Republic falls
More high street woe
The UK high street is facing up to more empty premises after the demise of youth fashion retailer Republic, which was set to call in the administrators this week. The clothing chain has 121 shops and employs up to 2,000 people and its demise adds to the sense of woe following the recent collapse of Jessops, Blockbuster, Comet and HMV. Republic's owner, US private equity group TPG, blamed crippling rent rises and said underlying trading was good. Elsewhere on the high street, mobile phone company EE, which formed after the amalgamation of Orange and T-Mobile, is to close 73 shops this year due to duplication between the two businesses.
G7 pledge
Currency war fear
The G7 group of major economic powers this week took the unprecedented step of vowing to avoid currency wars amid fears that Japan's aggressive attempt to devalue the yen will prompt retaliatory action from other countries. The G7 finance ministers' statement said they retained their "long-standing commitment to market determined exchange rates" and that they "are aware that excessive volatility in exchange rates can have adverse implications for economic and financial stability". But the Japanese finance minister added that his country had the support of other G7 members in its attempts to revitalise an economy that has been moribund for the best part of two decades and that its policies were aimed at battling deflation rather than manipulating foreign exchange rates.
LSE’s tech move
High Growth Segment
The London Stock Exchange is looking to boost its appeal to high growth technology companies by launching a new High Growth Segment in March, which it hopes will allow it to rival US exchanges such as Nasdaq for the next generation of tech giants. Fast-growth companies will be allowed to float in London by issuing just 10 per cent of their stock, rather than the current minimum requirement of 25 per cent. In contrast, Nasdaq requires a minimum 5 per cent free float. The intention is that the High Growth Segment will provide a springboard to main market listings as and when the companies see fit to release more of their equity.
Crest of a wave
Housebuilder lists
Housebuilder Crest Nicholson returned to the stock market in conditional dealings this week in a float which valued the company at £553m, a little higher than analysts expected when the company announced its intention to list last month. The first major float of the year saw Crest sell £56m of new shares and £168.9m for existing shareholders. The company had been in private ownership since 2007 when it was taken private by Scottish investor, Sir Tom Hunter. The ownership shifted on to distressed debt fund, Varde Partners, after a debt for equity swap in 2010.
Atlantic alliance
EU/US trade deal
The European Union and United States of America have signalled their intention to form a trade alliance or Transatlantic Trade and Investment Partnership. Following President Obama's endorsement in his State of the Union address on Tuesday, a joint statement said talks will commence immediately with a view to a deal being formed by the summer, cementing what is already a deep trading relationship, which the two sides believe accounts for half of the global economic trade and is worth nearly $1trn in goods and services. The chances of success are questionable given previous attempts that have become mired in bureaucratic wrangles, most recently the Transatlantic Economic Council, which was launched in 2007.
IHT freeze
Part of care costs plan
The government this week announced that it will freeze the inheritance tax threshold at £325,000 of assets out to 2019 in a bid to raise extra funds to pay for the care of the elderly. The reversal of a previous vote-winning pledge to increase inheritance tax thresholds to £1m, and recent more modest proposed increases, came as part of the government's wider plans to fund care of the elderly, which will see people with assets of more than £123,000 pay for the first £75,000 of their care costs, as well as their 'bed and board' up to £12,000 a year. This goes well beyond the recommendations of the Dilnot commission on care costs for the elderly, which suggested a £35,000 cap on care costs and £10,000 for annual accommodation fees.
