FirstFT: KKR steps up pursuit of UK companies

KKR is expanding its operations to target more takeovers in the UK, as the record-breaking pursuit of British companies by private equity firms reignites a debate over the role of the buyout industry in the economy.

One of the world’s largest private equity firms will set up a team of five dealmakers to focus on buying British companies, the heads of its European buyouts business said in an interview with the Financial Times.

There will be “dedicated people covering the UK proactively as a main job”, said Mattia Caprioli, co-head of KKR’s European private equity business. Its London staff are moving to a larger office in Mayfair’s Hanover Square.

Brexit and Covid-19 have depressed valuations in the UK, prompting private equity firms to snap up companies at the fastest pace in history.

Five more stories in the news

1. EU global tax deal wrangle Brussels is working to overcome resistance from three member states to last week’s international agreement to rewrite corporate tax rules, with Hungary and Estonia arguing that the proposal may even break EU law.

  • Opinion: let us not be too curmudgeonly — the agreement to reform international corporate taxation is a big moment, writes Martin Sandbu. But it also left fertile ground for new and clever techniques to circumvent the rules. For more, subscribe to Free Lunch, the FT’s weekly newsletter on global economic policy.

2. LGIM warns on private equity buying Morrisons The UK’s largest asset manager has warned that firms must not be allowed to acquire Wm Morrison for the “wrong reasons”, such as profiting from the supermarket chain’s property portfolio or “levering the company up with debt”.

3. China targets more tech groups Beijing has broadened a crackdown on tech platforms, targeting more US-listed Chinese companies after ordering the removal of ride-sharing group Didi Chuxing from domestic app stores. Separately, a co-ordinated attempt by Chinese tech companies to circumvent Apple’s privacy policies has been forestalled.

4. Barclays blocks UK payments to Binance The London-based bank has prohibited customers from transferring funds to Binance after the Financial Conduct Authority last month said the digital asset exchange was not authorised to undertake crypto business within UK borders. Barclays added that customers would not be blocked from withdrawing funds.

5. JPMorgan’s buying spree America’s biggest bank by assets has made more than 30 acquisitions in 2021, putting it on track for its largest buying spree in years. The acquisitions, mostly for smaller companies, are a sign of how chief executive Jamie Dimon is turning to deals to grow the banking giant.

Column chart of Number of deals showing JPMorgan acquisition spree looks set to eclipse previous years

Coronavirus digest

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The day ahead

UK borders bill Priti Patel, UK home secretary, said that the contentious legislation due to be published today, which is intended to eliminate clandestine Channel crossings by people seeking asylum, would help fix the “broken asylum system”.

  • Elsewhere in Whitehall: Gavin Williamson, education secretary, will announce the scrapping of the “school bubble” system of self-isolation.

Cannes Film Festival The storied film festival kicks off after being cancelled in 2020 owing to the pandemic. Spike Lee will serve as head of the festival’s jury. (Guardian)

Jacob Zuma hearing As South Africa’s former president launches legal challenges to avoid imprisonment, his lawyers have asked a lower court to interdict the jail sentence, with a hearing set for today — indicating that he will not be arrested until tomorrow at the earliest.

Economic data Eurostat has retail sales figures. Buoyant readings are expected from the Zew survey of investors. In the US, economists expect the services purchasing managers’ index for June to weaken; the Census Bureau is due to publish monthly motor vehicle sales data.

  • Companies: Ocado has half-year earnings out, J Sainsbury has a trading update for the first quarter and Marks and Spencer holds its annual meeting. (FT, WSJ)

Keep up with the important business, economic and political stories in the coming days with the FT’s revamped Week Ahead newsletter. Subscribe here. And don’t miss our FT News Briefing audio show — a short daily rundown of the top global stories.

What else we’re reading and listening to

Cashing in on Big Oil’s push to net zero One company’s transition away from fossil fuels is another’s opportunity to double down. Under intense pressure to take action on climate change, the world’s biggest oil and gas companies are putting billions of dollars’ worth of assets up for sale.

  • Oil prices jumped to the highest level since 2018 after Opec and its allies abandoned a decision over increasing oil production.

  • More energy news: Mexico has awarded control of one of the country’s biggest oil discoveries to state-owned Pemex, a blow to private investment that could prompt international litigation.

The end of EU migration will reshape the UK economy We are only learning how big a deal European migration was for the UK as we are confronted by life without it, writes Sarah O’Connor. In meat processing, where EU workers account for more than 60 per cent of staff, employers are complaining of acute labour shortages.

Tech Tonic podcast: trust me, I’m a robot What does it mean for artificial intelligence to augment human perception? In the latest episode of Tech Tonic, Madhumita Murgia takes us to a village in rural India where AI is being used to help doctors diagnose tuberculosis.

Swiss green energy dreams freeze Switzerland has long basked in its reputation for clean energy. But a complex regulatory process and local objections to potential eyesores have put one of the world’s wealthiest and most environmentally conscious societies in danger of moving backwards on renewable energy.

The internet wants to watch you eat Watching strangers eat is one of the weirder spectacles on the internet — simultaneously gross and mesmerising. If that sounds unappealing, it will come as a surprise to hear how popular the trend is, writes Elaine Moore.

Videos with the hashtag ‘whatieatinaday’ have been viewed more than 7bn times on TikTok © Pate

Work & Careers

Caffeine regimens and email headings are among the chirpier personal productivity hacks that have faded during the pandemic, with many workers struggling as the lines between the professional and personal blur. Here are some healthy habits to boost productivity.

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