Business News

A huge distribution warehouse used by national retailer Superdrug has been sold in a £17.25m deal. The 296,500 sqft property at South Elmsall has been sold by a client of global asset management group Columbia Threadneedle Investments to Arrow Capital Partners, an Australian investor, developer and manager of real estate in Europe and Asia. It will become part of Arrow’s €3bn Strategic Industrial Real Estate (SIRE) joint venture with US private equity firm Cerberus. The warehouse is on an 18-acre site and is let to Superdrug Stores Plc until December 2025. The health and beauty retailer has used the site for almost 34 years since it was built. Read more: Big name shareholders refused to bail out collapsed Tenet Group, documents show Read more: Drax Group hails full year outlook as £300m share buyback introduced Daniel Walker, from GV&Co, said: “This is a high quality, mission-critical asset located close to the A1M, as well as offering easy access to the M62 and M1, making it an integral part of Superdrug’s distribution network. We are delighted to have secured the off-market sale to Arrow and complete the final part of our client’s asset management strategy for the property.” Robert Howe, head of real estate, Europe, at Arrow Capital Partners, said: “This transaction reflects our ongoing commitment to acquire mission-critical assets offering strong reversionary potential for our SIRE joint venture. Our focus remains on identifying and acquiring standing investment and development opportunities that offer strong potential for value creation and sustainable returns for our investors.” Arrow’s SIRE joint venture was launched in 2019 to established a portfolio of European industrial and logistics properties. Earlier this year the joint venture announced plans to develop a 328,000 sqft logistics scheme near Bolton comprising two units of 107,500 sq ft and 220,250 sq ft. Arrow said the scheme will be a modern logistics development with enhanced sustainability measures in a “highly desirable industrial location”. Original artice – https://business-live.co.uk/all-about/yorkshire-humber

Power business Drax Group has reported a rise in operating profits and announced a £300m share buyback to start later this year. Half year results for the Selby power station operator show growth in adjusted operating profits to £402m, compared with £308m in the first half of 2023. Full year results for the business are expected to be at the top end of analysts’ estimates of between £881m-£996m. Biomass power generation was seven terawatt hours – around a 32% increase on the 5.3 terawatt hours achieved in the first half of 2023. And at July 22 the group had about £3.1bn of forward power sales between 2024 and 2026 on RO biomass, pumped storage and hydro generation assets. Read more: Anglo American reports $1.6bn impairment on Woodsmith Mine slowdown Read more: Harworth hails progress on ambitious targets amid strong half year sales Drax said it had boosted biomass pellet production to two million tonnes, up from 1.9 million tonnes in the same period last year – and now with an improved margin. Expansion of the group’s US pellet plant at Aliceville was also commissioned during the first half. Across the firm’s Energy Solutions business, adjusted Ebitda was down 35% to £22m. In June Drax sold about 90,000 customer meter points to EDF, from its SME business, which was loss making at Ebitda level. Group CEO Will Gardiner called on the Government to provide clarity on subsidies, which Drax needs to support its ambitious bioenergy and carbon capture and storage (BECCS). Mr Gardiner said further certainty on a bridging mechanism is needed to “give us the market signals and certainty required to invest”, pointing to delays in the previous Government’s plans. Mr Gardiner said: “Drax has delivered a strong operational performance, playing an important role supporting the UK energy system with dispatchable, renewable power, keeping the lights on for millions of homes and businesses, while supporting thousands of jobs throughout our supply chain. As well as celebrating 50 years of operations in 2024, we are excited about the opportunities for Drax Power Station, including bioenergy with carbon capture and storage (BECCS). “Both the National Grid ESO and the UK’s Climate Change Committee have recently reiterated that BECCS is important for the UK to achieve its decarbonisation goals. We look forward to working with the new UK Government to help grow the economy and take steps urgently to deliver a net zero electricity system by 2030. “We believe that Drax and our partners across the Humber and Scotland can accelerate growth, create thousands of new jobs and channel billions in private investment into carbon capture and green energy projects, subject to the right government policies to support regional development plans. Outside of the UK, through our plans for global BECCS, we are continuing to develop opportunities to provide long-term, large-scale carbon removals and attractive opportunities for growth as part of a potentially trillion-dollar market.” This week Drax’s board agreed an interim dividend of 10.4p per share, to be paid in October. Original artice – https://business-live.co.uk/all-about/yorkshire-humber

