Tax law experts claim that British taxpayers will end up subsidising US private equity outfit Clayton Dubilier & Rice’s $7bn takeover of Morrisons. On Saturday, MPs and tax campaigners said the deal “stinks” and will probably see the grocer pay less in taxes to the Exchequer. According to Richard Murphy, of Sheffield University Management School: “If CD&R put the debt on to Morrisons to buy it, then the profits are reduced due to the interest payments sent offshore. The Government will be subsidising this if there is debt involved. Is that a good use of taxpayer money?” – Financial Mail on Sunday
Bank of England Governor Andrew Bailey dropped his clearest hint yet that interest rates were set to head higher soon. In remarks made in an online panel, Bailey said: “Monetary policy cannot solve supply-side problems – but it will have to act and must do so if we see a risk, particularly to medium-term inflation and to medium-term inflation expectations. And that’s why we at the Bank of England have signalled, and this is another such signal, that we will have to act. But of course, that action comes in our monetary policy meetings.” – Sunday Telegraph
Australia-based Gelion Technologies, which was spun out from the University of Sydney, is planning to raise over £16m via a London listing next month. The battery storage developer is expected to fetch a market valuation of approximately £120m. Its zinc-bromide batteries employ an electrolyte gel, instead of pumping through a liquid solution, allowing them to reduce both size and cost. They are also said to be more robust, less wasteful and capable of working at higher temperatures than flow batteries. – The Sunday Telegraph
The Hut Group’s founder, Matt Moulding, is planning on giving up his so-called ‘golden share’ as part of a shake-up of the company following the collapse of its share price. Traditional City investors are upset because of the inordinate amount of say that it gives him in comparison to the average shareholder. Among other things, it allows Moulding to veto any takeover for three years and has prevented the outfit from joining the ranks of the Footsie due to stock exchange rules. – The Sunday Times
Britain’s financial markets watchdog’s plans to drastically restrict the number of small companies on the London stock market may hamper the City’s prospects after Brexit, some observers warn. According to the Financial Conduct Authority, companies with a value of less than £50m were “better suited” for the junior AIM market. Under its proposals, the threshold for being able to list on the stock exchange would rise from £700,000 to £50m. Yet City figures have warned that those proposals could keep entrepeneurs from choosing London as their listing venue. – The Sunday Times
Pandora will boost the salaries of its UK staff by £500,000 in a bid to retain them in the run-up to the vital Christmas period. The company will announce today that its 1,200 UK workers will receive a 6% pay rise. That comes as companies are struggling with the worst staff shortages since the late 1990s. The Danish jewellery brand, which has 185 shops in the UK, raked in £282.7m of profits in 2020, although that was down from the £434m achieved during the previous year. – Financial Mail on Sunday
