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BUSINESS
National Business News
Aviva attempts to sell off FPI INSURANCE giant Aviva is reportedly looking to offload Friends Provident International (FPI) in a deal worth up to £596million. The company announced earlier this month that it had seen lower profits from the business – which serves high net worth clients in the Middle East and Asia – and was placing it under ‘strategic review’. Two Chinese conglomerates – Fosun Group and HNA Group – are believe to be interested in the division, though the formal bidding process has not yet started, according to The Wall Street Journal. Aviva’s London-listed shares were up 1 per cent following the report. A disposal would come after the UK insurance firm acquired FPI as part of its £5.6billion takeover of Friends Life Group in April 2015.
Pound proves tight fit for Moss Bros MEN’S suit retailer Moss Bros has said it is preparing for a tough year ahead as the collapse of the pound adds to ‘significant’ cost pressures. It said the national living wage increase and the apprenticeship levy as well as the ‘combined effects of a devalued pound’ would weigh on the sector, which already faced ‘one of the most highly competitive’ trading environments in recent history last year. The group said: “The retail landscape in 2017 will undoubtedly be tough, with an uncertain consumer environment set against the wider political backdrop and alongside rising costs of operation and a weaker pound.”
Wednesday March 29 | 2017
Tesco faces bill of £235m over accounting scandal TESCO will take a £235million hit after reaching an agreement with authorities over its accounting scandal that will see it make a hefty compensation payout to investors. The UK’s biggest supermarket said its subsidiary, Tesco Stores, had entered a Deferred Prosecution Agreement (DPA) with the Serious Fraud Office (SFO), which could see it escape prosecution but pay a £129million fine and costs. The agreement, which will face court approval on April 10, came as Britain’s financial watchdog concluded that Tesco had committed market abuse when it inflated profits by £263 million in a trading update on August 29 2014. In an unprecedented move, the Financial Conduct Authority (FCA) said the supermarket chain
AISLE BE DAMNED Tesco wants to ‘restore trust’
would pay £85million in compensation to investors who bought shares and bonds on - or after – that date and had held stock when the financial statement was corrected on September 22 2014. Tesco suspended eight directors, and the SFO charged three former executives with fraud, after the black hole was discovered in the firm’s accounts in 2014. The scale of the problem was later revised from £263million to £326 million, helping drag the Big Four grocer to a £6.4billion loss in 2015, one of the largest in corporate history. Dave Lewis, Tesco’s Chief Executive, said the company was doing everything it could to ‘restore trust’ after seeing the brand suffer following the accounting scandal. He said: “What happened was a huge source of regret to all of us at Tesco, but we are a different business now. “The decisions over the last years are evident to all and the job now is to keep this momentum. “I am pleased with how our colleagues have responded and that has allowed us to rebuild the business since 2014. The brand was affected by the announcement back in 2014, that is clear. “I think everyone will recognise that there is nothing here to proud of, but I am proud that we faced into it.”
BUSINESS IN BRIEF
Virgin Atlantic braced for post-Brexit losses VIRGIN ATLANTIC has warned that it expects to nosedive into the red in 2017 with its first loss for four years as it struggles with the fall-out from the Brexit-hit pound. Craig Kreeger, Chief Executive of the carrier backed by Sir Richard Branson, predicted the losses as he revealed a £50million hit in 2016 from factors including the plunge in the pound since the Brexit vote and the impact on consumer confidence.
Transparency concerns PRICE comparison websites are to face deeper scrutiny around their transparency as part of an ongoing investigation by the competition watchdog. The Competition and Markets Authority (CMA) said it had found four areas ‘of possible concern’ in the first stage of its review of the sites. The CMA added it would now be focusing on their transparency around market coverage and treatment of personal data.
Ladbrokes merger costs BOOKMAKER Ladbrokes has revealed bottom line losses of more than £200million after it was hit by the costs of its merger with Coral, but said it was ramping up savings targets from the deal. Ladbrokes Coral said one-off costs of the £2.3billion merger in November pushed it into the red by £213.3million in 2016, against pre-tax losses of £46.5million in 2015.