Funding Circle's fundraising
The Financial Conduct Authority may be planning to introduce tighter restrictions on the peer-to-peer lending sector, but the enhanced regulatory scrutiny hasn’t deterred Funding Circle from pursuing a main-market IPO. The eight-year-old company plans to raise gross proceeds of £300m, with existing shareholders also selling stock. The flotation has secured the support of Danish billionaire Anders Povlsen, an investor in Asos (ASOS) and Numis (NUM), who has agreed to acquire a 10 per cent stake, provided the valuation doesn’t exceed £1.65bn. The offer will be open to retail investors via certain intermediaries.
WPP’s new CEO
Margin pressure flagged
Newly appointed WPP (WPP) chief executive Mark Read had a tough second day on the job this week. Disappointed investors sent the shares down 9 per cent on the day Mr Read – who previously headed up the group’s Wunderman agency – revealed margin pressure suffered during the first half was expected to continue throughout the year. The new boss inherits the company from founder Martin Sorrell after he quit in April among allegations of misconduct. Mr Read has already announced plans to sell minority stakes in some businesses and suggested a merger of some WPP brands.
Dechra braces for Brexit
Share slump
Dechra (DCH), one of the largest producers of veterinary drugs, saw its shares lose a fifth of their value after it announced preparations for a hard Brexit. The slump came despite reports of strong earnings for its last financial year, with a 13.9 per cent increase in revenue at £407.1m. The company plans to invest in an EU facility for product quality control, which will cost £1.2m upfront. In the event of a hard Brexit, Dechra anticipates further operating costs of approximately £800,000 a year.
Pester exits
Follows IT meltdown
TSB chief executive Paul Pester has stepped down as the bank continues to struggle with the consequences of a faulty IT upgrade earlier this year. Mr Pester, who has led the company for seven years, including through its public listing and sale to Sabadell, has been replaced by Richard Meddings. Mr Pester had faced calls to step down after the IT meltdown blocked the online access of thousands of customers to their accounts. He denied that the update was not adequately tested and that Sabadell hurried the process.
Deutsche demoted
Profitability threatened
Germany’s largest lender, Deutsche Bank (ETR:DBK), will drop out of the Euro Stoxx 50 index for the first time since the index’s inception in 1998. The bank will be demoted on 24 September, following a tough financial year in which its market capitalisation plunged 30 per cent to €20bn. DB’s market value has suffered due to a loss of confidence in profitability after a series of scandals and fines, including last year’s $7.2bn penalty for mis-selling of residential mortgage-backed securities prior to the financial crisis.
Carney to stay
Brexit continuity
Mark Carney has confirmed that he is willing to remain governor of the Bank of England beyond his previously planned departure in June 2019. Mr Carney, who has been governor since 2013, initially planned to serve only five years of an eight-year tenure, but agreed to stay an extra year after the 2016 referendum result. Mr Carney told the Treasury Select Committee that he was happy to do whatever he could "to promote a smooth Brexit and an effective transition at the Bank". Theresa May has backed the plan, with senior government officials confirming that Mr Carney will continue his role until 2020.
Heading stateside
Hill teams up
Gambling group William Hill (WMH) became the latest in the sector to unveil plans for US expansion after sports betting was legalised there in May. William Hill will exclusively partner with Eldorado Resorts to provide digital and land-based sports betting and online gaming at Eldorado’s casinos, with 21 properties across 11 states, and a customer base of around 23m. Eldorado is in the process of buying Tropicana Entertainment, which would bring the total to 26 across 13 states. Five properties will open William Hill sportsbooks “within weeks”.
