Sterling will drop to $1.05 by the middle of next year, according to consultancy Capital Economics, lower than the $1.21 in the immediate aftermath of Brexit and the $1.43 after Black Wednesday in 1992. The downbeat projection underscores the fragility of the UK economy. A historic inflation surge fuelled by global investors to ditch sterling-based assets, Capital Economics said. Paul Dales, chief UK economist at the consultancy, said he thinks “the UK has [already] fallen into recession, while the US may avoid one”. “If anything, the recent surge in UK wholesale gas prices suggests that the risks slowdown.Whilethe Bank of England has hiked rates to 1.75 per cent from 0.1 per cent, the Fed has lifted them 225 basis points since March and is expected to launch a third successive 75 basis point rise on 21 September. A weaker pound will put upward pressure on inflation –already running at a 40-year The UK imports a greater volume of goods and services than it produces, causing the pound “to behave more like a risky asset than a safe haven,” Dales added. The cheaper pound will also make UKlisted equities, already undervalued, even more appealing to private equity raiders from abroad.
INSIDE RISING COSTS HIT KLARNA P4 SUMMER OF DISCONTENT DRAGS ON P7 GORBACHEV’S LEGACY P8 BIDDERS CIRCLE PINK FLOYD P9 CRYPTO P13 OPINION P16 SPORT P19
London office market booms as firms bet on importance of in-person working
ANDYEXCLUSIVESILVESTER LIZ TRUSS will “empower the City to drive economic growth” through tax cuts and regulatory reform if she is, as expected, made Prime Minister nextTrussweek.told City A.M. that she wanted to maintain the Square Mile’s competitive edge and “supercharge growth and investment” here. The comments mark a change in tone from that of the previous Prime Minister Boris Johnson, who many in the City felt ignored the needs of the capital and the sector. The current foreign secretary said that the City is a “jewel in the crown of the UK economy but for too long its potential has been held back by onerous EU regulations, which have stifled growth and stunted investment”. Truss said she would push through “bold” reforms of Solvency II and MiFID regulation, which have been held up since the UK left the European Union bloc. She changessaidto the EU-era rules would Cityregulations“onerous”removeforfirms.
£ ONCONTINUEDPAGE3 LONDON’S BUSINESS NEWSPAPER LEIC IT A LOT OUR EXPERT REVIEW OF THE KING OF CAMERAS P18 IN THE KNOW MARK KLEINMAN RETURNS WITH HIS MUST-READ SQUARE MILE COLUMN P11 THURSDAY 1 SEPTEMBER 2022 ISSUE 3,809 FREECITYAM.COM
SQUARE MILE PLEDGE Truss: The City will ‘crownremainjewel’
STERLING TO FALL TO ALMOST PARITY WITH GREENBACK AMID RECESSION FEARS
EMILY HAWKINS CENTRAL London office take-up has rebounded back to pre-pandemic levels this year and has even surpassed the ten-year average. Occupancy in the heart of the capital bounced back to prepandemic levels during the 12 months to the end of 2022’s second quarter, according to data from real estate advisor CBRE. Take-up for offices hit 12.7m sq ft, a boost of 153 per cent versus the same period last year. After being hammered hard amid Covid-19 lockdowns, the West End has seen one of the speediest recoveries across major European office markets, the giant said. In the entertainment destination, take-up reached 4.9m sq ft, an increase of 149 per cent compared to the same period last year and a 24 per cent increase on the ten-year average. Bosses are also keen to expand their footprint, with more occupiers growing rather than shrinking when moving from one building to Commuteranother. numbers could also be boosted by higher domestic energy prices. Comparison site Uswitch yesterday suggested that working from home five days a week could cost an extra £131 a month.
POUND TO HIT DOLLAR LOW
THE EXECUTIVESTELEGRAPHWORKING FROM HOLIDAY HOMES FEAR TAX CRACKDOWN Tax authorities have begun collecting data on the number of people working from abroad, sparking fears of a crackdown on “workcations”.post-pandemic
City stands ready to invest –if government gives faith to do so
Goldman Sachs also said it expects a bigger hike from the ECB.
WHAT MORNINGSAYPAPERSOTHERTHETHIS
Liz Truss or Rishi Sunak to oversee worst UK living standards crisis in a century
Despite outgoing Prime Minister Boris Johnson promising to narrow income gaps between UK regions under his “levelling up” agenda, spending power is on course to plummet seven per cent by the end of the current parliament, making it “easily the worst parliament on record for income growth,” the Foundation said. Weak growth driven by a productivity malaise since the mid-2000s has squeezed workers’ pay, leaving them with little room to cope with the current cost of living crisis.
JACOB REES-MOGG NAMED FRONTRUNNER TO BE NEXT BUSINESS SECRETARY Jacob Rees-Mogg has been named frontrunner to be business secretary in a Liz Truss government, drawing opposition claims that he is a “climate dinosaur” who would delay net zero.
WE SAY TOMATO, THEY SAY TOMATE Spain’s tomato throwing festival returned after a two-year lapse yesterday, with revellers hurling some 130 tonnes of tomatoes in Bunol
CITYAM.COM02 THURSDAY 1 SEPTEMBER 2022NEWS
THE GUARDIAN EU FOREIGN MINISTERS AGREE TO SUSPEND VISA TRAVEL DEAL WITH RUSSIA
The EU has agreed to suspend a travel deal with Moscow to curb the number of Russian nationals entering the bloc for holidays, stopping short of a full tourist ban demanded by some.
Record inflation to force ECB into 75 basis point rate hike
Unless either Truss or Sunak launch a policy package that boosts growth, “the new Prime Minister risks overseeing the culmination of not just the worst two years in this century or the last, but the culmination of two lost decades for British households’ living standards,” the Foundation added. Energy bills will jump 80 per cent in October, but the Foundation warned bills could remain high for the next 18 months, cancelling improvements in living standards. All real pay growth since 2003 is set to be wiped out by 2024 without government intervention to cushion the energy crunch.
JACK BARNETT THE EUROPEAN Central Bank (ECB) could be forced to hike interest rates by a historic 75 basis points next week to tame the largest inflation surge on record, economists bet yesterday. The monetary authority governing the 19 countries using the euro may have to respond strongly or risk elevated prices being embedded into the bloc’s economy over the long run, according to experts. Inflation surged to 9.1 per cent this month, the highest level since the creation of the single currency in 1999, above analysts’ expectations and up from 8.9 per cent, new figures published yesterday by Eurostat revealed. A firming in price pressures across the single currency area “will add to the pressure on the ECB to step up the pace of tightening,” Jack Allen-Reynolds, senior Europe economist at Capital Economics, said, adding a 75 basis point rise is likely.
Truss and Sunak’s teams did not respond in time to a request for comment.
JACK BARNETT LIZ TRUSS or Rishi Sunak are set to oversee the steepest fall in living standards in a century after one of them enters Number 10 next Monday, a fresh report published today reveals. Brits are on course to be £3,000 worse off by the end of 2024 as soaring energy bills and inflation eats into their finances, according to the Resolution Foundation (the Foundation). Price rises will outpace pay growth, dealing a 10 per cent blow to spending power over the next two years.
HAT’s the size of 31 Lake fibreglasshomeWindermeres,to165steel-and-behemoths each taller than the Monument, and 70-odd miles from Grimsby? If your answer was the Hornsea 2 wind farm, ten points to you. The world’s largest offshore wind farm became fully operational yesterday, set to power around 1.4m British homes –combined with Hornsea 1, next door, that number climbs to 2.5m homes. This is absurdly good news, and it has been brought to bear by a combination of sensible planning decisions on behalf of local and national government and a bucketload of private cash. It’s the sort of thing we should look at as a national success story –but it’s easier to ignore socalled NIMBYs and judicial reviews when you’re building in the North Sea. If we could expand that model, then Britain could perhaps build some more of the infrastructure that might just power us out of our current trajectory towards a slow-growth, ageing country without resorting to an infrastructure-heavy benign Todictatorship.dothatthe City would need the ability to invest, and it is to the probable next Prime Minister Liz Truss’s credit that in speaking with City A.M. yesterday she brought up changes to Solvency II regulations Promisingly,unbidden.shealsospoke of reinvigorating the Square Mile’s ability to raise cash for potentially transformative research. None of Britain’s problems –be they going green, securing energy supply, delivering growth across the country or upgrading infrastructure –can be solved without the Square Mile’s financial support. But that needs to be earned: if it is to be Truss, she will have a short window to earn it. If she tackles the red tape that holds back boring but big projects and signs off on the more exciting, smaller projects that make investors eyes light up, perhaps Truss –who was probably not the City’s favoured candidate at the start of this race –may surprise on the upside.
THE FINANCIAL TIMES STANDING UP FOR THE CITY THE CITY VIEW
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Insurance giants in particular have been keen to amend Solvency II regulations in order to free up cash to invest in larger-scale UK projects, but have run into Treasury opposition over the detail of what a future regime might look like.
The delays to the licensing round follow gas prices climbing to all-time highs in recent weeks, amid a Russian energy squeeze on Europe, which is escalating fears of supply shortages this winter.
The government said it was still considering a public consultation into the checkpoints which closed in February but would publish them later this year. A BEIS spokesperson said: “There will continue to be ongoing demand for oil and gas over the coming decades as we transition to cleaner energy, and we are backing North Sea oil and gas production to ensure greater security of supply during this transition. The climate compatibility checkpoint will not affect proposed developments that come under an existing licence.”
THERE will be a larger
Truss’ comments come after the Mayor of London Sadiq Khan told City A.M. it was time for a “reset” of relations between the capital and central government after a series of public rows over Brexit, Transport for London funding and Covid-19 regulations.
OEUK remains in favour of environmental checks to ensure projects are sustainable and in line with domestic carbon budgets, which it has supported alongside net zero targets. Nevertheless, it considers oil and gas production essential for a long-lasting FROM 1
The UK currently meets nearly half its energy needs through domestic oil and gas – reducing the country’s reliance on overseas vendors compared to its European allies.
CITYAM.COMEXCLUSIVENICHOLASEARL
VITAL North Sea energy projects will be delayed if the government does not sign off on new climate regulations, the country’s biggest energy trade body said Offshoreyesterday.Energy UK (OEUK) told City A.M. that this year’s licensing round for new exploration projects was expected earlier this summer, but has been delayed by Downing Street which has refused to proceed until it has confirmed so-called ‘climate compatability checkpoints’.Natalie Couper, OEUK’s director of communications, told City A.M.: “Our concern is that new regulations tend to delay new projects. Right now the UK is facing a supply crisis and many of its older wells and fields are in decline. It’s critical for our energy secuGreen rule delay to hold up North Sea gas projects rity that we get the green light for projects that can maintain current levels of supply and minimise reliance on imports. We would urge the incoming government to publish these new regulations as soon as possible.”
“A successful City is key to a successful country,” she said. She further pledged to keep the position of City minister, and said that she would work to “maintain [the City’s] competitive edge” with changes to the tax regime, looking at competition from abroad.
transition to renewable energy.
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The previous 2019/2020 licensing round, overseen by the North Sea Transition Authority, saw 113 licence areas offered to 65 companies.
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RECESSION TO BOOST OIL SUPPLIES
OPEC+ to meet as Saudis signal cut on way
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Truss: City is good for rest of UK
The new licences are considered vital for UK energy supply
The leadership candidate, who leads in polling, also said “we need to ensure that regulators work to encourage growth”, hinting at previous reports that she would conduct a review into the workings of the various City watchdogs.
