First thought: what do the Japanese know about pizza? Seaweed and sashimi on a skinny crust? Not what you expect from your Domino’s deliveryman.
So what a relief to find that the Domino’s being bought for £1.03 billion is only Domino Printing Sciences, an inkjet sprayer. Who cares if Japan’s Brother Industries agrees a 915p-a-share cash bid for that? Making kit to print barcodes and packaging is all very well — but no big deal, unless you plan to eat the pizza box.
True, it is another domino down from Britain’s line-up of tech companies — and one founded in 1978, employing 2,300 people in 16 countries, with roots going back to Cambridge University. And, sure, it’s thrilling that Domino’s “next generation N610i” machine is the “only full-colour digital label press that combines the productivity of flexo with the flexibility of digital printing”. Or so Domino says. Yet seeing Brother’s bid as a low-ball raid on some hidden UK industrial gem would be wrong, not least because Domino has been touting the business around for months.
Indeed, as the Domino chairman Peter Byrom spelt out, the group’s push into digital printing technology has put it up against “a new breed of competitor with significantly greater scale and financial firepower”. In other words, a business with £350 million annual sales needs a deeper-pocketed owner to compete. The only question is whether that’s Nagoya’s Brother, valued at about £2.8 billion, or some other parent.
That’s why the Domino share price reaction was so instructive. It jumped 31 per cent to 941p, implying the start of the auction, not the end. US barcoding rival Danaher, valued at $60 billion, bought the UK’s Linx Printing in 2004 and isn’t short of firepower. Then there’s Danaher’s compatriot Dover Corp, worth $11.5 billion. What, too, of the big digital printing rivals, like Epson, Konica Minolta, Xerox and Kyocera?
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Sure, you’d think Domino adviser Rothschild had already sounded out other suitors before suggesting the board recommend an offer at a skimpy 26.9 per cent premium. But who knows yet if they were simply waiting for Brother to bite?
What’s in a name?
Exciting, isn’t it? Before the week’s out, Arun Jaitley will have pitched up in London, unveiled a statue of Mahatma Gandhi in Parliament Square and met two relatively minor political figures: David Cameron and George Osborne. It’s all part of the Indian finance minister’s attempt to drum up UK investment — a charm offensive begun in his February 28 budget with his repeated assurances that “retrospective tax provisions . . . shall be avoided”. So, you do hope our leaders point out his hypocrisy. India’s tax department has hit oil group Cairn Energy with a $1.6 billion retrospective claim, dating back to 2007 — provocatively timed, too, just hours after Tuesday’s full-year results. It’s taken 15.5 per cent off Cairn’s shares.
Amendments to 2012’s Finance Act enabled India to magic up a tax claim from Cairn’s “reorganisation” before the IPO of its Indian wing in 2007. Cairn boss Simon Thompson has been telling the Indian taxman since January 2014 that no liability exists. But now, he says, they’ve simply picked “the biggest number they could have come up with”.
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It’s not how a company that’s invested $5 billion in India would expect to be treated, not least with it now owning only 10 per cent of the business in question — most of the rest sold to India’s Vedanta. To add to the aggro, since January last year India has prevented Cairn selling the rest of a holding now valued at $700 million, $300 million less than it was before the oil price collapsed.
Cairn may go to international arbitration. But, as Mr Jaitley said at his budget, disputes like this bring “a bad name to India”. Quite.
No excuses
So much for blaming the weather for a tough year. What’s your excuse if Vladimir Putin invades the country you’re working in and your key pricing benchmark, the iron ore price, dives 47 per cent to $72 a tonne? Well, none, if you’re a hard nut like Ferrexpo.
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The iron ore pellet supplier operating in Ukraine has shrugged that off to post full-year numbers showing record production and pre-tax profits down only 17 per cent to $254 million. Better it’s maintained a 13.2 cent dividend, including a 6.6 cent special. Knock-off the 3.3 cent interim divvy already paid and that makes 9.9 cents to come for shareholders on the register by March 20. That’s a yield of 11.7 per cent on shares at 56½p, up 7 per cent yesterday. All 9.9 cents will be paid by May 29 after which you could sell out. One for the brave.
Born to be wild
Are you an FWIO, a member of “the noble Fraternity of Worldwide Insecure Over-achievers”? Patrick Pichette is, and that’s why, after almost seven years as Google’s chief financial officer, he’s packing in his $5 million salary and hitting the road with his wife Tamar, who deserves “lots more”. How do we know this? Because he’s told us in an interminable blog. No wonder Google has such problems with its privacy policies.