Chris Edwards has ruled himself out of bidding for parts of Poundworld, the discount store chain he founded in 1974, after administrators rejected his final proposal.
Mr Edwards said in a statement that he had tabled a deal to save 186 stores, along with 3,000 jobs, but that “we’ve now had written confirmation that it’s not high enough.”
“I’ve made a substantial and credible offer, which is the best offer we can put forward, but in my opinion, it hasn’t been given the respect it deserves,” he added, saying he was only given access to Poundworld’s premises and permission to talk to its bankers “in the last few days.”
Deloitte, which is handling the administration, said it continues to seek a buyer of all or parts of the business. “To date no party has presented a credible and acceptable bid with accompanying confirmation of funding,” it added. It denied that has obstructed Mr Edwards’ efforts to save the company.
“We have provided guidance to indicate how a successful bid might be structured and have provided detailed information to assist bidders in an effort to help them wherever possible,” a spokesperson said.
Mr Edwards sold Poundworld to TPG in 2015 for £150m, but trading worsened sharply as Britain’s consumers became more cautious, while the devaluation of sterling against the US dollar in the aftermath of the Brexit referendum compressed the company’s already-thin profit margins. Efforts to broker a sale as a going concern floundered, and the company went into administration in June, putting 5,000 jobs at risk.
A person close to the administration process said that talks continue with other interested parties. But Mr Edwards stressed that time was rapidly running out, with many of the group’s 300 stores already advertising liquidation sales. “I now believe the business will close rather than jobs being saved,” he said. “It seems that selling off all the stock and closing the stores is a better option.”
Deloitte declined to comment on the status of talks, beyond saying that it was “preparing for all eventualities.”
TalkTalk - one-and-a-half good reasons for a buyout
Analysis09 JUL 2018
Analysts from Dealreporter, Mergermarket’s sister publication, pick out pre-event ideas by combing through transcripts, stock exchange filings, analyst reports and news stories. This raw data is combined with proprietary insights and commentary to produce an exclusive report that offers short and long-term ideas (No investment action should be taken without further investigation). If you have any ideas for coverage please email europeflash@acuris.com
TalkTalk [LON:TALK] shares are down around 50% since the Flash weighed up its takeover appeal back in March 2017.
Deal prospects looked decidedly shaky back then: possible bidders already had ample opportunity to move and had not done so. Today, cheaper in absolute terms, and with shareholder changes appearing to raise buyout prospects, TalkTalk has at least one-and-a-half of the key ingredients for a successful pre-event trade.
Takeover speculation around TalkTalk makes most sense in the light of stake-building from activist Toscafund, along with a concentrated shareholder register which includes co-founder and executive chairman Charles Dunstone at 28.5%.
Toscafund now has 16.2% of the business after upping its stake on 3 July, while Dunstone has 28.6% and David Ross, another co-founder, owns a further 11.6%.
Mechanics of a buyout are difficult to weigh, though there are options aplenty. Toscafund itself has participated in listed company buyouts before, notably a GBP 500m deal to delist Daisy as part of a consortium which funded a management buyout. It’s possible that Toscafund is looking for a similar play as it seeks an exit from Daisy with what media reports indicate could be outsized returns.
TalkTalk already has a talented and experienced management team in place that might fancy its chances of creating a similar valuation uplift. But Toscafund’s earlier deal for Daisy was controversial: a "take-under" which was completed at a 1% discount to the target’s stock price a month earlier.
Other possibly interested strategics previously highlighted by the Flash included Vodafone [LON:VOD], Telefonica [BME:TEF] and Iliad[EPA:ILD].
Change on TalkTalk's shareholder register indicates a transaction could be nearing; change in the company's stock market valuation paints a more nuanced picture.
TalkTalk is now cheaper in absolute terms after its stock price plunge but valuation metrics have actually worsened over the past year.
The company trades at 8.7x EBITDA, which is more expensive than the 8.1x it traded at a year ago, even after a 50% decline in its equity price.
Drivers of this include new equity, totalling GBP 200m, which was raised in February via a placing in which all of Toscafund’s top shareholders participated. Debt still comprises a sizeable portion of TalkTalk’s overall capital structure so enterprise value has declined by something closer to a fifth.