In a new report set to be published next week, OEUK is expected to cite fresh data from the NSTA suggesting as much as 15bn barrels of oil could still be salvaged from the UK’s continental shelf with more exploration.
globallatestyesterdayrevealeddownrecessionandmonetarycosts,risingthisinexpectedthansurplustheoilmarketyearasenergytighterpolicyfearsofaweighdemand,OPEC+initsreportontrends.
In a statement yesterday, chief executive Sebastian Siemiatkowski said he had seen a “huge shift in investor sentiment” in the first half of the year. “We’ve had a few years now where growth has been really heavily prioritized by investors. Now, understandably, they want to see profitability,” he said. “We’ve had to make some tough decisions, ensuring we have the right people, in the right place, focused on business priorities that will accelerate us back to profitability while supporting consumers and retailers through a more difficult economic period.”
Supermarket boss Simon Roberts promised to stand with its customers amid the crisis
TOP DOG Accountancy sector veteran Pauline Wallace named chair of UKEB
“On discovery of this issue, we promptly informed the CMA of the error and resolved it,” they said.
as costs
FORMER PwC partner Wallace has been made the chairpermanentfirstofthe fromBritain’sstandardsaccountinginternationalalignmentthesetanBodyEndorsementUK(UKEB),organisationuptoensureUK’swithafterexittheEU.
Natwest forced to dish out refunds by CMA over ‘bundling’ breaches
MICHIEL WILLIAMS SUPERMARKET giant Sainsbury’s yesterday said it plans to invest £65m into keeping product prices lower amid ratcheting pressure on customers’ budgets. Simon Roberts, chief executive of the supermarket chain, promised the brand will stand with its customers “to ease the financial pressure theyTheface”.latest pricing pledge – which is part of a wider £500m investment commitment – comes as fresh figures from the British Retail Consortium (BRC) reveal that customers witnessed 9.3 per cent food inflation in August, compared with the same month lastTheyear.UK’s second largest grocery chain said £60m of its latest cash injection will go towards food prices in ItSeptember.saidthiswill predominantly go towards the Price Lock campaign, which freezes the price of a raft of its most popular products.
LOUIS GOSS THE CITY’s high-paying corporate law firms have more young partners than those operating in any other sector of the legal business, new research from accountancy firm Hazlewoods shows. Almost two fifths (38 per cent) of partners at City firms are now under the age of 44, as young lawyers are increasingly being drawn in by the huge payouts available to those at the top. For comparison, 30 per cent of all law firm partners are under the age of 44, Hazelwoods research shows. The higher prevalence of young lawyers at the top of City firms comes as those working in the highest paid areas of the legal sector are increasingly retiring from their positions early to enjoy the huge sums earned. This in turn creates greater opportunity for those rising up the ranks in corporate law. Ian Johnson, associate partner at Hazelwoods, said that while “competition to get to partnership can be intense… those who get there often enjoy a share of some of the biggest profits in the profession,” allowing them to build up wealth quickly and retire. Meanwhile, criminal law firms had the fewest young partners, with just 24 per cent of criminal law firm partners below the age of 44, amid a scarcity of young lawyers choosing to specialise in criminal law.
City law firms have youngest top lawyers
CHARLIE CONCHIE THE BOTTOM LINE
Sainsbury’s to pump tens of millions into keeping grocery prices lower
more than
CITYAM.COM04 THURSDAY 1 SEPTEMBER 2022CHARLIENEWSCONCHIE
CHARLIE CONCHIE NATWEST must dish out £600,000 in refunds because it breached rules by forcing business customers to open “costly” current accounts to access loans, a watchdog has ruled. In a statement yesterday, the Competition and Markets Authority (CMA) said it found that Natwest breached its retail banking rules by making business customers to open fee-incurring accounts in order to secure loans, in a practice known asThe‘bundling’.breachlasted for over three years, with Natwest failing to alert the CMA until January 2021 by which time over 700 customers had fallen foul of the scheme, the CMA said. A Natwest spokesperson said a “technical issue” meant that a small number of new business customers were “incorrectly provided with a business current account when taking out a business loan”.
A FTER a bruising six months, Klarna issued an important caveat with its latest set of financials yesterday. While the Swedish firm has made headlines this year for slashing its headcount and shifting away from a growth-at-all-costs mindset, it stressed that any impact of the changes was yet to be Thefelt.question therefore remains over whether the former fintech darling can revive its reputation among investors with a credible fast-track to profit, or whether costs will continue to climb. At first take, the financials look stark. Losses more than tripled in the six months to June as credit losses rose to 0.7 per cent –all while boss Sebastian Siemiatkowski openly underlined the fact that investors are now prioritising profit over growth. But Klarna’s inroads into the US cannot be shrugged at. Sales in the US more than doubled and the firm globally has recorded a 21 per cent uptick in the first half of the year. Siemiatkowski looked to soothe fears yesterday, saying that profitability was “something we know how to do”. Investors now need to see if the proof is in the pudding in the months ahead.
LOSSES at buy-now pay-later giant Klarna more than tripled in the first six months of the year as the Swedish fintech was hit by soaring employee costs and rising credit losses as it ramped up its expansion in the US. In its first half results yesterday, Klarna said losses across the group soared to SEK 6.2bn (£500m) in the first six months of the year despite a 24 per cent jump in revenues on the same period last year to SEK 9.1bn (£816m). The firm blamed the jump in costs on the integration of price comparison site Pricerunner, an increase in “employee costs” and rising credit losses across the group on the back of a major growth push in the US and UK. The mounting losses come amid a turbulent period for the fintech giant after it was forced to slash its headcount by ten per cent in May as fintech and tech firms globally were hit by a majorHowever,downturn.Klarna yesterday said it had significantly strengthened its position in the UK and US, with US revenues more than doubling on last year as it went from an “unknown Swedish payments company to becoming a market losses triple surge
Around 2,000 food products and household items have had their prices fixed for at least eight weeks, including a number of own label lines.Sainsbury’s said funding will also go towards its price match campaign against discounter rival Aldi. Aldi and German rival Lidl have seen a jump in customer demand in recent months as cash-strapped shoppers have sought better deals for groceries as soaring energy bills continue to weigh on households.
Klarna’s employee costs and credit losses jumped in the first six months of the year leader” with 30m users. Bosses indicated earlier this year that they were looking to scale back expansive growth plans and fast track a route to profitability, as investor sentiment shifts away from growth-at-allcosts amid the prospect of a looming global downturn.
Klarna
Klarna, once Europe’s most valuable startup, saw its valuation plummet from $45.6bn to $6.7bn as it raised $800m in a new funding round. Investors are also growing wary of buy-now pay-later firms globally as regulators ramp up scrutiny and concerns grow around usage amid a global cost of living crunch.
05THURSDAY 1 SEPTEMBER 2022 NEWS
Siemens Energy has previously carried out maintenance work on compressors and turbines at the station in the past. It has said it was not involved in the maintenance, but stood ready to advise Gazprom if needed. The closure comes after Gazprom reported a record net profit of 2.5 trillion roubles (£35.8bn) for the first six months of trading this year. The board also recommended offering £8.6bn in dividends to the Russian government, which owns 49.3 per cent of the company’s shares. Earlier this week, Gazprom announced it would suspend gas deliveries to its French contractor Engie due to a payments dispute, which France’s energy minister labelled as an excuse – although it anticipated a loss of supply.
LOUIS GOSS ØRSTED has launched the world’s biggest fully-operational off-shore wind farm, 89km off the east Yorkshire coast. The launch of the 1.3 GW Hornsea 2 project has seen Ørsted break its previous record, which the Danish firm previously set by launching its 1.2 GW Hornsea 1 wind farm in 2019. Ørsted’s UK chief Duncan Clark said the Hornsea 2 project will help “increase...security and resilience” in the UK’s energy supply and “drive down costs for consumers by reducing our dependence on expensive fossil fuels”. The wind farm will produce sufficient power for 1.4m homes, in supplying electricity to the UK via 390km of subsea cables that come onshore at Horseshoe Point near Grimsby.Thelaunch of the wind farm sits in line with UK government plans to bring online 50 GW of offshore wind capacity by 2030. Ørsted is now planning to break records again by building a third, 2.8 GW wind farm in the 2,000 square meter Hornsea Area, called Hornsea 3.
governments fear Russia could extend the latest outage in retaliation for Western sanctions targeting coal imports and seaborne oil shipment, which were imposed after the country invaded Ukraine. Further restrictions to European gas supplies could deepen an energy crunch that has already triggered a 400 per cent surge in wholesale gas prices since last August, squeezing consumers and businesses and forcing governments to spend billions to ease the burden. Unlike last month’s 10 day period of maintenance, this was only announced
COMMODITY costs for beer production and transportation have shot up amid the pandemic, as ‘drinkflation’ puts increasing pressure on brewers. Costs have risen 62 per cent in the past two years, according to social investing platform Etoro. This price growth rate has far surpassed a 12 per cent increase in UK inflation in this time.
NICHOLASCITYAM.COMEARL
Gazprom halts flows from Nord Stream pipeline two weeks in advance. However, Gazprom has argued the latest shutdown is needed to perform essential work on the pipeline’s only remaining compressor at the Portovaya station in Russia, which has to be carried out jointly with Siemens specialists.
Conflict in Ukraine has intensified pressures on brewers this year, with drinkers facing more price hikes down the line. It comes as breweries have urged the government to introduce aid to help them with soaring energy bills while thousands of pubs could be forced to shut this winter, industry chiefs have warned this week. The average price of a pint has risen by eight per cent over the past two years to £4.09, with Etoro’s Ben Laidler warning of “stiffer price rises” ahead.
Drink up now: Beer production costs surge past inflation levels
EMILY HAWKINS
World’s largest working offshore wind farm to power 1.4m homes
Breweries are facing heftier costs to produce and transport beer amid war in Ukraine
GAZPROM has halted gas flows into the Nord Stream 1 pipeline for the next three days to complete maintenance work, raising the chilling prospect of further cuts to supplies from Russia thisThewinter.Kremlin-backed gas giant has been ramping up pressure on the West in recent weeks, with its last round of maintenance in July resulting in gas flows being cut from 40 to 20 per cent of capacity following a dispute over a Europeanturbine.
The Russian giant continues to bring in huge profits
Holdings Corp, plant in the Japanese city of Meanwhile,Himeji.around £2.14bn will be invested in Toyota Battery Manufacturing in North Carolina. Unlike other carmakers, many of which have signed deals with battery manufacturers, Toyota’s strategy focuses on in-house production, which it hopes will give it an edge over rivals. It comes as carmakers worldwide are spending billions of dollars to ramp up battery and electric vehicle production in the face of tougher environmental regulations. Earlier this year, rival Ford unveiled seven new electric vehicles for the European market, which it hopes to bring to customers by 2024.
Toyota commits £4.5bn to drive electric switch
The new prime minister is now being urged by the group to ease the flow of digital trade by including regulators in “defining negotiation terms and objectives” of future deals, as well as building trade processes around “specific concrete commitments” from regulators. Policy chairman at the City of London Corporation Chris Hayward said today that addressing the barriers was “vital for our financial services exports” and would allow the UK was to “set the agenda on digital trade and the flow of data”.
