(Alliance News) - The following is a summary of top news stories Monday.
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COMPANIES
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UK housebuilder Countryside Partnerships has turned away a second approach in two months from San Francisco-based investor Inclusive Capital Partners. In-Cap said the offer - at 295 pence per share or about GBP1.5 billion in total - represents a "compelling proposition for Countryside shareholders". The stock was up 25% at 298.00p in London on Monday. "The In-Cap team believes that Countryside shareholders deserve the opportunity to decide on the merits of any offer, and that if an approach is made in good faith, the Countryside board should act in the interests of its shareholders by engaging with the potential offeror and not deny its shareholders this opportunity," it said. In-Cap currently owns about 45.8 million Countryside shares, a 9.2% stake.
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London-based advertising agency S4 Capital said its revenue jumped in the first quarter and was ahead of its guidance to the market. "Momentum has been reinforced by two further 'whopper' additions making a total of eight against the target of 20, one through pitch and one through a combination, both of which will be fully effective in 2023," S4 explained. Revenue in the first quarter of 2022 was up 70% on the year before at GBP206.8 million and up 41% on a like-for-like and pro-forma basis. Gross profit rose 65% to GBP171.1 million and by 35% on a like-for-like and pro-forma basis. For 2022, S4 maintained its like-for-like gross profit growth guidance of 25%. "The chickens may well come home to roost in 2023, as interest rates rise further this year to counter the inflation surge," Executive Chair Martin Sorrell said. "But, digital marketing expenditure remains robust, even in a recession, as, for example, our results in 2020 demonstrated, given its secular growth trend."
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Norwegian Air has ordered 50 Boeing 737 MAX passenger planes and secured the option to purchase a further 30 aircraft. The final contract is scheduled to be signed by the end of June. The 737 MAX aircraft are to be delivered between 2025 and 2028. During this period, Norwegian's existing aircraft leasing deals will expire.
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Toyota Motor said that both sales and production in April fell below the previous year's level as a result of Covid-19 and parts supply shortages arising from increased semiconductor demand. The Japanese carmaker added that it has revised its production plans to be "more reasonably in line with recent realities". Toyota calls the period from April to June an "intentional pause". It said conditions remain unclear regarding the spread of Covid-19 and parts supplies. Total worldwide sales in April stood at 835,657, down 10% against the previous year. Worldwide production totalled 826,287 in April, down 7.7%.
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Stellantis expands its partnership with Toyota, with a new agreement for a new large-size commercial van for the European market. The new vehicle marks the third body type under the agreement. Stellantis will supply Toyota Motor Europe with the new large-size commercial van for sale in Europe under the Toyota brand. The new vehicle will be produced at Stellantis' plants in Gliwice, Poland and Atessa, Italy. It is planned for mid-2024.
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Honda Motor reported worldwide production totalled 190,060 vehicles in April, the company's second consecutive year-on-year monthly decrease. In Japan, production registered its first year-on-year decrease in six months after Japanese production fell to 27,598 vehicles in April. Japanese sales and exports also fell, dropping to 37,422 vehicles and 3,574 vehicles respectively in April.
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Nissan Motor said global production in April fells 27% against the previous year to 207,268 vehicles. Production within Japan fell even more steeply, dropping 44% to 30,093 vehicles in April. Global sales in April fell 29% against the previous year to 254,267 vehicles.
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Germany's Volkswagen faces accusations of "slavery" practices in Brazil during the South American country's military dictatorship in the 1970s and 80s, German media said Sunday. Volkswagen has been summoned to appear before a labour court in Brasilia on June 14, following a notification sent by the local judiciary on May 19, ARD public television and the Sueddeutsche Zeitung daily reported. A VW spokesman told AFP it was taking the matter "very seriously". However, the world's second-largest carmaker did not want to say more at this stage "due to possible legal proceedings". The case covers the period from 1974 to 1986, when the dictatorship was in full flow to just after it ended. The military reigned in Brazil between 1964 and 1985.
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German industrial group Siemens has received a multi-billion-euro order from Egypt for high-speed trains, among other things. Together with two partners, the Munich-based company said on Saturday that it had signed a contract for the construction of a high-speed rail network. According to the contract, the Siemens' order is worth EUR8.1 billion. This includes EUR2.7 billion for the first line, which was already agreed last year. Siemens has called it the largest order in the 175-year history of the company.
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Mexico's energy regulator fined Spanish firm Iberdrola MXN9.15 billion, about USD467 million, for improperly selling electricity to third parties in violation of local laws, a document published Friday said. The Energy Regulatory Commission said Iberdrola "was obliged to generate electricity exclusively to satisfy the self-sufficiency needs of its partners...and not to sell, resell or by any legal act dispose of capacity or electricity," the document said.
