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Johnson takes Risk on purchase of online gardening retailer Primrose | Business News

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One of the country’s most prominent entrepreneurs is placing a bet on green-fingered Britons by buying a major online gardening products retailer.

Sky News understands that Risk Capital Partners, which is headed by Luke Johnson, has agreed the purchase of Primrose.co.uk.

Sources said the deal had been structured involving a pre-pack administration of Primrose’s parent company, with its operating subsidiary sold as a going concern.

The deal is Mr Johnson’s first since buying the tenpin bowling group All Star Lanes, which like much of Risk’s consumer-focused portfolio has been affected by the coronavirus pandemic.

Primrose has 20 million registered customers in the UK and Europe.

The company was launched in 2003 from a base in Reading, Berkshire, and sold a majority stake to Rockpool Investments, a private equity firm, in 2018.

Sales are understood to have surged this year with garden centres forced to close for large chunks of the pandemic.

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Online garden centres are among those to have witnessed strong demand during the pandemic. File pic

The reason why an insolvency process became necessary – against that backdrop of improved sales – was unclear on Thursday.

Sources said the pre-pack had been undertaken by FRP Advisory after Cavendish Corporate Finance was appointed during the summer to run a sale process for Primrose.

Earlier this year, Mr Johnson’s firm sold the swimwear brand Zoggs, while Risk Capital is also an investor in businesses such as the parent company of Gail’s, the chain of bakeries.

Mr Johnson, a former chairman of Channel 4 and current columnist for The Sunday Times, has been resuming his investment activity since being rocked by a massive fraud at Patisserie Valerie’s parent company last year.

“The Board of Directors of Meika Ltd, trading as Primrose, is pleased to confirm that…the company was acquired by Risk Capital Partners.

“The acquisition was completed via a solvent share sale and Primrose will continue to trade as normal.

“Following this transaction there is no external bank debt within the new group structure,” the company said.

It added that the deal would bring new investment, “which will enable it to further capitalise on the significant growth the company is experiencing at present, following the launch of its new plant and garden product categories and the general growth in online sales”.

Mr Johnson said: “We are very pleased to back the Primrose management to take advantage of the significant opportunities in online sales in the gardening sector.

“The business is well positioned to play an active part in the consolidation of a fragmented sector.”

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Reddit forum’s role in Gamestop shares frenzy faces regulatory probe | Business News

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Janet Yellen, U.S. President-elect Joe Biden's nominee to be treasury secretary, speaks as Biden announces nominees and appointees to serve on his economic policy team at his transition headquarters in Wilmington, Delaware

US financial market regulators are to review the extraordinary rallies in the shares of struggling gaming retailer Gamestop, part-driven by participants of an investor forum on Reddit.

The Securities and Exchange Commission said it was working with fellow regulators to “assess the situation and review the activities of regulated entities, financial intermediaries, and other market participants”.

The action reflects deep and widespread concern over the functioning of financial markets.

Gamestop shares were up by 1,744% in the year to date – with a market value above $20bn – at the close of trading on Wednesday night.

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The share frenzy has attracted White House scrutiny as treasury secretary Janet Yellen monitors developments

The value boom of the past week has created more than $2bn in personal wealth for its three largest individual shareholders, whose holdings have not increased during the frenzy.

The staggering leap represents a victory for retail investors over hedge fund short-sellers, who are nursing heavy losses, as markets witness a boom in amateur stock trading.

Millions of Americans have taken advantage of zero-commission trading platforms during the coronavirus crisis – often using social media forums to discuss opportunities.

The value surge has not been restricted to Gamestop.

Its shares, and those of other firms including BlackBerry and AMC Entertainment, fell by more than 20% in extended trading when it emerged that Reddit had temporarily closed the Wallstreetbets chat room.

The volatility prompted widespread calls for scrutiny of trading fuelled by anonymous social media posts. Reddit said it had not been contacted by any authorities in relation to users’ behaviour.

A woman wears a mask as she walks past a GameStop store in Des Plaines, Ill., Thursday, Oct. 15, 2020. GameStop is closing more stores than it originally planned, with the struggling retailer warning of more closures next year. (AP Photo/Nam Y. Huh)
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The company’s own announcements have been seen to have played no role in the meteoric rise in its stock

Wider market falls in recent days have been blamed on hedge funds selling positions to pay for losses shorting Gamestop.

Wednesday’s session saw the main indexes on Wall St lose more than 2% and futures indicate further turbulence ahead.

Even the new US treasury secretary, Janet Yellen, said she was “monitoring the situation” while a state regulator has called for Gamestop shares to be suspended for 30 days to allow a cooling off period.

Technology investor Chamath Palihapitiya told Sky’s sister channel CNBC: “We are moving to a world where ordinary folk have the same access as professionals and can come to the same conclusion or maybe the opposite.

“The solution is more transparency on the institutional side, not less access for retail.”

In Gamestop’s case, it has been shuttering stores for years in a tough retail landscape and market analysts have likened the stock interest – driven purely by retail investors – to a pyramid scheme.

Nasdaq chief Adena Friedman said: “If we see a significant rise in the chatter on social media … and we also match that up against unusual trading activity, we will potentially halt that stock to allow ourselves to investigate the situation.”

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EasyJet warns of lockdown drag but sees pent-up demand on horizon

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EasyJet warns of lockdown drag but sees pent-up demand on horizon

EasyJet has warned it expects to fly just 10% of normal services in its current financial quarter as coronavirus crisis restrictions continue to take a toll on travel.

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Tesla posts first profit after stellar year for electric car maker | Business News

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Elon Musk

Tesla has posted its first ever annual profit capping a stellar year in which its surging share price have seen it become the world’s most valuable car maker.

The electric vehicle firm, led by Elon Musk, reported a profit of $721m for 2020 compared to a loss of $862m a year earlier.

However there was disappointment for investors as the company’s fourth quarter earnings fell short of expectations, sending shares 4% lower in after-hours trading.

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Elon Musk is Tesla’s boss

The stock has surged by 700% in the past 12 months, taking the company’s value to more than $800bn and surpassing Toyota.

Tesla’s bottom line for the year was boosted by $1.58bn worth of environmental regulatory credits, which it is able to sell to other less environmentally-friendly car makers – and without these it would have remained in the red.

Still, its delivery of more than 180,000 vehicles during the fourth quarter was a record, though it narrowly missed a target to ship 500,000 for the year as a whole.

Total revenues for the year rose 28% to $31.5bn.

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