CHARLIE CONCHIE POST-Brexit trade deals have left “significant barriers” in place that are hampering digital trade to and from the UK, the City of London corporation warned today. Despite ministers striking a series of free trade agreements with the likes of Australia, Japan and New Zealand, the success of the deals has been hampered by a lack of engagement from officials, as well as “a litany of carve-outs and exceptions”, the City of London said in a new report. The group pointed to a lack of regulator-to-regulator cooperation and lacklustre means of sharing information between markets as among the key barriers to digital trade in the UK.
CEBR said the “untapped potential” of real-time payments would be a huge uplift to the economy.
“We hope the next Prime Minister and his or her Government will seize these opportunities during ongoing trade negotiations with India, Canada, Mexico and others,” he said.
Shirine Khoury-Haq, Co-op’s boss, said: “This transaction is in line with our strategy to move away from operating petrol forecourts and supports our vision of Co-operating for a fairer world while building our core leading convenience business.
MODERNISING the country’s payment infrastructure could boost the UK economy by almost $3.8bn (£3.3bn), a report issued today has claimed. An in-depth study by Global Data, the Centre for Economics and Business Research (CEBR) and ACI Worldwide, shows the UK’s GDP would hugely benefit if it upgraded its ageing payments infrastructure and increased real-time payments adoption.TheUK lags behind much of the developing world in real-time payments growth, the report said.
If fuel can believe it: Co-op sells petrol business to Asda for £600m
NICHOLAS EARL THE Co-operative Group (Co-op) has announced it will sell the company’s petrol forecourt business to Asda in a £600m deal. This transaction includes 129 petrol forecourt sites, spread across the UK and represents five per cent of Co-op’s retail estate of 2,564 stores. It will use the funds to reinvest in its stores and e-commerce operations, while expanding its presence with more shops nationwide.
CITYAM.COM06 THURSDAY 1 SEPTEMBER 2022NEWS
ILARIA GRASSO MACOLA NIGERIAN mobility fintech Moove will bring 10,000 electric vehicles to Uber’s fleet as part of its EU expansion. Moovewill enable Uber –for whom London is already its greenist city – to become all-electric by 2025. Founded in 2020 to expand access to vehicle ownership in Nigeria, the fintech will allow customers to access electric vehicles through its rent-to-buy model, which is based on a weekly fee. Moove has expanded to nine markets across sub-Saharan Africa and“WeIndia. areproud to have built a business in Africa to now be able to scale our model here in Europe, which is something that no other African fintech company has done before,” said Moove’s co-founder and co-chief executive Ladi Delano. According to Uber UK’s general manager Andrew Brem, Moove’s model will help more air”.London’supandrunningreducecarsswitchdriverstoelectricfaster“totheircostshelpclean
JACK MENDEL
The report urged the next PM to address the UK’s lagging payment infrastructure
“I would like to thank our incredible colleagues in these stores, and we will work closely with Asda to ensure a smooth transition.”
City groups are concerned about a lack of progress on digital free trade access Nigerian electric car start-up to supply Uber
The acquisition is expected to be completed in the fourth quarter of thisEarlieryear. this summer, petrol prices rallied to all-time highs.
Modernising payment infrastructure could boost UK economy by £3.3bn
NICHOLAS EARL TOYOTA Motor Corp yesterday announced plans to boost battery supplies for electric vehicles across Japan and the US. The car giant will commit up to ¥730bn (£4.52bn) in Japan and the US towards supplying batteries for electricToyotavehicles.aimsto begin battery production between 2024 and 2026, with an investment intended to augment battery production capacity in both the countries by up to 40 GWh. It will invest about ¥400bn in Toyota plants and Prime Planet Energy & Solutions, a joint venture with Panasonic standardsgreenwithtoareCarmakersracingkeepupnew
The deal is expected to be completed by the end of this year
Ministers urged to address ‘significant barriers’ blocking digital trade
“Real-time payments improve liquidity in the financial system and therefore act as a catalyst for economic growth,” Owen Good, head of economic advisory at CEBR, said. The country’s payments industry last year proposed a ‘New Payments Architecture’ programme, which is due to introduce sweeping changes in the next few years.
Train drivers and ticket staff back more strikes
ILARIA GRASSO MACOLA
The Open House Festival in London returns 8-21 September for two weeks of architectural exploration. As ever there will be wide range of buildings across the Square Mile, many not usually open to the general public, that you can access including Guildhall’s own historic Great Hall
The Department for Transport said union leaders were “choosing self-defeating strike action over constructive talks” and disrupting millions. Royal Mail workers went on strike yesterday with further action planned this month
A
Royal Mail accused of being ‘another part’ of gig economy
It follows strike action from both unions last month which caused chaos across theTSSA’scountry.strike action will place Labour leader Sir Keir Starmer in an awkward position, as he has said he will not stand on picket lines this summer. However, the TSSA action will fall in the middle of Labour conference, potentially triggering a contentious ideological split within the historically union-affiliated party.
LEAH MONTEBELLO AND EMILY HAWKINS CAKE BOX has warned full year profitability could be “significantly below current market expectations” as the cake maker battles inflationary cost pressures.Inatrading update yesterday, the British firm said while current trading was robust against a very strong comparative trading period in the first half of 2022, the board remained mindful of an increasingly challenging economic and trading environment.
THE LONG-TERM TfL settlement agreed on Tuesday will lead to further strikes, according to the union RMT. The union said the proposal was an attack on “workers’ pay and pensions” especially amid the cost of living crisis. The comments were echoed by union TSSA, who yesterday announced strike action. A spokesperson for TfL urged the union to “work with us constructively” and “move away from the managed decline of public transport that would benefit no one at Agreedall”. by the board of TfL and the central government, the deal will keep London running until the spring of London2024.mayor Sadiq Khan said the deal was “far from ideal,” as he was forced to accept conditions such as a reform to TfL’s pension scheme.
Cream cake maker Cake Box warned yesterday that its full year profits could be sliced by cost pressures in the coming months
UNION boss Dave Ward has accused the Royal Mail of turning its service into “another part of the gig economy” as industrial action continuedCommunicationyesterday.Workers Union General Secretary Dave Ward alleged that Royal Mail was engaging in “secret talks” with a US private equity firm, with the view to turn the company into a gig economy employer.ARoyal Mail spokesperson told City A.M. that the company was “proud” to be different. “We have a 97 per cent permanent workforce.”
There are fears the RMT will also call further rail strikes this month
31.1%
Opening(pictured).times, interactive maps and personal booking dashboard will all be on the Open House Festival website which was due to go live by the start of September. After a two year pandemic-induced hiatus, the rebooted festival guide is back - order your copy for £11.99 from the official website. openhouselondon. open-city.org.uk
LEAH MONTEBELLO
ILARIA GRASSO MACOLA COMMUTERS will face yet more misery this summer after two further unions announced a host of industrial action on the railways. TSSA members working as operational and support staff at 10 train companies yesterday announced a 24-hour walkout on 26 September.Meanwhile union Aslef announced train drivers at 12 companies will go on strike on 15 September in a dispute overAslefpay.said the operators had forced the workers’ hand by not offering a pay rise in line with inflation, which has now reached 10.1 per cent and is only set to increase. Disruption will affect services on Transpennine Express, West Midlands Railway, East Midlands Railway, Great Western Railway, Avanti West Coast, C2C, Crosscountry, LNER, Southeastern and Network Rail.
Cake Box shares sink after dire profit warning
City of London update News, info and of fer s at www.cityof london.gov.uk/eshot
Cake Box said that despite passing some of the cost increases onto franchisees with a recent price increase, the full year gross margin will be impacted. The company’s share price was down more than 30 per cent at close yesterday.Like-for-like sales declined 2.8 per cent in the first half of the year to date. The cake company said the recent heatwave impacted store footfall during the summer months. However, the board said yesterday they remained confident in Cake Box’s “future growth prospects”. This confidence was “underpinned by the increased investment in professionalising the group’s functions and the pipeline of new store openings across the country, with levels of franchisee deposits remaining at good levels.” The group said it continued to have a strong balance sheet and had cash of £6.7m as at close of business on 30 August 2022, prior to paying the proposed dividend of £2m in September.BackinJune, Neil Sachdev, nonexecutive chairman, said the business aims to open 24 new stores in the coming year, which should bring the total to 200 by autumn.
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07THURSDAY 1 SEPTEMBER 2022 NEWSCITYAM.COM
It is the first major event planned by the City of London Corporation under its new flagship Destination City programme. Launched in May, the initiative will transform the Square Mile’s leisure offer, creating a leading destination for UK and international visitors, workers, and residents to enjoy. The three fairs will open up for discovery at famous City locations including Guildhall and the Museum of London, with festival entertainment for all.
RMT: TfL deal will lead to further strikes
City is the destination for major October event
spectacular free event will transform the City’s streets with a huge programme of theatre, games and performance on Saturday 15 FeaturingOctober.over 100 performers, the family-friendly highlights include a mass treasure hunt, 16 doors into a ‘maze’ of adventures, three carnival-inspired fairs, and creative street theatre.
GREATEST REFORMER
Clockwise from top left: Margaret Thatcher greets the Soviet leader at Brize Norton air base in 1987 during an official visit to the UK; Gorbachev meets then US President Ronald Reagan during their historic 1986 summit in Reykjavik, inwith2009;aftercrossing,BerlinAngelaGermanGorbachevIceland;walkswithchancellorMerkelacrossaWallbordertwentyyearstheWall’sfallinGorbachevjokestheDalaiLama2007.
EUROSTAR will scrap London to Disneyland Paris direct services from next summer as it looks to focus on core services to Paris, Brussels and Amsterdam as it continues to recover financially from the pandemic. Services will cease on 5 June 2023.
MIKHAIL GORBACHEV, 1931-2022
Andy Silvester
I N A NOTE shared on social media yesterday, Tom Fletcher, a former No 10 adviser, shared a note that Mikhail Gorbachev wrote for Fletcher’s son during a visit to Downing Street. “The success you take will be equal to what you put in,” wrote the still-then Soviet leader. Gorbachev cannot be accused of not following his own advice. The bravery and bloody-mindedness he displayed to reach the top of the Communist Party’s apparatus was outmatched only by that he showed in his attempts to reform Soviet Russia’s relationship with the world once he gotHethere.isknown in the West as the man who ended the Cold War; in Russia, his legacy is more complicated. His reforms unlocked the Soviet Union’s people from years of repression –it is of no surprise that once begun, those forces became too powerful for any politician to control. Elected as General Secretary in 1985, Gorbachev benefitted from his youth, at least compared to the recent former incumbents of the seat. He politicked to shape the Politburo at the top of Soviet decision-making and then embarked on radical reform –glasnost, perestroika and even the reintroduction to the country of limited private enterprise. But if Gorbachev was a breath of fresh air at home, he was a revelation abroad. A visit to Britain –highly choreographed by a senior KGB spy working as a British double agent –secured his status as a man one could do business with, words first uttered by Margaret Thatcher in 1984. He was similarly cordial with Ronald Reagan, despite the US President’s ‘evil empire’ rhetoric. Nuclear disarmament deals followed, as did Russia’s opening to the West. It is hard, at this historical distance, to appreciate quite what a dramatic shift Gorbachev engineered on the global stage. For all that Gorbachev set the wheels in motion, towards the end of his tenure he became at the mercy of what he had created. Millions of people across the Soviet Union saw their moment to pursue genuine freedom, not least when Gorbachev withdrew 500,000 military personnel from the eastern bloc. The Soviet leader went as far as to welcome the fall of the Berlin Wall –effectively ending the Cold War just two years after Reagan himself had called on him to “tear down this wall” in a famous speech in Berlin. As the Soviet Union crumbled in practice if not literally –with independence declared across a host of eastern states and the Baltics –it became clear that Gorbachev had run his race, having angered hardliners and not given enough for liberals. An attempted coup in August 1991 forced a desperate bid by Gorbachev to keep a union of Soviet states together –but by December, the Soviet Union had ceased to exist. Feted in the UK and the West, a symbol of openness and freedom, Russians, for a number of reasons, treat him with less reverence. He is imperfect; most in former Soviet Russia were. But in the pantheon of great historical figures of the 20th century, Gorbachev sits firmly at the top table –standing for freedom and openness –and Russia’s current leadership only serves to remind us of what a statesman Gorbachev was.
