BUSINESS LIVE: Water groups reveal investment plans; YouGov agrees fresh financing

According to reports from BBC News, the chairman of John Lewis Partnership plans to step down at the end of her five-year term next year.

Sharon White is said to have told the board of Britain’s largest department store chain that she will not seek a second term.

John Lewis said last month that the turnaround would take two years longer than planned and cost more money after reporting another loss in the past six months.

Companies including Heathrow say Britain is missing out on spending from Chinese tourists returning to Europe.

Hundreds of bosses have urged the Chancellor to reintroduce a VAT-free shopping scheme.

London-listed shares are trading higher this morning, with defense company BAE Systems jumping to the top of the FTSE 100 after winning a contract to build attack submarines.

BAE Systems added 2.2 percent after Britain awarded the defense company a £4 billion contract as part of the AUKUS program with Australia and the United States to build attack submarines.

The broader aerospace and defense sector added 1 percent.

Pennon Group added 4 percent and United Utilities rose 2.3 percent after the water companies outlined their respective investment plans.

Aarin Chiekrie, equity analyst at Hargreaves Lansdown:

‘United Utilities puts its money where its mouth is. The group provides water and wastewater services in the North West of England and plans to invest a massive £13.7 billion in cleaning up its water treatment works over the 2025-2030 period, which it even describes as an ambitious and aspirational target.

‘Replacing more than 925km of pipes is no small feat, but once completed it should dramatically reduce the amount of sewage entering our rivers and seas – something that utilities have come under heavy criticism of recently in the news.

‘A huge investment like this will support around 7,000 new jobs in the North West of England, supporting more than 1 in 6 customers struggling to pay their bills.

‘But all this raises the question of where the money comes from. It appears that £1.35 billion of the money will come from issuing new shares, which will have the effect of diluting existing shareholder ownership in the company.

‘Only £4 billion will come from debt issuance and this should keep the group’s debt ratio at around 63%, towards the top end of the group’s target. This could cause problems and uncertainty for investors in the short term. But the current investment plan will increase United Utilities’ regulatory asset base by approximately 50%. Given that the revenue United Utilities is allowed to earn is based on this figure, this should help raise money in the long run.”

Polling firm YouGov has secured €280 million in new debt financing, which the company plans to use to help finance the acquisition of GfK’s Consumer Panel Business.

YouGov announced the proposed acquisition of the company, for a total purchase price of €315 million.

Alex McIntosh, Chief Financial Officer, said:

‘This new facility will provide additional financing for our proposed acquisition of GfK’s Consumer Panel Business and provide further firepower for investments in our strategic growth plan. We thank our lenders for their continued support.”

BAE Systems has received £3.95 billion in funding from the Ministry of Defense for a submarine programme.

Yesterday, Defense Secretary Grant Shapps said the money would “promote the development of the most powerful attack submarines ever operated by the Royal Navy”.

Water group Pennon and United Utilities have joined industry peers in unveiling plans for billions of pounds of infrastructure investment, amid concerns that Britons’ water bills could rise by more than £150 a year to fund the move.

Water companies have drawn up a five-year plan to prevent 140,000 sewer overflows per year.

Providers will invest £96 billion in the second half of the decade – almost double current levels – in proposals that companies say will pay for 10 new reservoirs, plug leaks and stop the equivalent of 6,800 Olympic swimming pools’ worth of sewage leaks.

Industry body Water UK said private companies have agreed to more than double the number of households that will receive financial support, by 2.0 million to 3.2 million. The sector wants to respond to public anger about sewage being pumped into beaches and rivers during storms.