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Labour and Lib Dems urge Morrisons owners to protect workers

Morrisons 

Labour and Lib Dems urge Morrisons owners to protect workers

Opposition parties have urged Morrisons’ incoming private equity owners to protect workers and ensure that the supermarket is not heaped with debt and stripped of assets as a result of the company’s pending takeover.

Politicians from Labour and the Liberal Democrats have signalled that they will be keeping an eye on US private equity firm Clayton, Dubilier & Rice (CD&R), which over the weekend won a tense auction with a rival suitor to take control of the supermarket chain for £7.1bn.

“Morrisons is a much-loved British firm which has been rooted in communities up and down the country for over 100 years,” Seema Malhotra, Labour MP and shadow minister for business and consumers, said. “The new owners must urgently deliver binding assurances for workers, pension fund holders and local people.”

“We cannot see a repetition of previous cases where businesses have been loaded with debt and asset-stripped. Morrisons is a great British company, which must be safeguarded for the future,” Maholtra added.

Unions and politicians have raised concerns over the wave of private equity takeovers aimed at UK firms, warning companies could be stripped of their property holdings and burdened with borrowed funds to pay off private equity backers, and that working conditions would deteriorate without binding guarantees.

Sarah Olney, Lib Dem MP and the party’s spokesperson for business, said: “It would be a great shame to see local teams lose their stake in the future direction of the business. With uncertain economic times ahead, the new owners must pass the key tests of not loading the business with debt, not cutting jobs, and critically, protecting existing working conditions.”

Labour has already warned it would crack down on the private equity industry if it gains power, saying it would close a loophole on carried interest, which lets private equity executives pay a lower rate of tax on their bonuses, resulting in larger payouts. Shadow chancellor Rachel Reeves said on Twitter that it would “reduce some of the tax incentives leading to asset-stripping.”

CD&R has tried to ease politicians’ fears by confirming that there were no plans to sell off Morrisons’ attractive store estate to raise cash, and promising that the company’s head office would remain in Bradford. Morrisons – which employs about 120,000 staff in the UK – owns the freehold for 85% of its 497 stores, which has been tipped as an attractive asset for any buyer. It also prides itself on its 19 manufacturing sites including bakeries, abattoirs, fishing fleets and egg farms.

But CD&R has also reached a deal with pension trustees to provide additional security and support for the scheme in a move that helped the private equity firm clinch backing from the Morrisons board even before the takeover went to auction.

The private equity firm, which narrowly beat the 286p offer by a consortium led by Softbank-owned Fortress Investment Group with a 287p bid on Saturday, has also expressed support for Morrisons’ recent pay award of at least £10 an hour for all workers in stores and manufacturing sites.

A CD&R spokesperson said: CD&R values Morrisons’ distinctive business model and is committed to supporting it, including the successful ESG [environmental, social, and governance] and broader stakeholder engagement strategies of the company that are essential to its continued success.”

But Maholtra said the UK government had a responsibility to hold CD&R to its promises. “It must ensure that the new owners are responsible, long-term investors, seeking to build the business for the future and that decisions taken are also in the public interest.”

CD&R’s offer, which has been backed by the Morrisons board, will go to a shareholder vote on 19 October.

Business

Adopting CNG can reduce Nigeria’s inflation – FG

The Nigerian government has said that successfully adopting Compressed Natural Gas can reduce inflation, which soared to 33.69 per cent in April 2024.

The Programme Director of the Presidential Initiative on Compressed Natural Gas, Pi-CNG, Michael Oluwagbemi, disclosed this during a one-day South-South and South-East stakeholders’ engagement meeting in Port Harcourt, Rivers State.

He noted that Nigerians can realize between 40 to 50 per cent savings from petrol upon adopting CNG.

“It can reduce inflation. It is cheaper. You can realize between 40% and 50% savings from patrol. This is good for Nigeria, and it is safer.

“It is 18 times safer than petrol and diesel. It is cleaner and safer for the environment,” he said.