THE
It is hard, at this historical remove, to appreciate how truly
FAIRYRAIL ENDING Eurostar to scrap direct London to Disneyland Paris service
Gorbachev’sextraodinaryshiftwasintheColdWarera Peta becomes shareholder in Jet2 to end promotion of marine parks
CITYAM.COM08 THURSDAY 1 SEPTEMBER 2022NEWS
ILARIA GRASSO MACOLA ANIMAL rights group Peta has become a Jet2 shareholder to protest the firm’s promotion of marine parks. Representatives for the animal rights organisation are set to attend Jet2’s annual general meeting, while a group of activists – including two dressed as “chained orcas” – will demonstrate outside 107 Cheapside, in the heart of the City. “As a shareholder, Peta will be able to push Jet2’s management to do the responsible thing for shareholders and animals alike and stop profiting from marine mammals’ misery,” said Peta’s vice president ElisaTheAllen.charity said most of the world’s largest travel companies have stopped selling tickets to marine parks following campaigns by Peta and other advocacy groups. Jet2 said it was willing to have a “constructive” dialogue with activists. “It is important to note that we are committed to only working with venues that agree to uphold the highest standards.”
FRANCO Manca owner Fulham Shore said that despite the ongoing economic turmoil and travel disruption across the UK, trading remains “resilient”. The hospitality group told investors at its AGM yesterday that it was on track to deliver 18 new restaurants in the current financial year as it continues to double down on expansion plans. The firm has opened nine Franco Manca chains and one The Real Greek store since the start of the year, taking the total number of restaurants to 90 for the group. Last month, Fulham Shore said that revenue soared more than 100 per cent in the post-lockdown march back to restaurant dining. The London-listed firm posted an operating profit of £6.7m in the year to 27 March, swinging from a £4.8m loss in Despite2021.the post-pandemic boom, shares have struggled to rally, and the stock has plunged 30 per cent in the last six months.
LEAH MONTEBELLO SNAP yesterday confirmed it would be cutting its 6,500-strong workforce by a fifth as it struggles to ride the advertising slump. The social media chief Evan Spiegel said in a statement yesterday that the company restructuring was based on three “strategic priorities”, including community growth, revenue growth and augmented reality.
KLEENEX and Huggies yesterday.Clark2025,operationcommercialaims£40mFurness.Barrow-in-basemanufacturingtogreentpCarltondealhasKimberlyownerClarkagreedawithPowersupplyenergyitsinTheschemetoenterinKimberlysaid
LEAH MONTEBELLO
Donald Trump’s Truth Social blocked from Google Play Store Tiktok owner to cut price of staff stock options
Snapchat’s parent company said current year-over-year quarter-to-date revenue growth of eight per cent was “well below” what it was expecting earlier this year. Like its Silicon Valley rivals, Snap warned in its second quarter letter that the demand growth on its advertising platform had “slowed significantly”. The company said it is seeing “increasing competition for advertising dollars that are now growing more slowly”. Google and Meta both recently announced they were halting hiring as big tech firms feel the sting from dwindling ad budgets. Shares have also had to battle with a wider tech sell-off, which has seen Snap’s stock plunge 74 per cent in the last six months alone. Shares climbed nearly 10 per cent following the news yesterday.
Sell on you crazy diamond: Pink Floyd bids flock Pizza chain Franco Manca has opened nine new stores this year in an expansion drive
inks £40m deal for hydrogen supply
DONALD Trump’s new social media app has been blocked by Google Play in another blow to the former President’s quest for “free speech”. It is understood that Google will not allow Truth Social on its app store, which is used by Android phones, until it offers “effective” moderation for user content and prohibits content such as physical threats.Trump launched the social network on the Apple App store in February with the mission to move away from Silicon Valley and “create a rival to the liberal media consortium”. Trump has been banned from both Twitter and Facebook since the start of 2021. A Google spokesperson told the BBC that it had notified Truth Social of several violations of standard policies and had offered to provide advice for how to fix them. The app itself has been plagued with a number of technical glitches, including outages.
Hipgnosis declined to comment on theseSourcesreports.told the FT that KKR-backed BMG, Sony Music Group, Warner Music Group and Primary Wave were also in the running to nab the rights. MBW revealed this week that the rights under negotiation are focused on the band’s entire master rights collection, as well as neighbouring and ‘name and likeness’ rights. It is understood the deal does not include the music publishing rights at this stage. In practice, this means bidders are fighting over the rights to the original sound recording as opposed to the rights in a musical composition, words, and music.Music expert from Enders Analysis Alice Enders said that while master recordings are still valuable, US non-digital radio play does not pay royalties for masters: thereby undermining the full financial gains on the deal for Pink Floyd bidders. It comes as superstars Lionel Richie, Bob Dylan and Sting all recently sold their top hits for millions of dollars.
CITYAM.COMLEAHMONTEBELLO
“The extent of this reduction should substantially reduce the risk of ever having to do this again, while balancing our desire to invest in our long term future and reaccelerate our revenue growth,” he said.
Snap culls workforce by a fifth as firm scrambles for revenue growth
Franco Manca owner Fulham Shore pushes forward with new site plans
Beijing’s hawkish approach to local technology companies has also hit the company. It was reported in July that Bytedance’s valuation had dropped from a peak of $400bn (£343bn) to However,$300bn. increasing competition from the likes of Instagram parent company Meta may also be weighing on Bytedance’s performance. After Tiktok debuted the shortvideo social media structure to roaring success, it was not long before Instagram adopted a similar approach.PaoloPescatore, technology and media analyst at PP Foresight, told City A.M.: “It is becoming increasingly hard for any provider to benefit from early mover advantage for a long period and differentiate in a crowded market. Big tech giants no longer need to move first.”
SOARING inflation is set to hit football fans during the Qatar 2022 World Cup. The cost of filling the tournament’s official Panini sticker book has jumped 12.5 per cent to an average of £883 compared to the Russia 2018 World Cup, according to one calculation.
POWERED UP Huggies owner Kimberly Clark
GOT GOT GOT NEED Inflation pumps up cost of filling Panini World Cup sticker book
MILLIE TURNER TIKTOK owner Bytedance is reportedly looking to lower the price of its stock options for employees amid declining growth. The Chinese technology giant is expected to lower prices to $155 a share from $195, Bloomberg first reported yesterday, citing a human resourcesBytedance’sexecutive.revenue growth slipped to 70 per cent year-on-year last year, down from more than 100 per cent in 2020, when Tiktok exploded in popularity.
09THURSDAY 1 SEPTEMBER 2022 NEWS
LEAH MONTEBELLO
YET ANOTHER suitor has joined the race to snap up Pink Floyd’s music rights catalogue in an estimated £400m bid. As reported by Music Business Worldwide (MBW), US music publishing firm Concord is the latest to join the battle for the famous rock band's tunes. Concord notably snapped up indie band Imagine Dragons’ back catalogue in 2020 for an estimated $100m. The noise around Pink Floyd started last week after the Financial Times (FT) reported that US private equity group Blackstone, via Hipgnosis Song Management, was eyeing up the catalogue of hits, including hit songs like “Money” and “Another Brick in the Wall”.Hipgnosis was founded by Elton John’s former manager Merck Mercuriadi and currently holds the catalogues of Leonard Cohen and Justin Timberlake to name but a few.
Stephen Black, director at Co-re, said the proposals “will transform a dormant, closed-off site on a popular part of the River Thames into an open and welcoming building that prioritises highquality workspace and the provision of newBlackarts.”anticipates the project will create over 4,000 new jobs while granting local creatives access to some 40,000 sq ft of “affordable workspace” and studios. The developers said they are also looking to create new green spaces and 1,300 cycle parking spaces. Some 40 per cent of the 2.5-acre site will be given full public access.
ILARIA GRASSO MACOLA CHINA’s ports continued to dominate the container trade in 2021, according to a recent survey. Figures published yesterday by Lloyd’s List show that 40 per cent of all twenty-foot equivalent unit (TEU) liftings in 2021 came from China. According to Lloyd’s List, the country also held seven of the world’s biggest ports – including Shanghai, which was ranked first for the 12th consecutiveSingaporeyear.and Hong Kong came in second and eighth respectively, while the port of Rotterdam was the only European hub to rank. Some have suggested that China’s vast lead could be at risk as the country introduces a fresh set of Covid-19 restrictions in major cities. The latest curbs are a reflection of China’s “zero Covid” policy.” “Talk of a shift of production away from China is wide of the mark," Richard Meade, editor at Lloyd’s List, told City A.M, saying China's dominant role in containerised trade was “unwavering”, China’s dominance over container trade risked by ‘zero Covid’ policy
Investors must be able to measure impact to avoid greenwashing label
Trouble brews over South Bank ‘Slab’
Zamo Capital founder Jim Roth said: “If you can’t measure it, you cannot manage it”
Roth added that investors should also check if an ESG investment passes the “sniff test” and ask if a given project is “genuinely having an obvious and transformational social or environmental impact”.
MICHIEL WILLEMS INVESTMENT managers must be able to measure the social or environmental impact of any ESG investments in order to avoid being embroiled in a greenwashing scandal, a top City impact investor has“Ifwarned.youcan’t measure it, you cannot manage it,” Jim Roth, founder of Zamo Capital, told City A.M. Roth said setting solid ESG and impact targets, which can be reported to the board like any other financial targets, would also help investors dodge greenwashing allegations.
Persil greenbannedadvertoverclaims
‘The Slab’, nicknamed by C20 chairman Sir Simon Jenkins in the Guardian, will overlook the famous OXO Tower, the National Theatre and the IBM building.
Roth said it was also important for managers to understand the extent to which “profit and purpose are colinear” for a given investment. Roth’s warning comes after the relatively new City minister, Richard Fuller, warned in July that sustainable investing needs to have stricter standards in place or corporate greenwashing will continue to rise.
LEAH MONTEBELLO AN ADVERT for Persil has been banned for being misleading about its environmental benefits. The advertising watchdog said that the television spot, which claimed to promote a laundry detergent that was “kinder to our planet”, was unsubstantiated and thereby misleading to consumers.
Persil’s parent firm Unilever initially argued that the product was in fact “kinder” to the planet because it saved on energy by offering faster washes at lower temperatures. It also said that the product was made of used recycled plastic. However, the Advertising Standards Authority (ASA) said “the context of the entire ad with several messages relating to environmental issues, we considered the meaning and basis of the claim ‘kinder to our planet’ was unclear.” Unilever, which also owns brands like Dove, said it was “disappointed” with the decision. It added: “We are committed to making ongoing improvements to all our products to make them more sustainable and will continue to look at how we can share this with our shoppers”. Partner at law firm Harbottle & Lewis Andrew Terry said the decision shows a “robust approach to environmental claims” and called on brands to be more cautious with terms used.