And EBITDA has also declined, by 35% in the 12 months to 31 March. As both sides of the EV/EBITDA equation have been compressed, TalkTalk’s valuation multiple has actually increased despite a decline in its enterprise value.
Still, TalkTalk is cheaper in absolute terms at an enterprise value of GBP 2.0bn versus GBP 2.5bn a year ago. It was not a particularly large target relative to the size of potential strategic suitors to begin with. And it’s in the sweet spot for some private equity funds. Daisy's delisting was executed at 1.6x sales and 10.0x EBITDA, though it operates in the business-to-business rather than consumer telecoms services market.
Developments over the past year in TalkTalk’s shareholder register, and its valuation, mean these are all factors worth paying attention to.
The Galaxy S10 is rumored to have Dual Face Cameras along with a Trio of Backside Cameras to enhance Landscape Mode
In March Huawei introduced their premium P20 smartphone that introduced a triple camera setup. In June the Korea Herald reported that one of Apple's premium iPhones and the Galaxy S10 would come with three backside cameras with a 3D sensor. The triple cameras, which allow consumers to take clearer and crisper pictures at different angles than single and dual peers and to use enhanced zoom features, can also be utilized for augmented reality solutions. Today we're getting a few more rumored details about Samsung's S10 cameras.
With Apple launching three new iPhones in September, Samsung has reportedly decided to follow Apple's lead and plans to introduce a trio of smartphones themselves for the Galaxy S10 including a premium large-screen Galaxy S10+ whose project name is Beyond 2; a basic Galaxy S10 or Beyond 1; and a cheaper version or Beyond 0.
Sources told Korean publication 'The Bell,' that the upcoming Galaxy S10+ is expected to feature a whopping five camera lenses -- a front-facing dual-lens camera and a rear-facing triple-lens camera. The dual face cameras will likely be used to support their version of Apple's Face ID. Samsung was granted a patent for an advanced smartphone biometric camera in Q3.
The current Galaxy S9+ that was launched earlier this year features a 12-megapixel rear-facing dual-lens camera. The sources added that a 16-megapixel "super-wide angle" camera will be added to greatly improve landscape photography.
What’s so wrong with Silicon Valley investing in sin?
Investors are divided about whether it is kosher to place bets in fields like marijuana or pornography. But what about vaping?
There is money to be made on our vices. So why do so many investors refuse to make it?
That’s an age-old question thrown into sharp relief this summer as Juul, the e-cigarette company that teenagers are gaga for these days, raises a round of financing that values the company on the same par with names like Lyft or Snap. There is perhaps no better market than one we are addicted to, but puritanical Silicon Valley typically refrains from industries that call upon our taste for sin.
So that means not to expect to see a marquee venture capital firm behind a new marketplace to organize the Adderall industry, even if there is surely a better way to connect dealers and buyers. Or behind a new technology to muffle the blast of a pistol, even if tens of millions of firearms are sold each year. Or behind a new innovation in how we experience pornography, even though the virtual reality platforms that firms’ portfolio companies build could very well revamp an estimated $100 billion industry worldwide.
Silicon Valley is certainly leaving money on the table. And it raises an intriguing question about the ethical obligations of venture capitalists: Is their job a soulless quest to make money for their own investors? (Which, by the way, happen to include public universities, charitable foundations and retirees on public pension plans.) Or is their job more akin to professional athletes — making big money, yes, but driven by a love of the game and some public display of finesse? Should they only invest in technologies and businesses that make the world a better place?
Here’s the deal: By rule in some circumstances — and by tradition in others — premier venture capital firms don’t touch the industries that prey upon our worst angels. That’s generally to please their own investors, known as limited partners, who might be doing good, expensive work but put in place these “vice clauses.”
“All investment opportunities are evaluated through the lens of what is consistent with our values,” said Kleiner Perkins, the oldest of the old-guard venture capital firms, “and we have no current investments in the categories of alcohol, tobacco and guns or businesses that are illegal in any state.”
That’s long been modus operandi at Silicon Valley’s most brand-conscious firms. The reputational risk is real — or, at least, was real.
