedish private equity fund EQT IV confirmed it has sold just under 95 million shares in airport and train station concessions operator SSP Group, a 20% stake, to raise GBP275 million. The sale of the shares at 290 pence per share means EQT no longer holds any stake in SSP.
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MARKETS
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London stock prices are experiencing a small rebound following heavy losses on Tuesday, as a light day of economic data sees company news steal attention.
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FTSE 100: up 0.6% at 6,990.58
FTSE 250: up 0.5% at 18,188.48
AIM ALL-SHARE: up 0.1% at 765.50
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GBP: up at USD1.5388
EUR: up at USD1.0901
GOLD: down at USD1185.90 per ounce
OIL (Brent): up at USD64.15 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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The Queen's Speech is set to be delivered in the House of Lords later on Wednesday, setting out the agenda for the newly-elected majority Conservative government amid expectations the policies to be tabled will include plans for an in-out referendum on the European Union, tax cuts and further information on the Right to Buy scheme. The most keenly anticipated aspect of the speech, to be delivered by Queen Elizabeth but written by UK Prime Minister David Cameron's team, will be the Tory plans for an in-out referendum on Britain's EU membership, which Cameron has pledged to hold before 2017.
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German consumer sentiment is set to improve to its highest level since October 2001, survey data from market research group GfK showed. The forward-looking consumer sentiment rose to 10.2 in June from 10.1 in May. This was the highest score since October 2001.
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Iraqi security forces have rebel-held Ramadi hemmed in on three sides in an offensive to recapture the capital of western Anbar province, nine days after the city fell to Islamic State jihadists. "The legions of our armed forces...with the support of the Popular Mobilization and the tribesmen are now beginning the operation to free Anbar from the Islamic State gangs," Defence Minister Khalid al-Obeidi wrote on his Facebook page. The Iraqi Army and police were taking part in operations alongside mainly Shiite volunteers from across the country and local tribes from the Sunni province, Captain Ahmad Ibrahim of the Anbar police command told dpa.
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A Saudi-led coalition targeted the headquarters of Yemen's special forces in the capital, Sana'a, killing at least 30 people, medical officials said. A Health Ministry official, speaking on condition of anonymity, said most of the dead were special forces troops, and at least 100 people had also been injured. The special forces, which include counterterrorism forces trained to take on the Yemeni branch of al-Qaeda, are loyal to former president Ali Abdullah Saleh. Along with other pro-Saleh forces, they have supported the mainly Shiite Houthi rebels in their advance across the country.
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UN-sponsored peace talks on Yemen planned for Thursday have been postponed at the request of the Yemeni government and other stakeholders, UN spokesman Stephane Dujarric said. The UN-backed talks to be held in Geneva aim to bring together key stakeholders in the Yemen conflict to reinvigorate the political peace process that stalled when Houthi rebels overran parts of the country. UN Secretary General Ban Ki-moon is working to convene the talks "at the earliest possible time."
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Swiss prosecutors are investigating possible corruption related to the awarding of the 2018 and 2022 football World Championships to Russia and Qatar, officials report. They seized files at the headquarters of football's ruling body FIFA in Zurich and plan to question 10 members of the FIFA Executive Committee who were involved in the decision in 2010, the Federal Prosecution Authority says, calling the officials "witnesses". The investigation is separate from the US probe into alleged bribes paid to FIFA associates related to US and Latin American tournaments, resulting in six arrests in Zurich earlier on Wednesday.
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International Airlines (IAG)
SSP Group (SSPG)
De La Rue (DLAR)
CRH (CRH)
Barr (A.G.) (BAG)
Card Factory (CARD)
Rolls-Royce (RR.)