Shanghai was ranked the world’s biggest port for the 12th year in a row
MILLIE TURNER TROUBLE is brewing over ‘The Slab’, a proposed South Bank development at 72 UpperCampaignersGround. have claimed it will overshadow neighbouring post-war architecture and encroach on a riverside conservation area. The redevelopment of the former ITV studios had been granted planning approval by Lambeth Council in March 2022. However, the #SaveOurSouthBank campaign, led by the Coin Street Community Group, has objected to theBuildingproposal.campaigners at the Twentieth Century Society, known as C20, last week wrote to levelling up secretary Greg Clark, saying the project’s two interconnected towers of 14 and 6 storeys are estimated to be 225 per cent larger than existing buildings on the site. The project, designed by Make Architects and developed by Mitsubishi Estate and Co-re, is targeting a completion date of 2026. “The proposed development would be an over-development of a site within a sensitive historic environment,” C20 said. “London’s South Bank is home to some of the country’s finest post-war buildings and public spaces, and its heritage significance is recognised in numerous listings and in its designation as a conservation area.”
CITYAM.COM10 THURSDAY 1 SEPTEMBER 2022NEWS
“A luxury apartment development in central London can be framed as an impact investment because it generates employment but it is quite different from the redevelopment of polluted land being turned into quality, relevant and affordable social housing and homes for key workers.”
ILARIA GRASSO MACOLA
11THURSDAY 1 SEPTEMBER 2022 NEWSCITYAM.COM
Given the chaotic nature of global supply chains, it takes a brave, or brazen, board to express confidence that such headaches will be a one-off. Then there’s the challenge of raising capital after the calamitous collapse in Made’s share price. Down by over 95 per cent during the last 12 months, the company now has a market value of little more than £30m. Assuming it needs to raise £50m in new equity, its bankers at JP Morgan will need to think creatively
Volkswagen plans board revamp, cutting down seats from 12 to nine
FORECASTS of consolidation among the City’s mid-cap brokers feel like they’ve been around for almost as long as some of the Square Mile’s most venerable institutions. Despite the obvious impetus arising from overcapacity and regulatory strains on firms’ revenue streams, though, few such deals have emerged. One perennially rumoured target has been WH Ireland, the listed broker and wealth manager, which was the subject of break-up and takeover speculation earlier in the Now,summer.Iunderstand it is being targeted by an activist investor in Oceanwood Capital Management, which holds just over 11 per cent of the shares.
In a letter to Simon Lough, WH Ireland’s chairman, CEO Philip Wale and finance chief Simon Jackson, Oceanwood lambasts their “strategic errors” and says it does “not see the format of this business as having sufficient resilience for the current market environment”.
BREAKING BUSINESS STORIES AND ANALYSIS given the extent to which Made’s share register remains in the hands of its pre-IPO venture capital backers.Meanwhile, existing shareholders face the prospect of being all-but wiped out by the dilution they would suffer in an emergency cash call. A similar dynamic is playing out at Joules Group, the fashion and lifestyle products retailer whose share price decline – at just shy of 90 per cent over 12 months – is only modestly better than that ofJoulesMade. is trying to negotiate a £15m capital injection from Next while at the same time trying to avoid selling more than 25 per cent of its equity. At the current market capitalisation of just £30m, that ambition looks fanciful. Lord Wolfson, Next’s chief, is not renowned as a charitable negotiator, with goodInvestorsreason.in Joules face the quandary of being asked to vote for heavy dilution of their interests, but in the absence of a superior offer, that looks a better bet than foregoing the safe haven that Next’s financial muscle and retailing expertise would provide. The alternatives for Made and Joules to rescue fundraisings look bleak – and they may portend worse to come for a consumer economy which increasingly resembles a breakable item of furniture.
“In our view the business continues to pursue a strategy of unprofitable growth that neglects efficiency gains and leaves us wondering when we will ever see a return for our investment,” Julian Garcia-Woods, Oceanwood’s deputy chief investment officer, wrote. The thrust of his ire, however, was reserved for WH Ireland’s approach to remuneration, accusing the board of “a lack of alignment between management compensation and shareholder interests”. In particular, Oceanwood said the package awarded to Wale, the City veteran who was handed a £125,000 bonus last year, failed to reflect “the group’s declining profitability, its peers or its“Inmarket”.ouryears working in the industry we have seldom come across businesses so mediocre that rewards executives so heavily, and we believe that it is our fiduciary duty to challenge such poor business practices,” Garcia-Woods wrote. “We will strongly caution other shareholders against siding with management, as we do not believe that WHI in its current form can meet the reasonable investment objectives of competitiveOceanwood’smanagers.”principal demand is for WH Ireland to launch an auction of its wealth management arm – a move it says would generate value worth 50p-pershare, well ahead of the company’s current market value. A WH Ireland spokesman said the company “welcomes feedback from all shareholders”. If it fails to act, it can expect more robust “feedback” from Oceanwood in the weeks ahead.
VOLKSWAGEN is reportedly planning a revamp of its executive board, trimming the total seats from 12 to Peoplenine. close to the matter told Reuters the move was floated earlier this week during a board meeting but it is yet to be finalised. According to sources, procurement and sales will be the positions removed during the reshuffle. Volkswagen declined to comment. The news came one day before Porsche boss Oliver Blume took over from Herbert Diess as the group’s chief executive. Diess stepped down on July 22 after four turbulent years –plagued by the pandemic and semiconductor shortages as well as rows with unions – at the helm of the marquee. The decision to have Blume head both Porsche and Volkswagen initially raised eyebrows, as investors believed it might hurt Porsche’s float. Volkswagen chief financial officer Arno Antlitz said in late July the listing continued “with more emphasis than before.”
Mid-cap broker catches eye of activist investor THEY got there in the end. Transport for London’s £1.2bn funding settlement with the representsannouncedgovernment,thisweek,atriumphof hope over expectation. My Whitehall moles tell me, albeit grudgingly, that Andy Byford (right), the TfL commissioner, deserves much of the credit for keeping the show on the road – and the rails. The reality remains, though, is that with hundreds of millions of pounds of funding cuts built into the deal, none of its protagonists should be celebrating too wildly.
@MARKKLEINMANSKY MARK KLEINMAN
Sofa, not so good: Made.com looks wobbly indeed EVEN the most robustly constructed furniture is vulnerable to breakage. The sight of Made Group, the online furniture retailer which has become one of London's most disastrous flotations of recent years, scrambling to raise new funding has ‘fragile –handle with care’ written all overTheit.company, which floated only last year with a market valuation of £775m, is to all intents and purposes now engaged in a survival battle. The deteriorating economic backdrop is nothing short of disastrous for a company selling big-ticket items to increasingly cash-strapped consumers. Its most recent trading update, in July, flagged £20m of supposedly non-recurring charges, related to additional marketing expenditure required to shift excess inventory, and supply chain-linked costs as a result of delays at ports and extra handling at warehouses.
London’s TfL deal driven by boss Byford –but it’s none too perfect
The carmaker is still struggling to shake off ‘Dieselgate’ reputational damage
CITYAM.COMMarkets
13THURSDAY 1 SEPTEMBER 2022 FEATURE
slowly claw their way out of weekend dip
THODEX FOUNDER ARRESTED THE founder of a Turkish cryptocurrency exchange missing with client funds since April 2021 has been arrested in Albania. Faruk Fatih Ozer, creator of Thodex, went missing last year along with an estimated $2 billion in customer assets.
CRYPTO AM AWARDS NOMINATIONS for the Crypto AM Awards are now Individualsopen.ororganisations wishing to make a nomination for the panel of independent judges can now do so by visiting www.cityam.com/camsa22 and clicking the ‘NOMINATIONS 2022’ button. There are 20 categories spanning every aspect of the cryptocurrency and blockchain industry. Awards will be presented during a glittering ceremony at the Leonardo Royal St Pauls, London, on Thursday November 24. The Thanksgiving Gala dinner will mark the climax of the two-day Crypto AM Summit which begins on November 22. Tickets for the summit can also be purchased by www.cityam.com/camsa22.visiting
It was also ranked as a tier 1 exchange for the majority of sub-categories, largely because of its robust security features.Insecond place was FTX US Derivatives with an overall safety score of 4.0/5. It fell into tier 1 for the majority of the factors in the BrokerChooser index.Bitstamp took the bronze position with 3.8 points, largely due to keeping 98 per cent of assets offline in coldCommentingstorage. on the findings, BrokerChooser’s Head of Legal - Zoltan Kormanyos – said Coinbase’s recent warning that customers could be viewed as general unsecured creditors was a risk disclosure confirming risks associated with crypto. “As a publicly listed company, Coinbase had to disclose and confirm this fact in an official regulatory document,” he explained. “The problem here is simply stemming from the unregulated nature of crypto and cannot be simply associated with Coinbase only. “Now that these risks are known and confirmed, what retail investors can do is check what kind of safeguards might be available for them when things go wrong on an exchange.”
R ESEARCH published this week has revealed the safest global cryptocurrency exchanges where investors’ funds are considered the best protected.Theextensive study, carried out by comparison website BrokerChooser, employed a swathe of metrics to score the world’s crypto exchanges over regulation, consumer protection, market fairness and transparency to reveal the safest exchanges for investors. Threeexchanges registered a perfect score of five out of five when it came to regulation - FTX US Derivatives, Gemini, and Kraken Futures. Two exchanges - KuCoin and Bybit – scored the lowest with one out of five. No exchange managed the full five points under consumer protection, but Gemini came close with 4.8. Worst performer in this category was OKX, and was the only exchange to score just one out of five. Two exchanges got full marks when it came to market fairness, with FTX US Derivatives and Bittrex ahead of the pack. Again, OKX and Bybit – together with Gate.io - came out as the worst-performing exchanges. Transparency is key to ensuring that consumers feel protected, and in this category Coinbase ranked top. A large number of platforms scored poorly over transparency with six different exchanges all scoring just one out of five - including Binance, OKX, KuCoin, Gate.io, Bybit and Phemex. With an overall safety score of 4.1/5, Coinbase was found to be the safest.
THE price of Bitcoin again slipped below $20,000 over the weekend. The largest cryptocurrency by market value dropped to $19,600 on Saturday, a six-week low, though it has largely managed to hold above the psychologically-important $20,000 mark sinceOtherthen. major cryptocurrencies also saw a dip over the weekend, but have since clawed their way back. The price of Ethereum managed to navigate back to around $1,600 on Wednesday morning, having fallen as low as $1,430 on the weekend. Where to next? The price drops follow remarks by the US Federal Reserve on Friday that appeared to reinforce their stance on raising interest rates in the future to tackle inflation. In a hawkish speech at Jackson Hole on Friday, Chairman of the US Central Bank Jerome Powell cited the success of "Volcker disinflation" — a period during the early 80s which saw the chairman at the time Paul Volcker introduce massive rate hikes. Investors had hoped Powell would give some signal that higher interest rates wouldn't have to stick around for very long. Traditional markets have also struggled since the speech, as seems to have been the case generally this year whenever the topic of interest rate rises comes up. Stocks tanked on Friday, with the Dow plunging more than 1,000 points. The Nasdaq and the S&P have also now both fallen for three consecutive days as of Wednesday. Interestingly, Arcane Research supported by Luno has found that Bitcoin’s major price movements so far this year have mostly occurred during Asian and US market hours. Despite a year-to-date loss of 58 per cent in BTC, the cumulative Bitcoin returns during European trading hours is just -1.36 per cent. On the other hand, Bitcoin is down 25 per cent during US market hours – very closely aligned with the cumulative YTD returns of Nasdaq of 24 per cent.