What’s new is the liberalizing of the country’s mores on topics like drugs, with growing parts of both the left and the right pursuing criminal justice reforms that treat drug addiction like more of a business problem to be solved than an industry to be eradicated.
Take marijuana: As states like Colorado began legalizing weed, effective in 2014, about $700 million has flowed into the cannabis industry. From investments in delivery startups like Eaze, backed by DCM Ventures, to providers like PharmaCannis, some venture capital firms have shown that they do occasionally change with the times.
Founders Fund, for instance — an eagerly contrarian firm co-founded by Peter Thiel, yet one that is still a top performer thanks to bets in mainstream companies like SpaceX and Airbnb — stands out in a more timid industry for doing a number of weed deals.
“We don’t have any vice clauses in place,” Founders Fund told Recode. Its limited partners “invest in Founders Fund because we seek out the best entrepreneurs regardless of sector or popularity among other VCs. We’ve earned our investors’ trust and that allows us the freedom to invest in anything that has the potential to be a great business.”
Hemant Taneja, a top investor at General Catalyst, said his firm was searching for not only great businesses but ones that are “also in the long-term interest of society.” That’s not just because their limited partners value that, he said, but also because that sort of mission attracts better talent and builds a better startup.
That brings us to vaping and Juul.
“The company has executed exceptionally well and is a consumer phenomenon by all measures,” Taneja told Recode. “What’s unclear to us is whether Juul is helping consumers get off an unhealthy addiction or is it creating a new addiction for them. In the absence of knowing that, we were hesitant to pursue the investment.”
Taneja is not alone in not totally knowing what to make of Juul. Teens have flocked to the battery-powered device that dispenses a flavored nicotine vapor — one meant to simulate smoking but, in the eyes of its proponents, without the addictive or destructive health consequences. Is it actually moving pack-a-day teens toward a less-bad alternative — vaping? Well, it’s still nicotine (which 60 percent of youth users don’t know), and there is some evidence that vaping actually serves as an entry point for eventually buying cigarettes.
The ethics are murky, yes. But the business? Not so much. The company reportedly brought in about $250 million in revenue last year and has grown to take over about 70 percent of the U.S. e-cigarette market. Sales surged to almost $1 billion within the last year, according to CNBC, and since only about 10 percent of high school seniors say they’ve vaped in the last year, there’s plenty of room to grow.
Here’s how Jeremy Liew, the first major institutional investor in Snap — who keeps a close eye on phenomena among high schoolers — sees the business: As a social network.
Liew, who is not a Juul investor, said its colors and flavors make it “super fun”; that it can grow virally as more people use it and a camaraderie develops within its user base, and notes that there’s a budding Juul culture on social media like Instagram. It doesn’t sound that different from Snap.
Now, there are still some financial holdups for venture capital firms seeking to capitalize on this bonanza. Not unlike the cryptocurrency industry, the vaping industry could encounter tough regulators. In April, the U.S. Food and Drug Administration asked Juul for documents as part of an attempt to determine why it is so popular with minors (it is only supposed to be available for purchase to those over 21).
Plus, as one other top-tier venture capital firm described it, it’s unclear how startups that thrive on vice eventually return money to their investors. Can they go public as an independent company? Maybe, but how would they be valued? And who would acquire a company like Juul?
And then there’s a related question among some investors about whether these companies are even truly technology companies and whether they should be in the domain of venture capitalists in the first place.
The firm that is reportedly leading the financing of Juul isn’t a typical blue-chip Silicon Valley firm. It’s Tiger Global Management, a powerful New York-based late-stage investor that led a marijuana deal this spring as well.
Despite its landmark investments in companies like Spotify and Flipkart, the firm famously shuns the spotlight. But it’ll have no luck avoiding scrutiny when it’s at the center of the vaping craze in our schools.
PARROT ANAFI DRONE REVIEW: FLYING HIGH, BUT FALLING SHORT
DJI’s only real competitor misses the mark
Competition is good. It forces you to get better, to stay innovative, and potentially change your approach in order to snag the market share you believe you deserve. In the world of drones, competition for the market leader DJI seems to be nonexistent.
