It's been a big week for...
25 September 2000
Granada Compass. The hospitality group is conducting a strategic review which may result in it selling off its hotel portfolio. The move comes following shareholder pressure since the May merger of Granada's hotel and restaurant arm with catering group Compass. The sale is likely to include the 120-strong luxury chain Le Meridian and the UK Posthouse and Heritage groups. It is expected to fetch around £3bn, but the company will probably hold on to budget hotels Travelodge and motorway restaurants Little Chef. French company Accor, which owns Sofitel and Novotel hotels, has confirmed that is in exploratory talks with the UK group.
The Canary Wharf Group, which has reported its first-ever profit since the company was launched in the mid-1980s. Last week the owner of the 85-acre site in Docklands, London, posted profits for the year ending 30 June of £54.1m (£42.8m loss) which was bolstered by a one-off £39.1m gain on the sale of a completed property. It also witnessed its share price rise by 5.5p to 535.5p, giving it a market capitalisation of £3.67bn. The company floated in April last year with a market value of £2.26bn.
The European Court of Human Rights, which has declared that the UK trial of the Guinness three was a breach of their human rights. Gerald Ronson, Jack Lyons and Anthony Parson were convicted for colluding in illegal share-fixing. But the Strasbourg judges ruled that the prosecution was wrong to use transcripts of statements made to DTI inspectors because the evidence was self-incriminating and therefore contravened Article 6 (the right to a fair trial) of the European Convention on Human Rights. The men may now seek to have their convictions quashed.
Cadbury Schweppes, which has acquired Snapple Beverage Group for $1.45bn (£1.03bn) from leading US food group Triarc. The food and drinks group is paying $910m (£644.6m) in cash and will take on debts of $420m (£297.5m), as well as paying $120m (£85m) to buy out employee share options. Triarc purchased Snapple from Quaker Oats three years ago for just $300m (£212.5m). Quaker paid $1.7bn (£1.2bn) for the drinks group in 1994, but the acquisition was not a success. Cadbury Schweppes intends to cut costs by $50m (£35.4m) within the next three years.
Marks & Spencer, which faced further criticism this week, this time about board-room payoffs. Peter Salsbury, who resigned as the group's chief executive following a collapse in profits and a slump in the company's share price, is receiving a golden handshake of £560,000 - the equivalent of a full year's salary. Two other directors are also leaving with significant compensation packages. GMB union attacked the payoffs as "obscene". General secretary, John Edmonds, said to The Independent: "It is bad enough that these directors are being rewarded for failure, but their failure has been built on the lost jobs and livelihoods of thousands of workers."
Camelot, which has won a High Court battle after it alleged that the Lottery Commission's decision to consider only Richard Branson's People's Lottery for licensing was unlawful. David Pannick QC, acting for Camelot, said that the commision gave unfair advantage to the People's Lottery when they effectively locked Camelot out of the bidding. Concerns arose over relationships between the current lottery operator and US company GTech, which supplies the computer software behind the lottery. GTech executives covered up software problems that resulted in incorrect prizes being paid out. The Commission did not believe Camelot could resolve its difficulties within the allocated timescale, and started negotiating solely with Branson. However, Mr Justice Richards decided that the commission had acted unfairly. The decision allows Camelot back into the running.
Victoria Friendly Society. The Liverpool-based mutual insurance company may have to abandon plans to purchase Scottish Life and demutualise if it becomes a target of insurers Aegon, Life Assurance Holdings Corporation or Securitas in a deal that has valued the mutual organisation at £3bn. The society's one million customers are set to receive £2,000 in windfall payments because the Liverpool management has built up around £2bn worth of free assets. The mutual, which owns a bank and general insurance company Frizzell, has total assets worth £5bn but the actual business is valued at no more than £500m to £1bn.