The Business: Wednesday August 6 2014
Company news, markets and financial talking points, available from 8am Monday to Friday
Rupert Murdoch's 21st Century Fox has withdrawn its bid to buy American entertainment giant Time Warner for an estimated $80bn (£47bn). Fox has announced that Time Warner, which rejected its initial offer in July, had "refused to engage with us to explore an offer which was highly compelling". A merger between the two giants would have radically altered the media industry in the US and created one of the world's largest media conglomerates.
A supermarket price war and weak spending on the high street will ensure prices keep falling, says the British Retail Consortium. The overall price of items fell by 1.9% last month compared with a year ago, marking the fifteenth consecutive decline and the fastest rate of deflation since records began in 2006. The BRC says that the strong pound and “fierce competition” on the high street will ensure prices keep falling.
A stronger than expected month for Britain’s dominant services sector boosted expectations that one or more Bank of England policymakers will vote for a rise in interest rates this week. The headline index in the sector – which includes restaurants and hotels and accounts for more than three-quarters of the economy – rose to 59.1 from 57.7 in July. Experts had predicted a more modest increase to 57.9. The BOE’s monetary policy committee meets this week to discuss rates.
While Britain has enjoyed a balmy summer retailers have been setting up click-and-collect sites for this year’s Christmas shopping battle, reports The Guardian. Local shops, car parks and petrol stations are being turned into places to pick up shopping ordered online, as retailers increasingly believe that click-and-collect shopping options will be the key to winning customers this festive season. Waitrose, Argos, New Look and Sainsbury’s are among those who have arranged sites.
“He follows his own hunches, promotes his own offspring, takes huge, high risk bets, and largely ignores outside criticism in a manner which would be virtually impossible in any normal publicly quoted company.” Jeremy Warner explains in the Daily Telegraph why Rupert Murdoch’s ‘dynastic priority’ thwarted his Time Warner dream.
British chemist Boots is set to fall into American hands today, reports The Times. The retailer’s new owner, the US pharmacy chain Walgreen, has been considering its options for a full takeover of Alliance Boots since it bought 45% of the company for $6.7bn in 2012 with an option to buy the rest by 2016. Walgreen is expected to avoid the temptation of using the takeover to lower its tax rate by moving its own headquarters to Switzerland.
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