|Bid||4,491.00 x 0|
|Ask||4,492.00 x 0|
|Day's range||4,404.00 - 4,499.00|
|52-week range||4,055.00 - 5,162.00|
|Beta (3Y monthly)||0.74|
|PE ratio (TTM)||2.21|
|Forward dividend & yield||1.00 (2.19%)|
|1y target est||N/A|
Bisto gravy and Oxo cube maker Premier Foods named its UK business chief Alex Whitehouse as its new CEO on Friday, handing him the task of reviving the company which has been under pressure since a failed takeover bid three years ago. The company also said it had hired Colin Day from Reckitt Benckiser, where he was CFO, to be its new chairman, and appointed a new finance chief, filling a leadership void at the group. Whitehouse was credited with turning around Premier Food's UK business, including a relaunch of the Mr Kipling cake brand, which has outperformed the rest of the group.
An economic downturn could present great opportunities for this FTSE 100 (INDEXFTSE:UKX) company and this smaller-cap stock, argues G A Chester.
(Bloomberg Opinion) -- The 2.7 billion pound ($3.3 billion) offer for the British pub chain Greene King Plc from an investment group backed by billionaire Li Ka-Shing has put the spotlight on other unloved businesses in the U.K. leisure sector.One stands out: Whitbread Plc. Since the hotel and restaurant operator returned 2.5 billion pounds to shareholders from the 3.9 billion pound sale of its Costa coffee stores, its stock has been in the doldrums. But it owns lots of property, which is just the thing that drew Li to Greene King. Some 65% of Whitbread’s estate is freehold, and international buyers might be attracted by the prospect of using the dirt-cheap pound to grab themselves some British property assets.The central business isn’t without its attractions either. Hotels suffer more than pubs during recessions; while Brits will always eat and drink, they may be less inclined to take a mini-break. Yet Whitbread is the country’s leading hotel chain, with a focus on the value sector, so it should be able to weather a downturn. While bookings fell during the last downswing, it outperformed its rivals thanks to cost controls and winning more custom among cost-conscious holidaymakers and business travelers trading down to cheaper digs. Premier Inn, Whitbread’s main budget hotel brand, has long been seen as a potential target for a bigger chain.With the value of Whitbread’s debt and equity not much higher than the value of its real estate portfolio, there’s certainly cause for interest.Of course, the company could try to better exploit the value of that property itself. Earlier this year the Sunday Telegraph reported that the activist hedge fund Elliott Management Corp., which owns a stake in Whitbread, was agitating for change on the property holdings.Greg Johnson, an analyst at Shore Capital, estimates that 3.7 billion pounds might be realized from selling the real estate, while Whitbread estimates the value of its property at between 4.9 billion pounds and 5.8 billion pounds.On Shore’s estimates, the operating company could be worth another 3.6 billion pounds. Adding in 300 million pounds for Whitbread’s German business, and assuming net debt of 500 million pounds, would take the equity value to about 7.1 billion pounds. That’s well above the current market capitalization of 5.7 billion pounds. No wonder Elliott is sharpening its knives.Superficially there’s appeal in Whitbread doing this by itself. But sale-and-leaseback deals (when companies sell off freehold sites and rent them back) are risky. Look at the retail sector, where chains such as Debenhams Plc were tied to ruinous long-term leases after following this path, hampering their financial flexibility when times got bad – as they do inevitably in consumer businesses.With the current political and economic uncertainty, Whitbread would be wise to resist any big moves to sell off its property. Activist investors were right to urge it to offload Costa to capitalize on piping hot valuations in the coffee market. Their case on real estate is less compelling.The dilemma for Whitbread’s chief executive Alison Brittain is that by leaving the freehold estate largely intact, she encourages a buyer to come in and exploit that value instead. That risk is heightened by a slump in the share price. Brittain should prepare the defenses. Shareholders should take some heart, however. She managed to wring a very good price from the Coca-Cola Company for Costa. If a property-hungry bidder came knocking for Premier Inn she might just do the same.To contact the author of this story: Andrea Felsted at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
FTSE 100 (INDEXFTSE: UKX) share Coca-Cola HBC looks like a promising buy to me, but Whitbread doesn’t look as good on an uncertain future.
