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What to watch: GardaWorld makes final G4S offer, Mitchell and Butlers agrees lifeline funding, Russia's Fix Price London IPO

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LaToya Harding
·Contributor
·4 min read
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A general view of a G4S van outside Aberdeen High Court.   (Photo by Andrew Milligan/PA Images via Getty Images)
G4S shares tumbled as much as 10% on the back of the news. Photo: Andrew Milligan/PA Images via Getty Images

Here are some of the top business, market, and economic stories you should be watching today in the UK, Europe, and around the world.

GardaWorld says G4S offer is final

Canada’s GardaWorld has confirmed it will not increase its 235p (329 cents) December offer for UK-based rival G4S (GFS.L), meaning Allied Universal is now in pole position to take over the FTSE 250 security outsourcer.

The UK’s takeover panel had pushed the bidders into an auction situation to decide the best bid.

Stephan Crétier, chief executive of GardaWorld, said: “There can be no better owner for G4S than GardaWorld, but we are disciplined buyers and we will not overpay for a company with systemic ESG issues that continue to come to light.

“In light of the above, we have concluded that priced above 235 pence per share, there are better and less risky opportunities available to GardaWorld.”

Allied’s 245p bid values the company at around £3.8bn.

G4S shares tumbled as much as 10% on the back of the news.

G4S fell out of fashion with investors on Monday, slipping as much as 10%. Chart: Yahoo Finance
G4S fell out of fashion with investors on Monday, slipping as much as 10%. Chart: Yahoo Finance

Mitchell and Butlers agrees emergency funding as sales slump

All Bar One owner, Mitchell and Butlers (MAB.L), has pressed ahead with its £350m emergency funding as sales slumped 70% between the end of September and mid-January, compared to the same period a year ago.

The pub chain said the move was “critical for the continued operation of the group and its immediate financial stability”.

On a like-for-like basis for sites when open, trading was 30.1% down on the year.

It also said it was burning through as much as £35m per month during lockdown and delayed monthly staff pension contributions from January to March. The company, which also owns the Harvester restaurants and pub chain O’Neills, usually pays £4.2m a month into its pension fund.

It said it had a cash balance of just £113m as of 16 January, and needs to make a £51m interest payment on its debts by 15 March.

READ MORE: Wetherspoon boss calls for UK pubs to open at same time as non-essential shops

All of the group’s 1,600 pubs and restaurants have been closed since 30 December due to COVID-19 lockdown restrictions.

It came as cake maker Finsbury Food (FIF.L) saw group revenue fall by more than 4% to £152.9m in the six months leading up to Christmas.

European markets muted

European stock markets were cautious on Monday as UK prime minister Boris Johnson prepares to deliver his roadmap out of the third national lockdown.

The FTSE 100 (^FTSE) fell 0.56% after opening, while the CAC (^FCHI) tumbled 0.74% and the DAX (^GDAXI) was 0.93% lower.

The PM is expected to reopen schools across the country from 8 March and gradually relax rules on socialising in a public space. Reports this morning also said that outdoor gatherings will also be permitted again for either up to six people or two households.

Many stocks in sectors hardest-hit by lockdown restrictions were among the biggest fallers, suggesting the lifting of lockdown restrictions will be slower than expected by investors.

Retailer JD Sports (JD.L) lost 2.8% and Games Workshop (GAW.L) lost 1.9%, rail ticket website Trainline (TRN.LR) lost 2.1%, property listings site Rightmove (RMV.L) shed 3% and housebuilder Persimmon (PSN.L) shed 1.2% in early trading on Monday.

WATCH: What can we expect Boris Johnson's lockdown announcement to include?

“It looks like the roadmap for easing lockdown restrictions is set to cause some disappointment in the world of business and that’s reflected in share price behaviour ahead of the Prime Minister’s speech,” Russ Mould, investment director at AJ Bell, said.

“The UK-focused FTSE 250 index slipped 1% as investors took the view that the UK economy would only be unlocked gradually rather than a quick flick of the switch.”

Russia's Fix Price to float in London

Budget retailer Fix Price has confirmed its intention to float on the main market of London’s Stock Exchange.

The company, which is the largest value retailer in Russia, said the potential initial public offering (IPO) would “allow it to pursue growth and international expansion”.

Dmitry Kirsanov, chief executive of Fix Price, said: “Today’s announcement represents a landmark that testifies both to the impressive size and scale that Fix Price has already achieved and to our strong belief that the company will continue its robust growth trajectory.

Fix Price, which launched in 2007, has more than 4,200 stores. It sells goods for less than 250 rubles, which is equivalent to £2.46.

WATCH: What UK government COVID-19 support is available?