COMPANY NEWS IN BRIEF
COMPANY NEWS IN BRIEF

COMPANY NEWS IN BRIEF

Phillepus Uusiku
StanChart executes ESG-based repo deal

Standard Chartered Bank said on Monday it has executed a US$250 million repurchase agreement transaction (Repo) based on ESG principles with the Saudi National Bank.

The transaction is the first in the Middle East, North Africa and Pakistan region, and among the first globally, where repo financing proceeds are allocated towards ESG assets, it said in a statement.

The Saudi National Bank, the kingdom's largest bank, will allocate the proceeds of the financing to several large renewable energy projects and green initiatives in Saudi Arabia and the wider Gulf region. The deal follows Saudi Arabia's recent pledge to cut its carbon emissions to net zero by 2060.

In September, a senior Standard Chartered executive told Reuters the bank is looking to add bankers to focus on sustainable finance, project finance and capital markets in Saudi Arabia, a market it sees will become a front-runner for its regional business in coming years.

Separately First Abu Dhabi Bank, UAE's largest bank, said it has executed a green repurchasing transaction with Deutsche Bank. -Nampa/Reuters

Shell to move headquarters to London

Royal Dutch Shell's decision to move its corporate headquarters and tax base to London may win over shareholders but it has struck a blow to Dutch prestige.

As the energy giant crosses the North Sea, it will shed "Royal Dutch" from its name, ending a link to the monarchy in the Netherlands that began when the Royal Dutch Petroleum Company was formed in 1890.

Even after a tie-up with Britain's Shell Transport and Trading Company in 1907, while the rest of the world knew the merged firm as "Shell", most Dutch still referred to it as "Koninklijke Olie" or "Royal Oil". Its formal name will now become Shell Plc if changes to the dual share structure and other plans are approved.

The Dutch government said it was "unpleasantly surprised" by the decision, as the country counts the cost of losing another Anglo-Dutch multinational to London after a similar move by consumer giant Unilever last year.

Britain, which has watched billions of euros in share trading move to Amsterdam since its departure from the European Union, called Shell's move a "vote of confidence”. -Nampa/Reuters

Spain's BBVA raises bet on Turkey

Spain’s BBVA offered on Monday to buy the rest of Garanti for up to 2.25 billion euros (US$2.6 billion), taking advantage of a slide in the lira and raising fears in Turkey that foreigners might snap up assets at bargain prices.

The cash offer to buy out the remaining 50.15% stake in Garanti for 12.20 Turkish lira (US$1.22) per share represented a premium of 15% over Friday’s market price.

The proposal means BBVA could potentially buy 51% of Garanti for less than half the 7 billion euros it spent buying up the 49.85% stake it currently holds.

BBVA, like rival Santander, is struggling to earn money from more mature markets in Europe and has been expanding in emerging markets, where it sees greater growth opportunities.

Other major foreign banks have by contrast been pulling back from Turkey. Last week UniCredit sold its remaining stake in Yapi Kredi to Kok Holding for 300 million euros.

JP Morgan said in note to clients it expected some share price weakness on the “back of the economic and political risks associated with a larger stake in Garanti”. -Nampa/Reuters

Tyson Foods sales rise

Soaring meat prices helped Tyson Foods Inc overcome pandemic-related labour shortages at its plants as the top US meat packer reported a stronger-than-expected quarterly profit on Monday and forecast improved revenue in the year ahead.

The Springdale, Arkansas-based company reported a double-digit jump in sales and earnings in the fiscal fourth-quarter ended Oct. 2, including a record quarter in its beef segment despite a 20% surge in cattle prices.

Rising meat prices and improving demand from restaurants have boosted US meat companies including Tyson after the Covid-19 pandemic kept many diners at home last year. Meat packers have also seen record demand for American beef from China and amid diplomatic tensions between Beijing and supplier Australia.

Increased costs for labour, transportation and items such as feed grain and packaging have created headaches, however.

"Inflation has clearly had an impact on the business," said CEO Donnie King. "As rates of inflation continue, so will our pricing actions."-Nampa/Reuters

Tesla's market value falls

Tesla Inc's shares tumbled again on Monday, taking the electric-car maker's market value below $1 trillion for the second time in four sessions as investors reacted to CEO Elon Musk's recent stock sales of a combined US$6.9 billion.

Shares of the company, which lost some US$187 billion in market value over the past week, were down about 4.5% at US$986 on Monday morning.

The drop below US$995.75 put the company's market value below US$1 trillion, a milestone it breached late last month after news of its largest-ever order, from car rental firm Hertz, helped fuel a sharp rally. read more

The drop comes on the heels of a Sunday dispute on Twitter between Musk, the world's richest person, and Bernie Sanders after the US senator demanded that the wealthy pay their "fair share" of taxes.

"Tesla shares have been sinking post the sale based on a Twitter poll last week. And Musk's Sunday tweet deriding a senior politician may add pressure on the stock in the coming weeks," said Kunal Sawhney, CEO of equity research firm Kalkine Group. -Nampa/Reuters

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