Remember 3D Robotics? It has exited the consumer drone space. Lily Robotics, which had the most exciting Kickstarter project in years? It’s been killed and resurrected with nearly none of the original autonomous features present. Even GoPro’s Karma program, an initiative that was dubbed a savior for the already turbulent company, is dead.
Parrot, a company mostly known for drones tailored to kids or beginner pilots, on the other hand, is still around. The new $699.99 Anafi is the company’s direct answer to DJI’s recent Mavic Air, and is a compact, capable drone that promises to capture stunning aerial footage in 4K. It also introduces a few features you can’t find on other drones today.
But is it enough to knock DJI out of the sky?
I’ve been testing out Anafi for the past two weeks, and have logged around 30 flights in that span. There are a lot of things I like about it, including zoom capabilities and the ability to capture HDR footage that you won’t find in other drones. But all of those positives are overshadowed with how miserable the overall experience was.
My initial experience with the Anafi was marred by a variety of problems, mostly around buggy software, poor connectivity, and even corrupted files. Parrot was able to send out another device, and my experience did improve with it. But even with a unit that was working as Parrot designed it to, the Anafi lacks the refinement and finesse you get with DJI’s Mavic Air. It’s not as portable as you’d want it to be and overall ease of use isn’t quite there.
The most important feature of any drone designed for videographers is the image quality. This is where Anafi shines. Its 4K 100 Mbps bitrate footage looks great and is just as good as the footage from the Mavic Air. I even prefer its flat image profile better than what I get on the DJI for color correction while post processing.
Unlike the Mavic Air, however, Anafi has a built-in HDR video option. Ability to shoot HDR is one of the standout features that you can’t find on any other drone in this price range. HDR promises to provide a better image by balancing the exposure between bright and dark areas better, something that is a challenge when shooting a skyline or horizon with a drone.
Sadly, the Anafi struggles with the execution on its flagship HDR feature. When flying, it’s not entirely clear when the HDR option is available or even when it’s turned on, which quickly becomes a frustrating experience. The difference between non-HDR and HDR footage is very evident, as the HDR footage captures a lot more detail, especially in the sky, which usually gets blown out. But at the same time, it looks overly saturated and unnatural. Additionally, it just had too much noise and moire in areas with a lot of details like rooftops or trees.
During the time I have been testing this drone, Parrot issued many software updates which have made my experience progressively better. The improvements were most noticeable in the still image quality from the Anafi’s 21-megapixel camera. The first few photos I took had very harsh distortion as if shot with a fisheye lens. That has been fixed with the latest software updates, and photos do look great now. The high-resolution images have a lot of detail and very little chromatic aberration. It can shoot both DNG and JPEG, but for some reason, you can’t use the zoom options here. Hopefully that gets added with another software update.
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The Anafi’s second standout feature is its ability to tilt the camera upwards towards the sky. It’s neat and opens up a world of possibilities for capturing unique angles, such as when flying under a bridge or some other structure. It takes some effort to find interesting ways to use this footage, but I look at it as just another tool in my creative kit that I can use when I need to.
The Anafi’s ability to zoom in without losing image quality is it’s third standout feature. While filming in 4K, you can zoom up to 1.4x and if you’re filming in 1080p it goes up to 2.8x without losing detail. Even though I can do similar things in post processing by shooting in 4K and scaling down to 1080p, I really enjoy having zoom options while flying. Similar to how GoPro footage is instantly recognizable the second you see it, drone footage is becoming very repetitive. Being able to change that, without having to buy high-end professional production drones with interchangeable lenses, is a welcoming change. We already reached a point where smartphones have multiple built-in lenses, I don’t see why we can’t have that with drones soon.
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While the Anafi does have several useful features, it misses in other key areas. It lacks many automated filming options you get with DJI drones. The one automated “Follow me” feature (which costs an extra $17.99 in-app purchase to enable) simply didn’t work in my tests. It’s inexcusable that one of the most common features you find in most drones today costs extra and then doesn’t even work that well. The Anafi also lacks obstacle avoidance sensors, which decreases chances of me ever using it, even if I could get it to work.
Like the Mavic Air, the Anafi is foldable. When unfolded and ready to fly, the two drones are very similar in size. But when packed up for travel, the DJI is noticeably more compact.