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US market authorities have asked Elon Musk to explain an apparent delay in reporting his Twitter stock buys, the agency revealed Friday, the latest questions on the methods and intent of his troubled bid for the platform. Musk became a major Twitter stockholder following the purchase of 73.5 million shares in early April, and less than two weeks later launched a hostile takeover bid. He went on to ink a USD44 billion deal to buy the San Francisco-based company, but has since given mixed signals regarding how committed he is to following through. The Securities & Exchange Commission letter to Musk showed regulators asked him to explain why he didn't disclose within a required 10-day time period his increased stake in Twitter, especially if he planned to buy the company. Neither Musk nor the SEC immediately responded to requests for comment.
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MARKETS
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Asian and European stock markets traded positively at the start of a truncated week, encouraged by the lifting of some lockdown restrictions in Beijing and Shanghai. Wall Street is closed on Monday for the US Memorial Day holiday, while London markets close on Thursday and Friday for the the Queen's Jubilee bank holiday.
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CAC 40: up 0.8% at 6,572.11
DAX 40: up 0.8% at 14,573.95
FTSE 100: up 0.2% at 7,601.12
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Hang Seng: closed up 2.1% at 21,123.93
Nikkei 225: closed up 2.2% at 27,369.43
S&P/ASX 200: closed up 1.5% at 7,286.60
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US markets closed for Memorial Day holiday.
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EUR: up at USD1.0763 (USD1.0705)
GBP: up at USD1.2635 (USD1.2612)
USD: up at JPY127.33 (JPY127.17)
GOLD: up at USD1,858.30 per ounce (USD1,852.40)
OIL (Brent): up at USD119.93 a barrel (USD117.73)
(currency and commodities changes since previous London equities close)
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ECONOMICS AND GENERAL
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EU ambassadors made a final push to persuade Hungary to accept a watered-down oil embargo against Russia before a summit on Monday, as European unity over the war in Ukraine showed cracks. Envoys from the 27 member states were meeting in an attempt to finalise a sixth package of sanctions against Moscow, but remain deadlocked over a proposed embargo on Russian oil. The meeting was held just hours before the start of a two-day EU summit, where leaders hope to discuss ways to help Ukraine and how to beef-up European defence spending in the face of Russian aggression. A senior EU diplomat said that any failure to clinch a sanctions deal would be the "elephant in the room", given that Ukrainian President Volodymyr Zelensky was also expected to address the leaders by video link. The latest wave of sanctions was put on the table on May 4, but has been refused by Hungarian President Viktor Orban, an ally of Russian President Vladimir Putin before the war, who argues that an oil embargo would be an "atomic bomb" against his country's economy. Landlocked Hungary imports 65% of its oil consumption from Russia through the Druzhba pipeline and, along with Slovakia and the Czech Republic, have asked for an exception from the import ban.
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Italy industrial producer prices grew at a slower pace in April, though remained massively elevated compared to a year before, data from national statistics office Istat showed. Italy industrial producer prices rose by 0.2% month-on-month in April after increasing by 4.0% in March. Year-on-year, prices grew by 35%, slowing March's 37% jump.
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Spain's consumer price index rose by 8.7% in May from a year before, according to the latest data from INE. In April, inflation stood at 8.3%. The acceleration was mainly due to higher fuel and food and non-alcoholic beverages prices than in May 2021, while electricity prices fell. The estimated annual variation rate of underlying inflation - which excludes unprocessed food and energy productions - rose to 4.9%, its highest rate since December 1995. Month-on-month, Spain's consumer price index rose by 0.8% in May.
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Shoppers returned to the malls of Beijing on Sunday as the Chinese capital relaxed pandemic restrictions after declaring a small but persistent Covid-19 outbreak effectively under control. A partial reopening of stores and offices in Beijing was welcomed by weary residents and struggling shopkeepers eager for life to return to normal. Coupled with a gradual easing of restrictions in Shanghai, it signalled that the worst is over in the twin outbreaks in China's most prominent cities. Restaurants remain closed in Beijing, except for takeaways and deliveries, and many people in Shanghai can still only go out with special passes and for a limited time period, even as the number of new cases has plummeted.
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Ten Pacific island nations rebuffed China's push for a wide-ranging regional security pact, amid worries the proposal was designed to pull them into Beijing's orbit. Talks in Fiji between Chinese Foreign Minister Wang Yi and leaders from the small island nations failed to reach an agreement, in a high-profile diplomatic setback for Beijing. China is offering to radically ramp up its activities in the South Pacific, directly challenging the influence of the US and its allies in the strategically vital region. The proposed pact would see Beijing train Pacific island police, become involved in cybersecurity, expand political ties, conduct sensitive marine mapping and gain greater access to natural resources on land and in the water. As an enticement, Beijing is offering millions of dollars in financial assistance, the prospect of a potentially lucrative China-Pacific islands free trade agreement and access to China's vast market of 1.4 billion people.
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By Tom Waite; thomaslwaite@alliancenews.com
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