Gains in oil heavyweights amid heightened tensions in the Middle East helped London's main index hold steady on Monday, while Ted Baker was in demand after several media reports of takeover plans. The FTSE 100 index of bluechip companies and the FTSE 250 midcap index both edged higher by 0.1%. Oil majors Shell and BP rose about 1% each, tracking gains in crude prices on concerns that Iran's seizure of a British tanker last week may lead to supply disruptions in the Middle East.
The Sunday Telegraph reported in May that Elliott had become increasingly frustrated with Whitbread's strategy of owning Premier Inn hotels outright and wanted the company to offload chunks of its property portfolio. According to the report, the activist investor believes Whitbread's strategy is depressing the company's share price and is leaving it open to a cut-price hostile takeover.
Activist investor Elliott Capital Advisors has trimmed its stake in Premier Inn owner Whitbread to below 5%, a filing http://pdf.reuters.com/htmlnews/htmlnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20190719:nRSS1308Ga on Friday showed. The Sunday Telegraph reported in May that Elliott had become increasingly frustrated with Whitbread's strategy of owning Premier Inn hotels outright and wanted the company to offload chunks of its property portfolio.
(Bloomberg Opinion) -- Shareholders in Merlin Entertainments Plc are poised to exit the theme park.The company that operates Legoland resorts and Madame Tussauds wax museum has agreed to a 4.8 billion pound ($6.1 billion) joint bid from Blackstone Group LP, the family behind the Lego empire, and Canadian pension fund CPPIB.The offer continues the trend for private equity groups to buy back the businesses that they once owned, and are languishing in public markets. The descendants of Lego founder Ole Kirk Christiansen sold a share of their stake in Merlin to Blackstone in 2005, and the company was listed in London in 2013. The family has held a stake throughout, and it now stands at almost 30%. Companies that are unloved in the stock market make good targets for a second bite of the cherry by the private equity firms that were previous owners. They know the businesses well. Add in the fact that buyout funds have more money than they know what to do with, and you have deals for U.K. satellite company Inmarsat Plc and Swedish building materials group Ahlsell AB.The 455 pence per share offer for Merlin represents a 15% premium to the closing share price on Thursday, and looks fair. It is around the level the stock was were trading at before a lackluster trading update in Oct. 2017, when demand for the company’s attractions was dented by nervousness about terrorism and the first signs of the U.K. consumer slowdown. The shares have traded lower ever since. They rose 14% on Friday, to just below the offer price.As for the buyers, it’s hard to see what they can do differently. Having come from private equity ownership, the company is already pretty efficiently run. There isn’t scope for big cost cuts. Current management will continue.What will be change is how patient investors will be. Blackstone is making the investment from its long-term fund, which typically has a time horizon of at least ten to 15 years. In private hands there’s scope for owners to allow ample time for investments to pay off, a point made by activist investor ValueAct Capital, which has a 9.3% stake. Merlin has spent about 1 billion pounds over the past three years developing its attractions, but the potential benefit from this has not been reflected in earnings, or the share price.The new owners are betting that the investments the company is currently making will ultimately generate returns. At that point, the Merlin can achieve an appropriate evaluation in public markets.There is one wild card: a combination with Whitbread Plc, which has been mooted by some analysts. The company is focused on hotels now that it has shed its Costa Coffee chain. It wants to expand internationally, and Merlin’s global reach would help. Merlin, meanwhile, is building accommodation in its attractions. Whitbread would bring an experienced operator, plus potential synergies.The large number of hotels that the group would own outside of Merlin’s attractions is a significant stumbling block, and makes a deal a stretch.But with the potential for Whitbread to come under pressure to bolster returns from its hotel division, Merlin’s new owners should consider the combination as another route to create value from the buyout.To contact the author of this story: Andrea Felsted at email@example.comTo contact the editor responsible for this story: Jennifer Ryan at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries. She previously worked at the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
London's main bourse inched higher on Wednesday, helped by better than expected numbers from housebuilder Berkeley and a surge in Clydesdale and Yorkshire Banking Group after it promised more savings from its buyout of Virgin Money. The FTSE 100 index, sharply higher on Tuesday along with other European markets on the back of a strong policy speech from European Central Bank chief Mario Draghi, edged 0.05% higher by 0707 GMT.
Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Thyagaraju Adinarayan. Reach him on Messenger to share your thoughts on market moves: email@example.com WHAT'S ON OUR RADAR: SAGA, BERKELEY, STEINHOFF, ADYEN (0656 GMT) It's a lull in continental Europe, but there is some action in the UK with corporate companies continuing blame Brexit and/or political uncertainties for poor results. Saga says its tour operations business is still being hit by political uncertainties, housebuilder Berkeley Group has reported a 21% drop in pretax profit and Whitbread's like-for-like revenue per available room in the UK fell 6% in Q1.
Britain's Whitbread Plc, focused on the hotel business after the sale of its Costa Coffee chain, reported lower room revenue over the past three months as companies cut back on business travel. Whitbread's coffee sale has left it more exposed to increased competition from budget hotel groups and Airbnb as subdued economic activity and political turmoil force Britons to rein in spending. "We have a higher business than leisure mix than most of the other hotels and the ongoing political and economic uncertainty is continuing to impact the hotel industry (in the UK) and is leading to a decline in short lead bookings from business customers," Chief Executive Officer Alison Brittain said on Wednesday.
Whitbread's coffee sale has left it more exposed to increased competition from budget hotel groups and Airbnb as subdued economic activity and political turmoil force Britons to rein in spending. Short lead bookings refer to rooms booked only a week or so in advance, usually by business travellers, who contribute significantly to Whitbread's revenue. Originally a brewer, Whitbread is expanding its hotel business after selling Costa to Coca-Cola Co for 3.9 billion pounds ($4.9 billion) in a cash deal in January.
The value of cross-border company takeovers in Britain fell sharply in the first three months of 2019 as the number of acquisitions by British and foreign companies fell, official figures showed on Tuesday. Foreign companies bought British firms worth a total 6.3 billion pounds ($7.97 billion) in the first three months of 2019, the lowest since late 2017 and down from 38.8 billion pounds in the last three months of 2018, the Office for National Statistics said. British companies bought foreign firms worth 5.4 billion pounds over the same period, down from 10.5 billion pounds in late 2018.
According to the report http://bit.ly/2VEGpuh on Saturday, the activist investor believes Whitbread's strategy is "depressing" the company's share price and is leaving it open to a cut-price hostile takeover. Citing city sources, the newspaper said Elliott wanted Whitbread to sell 10 to 15 percent of its hotel portfolio and "continue to be open minded about the rest".
Elliott Advisors has become increasingly frustrated with Whitbread Plc's strategy of owning Premier Inn hotels outright and wants the company to offload chunks of its 5.8 billion pound ($7.64 billion) property portfolio, the Sunday Telegraph reported. According to the report http://bit.ly/2VEGpuh on Saturday, the activist investor believes Whitbread's strategy is "depressing" the company's share price and is leaving it open to a cut-price hostile takeover. Citing city sources, the newspaper said Elliott wanted Whitbread to sell 10 to 15 percent of its hotel portfolio and "continue to be open minded about the rest".
Premier Inn owner Whitbread has warned that demand for its hotel rooms is being hit by an "acute period of political and economic uncertainty in the UK". Chief executive Alison Brittain said there were "ongoing signs of market weakness across both business and leisure especially in the UK regions". The warning covers a period when the UK has faced intense uncertainty over the terms of its departure from the EU - though Brexit was not specifically mentioned by the company as a factor.