Iain Wright has been a busy man. Like a university student cramming to get his essays done before school’s out for summer, the chairman of the business, innovation and skills (BIS) select committee has been knocking out reports during the final few days before the parliamentary recess.
On Friday, the committee’s take on the working practices at retailer Sports Direct was released, which pulled few punches, and contained words such as “punitive”, “appalling”, “unreasonable”, “excessive” and “contempt”.
Anyway, Wright’s work will be back in front of the invigilators again on Monday, with the publication of the investigation into the collapse of BHS, which the BIS committee has conducted jointly with Frank Field’s work and pensions gang.
It is hard to envisage this making great reading for Sir Philip Green, the former owner of BHS, or Dominic Chappell, the “Walter Mitty” who Green decided was a suitable buyer of a business safeguarding 11,000 jobs and a £571m pension deficit. Westminster gossips suggest the BHS report will be even punchier than Sports Direct.
All of which wraps up Wright’s coursework for the year, which might one day form part of some weightier thesis. How about “the worst of British business” as a possible title?
Arrests, falling shares, gloom – that’s banking
Another terrible few days for the banks, which obviously pains us all.
Last week, Mark Johnson, a British citizen and HSBC’s global head of foreign exchange trading, got nicked by the FBI and charged with fraudulently rigging a multibillion-dollar currency exchange deal. Meanwhile, back in the UK, more mundane problems persist. Shares in Virgin Money, which is run by Jayne-Anne Gadhia and reports numbers this week, are wallowing near all-time lows, while the stock of Lloyds Banking Group (still 9% owned by the UK taxpayer and also reporting this week) isn’t doing much better.
This is an inconvenience to Lloyds’ dashing chief, António Horta-Osório, who everybody assumed would be mounting his black horse for a victory lap by now. But Brexit and low interest rates are making his life pretty tough.
Lloyds shares closed on Friday at 55.58p, some way below the taxpayer’s supposed break-even price of 73.6p.
Still, if you count the dividends, fees and other proceeds we’ve received, there’s a view we could get our money back by flogging the rest of our stake for 8.4p a share. That’s if you believe Hargreaves Lansdown – which might make a few quid from any retail offer.
Has ARM’s new owner gone out on a limb?
“It would be a dreadful shame if this acquisition followed form – job losses, investment drain and, worst of all, new technologies and skills ebbing out of our economy. [The business secretary] must surely be regretting dragging his heels on his promised Cadbury law [which would make it more difficult for foreign takeovers to succeed].”
It is a topical view, following the announcement of the £24bn takeover of UK chip designer ARM Holdings by Japan’s SoftBank last week, even if the words were said about Vince Cable in 2011 by Unite’s Tony Burke.
Burke, of course, was speaking about US technology giant Hewlett-Packard, which had just taken over Cambridge-based software firm Autonomy, then the darling of Britain’s tech sector, for £7bn. Yet if anybody is regretting HM government’s inaction on that one, it is probably HP boss Meg Whitman, since the US group ended up taking a $5bn charge on the deal.
That is not to say that the ARM transaction will also be unsuccessful – or that Burke’s view is invalid – but it does illustrate that these things can work both ways.
Anyway, there’ll be plenty more scope to debate this one, starting this week. With delicious timing, ARM’s half-year results are due on Wednesday.
