Below are the key headlines from today’s updated papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Tobacco shares stubbed out as US threatens fresh crackdown. London-listed tobacco shares plunged on Monday as investors took fright at a potential crackdown on menthol cigarettes in the US. The Food and Drugs Administration (FDA) is reportedly readying a ban on the products following other countries who have already imposed bans. The news sent British American Tobacco (BATS) shares down as much as 11%, before recovering to trade down 8.6%, at 3029p. The decline was the first time shares had fallen over 10% in nearly two decades, when the Department of Justice launched a major lawsuit against the tobacco giants. Rival Imperial Brands (IMB) dropped as much as 5% to 2613p as it and BAT sank to the foot of the FTSE 100.
Restaurant Group asks shareholders for £315m to buy Wagamama. Restaurant Group (RTN) shrugged off investor concerns over its proposed £559 million takeover of Wagamama as it announced a fully underwitten £315 million rights issue at a deep discount to the prevailing share price. The Frankie & Benny’s and Chiquito operator said that it would issue 290.4 million shares, equivalent to 144% of its existing share capital or 59% of the enlarged company, in a funding that will be fully underwritten by JP Morgan Cazenove. Existing shareholders will be offered the chance to buy 13 new shares for every nine they already hold at a price of 108.5p, a discount of 56.9% to Friday’s closing price of 251.8p and 35.1% lower than the theoretical ex-rights price of 167.1p, which takes account of both new and existing shares.
Burial provider Dignity (DTY) is hit by cheap funerals push. Burials company Dignity, the UK’s only stock market-listed undertaker, showed the full impact of its price war with the Co-op on Monday after profits were hit by more people choosing budget funeral plans. The company, an umbrella group of dozens of funeral providers including London’s J H Kenyon which buried Sir Winston Churchill in 1965, said underlying quarterly profits fell 39% to £12.2 million from £19.9 million as it overhauled its funerals range. Dignity announced plans last January to slash its basic funeral prices by 25% to go head to head with Co-op Funeralcare, which would lead to lower profits in 2018.
Government steps in as Babcock International Group (BAB) battles ‘malicious’ mystery analyst attack. Defence outsourcer Babcock was boosted on Monday after the UK government took the unusual step of backing the group after a short-selling report alleged relations between the two sides had soured. Babcock, the second-largest supplier to the Ministry of Defence and one of 34 top “strategic suppliers” to the government, rallied the support of ministers to quash the claims. The company issued a statement of support from officials, which pledged to carry on working with the firm on a wide range of contracts. Babcock has 128 contracts for the UK government.
Diageo (DGE) agrees sale of 19 brands in $550m US deal. Drinks giant Diageo on Monday agreed a $550 million (£430 million) sale of 19 spirits brands in the US, allowing the Guinness and Cîroc vodka maker to concentrate on more upmarket products. The FTSE 100 firm said private US-based firm Sazerac is snapping up the portfolio, which includes Parrot Bay ‘Freeze and Squeeze’ cocktail pouches and Seagram’s whisky. Finance chief Kathy Mikells said Diageo has had the brands for a long time and they make most of their revenues in America. Chief executive Ivan Menezes said: “The disposal enables us to have even greater focus on the faster growing premium and above brands in the US spirits portfolio.”