BINANCE DONATES $250,000 TO WOMEN IN TECH BINANCE Charity, the philanthropic arm of cryptocurrency platform Binance, has teamed up with Women in Tech to deliver a flagship global partnership providing blockchain educational courses to 2,800 women from vulnerable communities across Brazil and Africa. Binance Charity is donating $250,000 BUSD for a six-month pilot project to empower women with the knowledge and skills to thrive in a Web3 future, with the first courses taking place in Rio De Janeiro, Brazil, and Cape Town, South Africa, in October.
Turkey’s Interior Ministry yesterday announced Ozer had been detained in Vlora by Albanian officers and Interpol. A ministry spokesman added "extradition procedures to Turkey have been initiated". Until yesterday, there had been no reported sightings of Ozer since he was seen going through airport security in Istanbul days after Thodex mysteriously announced it would briefly suspend trading.
ETHEREUM BREAKS OUT OF WEEKEND SLUMP ETHEREUM has been the strongest performing digital asset this week following Friday’s downward market reaction to the US Federal Reserve reinforcement of its stance on interest rates. Comments from official sources within the reserve led to a market-wide dip that saw Bitcoin slump to $19,500 and Ethereum stumble from $1,700 to $1,420. However, the second-largest cryptocurrency by market cap enjoyed a strong weekend, and has seen a price rise over the week by as much as nine per cent to $1,600.
NEWSCRYPTO IN BRIEF FOR ALL THE LATEST NEWS, VIEWS AND ANALYSIS HEAD OVER TO CRYPTOAM.IO Connecting the Community Experts publish list of world’s safest crypto exchanges
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“Jane has a unique understanding of the asset management industry and a proven track record of building leading businesses,” said Stallvik. career pictures to citymoves@cityam.com
as pound falls P 31 Aug 89.50 31 Aug30 Aug26 Aug25 Aug24 ECOAugANIMAL HEALTH 84 86 88 90 92 94
Serabi Gold has unveiled hefty ebitda of $3.1m (£2.6m) –well ahead of Peel Hunt’s $1.2m estimate. This was driven by a destock of gold bullion and shifting investor senitment. It suffered a short delay in shipments of copper and gold concentrate after period end but those issues have been resolved. Peel Hunt believes the company is in a healthy position and holds a buy stance with a target price of 110p. ing it to near its storage target. “A fall in wholesale gas prices yesterday, as European storage targets were met early, provided some hope that the current energy crisis might ease slightly,” Russ Mould, investment director at AJ Bell, said. The pound weakened around 0.3 per cent against the US dollar to buy $1.1624. Sterling has been on a downward spiral in recent months, mainly fuelled by investors flowing into dollar-denominated assets to capitalise on the Federal Reserve’s rapid rate hike cycle and anxiety over the UK tipping into a long recession. FTSE 100-listed UK energy operator National Grid shed over four per cent, pushing it to the bottom of the index. Pharmaceutical giants Astrazeneca and GSK were among the biggest losers, dipping more than 1.5 per cent. Wall Street opened lower.
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A recent string of downbeat forecasts predicting where the UK economy is headed over the coming year has weighed on London FTSE 100 Investmentstocks.bank Goldman Sachs earlier this week said inflation could surge to over 22 per cent unless global gas prices drop from their historic highs. European gas prices have tumbled, driven by Germany reportedly receiving more gas inflows than expected, pushGlum economic risk appetite
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T he sun may have been shining but it was a damp day on London’s FTSE 100 driven by economic gloom hitting investors’ risk appetite. The capital’s premier index dropped 1.05 per cent to 7,284.15 points, while the domestically-focused midcap FTSE 250 index, which is more aligned with the health of the UK economy, fell 0.45 per cent to 19,063.75 points.
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REDWHEEL Specialist investment firm Redwheel, formerly RWC Partners, has poached its new head of business development from Abrdn. Jane Nicholls, who was previously global head of ESG client strategy at abrdn, replaces Tord Stallvik, who stepped up to the role of CEO last year. The incoming lead, who also brings experience from JP Morgan Asset Management, will oversee Redwheel’s global sales, marketing and client-facing operations and be responsible for accelerating the firm’s commercial development.
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POWELL JITTERSINVESTORSGIVESTHE “Up until the end of last week the FTSE 100 had been on course for a positive month, however the last three days, and the hawkish tone from Powell’s Jackson Hole speech, has seen the rug pulled out underneathfrom the positive mood.”
HEWSON,MICHAEL CMC MARKETS
PKF LITTLEJOHN Canary Wharf accountancy firm PKF Littlejohn has bolstered its capital markets practice with a former UHY Hack Young executive. Joining as an audit partner, Dan Hutson brings nearly two decades of experience in auditing listed and private companies.Hutson’sappointment is the firm’s third partner hire this year and brings the number of specialist capital markets partners in the team to nine. “Dan has worked on a wide portfolio of clients from growing LLPs through to large international groups,” said managing partner Dominic Roberts. “We want to harness that valuable experience and broad skills-base to support the continued growth of the practice.”
QUADREAL Quadreal Property Group has appointed a Deutsche Asset Management lead as its vice president of research and strategy.Farhaz Miah is set to oversee research across UK and EuropeanReportingmarkets.toexecutive vice president Rosemary Feenan, Miah will be responsible for analysis of investment transactions, sector trends and unfolding geographies of opportunity in Europe. “Farhaz is another highly talented addition to our research team, which plays a vital role informing Quadreal’s global investment strategy,” said Feenan.
Livestock medicine specialists Eco Animal Health has reported results in line with expectations with sales of £82m and an ebitda of £6.4m. Unsurprisingly there has been a slow start to the current year given the low prices in China and general reductions in hog herds. Peel Hunt has kept its buy stance, but expects China to take time to recover from the pandemic, cutting its target price from 350p to 270p.
“His pan-European experience and forensic understanding of the cities and markets we operate in will be an invaluable support to our decision making.”
RamanauskasBen
EDITEDOPINIONBYSASCHA
T HERE are few guarantees in life, but it seems a racing certainty that this time next week Liz Truss will be Prime Minister. The Foreign Secretary may have started slowly amongst MPs but since making the final round she has led every poll of the membership, usually by margins which would require an implausibly large polling error for her opponent to overcome. Her coming victory means a crushing defeat for Rishi Sunak, the former Chancellor who has irritated many an ally with an erratic campaign that combined Pooterish policy announcements with acerbic attacks on the frontrunner. The temptation is of course to blame Sunak’s defeat on a poor campaign, but Sunak’s fate was sealed long before then. As society slowly returned to normal last year, public services desperately needed more money to address the backlogs caused by lockdown and government debt had reached new heights. Sunak believed the Conservatives should prioritise getting the public finances in order. He sought to achieve this by resisting additional spending and funding the few real rises he allowed with tax increases. Increasing national insurance to pay for the additional funding directed to the NHS was the defining example. It’s easy to forget now but this approach discombobulated those across the aisle. The Labour Party was caught between arguing that both the spending increases were too few and that the tax rises were too many. Arguably, his reluctance to increase the deficit has been vindicated by the high inflation we now expect to see for months to come. Initial polling about what was literally a tax and spend package, was positive, with swing voters more likely to support it than committed partisans on either side. But this was Sunak’s first problem; most Tories hated his approach. Those on the party’s left worried the government wasn’t spending enough to help uation worsened, Sunak’s principled and tactical opposition to increased borrowing, seemed to make further spending cuts and tax increases more likely thanHavingnot. placed himself at ideological odds with many within his party, Sunak’s personal reputation was badly damaged as the government became mired in scandal. He was personally fined for breaking lockdown rules, and his personal affairs - including his US green card and his wife’s tax statuswere thrown into the spotlight. More broadly, the pressures placed on the government during this period destroyed his relationship with his nextdoor neighbour. Those close to Boris Johnson began to believe that Sunak wasn’t doing enough to support him, whilst the prime minister chafed at his Chancellor’s reluctance to sign-off on a package of tax cuts and spending increases to relaunch his premiership. Taken together these setbacks left Sunak with no plausible pitch for the Tory Leadership. He couldn’t promise to change the government’s approach on the core issues of the day, because he himself had imposed that direction on a reluctant party. He couldn’t claim to be the fresh start an otherwise popular government needed to put the scandals behind it, because he had been caught up in Partygate. And he couldn’t position himself as the heir to Boris Johnson, because even before he resigned in protest, everyone had realised that the two men were atSunak’sloggerheads.campaign, in a sense, overachieved by convincing MPs to rally around him. He might have done himself and those who believed in him far more good if he had chosen not to stand, and instead backed a compromise candidate that would have welcomed him back to the Treasury. Instead, he will have to watch as he is badly beaten and the next government aggressively defines themselves as the antithesis of his record at the Treasury by cutting taxes, increasing borrowing, and dashing for growth. It is a spectacular fall from grace, and one that began long before this leadership election began.
O N TUESDAY night I went to see Bright Eyes perform in Hammersmith. It was fantastic - but it was also all over by 11pm. Now, in fairness, the frontman was in pretty bad shape towards the end of the set, but it was clear fans would have enjoyed some emo warbling for even longer. Not only was the gig done, pretty much everything else in the area was closed. Those looking for a drink before the tube home had nowhere to go, while those peckish for a meal were limited to some sketchy looking kebab shops. It was a sorry state of affairs, with London tucked up for bed before Cinderella’s carriage would have turned back into a pumpkin. And even then, it was better than some areas of London.This is a pattern repeated across London, but nowhere is it more pronounced than in Soho. The world famous area, with its plethora of bars and restaurants which attract tourists from around the globe, pretty much shuts down beforeThemidnight.reason? A licensing system used by Nimbys to put pressure on councils to make venues close their doors early. People - predominantly old and rich - who chose to live in central London, stopping younger people from having fun. Perhaps one of the only good things to come out of the pandemic was the pedestrianisation of places such as Soho. Predictably though, local residents objected and the roads were returned to the cars of the wealthy. It’s not simply a question of unfairness to young people - though it is for anyone who doesn’t want to be tucked up in bed with a Horlicks at 11pm - it’s also damaging to London’s economy. Our bars, restaurants, and clubs are missing out on millions of pounds by being forced to turn away paying customers. They are losing important cultural power by enticing people to visit and live in the capital. The hospitality industry has had a torrid time with the pandemic and as the economy collapses under the weight of inflation and energy prices, it’s not a cheery vision for the coming months. Venues need all the help they can get, not rules which exacerbate their woes by restricting when and where they can serveThiscustomers.tooisathreat to London’s international reputation. There is so much that is good about London and people rightly visit here from all over the world. However, if we see more venues being forced to close, tourists will naturally start to choose other cities instead. For low-paid workers, it is also bad news, limiting their options. The current system is depriving people of working longer hours and thereby earning more money. Given that we’re in the midst of a cost of living crisis which looks set to turn into a catastrophe, this is needlessly cruel. We can’t go on like this. We need to recognise that areas such as Soho are there for all our enjoyment, not just for residents. Therefore, rather than allowing councils - which are too easily swayed by Nimbys - to control licensing, the system should be centralised for areas such as Soho and near large music venues. The Night Tsar should ensure that late licences are granted for venues in these areas and that pedestrianisation is the norm.
