Companies in the news ... and how they were assessed

AstraZeneca/Gilead: losing the plot

“Nothing gets the blood running” like the prospect of a “mega-merger”, said Alex Brummer in the Daily Mail. So the possibility of a £200bn tie-up between Britain’s AstraZeneca and the US drug-maker Gilead – both big players in combating Covid-19 – has had “pharma analysts in overdrive”. Ostensibly, the deal looks dandy: Gilead has been moving markets stateside, with its promising retroviral treatments, and has a $18.9bn cash-pile “waiting to be spent”. Still, cynics were quick to suggest that a merger might also “put a Bunsen burner” under Astra boss Pascal Soriot’s “personal rewards”. If so, investors weren’t playing ball this week. Mere speculation about a dreaded “transformative” deal was enough to wipe £2.5bn off AZ shares, helping to topple it from its top spot on the FTSE 100, said Nils Pratley in The Guardian. Investors had thought the future was “mapped-out and rosy”; the last thing they want is a “messy” transatlantic combo that “would probably take half a decade to integrate”. Soriot has done a brilliant job, taking AZ from “strength to strength”, said Ben Marlow in The Daily Telegraph. The company is currently at the forefront of efforts to massproduce a Covid-19 vaccine and a “potentially life-saving” antibody treatment for those already infected. This putative deal is a grandiose distraction too far. “They say don’t get high on your own supply.” Maybe Soriot “didn’t receive the memo”.

HSBC/Standard Chartered: lions and donkeys

In Hong Kong, locals sometimes refer to HSBC as the “Lion Bank” after the sculptures that adorn its HQ, said Philip Collins in The Times. After last week’s act of “craven capitulation”, it should be shamed as a lion “led by donkeys”. The bank faces a backlash, in both Hong Kong and Britain, for its decision to back Beijing’s repressive security law in the territory in defiance of the UK government’s stance. Another Londonlisted bank, Standard Chartered, is also in the cross-hairs. “There is a principle at stake here”, and putting profits before people will rebound in the long term: HSBC also has eight million customers in Britain. And Aviva issued a statement saying it was “uneasy” at the banks’ decision to support the new law. Still, there was sympathy for the banks in some quarters, said Lucy Burton in The Daily Telegraph. The last British Governor of Hong Kong, Chris Patten, accused China of using “Mafia” tactics to bully the banks into line; many analysts, noting the vital importance of China to the banks’ revenues, argued they couldn’t survive without kowtowing. HSBC investors are pinning their hopes on group chairman Mark Tucker, a long-time Hong Kong resident, known for his “political savvy”, said the FT. But this won’t be an easy dispute to navigate.

British pubs: summer saved?

The business secretary Alok Sharma told the PM last week that delays to reopening the hospitality sector could cost the country 3.5 million jobs, said The Sunday Times. “Christ!” is said to have been Boris Johnson’s reply. Hence, perhaps, reports that Britain’s hostelries could reopen to serve customers outdoors earlier than planned, on 22 June. Investors cheered the news: shares in pub groups Marston’s and Mitchells & Butlers jumped. But Downing Street’s official spokesman downplayed those reports, said Rob Davies and Heather Stewart in The Guardian, saying that the Government’s “roadmap” points to 4 July as the earliest date for reopening pubs, bars and cafés. The driving force behind the push was a group of ministers, led by Chancellor Rishi Sunak, who call themselves the “Save Summer Six”, said Cat Rutter Pooley in the FT. Heeding the “howls of airlines”, they’re also pushing for an “early end” to the quarantine restrictions imposed this week.

BASF etc: corona goodie bag

“After a little pressure”, the Bank of England has revealed which big companies have been taking advantage of its Covid corporate-lending scheme, said Larry Elliott in The Guardian. “An interesting list it is, too.” Clearly, it would be foolish to deny a company help because it is foreign-owned. Nonetheless, BASF’s position at the top of the pile has raised eyebrows. The German chemicals company took £1bn from the BoE’s “corona goodie bag”, said Alistair Osborne in The Times. That works out at nearly “£1.2m per UK staffer” for a company that paid no corporation tax in its last year. Another recipient, London-listed Chemring, which took £50m, is under investigation by the Serious Fraud Office. Meanwhile, Tottenham Hotspur FC – controlled by the billionaire tax exile Joe Lewis – “won the Corona Cup”, scooping £175m. The think tank Tax Watch wonders what “meaningful conditions” the Bank applied to borrowers. “It’s not the only one.”