Social Housing Landlord Gets Takeover Approach: The London Rush

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(Bloomberg) — A cheap pound and slightly improving financing conditions continue to revive M&A activity in the UK. Embattled landlord Home REIT announced today that it has received an unsolicited approach. Standard Chartered’s finance chief, meanwhile, told Bloomberg Television that his bank has had no contact with First Abu Dhabi Bank despite continuing speculation about a potential takeover bid for the emerging markets-focused lender.

Here’s the key business news from London this morning:

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In The City

Home REIT Plc: The social housing landlord that’s been targeted by a short seller said it got an unsolicited approach from Bluestar Group Limited regarding a possible cash offer. Bluestar now has until March 16 to announce a firm intention to make an offer.

Centrica Plc: The owner of British Gas is boosting shareholder returns after posting a record profit last year, joining Shell Plc and BP Plc reaping the rewards of soaring energy prices.

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Standard Chartered Plc: The London-based lender announced a $1 billion share buyback as Chief Executive Officer Bill Winters is trying to bolster his argument that the bank is better off as an independent firm amid potential takeover interest from the Middle East’s largest bank.

AstraZeneca Plc: The firm’s Covid antibody drug was rejected by England’s cost regulator as it’s unlikely to work against most circulating strains of the virus and is not cost-effective for the struggling National Health Service.

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In Westminster

Environment Secretary Thérèse Coffey said she hopes to create bonuses in the country’s agriculture subsidies that would encourage farmers to band together to accomplish environmental goals.

Meanwhile, the price of a full English breakfast has soared to a record high even as the UK’s overall rate of inflation slows.

ClientEarth, the environmental law firm that successfully sued the UK government for failing to live up to its net-zero pledge, is now launching legal proceedings against the Financial Conduct Authority. The watchdog shouldn’t have approved an initial public offering prospectus from Ithaca Energy Plc, because the document didn’t “adequately describe the climate-related risks faced by the company,” ClientEarth said. 

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In Case You Missed It 

London businesses are shrinking their office footprints and giving up traditional long leases as the pandemic-induced shift to flexible working settles in. A quarter of companies are downsizing office holdings and a further 18% are opting for coworking and flexible office spaces, according to a survey of 500 London workers conducted by Bloomberg Intelligence.

Neel Sachdev has a reputation for going above and beyond to ensure his private equity clients get what they want. The power the London lawyer wields over Europe’s $2 trillion buyout market is testament to that, and a reflection of the dominant debt finance practice he has built at US law firm Kirkland & Ellis over the past decade.

Vodafone Group Plc is exploring options for its African business as investors ramp up pressure on the UK telecom company to boost performance, people familiar with the matter told Bloomberg. 

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Looking Ahead 

NatWest Group Plc will cap off the earnings week tomorrow. 

The lender’s net interest income — the money a bank makes in interest on loans compared to what it’s paying on deposits — is likely to beat analysts’ expectations on the back of the Bank of England’s interest-rate hikes throughout 2022, say BI analysts Lento Tang and Jonathan Tyce.

Besides costs, NatWest’s loan-loss provisions will also be in focus. Estimates compiled by Bloomberg see 2022 provisions up 132% compared to the year before — and point to a 255% jump this year. The direction of UK house prices and the pace of mortgage growth will be important for gauging the credit losses NatWest may have to provision for, according to BI.

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