£ Will Cooling writes about politics and pop culture at the It Could Be Said substack
It’s time to ignore the Nimbys tucked up in to bed by 10pm and re-pedestrianise Soho
OPINION
Rishi Sunak’s demise was sealed long before he ever threw his hat in the ring
AROUND?LOUNGING
Jacob Rees-Mogg, infamous for lying across the green benches of Parliament, will be a busy man if rumours are to be believed. His name has been linked to a handful of different Cabinet benchesonhe’sSoundssecretary.Levellingincludingjobs,Uplikeboredthe Sunak wanted to put the public finances in orderbut most Tories still hated his approach people through difficult times, whilst those on the right despaired at the growing tax burden. And as the economic sit-
O’SULLIVAN
CoolingWill Rishi Sunak is expected to lose thepartyConservativeleadership
CITYAM.COM16 THURSDAY 1 SEPTEMBER 2022
£ Ben Ramanauskas is an Oxford University economist and ex-trade adviser
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As Health Secretary, Sajid Javid was committed to putting a digital approach at the heart of his plans to get NHS waitlists down. But then he quit, and it was left in limbo as the country waited for a new prime minister. His successor Steve Barclay hasn’t sat on his hands and is pushing forward a plan to give patients access to “real-time” data of waiting lists at individual hospitals. It will enable them to choose somewhere to get treatment where wait times are lowest by checking on their NHS app. The digital league tables will be in place by next April, with the aim to give patients more control and choice of where and when they get treatment. It’s part of an attempt to cut down on the internal bureaucracy within the health service by putting the informationpublished weekly - literally in patients hands. At some hospitals there is a three week wait time while others average 28 weeks. In London, for example, the Royal Free has double the wait time as Guy’s.
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HEN the going gets tough, cultural roles get going. In June, Elon Musk told Tesla employees that 10 per cent of the workforce was going to be cut, as a result of his “super bad feeling” about the economy. Amongst those let go were Tesla's LGBTQ+ community President and several diversity and inclusion programme leads.Mass redundancies have ripped through organisations as global economies brace themselves for a recession; tech companies laid off seven times as many employees in May as they did in the first four months of this year combined. The steep economic downturn and soaring inflation have spurred widespread belt-tightening. On a mission to bring down costs, business leaders (and their investors) are putting company expenditure under the microscope, assessing them for priority and performance. In times of recession, initiatives like D&I are often first on the chopping block. Employees and schemes that add direct and tangible monetary value are typically prioritised, while roles related to company culture are deemed expendable, as luxury business components irrelevant to profit margins. This thinking is misguided and shortsighted. Every aspect of company performance is shaped by diversity and inclusion: growth, culture, talent acquisition, employee churn, reputation, leadership potential and readiness to embrace innovation. A lack of diversity is the first indication that a company isn’t run as a meritocracy. Equitable employers outpace their competitors by understanding the needs and potential of their employees, in turn earning their trust, commitment and the competitive advantage of diverse ways of thinking. None of that sounds like a luxury. During periods of hypergrowth, it’s easy for companies to make hires that “look good”. However, in the wake of financial turbulence, companies must walk the walk that they’re so good at talking. Many businesses spend time marketing their inclusivity in times of profit, before quickly (and often quietly) pulling the D&I plug the moment market pressure is applied. There is a key distinction between creating and committing to policy, with true dedication to D&I meaning in sickness as much as in health. If not, it is merely a hollow marketing tool to attract talent and customers with unfounded claims of inclusivity.Who a company lays off, as well as how they do it, says more about their values and vision than any sparkly manifesto. If the employees really are the “beating heart” of your organisation, this should translate as open communication, considerate planning, generous separation packages and adequate support in helping laid-off workers find new employment. Truly inclusive leadership demands prioritising D&I, demonstrating to a workforce that such roles are considered indispensable. Knee-jerk redundancies can also have irredeemable consequences for employer brand, made clear by the wave of coverage of recent European tech layoffs. The effects of these cuts will be acutely felt as companies try to retain top talent or re-enter the hiring pool. The consequences of jaded staff, punctured morale and damaged reputation linger long after the door has closed behind the latest spell of laid-off employees.Between2018 and 2021, there was an 115 per cent increase in the number of jobs with “diversity” and “inclusion” in their title posted on jobs boards. Despite this sharp growth, the current wave of redundancies has the power to undo years of hard-fought, seminal D&I progress, which has edged us in the direction of an equitable future but is a battle far from won. Everyone deserves to work in a place where they feel accepted, respected and comfortable; where their opinions are valued and they’re treated as more than just a box or quota to meet. This financial downturn is far from over, and it’s likely that more layoffs will be on the horizon. As business leaders peer into their uncertain economic tea leaves, they’d do well to remember that D&I isn’t a luxury add-on or marketing weapon, but an essential business component, critical to long-term survival and growth.
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LETTERS TO THE EDITOR Time to keep moving
£ Linnea Bywall is head of people at Alva Labs
EXPLAINER-IN-BRIEF:
THE NEW TECH SET TO HELP CUT NHS WAIT TIMES
ABywallLinnearecession will test the firms which used diversity plans merely as a way to look goodLondon signs funding settlement with government, August 30] Sadiq Khan has finally given up the petty political posturing and agreed to a long-term financial settlement for TfL. The deal reached is a reasonable one, and it reflects TfL’s own pre-Covid financial plans. The government is providing £3.6bn, on top of the £5bn it has already given TfL. This means major projects like the Northern Line extension, the reopening of Hammersmith Bridge, and the final stages of the Elizabeth Line can go ahead.
Elon Musk made several diversity heads at Tesla redundant Britain has closely guarded much of the technology onboard our nuclearpowered submarines, but in what’s being billed as a ‘first of its kind’ deal, Australians will be able to train in UK subs to improve their own skills.
COMRADES DOWN UNDER Aussies to train in British nuclear submarines Certified Distribution from 30/5/2022 till 01/07/2022 is 79,855
The government has stepped in to cover the cost of Covid-19, but we should not forget that the Mayor weakened TfL’s financial position prior to the pandemic by mismanaging its finances.Hehasresisted sensible savings such as reforming the bloated pension scheme and scrapping excessive staff perks, so he can appease the unions. Now the Mayor needs to stop playing politics and get on with the job. He must stop threatening damaging bus cuts, which are not necessary with this deal. And he should cancel his ULEZ expansion, which would impose a £12.50 daily cost of living charge on Londoners who cannot afford to upgrade their cars, for a negligible effect on air quality.
virgin:
£ The Leica M11 is available for £7,500 from leica-camera.com
CITYAM.COM18 THURSDAY 1 SEPTEMBER 2022LIFE&STYLE LIFE&STYLE
STYLE ICONS: CARY GRANT IN NORTH BY NORTHWEST
Andy Blackmore takes the new M11 for a nostalgic spin medium 36MP images or smaller 18MP files, all full-width, and in both JPEG and DNGLikeformat.itspredecessors, the M11 only has two exposure modes, full manual exposure and aperture priority AE. These settings are changed via an agreeable easy-to-use hybrid system that uses solid analogue dials to select the exposure mode, shutter speed and ISO. Other settings are accessed electronically using the LCD screen on the rear of the camera.Whilst the LCD display does offer touch control, menu and navigation settings still require physical input on the control pad located on the rear of the camera. Compared to the mind-numbingly complex menus offered by some manufacturers, the Leica M11's main menu is refreshingly concise, with a minimalist 26 options in total. Even if you're only passingly familiar with digital cameras, a quick scan of the quick-start guide and you will have conquered its settings in minutes. The whole system is a symphony of simplicity and control. But the M11 is not a point-and-shoot: you must actively engage with the camera. You make the decisions, while it imposes an ideology, encouraging a way of thinking, slowing you down, and insisting you take life at its pace. This is a camera crafted for painting with light or fishing for shadows. Yet, like a racer shifting a manual gearbox, it's only as good as the driver. So, whilst I can’t guarantee it will make you a better photographer, I can guarantee it will make you look at the world differently. Now to the elephant in the custard: the price. On paper, it doesn't really make sense, but life shouldn't be lived to a spreadsheet. Sometimes it's better to heed the heart than listen to the head. I’d have one in a heartbeat, but reality means it stays wishful thinking. I simply hope it's not another twenty years until we meet again.
Thornhill a smooth, dominant man of business cast adrift in a baffling plot of mistaken identity. He wears it with a plain white shirt, grey tie and oxblood Derby shoes, the overall appearance being clean and slick. It fixes the image of Cary Grant as a man who could slip through high society yet endure the rough-and-tumble if he had to. That duality is important, because the suit had a legacy beyond North by Northwest. When Albert “Cubby” Broccoli was beginning the process of bringing James Bond to the screen in the 1960s, his first choice to play 007 was his close friend Cary Grant, not least because of his recent performance in North by Northwest. Grant went as far as accepting but, by then in his late 50s, would only sign a contract for oneThatfilm.was no good for Broccoli, perhaps
Above: M11’sretroshowscamera;outstandingcontrastideaShardleft:hammer;bladesmith’sbalancedM11,stunningTheLeicawhichisasasaFromAshotofthethatgivesanoftherichonthisAshotthatoffthelush,qualityofthepictures
When it comes to style icons, the name of Cary Grant is never far from the top of the pile. The Bristol-born actor came to define elegance and suavity in the 1940s and 50s, his naturally athletic frame clothed in immaculate tailoring. In a string of hits like Suspicion, Notorious, To Catch A Thief and An Affair To Remember, he defined Hollywood’s well-
dressed gentleman. In Hitchcock’s North by Northwest (1959), Grant was at his zenith, and it is a film in which his wardrobe might as well have had separate billing, or rather, one piece of his wardrobe: a grey check suit which he wears for almost the whole film, and which remains iconic to thisAnyoneday. who has seen the film will know the image: Cary Grant on the run from mysterious hoodlums, being pursued through a field by a cropdusting aircraft. He puts in some proper action performances — he had been an acrobat in his early years and remained formidably fit — but he does it all in a suit and tie, his tailoring taking a battering but never quite giving up the ghost. The suit is important. Made by Kilgour of Savile Row, it is well-cut and stylish but unshowy. It is a lightweight flannel which gives it a versatility (Grant takes it literally from the cocktail lounge to Mount Rushmore), and its three-button, ventless cut was popular for the time. In fact, although Kilgour, where Grant bought his own suits, made the original suit, there are several copies in the film by Quintino for use in the rougher, more active scenes. It is a good suit worn well, and the effect is to make Grant’s advertising executive Roger the focus ring is rotated. When both are aligned, the lens is correctly focused. Fiddly at first, you soon get the hang of it. Once mastered, it’s swift and accurate. However, the M11’s traditional styling
already scenting the franchise that was to come, so it would eventually be Sean Connery who brought the role to life in 1962’s Dr No. Think about Connery’s early films. His wardrobe is almost identical to Grant’s: he wears three suits in Dr No, a dark grey flannel, a light grey mohair and a grey Glenurquhart check. Cut by Anthony Sinclair of Conduit Street, they defined the look of Connery’s Bond, paired with white or pale blue shirts and dark ties. Grant’s Roger Thornhill had essentially made a template for the 1960s secret agent. This look can teach us a great deal. A grey check flannel will work in high summer and dankest autumn, in the office or the hotel bar, and can be dressed up with a pocket square or kept ruthlessly simple. If it inspires you to get one, to celebrate your purchase it can only be a dry martini.
