Companies in the news ... and how they were assessed
Eve Sleep: mistress of mattresses?
High achievers, from Margaret Thatcher to Donald Trump, have traditionally viewed sleep as “no more than an irritation in a productive day”, said The Times. But achieving the right kind of shut-eye is suddenly cool, and companies are queuing up to exploit the new craze for “smart sleep”. The latest to benefit from the big money being pumped into memory foam is Eve Sleep – a two-year-old online mattress seller, which was valued at a “bullish” £140m when it floated on Aim this week. That’s quite a multiple of last year’s £11.3m losses, or even its £12m sales, yet big backers, including Standard Life, Hargreave Hale and the veteran fund manager Neil Woodford, have all piled in. Eve claims to sell “the world’s most comfortable mattresses”, and bills itself as a disrupter in the traditional mattress market, with access to a £26bn European “sleep market”, said Christopher Williams in The Daily Telegraph. Even so, “the odds are against” it. Most of us only buy a new mattress once a decade, and Eve is just “one of a pile” of venture capital-funded firms (Casper, Simba, Tuft & Needle…) now flogging them online. “There are probably better places to put your money. Under a mattress, for instance.”
JP Morgan: the lure of the Liffey
In the run-up to last year’s Brexit vote, JP Morgan boss Jamie Dimon stood alongside the then chancellor, George Osborne, to warn that up to 4,000 roles could be lost. The s125m purchase of a new building in Dublin’s swanky docklands development brings him closer to making good on his “threat”, said Jill Treanor in The Guardian. The Wall Street bank, which currently employs around 500 people in Dublin, will have room to house 1,000 staff, and plans a big expansion of its “custody operations” in the city. The move has been cheered in Ireland as the first fruit of Dublin’s “major campaign” to attract financial firms in the wake of Brexit, said Conor Humphries in The Independent. Citigroup and Credit Suisse have also indicated they will increase their presence, while the Australian financial giant Macquarie is thought to be applying for a full Irish banking licence. “Overall, Brexit is expected to have a negative effect on the Irish economy,” said John Walsh in The Times. But Dublin’s growing lure as a financial centre sweetens the pill. As the Irish PM, Enda Kenny, observed this week: “I’m quite happy that we’re going to gain substantial business from what was an unwanted decision in the first place.”
Lloyds: private concern
The Labour manifesto has thrust the concept of state-owned industries back onto the news agenda, said Simon Goodley in The Observer. With nice timing, the Government chose this week to withdraw completely “from one of its most infamous investments”. After spending £20bn-plus on a 43% stake in 2008-09, the Treasury has finally sold its last few shares in Lloyds Banking Group. The move ends “one of the largest bailouts of the financial crisis” and marks “a historic moment for the banking sector”, said Emma Dunkley in the FT. Investors lauded the “symbolic” reprivatisation, noting that “the removal of a forced seller” should ease “some of the pressure on the share price”. The then government began divesting its stake in Lloyds in 2013-14 by selling chunks to institutions, and later “drip-feeding” shares into the market. It was an “efficient” job, resulting in a £500m profit for taxpayers, said Nils Pratley in The Guardian – though doubtless there would have been “better ways to invest £20bn”. What a contrast to the fate of RBS – still 72% backed by the Government and likely to be sold at a sizeable loss.
Saudi Aramco: selling the chicken
Stock exchanges around the world are “vying for a piece” of Saudi Aramco’s initial public offering – touted as “the largest in history”, said Reuters. The Saudi state oil giant is expected to list on the Riyadh Exchange and at least one other major international bourse in 2018. London has been “pushing hard” to land the business: the London Stock Exchange is working on a controversial new listing model to enable the company “to avoid the most onerous corporate governance requirements”. The Saudi deputy crown prince, Mohammed bin Salman, hopes to raise $100bn from the sale of a 5% stake in Aramco, said Simeon Kerr in the FT. The sale is “core” to his plan “to push through bold reforms intended to overhaul Saudi’s oil-dependent economy”, but it has prompted “an outpouring” of local discontent. Saudis, who often liken Aramco to “a fat cow or productive hen”, regard it as a guarantor of future well-being. Few dare speak openly, but the hashtag “Mohammed has sold the chicken” has been trending on Twitter…