I initially wasn’t fond of how the Mavic Air folds. It’s confusing how the back legs fold downwards and into the body, but looking at Parrot’s approach with the Anafi, DJI’s convoluted folding legs make a little bit more sense. The Anafi, when folded, is a lot longer than the Mavic Air. It’s basically as big as a telephoto lens for a DSLR when it’s stored in the included carrying case. Also, it’s worth noting that the drone just feels cheap and more fragile than the Mavic Air. It is lighter than the Mavic Air, which help with battery life, but also makes it harder to fly in windy conditions.
There are other issues I found worrisome. The drone kept drifting when left in hover mode. Some files were never recorded. Changing settings in the app weren’t applied. The already mentioned HDR mode, which only works in 4k, either isn’t present or just wasn’t working and I couldn’t tell why or when. Almost every flight I took with this drone had some new or reoccurring issues which would require me to land the drone and change the battery or restart the app and the remote.
The issues don’t end there, either. The SD card slot is placed under the battery in a lockable tray that reminds of old SIM trays in Nokia phones. There isn’t any internal storage, so forgetting an SD card, which happens more than any of us want to admit, isn’t as simple as just inserting one. Parrot does include a 16GB card in lieu of the internal storage. Frustratingly, there is no way to check the battery level when the battery is plugged in.
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Parrot Anafi next to DJI Mavic Air
The Anafi’s remote control is massive. It feels sturdy and fits well in your hands, but be prepared for it to take up a lot of space in your bag. Ever since DJI introduced removable joysticks, it’s hard to get used to anything else. The phone holder also doubles as an antenna and despite a few bad connections I initially had, the Wi-Fi connection otherwise was very stable throughout. The connectivity problems that plagued Parrot’s older Bebop 2 drone seem to be resolved here.
A lot of the issues mentioned could potentially be fixed with software updates, but the unfinished feel made me feel insecure about where and how I can fly this drone. Every time I switched back to Mavic Air there was some sense of security which made drone piloting feel like a relaxing and fun activity. The Anafi lacks that confidence.
However the most alarming problem I had was when I tried putting my hand underneath the drone to test its proximity sensor. The drone lost control and went flying uncontrollably in circles until it finally crashed into a tree. Fortunately, there was no visible damage to the drone, likely thanks to the light carbon with glass fiber materials it’s made of. I have a feeling if this had happened to the Mavic Air, there would be a lot more damage and a few broken props. But the DJI likely wouldn’t have crashed like that.
Battery life, however, is a bright spot for the Anafi. I really enjoyed the extra 4-5 minutes I got out of it compared to the Mavic Air. In my Mavic Air review, I mentioned the advertised 21 minutes of flight time just felt too short. The Anafi’s 25 minute mark really is a sweet spot for drones meant for travelers and people on the go. Even the fact that both battery and the remote can be charged through USB-C means you can easily charge it in your car or with an external battery pack. That definitely saved my ass a few times when shooting in Northern California.
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Overall, Parrot has made the best competitor to a mainstream DJI drone in years. But just showing up isn’t enough, to really matter, the Anafi had to be better than the DJI Mavic Air, and unfortunately, it’s far from that.
This drone is close to being good, but I had too many issues that outweigh its potential. In addition to the buggy software, the experience I had just wasn’t as fun or rewarding as what you get with the Mavic Air.
Markets Are Crazy" - Gundlach, Minerd Warn: This Is Anything But Goldilocks
Dow Jones Futures are up almost 400 points from the post-trade-war lows, Nasdaq is up even more on a relative basis, and 'safe-haven' FANG stocks are soaring as investors embrace the trade war...
There's just one thing - nothing else agrees with this riskless, goldilocks environment, and DoubleLine's Jeff Gundlach points out the ugly reality to those willing to listen...
One quick glance at the gaping divergence between lower yields (and collapsing yield curve) and soaring stocks tells you something is amiss (and we know which way this normally resolves in the short term)
Which is what Guggenheim's Scott Minerd is worried about:
And judging from the yield curve, growth is anything but the thing to buy right now...
As we are already seeing global trade volumes slump...