He added that Nigeria would save about $2.5 billion by converting every one million vehicles to CNG.

Recall that President Bola Ahmed Tinubu asked all federal government ministries, departments and agencies to procure CNG buses.

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Business

Nigeria won’t need to import fuel by June — Dangote

Aliko Dangote, Chairman of the Dangote Group, announced that by next month, Nigeria will no longer need to import gasoline due to the operational plans of the Dangote Refinery.

Speaking as a panellist at the Africa CEO Forum Annual Summit in Kigali, Dangote highlighted that the refinery, which has already commenced supplying diesel and aviation fuel in Nigeria, has the capacity to fulfil the diesel and petrol needs of West Africa and the aviation fuel requirements for the entire African continent.

Dangote emphasised, “Right now, Nigeria has no cause to import anything apart from gasoline, and by sometime in June, within the next four or five weeks, Nigeria shouldn’t import anything like gasoline; not one drop of a litre.”

Highlighting how far the oil company has come, Dangote expressed how they are focused on ensuring that the continent will depend less on imports in the near future.

“We have enough gasoline to give to at least the entire West Africa, and diesel to give to West Africa and Central Africa. We have enough aviation fuel to give to the entire continent and also export some to Brazil and Mexico,” he said.

“Today, our polypropylene and our polyethene will meet the entire demand of Africa, and we are doing base oil, which is like engine oil; we are doing linear benzyl, which is a raw material to produce detergent. We have 1.4 billion people in the population; nobody is producing that in Africa.

“So, all the raw materials for our detergents are imported. We are producing that raw material to make Africa self-sufficient.

“As I said, give us three or a maximum of four years, and Africa will not, I repeat, not import any more fertiliser from anywhere.

“We will make Africa self-sufficient in potash, phosphate, and urea; we are at three million metric tonnes, and in the next twenty months, we will be at six million metric tonnes of urea, which is the entire capacity of Egypt. We are getting there.”

Dangote recalled how his dream for further investment in Africa as well as ending fuel importation in Africa has culminated in what is now one of the biggest refineries in the world.

“For some of us, despite the boom of the capital market in the US—you know, Google, Microsoft, and the rest—we didn’t participate; we took all our money and invested in Africa.

“We had this dream just about five years ago, and we said we wanted to move from five billion dollars in revenue to thirty billion dollars in revenue, and we made it happen. It is possible and now we have made it happen and now we have finished our refinery.

“Our refinery is quite big; it is something that we believe that Africa needs. If you look at the whole continent, there are only two countries that don’t import petroleum products, which is a tragedy.

“They are only Algeria and Libya. The rest are all importers. So, we need to change and make sure that we don’t just go and produce raw materials; we should also produce finished products and create jobs.

Speaking further, the African richest man said, “One of the things we also need to know as Africans is that we produce raw materials and export them when you export raw materials and somebody now keeps importing things into your continent and dumping goods. what you are importing is poverty and exporting jobs. So, we have to change that narrative.”

“We just commissioned in February, and now we are producing jet fuel, diesel, and by next month, gasoline.

“What that would do is that we would be taking most of the African crude that is being produced and also be able to supply not only Nigeria because our capacity is too big for Nigeria, but it would also supply West Africa, Central Africa, and also South Africa.

“We have 650,000 barrels per day, 1 million metric tonnes of polypropylene, and 590,000 metric tonnes of carbon black; those are the raw materials—ink, dyes and co.

“We are expanding more. This is the first phase and we are going out to the next phase, which will start early next year.”(tribune)

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Business

Customs FX rate for import duties rises to N1,530/$

The foreign exchange (FX) rate for import duties has been adjusted by the Nigeria Customs Service (NCS) to N1,530 per dollar.

This was adopted on Friday, May 17, representing a 6.13 percent increase compared to the N1,441.58 adopted on May 6.

The NCS always adopts FX rates recommended by the Central Bank of Nigeria (CBN) for import duties based on trading activities in the official FX market

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