Leica Reunited withthis stunner after 20 years
His effortless chic in this movie made the template for James Bond, says Eliot Wilson functions by overlaying a second faint “ghost” image on a bright spot in the centre of the viewfinder. This “ghost” moves laterally, left or right, relative to the main view, depending on which way belies its state-the-art technology, especially its full-frame 35mm 60-megapixel sensor – Leica calls it a ‘triple-resolution’ sensor since you can select the desired resolution; full-sized 60MP pictures, A nticipation, such a bittersweet sensation. Will the moment linger forever on the lips or leave a nasty taste in the mouth? Suffice to say, I've been looking forward to this for quite a while. At last, I've got my hands on the Leica M11, a 60-megapixel, Digital Rangefinder Camera, and thanks to its impeccable pedigree it’s like a reunion with an old friend. I simply can't believe it's 20 years since I reviewed and fell in love with its analogue ancestor, the M7. Since then we’ve both embraced a digital world. As with all Leicas, the first thing that strikes you is build quality. Oozing excellence, it emits a confidence-inspiring aura of artisan craftsmanship. The next is its styling; its polished design ethos is on par with van der Rohe's "Barcelona Chair" and "that" lemon squeezer by Philippe Starck. This all makes the M11 not only a sublime camera but a thing of beauty,Reassuringlytoo. robust, satisfyingly solid and as balanced as any bladesmith's hammer, it sits perfectly in the hand. Its weight is just about perfect too, right there in the Goldilocks zone: not too much, not too little, just right. Perhaps this is the time to tell you what this camera lacks: there’s no video, no image stabilisation and definitely no autofocus. Manual focus only - I can't stress thatFocusingenough.is primarily achieved by looking through the camera’s optical viewfinder and using the old-school coincident-image rangefinder system. This It’s the king of cameras with a price-tag to match.
I T DOESN’T yet look like a camel, but Andrew Strauss’s committee to propel English cricket to the top of the world and keep it there has come up with a discussion document that doesn’t quite resemble a thoroughbred racehorse. Once it’s been through the wringer of consultation with the members of the 18 first class counties it may well become a dromedary. Which would be a shame as it has much to commend it. The work of Strauss’s gang of high performance experts has been corralled by Twenty First Group, a consultancy that I’ve got a lot of time for, but whose principal expertise lies in football and golf rather than cricket. The material the England and Wales Cricket Board (ECB) published last week for debate with the counties is quirky in the data that the committee has chosen to present. It is heavy on red ball statistics, even though the stated objectives are success across all formats of cricket and a thriving domestic game. It’s clear that Strauss and co. have been looking primarily through a Test matchWhichlens.inone way will be a relief for those who fear that the ECB is neglecting the sport’s heritage in its dash for cash. Even the most insular county member would surely concede that a successful England Test team is good for the overall health of the game. There is even a hint that Strauss himself might be frustrated at being hamstrung by his paymasters’ commitment to The Hundred until 2028. The discussion paper tip-toes around the issue, simply asking how more successful T20 Blast players can secure contracts in The Hundred. The document does slavishly describe The Hundred as a best vs best competition, without asking whether this is a format that is needed at all in the pursuit of No1 global status.
WE’RE GUNNA MAKE IT Ninety-first ranked Crawley Town FC dumped Premier League Fulham out of the League Cup last week and the price of its NFTs doubled overnight.AndsoIRL (in real life) and the digital world entwined. For 5,577 fans in the stadium that night, a pitch invasion that risks the club being fined; for 5,600 holders of tokens, a little relief from their sliding value since they were minted in Crawley’sJuly.new owners, WAGMI United, hail from the world of Web3 and raised the equivalent of $4m (£3.4m) from the issue of 10,152 NTFs at 0.4 ethereum each. The tokens give no ownership stake in the Insteadclub.they grant access to a range of IRL and digital events, some exclusive merchandise and promise “special input on the future of Crawley Town FC”. In essence, this is a membership bolton for a dedicated fan, or a means of engagement for those following remotely. Unsurprisingly, it appears the proven short-lived. As yet without a win in six league games, the team is a long way off the new owners’ boast that promotion to League One is a 50/50 shot within two seasons.Theutility of a token shouldn’t be so strongly correlated to the team’s performance. (In fact, having a say might be deemed to be more valuable when times are tough than when all is going well on the pitch). But it seems that’s the case. Crawley may well be operating at a loss at present, like most of their League Two counterparts, and if so WAGMI could be contemplating future token issues. Perhaps an annual close season minting. If so, they’ll need to start making good on those claimed promotion odds pronto. I’d like to see Crawley/WAGMI succeed, if only because theirs is an innovative approach to football finance that needs more than one go around before we can properly gauge its utility.
19THURSDAY 1 SEPTEMBER 2022 SPORTCITYAM.COM
DESIRE IS THERE No other nations are showing signs of adopting it. The review is heavy on the What It Takes To Win (WITTW) sloganeering so beloved of UK Sport, without going so far as using its discredited “no compromise” tag. The Hundred is clearly one ginormous compromise which will no doubt be central to the debates Strauss will be having on the county circuit over the coming weeks. Most of the first class counties are heavily dependent on subsidies from the ECB, which has always made discussions about the structure of the cricketing calendar fraught. What I like about the thrust of Strauss’s proposals is the evident desire to ensure that the standard at the top of the county game is as close as possible to that required for players to succeed in Test cricket. It makes sense, however uncomfortable that might prove for those counties not initially in, say, a smaller top red-ballAnotherdivision.clearcompromise constraining the committee is the commitment to retaining 18 first class counties. With at least 12 of those required to vote in favour of any changes this is obviously a prudent concession. And again, a very welcome one – provided the ECB is genuinely committed to helping each county find a healthy place in the ecostructure of the game reflective of its individual scale, geography and ambition.
Strauss is chair of the ECB committeereport
ambition was to have changes in place for 2023. Now the aim is 2024
WHAT TAKESITTOWIN
Ed Warner is chair of GB Wheelchair Rugby and writes at sportinc.substack.com
pleasant viewing conditions – and ideally for their team to be winning. A lot is being made of Strauss’s drive to reduce the amount of acknowledge its own culpability and Strauss’s original ambition was to have any changes to cricket’s structure Now the aim is 2024, no doubt in part a reflection of the arrival (at long last) of Surrey’s Richard Thompson as the new ECB chair, as well as realistic expectations about how difficult the coming consultations and eventual vote(s) will be. This English cricket season is going to stretch long into the winter. Horse or camel? Lay your bets.
WarnerEdCOMMENTSPORT
“Losing is obviously really disappointing, really sad to leave here. It’s probably my favourite tournament,” Raducanu said after the loss. “But also I’m in a way happy because it’s a clean slate. I’m going to drop down the rankings. Climb my way back up.”
O’Toole’s bid has already expressed how elements of the club would go into administration but that usually comes with a 14-day notice period and a 14-day cooling off period, so it could be October before anything actually changes – which could be too late.
ENGLAND SIDE FOR SOUTH AFRICA TEST UNCHANGED £ England’s Test team has remained unchanged ahead of next Thursday’s deciding test against South Africa at the Oval. The side who beat the Proteas at Old Trafford last weekend will train alongside Matthew Potts, Craig Overton and Harry Brook. Elsewhere white-ball captain Jos Buttler is a doubt for the sevenmatch tour of Pakistan next month after picking up a calf injury in The Hundred – Moeen Ali is expected to take over the reins.
CLOSE THE DOOR BEHIND YOU
RADUCANU TO USE ‘CLEAN SLATE’ TO RESET GAME £ British No1 emma Raducanu has said the “target will be off my back slightly” after her shock round one exit at the US Open yesterday morning. The 19-year-old defending champion was knocked out of the final Grand Slam of the year in straight sets by France’s Alize Cornet.
gether – a number of players are being looked at by other clubs and could be free to walk if they’re unpaid.
STATUS QUO Quite simply, Jason Whittingham and Colin Goldring own Worcester until, well, they don’t. There is a lot of talk surrounding potential bids for the club – the most public being the Jim O’Toole–Atlas SportsTech proposal which is said to have American capital behind it. But until the t’s are crossed and the i’s dotted, if they are at all, the club belongs to its existing owners and will remain locked under its winding-up petition for the time being. Director of Rugby Steve Diamond yesterday said that the players remained unpaid and that his club’s planned pre-season trip to Scotland tomorrow would not take place because it was “unethical for professional players to play a full-on game with the risk of injury and the real possibility of no employment to follow”. But last night the owners said that they had “secured funds” for player contracts – which keeps the squad at the club for another month – but that “non-playing staff” will receive just “65 per cent” of their salaries overnight or today, with the rest being paid in five working days. If the status quo remains, it will go down to the wire to see whether the current owners can find the funds to keep their squad and wider club to-
There were reports recently surrounding a need for Premiership Rugby to have a clear understanding of where Worcester Warriors are financially by today, with the possibility of needing to reshape fixtures to accommodate what could become a 12-team league. Earlier this week fellow Premiership outfit Saracens moved a pre-season match with Championship club Ampthill forward by a day on the offchance that they would need to play a league fixture the following week –where originally they had a bye. It appears, then, that contingency plans are being drawn up by the sport’s bigwigs to ensure that the league can Premiershipcontinue.Rugby chief executive Simon Massie-Taylor and chairman Martyn Phillips are expected to be quizzed later today at the season launch, where Worcester boss Diamond is also set to be in attendance. But if the club are kicked out of the league due to their financial situation being unsolvable in the short term, questions will be raised around the long-term future of the club, where it belongs in the sport and what happens to its financial stake in the league.
Coach says ‘unethical’ for pre-season match to go ahead with club future unknown, writes Matt Hardy
WORCESTER FUTURE IN AIR
T HE CLOSE of play yesterday, the last day of the month, was the deadline for troubled Premiership rugby club Worcester Warriors to pay their players and staff. But as we reach September, just a week out from the new Premiership season, it’s still not certain as to whether Worcester will take the field against London Irish next Saturday. Here are three of the potential scenarios that the West Midlands club could face in the coming days and weeks.
Diamond says pre-season game “unethical”
RALLIED Murray comes from behind to win US Open second round match
CITYAM.COM20 THURSDAY 1 SEPTEMBER 2022SPORT SPORT WHAT IT TAKES TO WIN Ed Warner on Andrew Strauss and the cricket review PAGE 19 CHELSEA AGREE FOFANA DEAL ON DEADLINE DAY £ Chelsea have finally managed to secure the signing of 21-year-old defender Wesley Fofana. The former Leicester City player will move to the capital for a fee of £70m after the Blues had multiple bids rejected for the Frenchman. “The two last days have been really big for me and I’m very happy,” he said. “I trained this morning with the team and it’s a dream for me. I’m very excited to start playing games for the fans and the club. I’m here to win trophies.”
NEWCOMERS If an ownership change does happen in the higher levels of English rugby, the Rugby Football Union looks at four key aspects of the favoured bid: financial stability under new ownership, the reputability of the new ownership, whether there’s any conflict of interest in owning the club, and any other aspects they see fit. Should one of the bids satisfy these tests, satisfy the Department of Culture, Media and Sport – who are owed £14m in Covid-19 repayments – and satisfy the current ownership then the cogs of a transition can begin to move.
SPORT DIGEST
Former world No1 Andy Murray came from behind to beat American up-and-comer Emilio Nava at the US Open. The Brit lost the first set to the 20-year-old 7-5 but rallied thereafter to take the following three sets 6-3 6-1 6-0 at Flushing Meadows in New York and earn a spot in the third round for the first time since 2016. The Scot had entered the US Open with injury fears after suffering a series of cramps prior to the tournament but has so far been able to compete. He will face Matteo Berrettini in the last 32.