Nissan Admits Emissions-Test Data Was Falsified
It is the second compliance scandal for Nissan, after faults in vehicle inspection procedures saw it recall more than a million cars last year
TOKYO—Staff at some of Nissan Motor Co.’s NSANY 0.64% Japan plants falsified auto-emissions and fuel-economy data, the company said, in what is the latest data-faking incident among Japanese manufacturers.
It is also the second compliance scandal at Nissan in recent months after it admitted to faults in vehicle inspection procedures.
Staff at four Nissan plants altered emissions and fuel-economy data for 913 cars tested as far back as 2013, the company said. More than a dozen vehicle models for the Japanese market were affected.
An internal review of vehicle testing also found other problems such as erroneous calibration of testing equipment.
Combined, bad testing and rewritten data affected a total of more than 1,000 cars.
Nissan said it found the problems during compliance checks launched at its plants after the discovery of flawed vehicle inspections last year. Other than one model still under investigation, Nissan said all of the affected vehicles met Japanese auto standards. The data alterations were made by staff to meet Nissan’s own stricter internal standards, it said.
“A full and comprehensive investigation of the facts…including the causes and background of the misconduct, is under way,” Nissan said Monday.
A Nissan spokesman said the affected cars wouldn’t be recalled because they all met Japan auto standards.
Nissan’s stock fell 4.6% in Tokyo after the company said it would make an announcement about vehicle emissions, which came after the market closed.
The Transport Ministry ordered Nissan to fully investigate the problem and, within a month, come up with measures to prevent a recurrence.
Late last year, Nissan said unauthorized workers at some plants in Japan had performed parts of final inspections—which includes confirming that the brakes and lights work—and inspection documents were then falsely stamped with authorized inspectors’ seals, equivalent to a signature in Japan.
Nissan recalled more than one million cars in Japan for re-inspection in that case.
In the past year or so, a string of Japanese companies have admitted to manipulating quality inspections, damaging Japan’s global reputation for producing high-quality products.
Some employees at Japanese manufacturers have said pressure to cut costs and keep production lines moving amid rising global competition have resulted in quality control being sacrificed.
An internal Nissan report into the inspection scandal last year blamed management for setting unrealistic targets, relying on factory workers to figure out the details. As a result, factory workers cut corners to meet those targets and then hid the evidence, the report said.
Nissan’s announcement Monday also marks the latest in a series of emissions-testing scandals to rock the broader auto industry in recent years.
Volkswagen AG has acknowledged rigging nearly 11 million diesel vehicles world-wide to cheat on emissions tests, including some 600,000 in the U.S. The company agreed to compensate owners, buying back or fixing the diesel vehicles equipped with illegal software that helped it pass government emissions tests but then pollute above allowable levels.
The U.S. Justice Department in 2017 sued Fiat Chrysler Automobiles NV, accusing the Italian-American auto maker of using illegal software on about 104,000 Jeep Grand Cherokee sport-utility vehicles and Ram pickup trucks to help the diesel-powered vehicles cheat on government emission tests. Fiat Chrysler has denied the allegations.
Gapping down
In reaction to disappointing earnings/guidance:
- N/A.
Other news:
- CTIC -15.2% (CTI BioPharma and Servier announce that the pivotal Phase III trial evaluating PIXUVRI)
- FBIO -1.9% (files $50 mln mixed securities shelf offering)
- PFPT -1.3% (announced the hiring of Klaus Oestermann for the role of President and COO)
- SU -1% (updates on Syncrude Oil Sands facility following the site wide power disruption on June 20)
- IMO -0.7% (provides update on work to restore production at Syncrude)
- IOTS -0.6% (to offer and sell $40 mln of shares of its common stock in an underwritten public)
Analyst comments:
- PG -0.6% (downgraded to Hold from Buy at Jefferies)
- OAS -0.8% (downgraded to Neutral from Positive at Susquehanna)
- AKS -0.9% (downgraded to Hold from Buy at Deutsche Bank)
- DOVA -1.1% (downgraded to Mkt Perform from Outperform at Leerink Partners)
- PETS -1.8% (downgraded to Sell from Hold at Craig Hallum)
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