Unilever Reject Kraft’s Advances

Friday, 17th February: A relatively quiet start to the day in terms of news, but the ever reliable Office for National Statistics (ONS) released UK retail figures for January. The data revealed another dip in consumer spending, following on from December’s fall. Retail sales volumes fell 0.3% month-on-month, much lower than the 0.9% rise expected. Compared to a year earlier sales were up 1.5%, the weakest performance since November 2013. The pound once again dropped following the data release; GBP/USD is currently -0.55% at $1.24.

If anyone clocked off early this Friday, Unilever (remember they fell out with Tesco last year over the price of Marmite) has turned down a takeover offer from Kraft Heinz. Kraft Heinz, who make, if you hadn’t guessed, Heinz beans and ketchup (amongst other things) has offered $50 per share, made up of $30.23 in cash and the remainder in the new combined group. However Unilever claim the $143bn (£115bn) offer is significantly undervalued in terms of its share price. It continued to say it “sees no merit, either financial or strategic” for its shareholders. And with that it says there is no need for any further discussion. Unilever jumped to more than £38 a share (opening at £33.60) and has closed +13.43%.

If you are a driver in London then be prepared for a new vehicle pollution tax, the “T-charge”, to be introduced in October. It is hoped the £10 daily tax applicable to diesel and petrol vehicles registered before 2006 will help improve air quality. The charge will be implemented between 7am-6pm weekdays, just like the £11.50 congestion charge in central London.

The blue chip index recovered from yesterday’s slight loss to finish the day +0.30%. The index is +2.72% month-to-date. The more domestically focused FTSE 250 is up in similar fashion: +2.56% month-to-date. After a turbulent week, suffering from numerous data releases, GBP/USD is down c.2% for the month, GBP/EUR suffering less so.