Big name shareholders of financial advice support network Tenet Group declined to stump up funds to avoid its collapse earlier this year, it has emerged. Administrators were called in to the Leeds-based provider of regulatory and support services to financial advisors in June amid a winding down of the business that revealed solvency issues. The £121m revenue business had incurred substantial losses in recent years and faced issues surrounding FCA-led redress for advice around transfers of defined benefit pensions provided to members of the British Steel Pension Scheme. New information from insolvency experts at Interpath shows that additional funding was sought from shareholders Aviva Group, abrdn plc and Aegon plc in March this year, in order to achieve a solvent wind down of the business. But that call was declined, plunging Tenet Group and several subsidiaries into administration and prompting nearly 100 job losses. Read more: Anglo American reports $1.6bn impairment on Woodsmith Mine slowdown Read more: Yorkshire Building Society grows mortgage and savings books amid ‘cautious optimism’ about economy Interpath says unsecured creditors are expected to receive a dividend, contingent on money recovered. A summary of liabilities shows the group has a deficit of £10.1m Prior to the move, two Tenet Group businesses – mortgage services outfit TenetLime Limited and Tenet & You – were sold to LSL Property Services and and My Pension Expert respectively. However, the administrators say LSL Property Services is disputing two sums of £48,566 and £21,551 said to be due to Tenet under a transitional services agreement due to TenetLime’s inability to meet certain obligations. Interpath said it is still in discussion with LSL about what services can be provided by TenetLime and the amounts to be paid. Together with value to be realised from the group’s insurance subsidiary Paragon, which continues to be solvent and is not in administration, Interpath says there is estimated to be more than £10m of deferred consideration balances from those sales to be realised. Original artice – https://business-live.co.uk/all-about/yorkshire-humber

Mortgage lending and savings balances at Yorkshire Building Society have grown despite competition and an increase in mortgage arrears. Bosses said that while there was cause for cautious optimism about the UK economy, household finances for many remain more strained than they once were, and would-be home owners still face borrowing costs much higher than a few years ago. That came as gross mortgage lending was £5.2bn in the first six months of the year, up from £4.2m last year, and savings increased by £2.6bn to £50.3m, growing more slowly than the first half of last year which saw a £3.7bn increase. Half year results for the mutual to the end of June also show core operating profits were £149.2m, down from £246.4m at the same point in 2023. Statutory pre-tax profit was reported at £158.1m, compared with £180.6m in the first half of last year. Read more: South Yorkshire tech firm FinLegal seals £2m investment to trigger job creation Read more: Anglo American reports $1.6bn impairment on Woodsmith Mine slowdown Net interest income was £340.8m across the six months, a decrease on the £417.2m seen in the first half of last year. Repricing of mortgage and savings books, particularly the maturity of mortgage written in 2021, was given as the reason. The listed mutual pointed to signs that inflationary pressures of recent years were easing. It said if and when the Bank of England begins to loosen monetary policy, there would be challenges and opportunities including boosted consumer confidence amid lower living and borrowing costs but savers facing less attractive returns. Susan Allen, Yorkshire Building Society chief executive, said: “Our core markets of mortgages and savings continue to be influenced by external factors, including the interest rate environment and the intensity of competition. The level of demand in the mortgages market has been stronger than expected in 2024 so far, and house prices have proven more resilient than some previous expectations. “Coupled with the larger application pipeline as we entered 2024, the Society’s gross mortgage lending in the period increased, reaching £5.2bn (2023 H1: £4.2bn); net lending also increased, to £2bn (2023 H1: £700m). In line with the more challenging economic environment, we have observed an increase in the level of mortgage arrears, though levels remain significantly more favourable than the industry average (0.49% at 30 June 2024 vs. industry average 0.97%). We will continue to offer support for our members who are experiencing difficulty in meeting their repayments.” Original artice – https://business-live.co.uk/all-about/yorkshire-humber

A decision to significantly slow down construction of the Woodsmith Mine in North Yorkshire has caused its owner to report a $1.6bn (£1.2bn) impairment, and fed losses. In May, Anglo American announced it would significantly dial down development of the fertiliser mine which it took over in 2020 amid a push to deleverage its balance sheet. The decision, which has prompted job losses, is now revealed to have contributed to a £700m loss attributable to equity shareholders of the global mining giant, which says it still hopes to exploit the polyhalite deposits under the North York Moors in the future. Half year results for Anglo also show restructuring costs across the group of $300m (£232m) as part of a “change programme” designed to make the business more agile and profitable in the wake of a rejected takeover offer from larger rival BHP. Read more: Harworth hails progress on ambitious targets amid strong half year sales Go here to read the latest climate agenda news This year’s forecast capital expenditure on the Woodsmith project is still around $900m (£698m), with $500m (£388m) of that already spent in the half year to the end of June. But spending is expected to come down significantly to about $200m (£155m) next year and nothing in 2026. Anglo bosses said a detailed review of the project had identified where it can preserve progress “ready for ramp-up when conditions allow”. Sinking of the mine’s service shaft is expected to continue while activity on the production shaft has been halted. And boring of the 37km tunnel, which will connect the mine site near Whitby and Redcar where the fertiliser product will be processed and shipped worldwide, has been significantly slowed down. Anglo has said its crop nutrients business, of which Woodsmith is the main component, is still strategically important. It is now looking for syndication partners to bring into the project. The company’s chief executive, Duncan Wanblad, said he had been encouraged by a strong operational performance and that Anglo had been “moving at pace” to create a more agile and profitable business. He added: “Our decision to temporarily slowdown the Woodsmith crop nutrients project and thereby push out its production timing has resulted in a $1.6bn impairment of the project. As we progress our portfolio transformation, we expect to substantially reduce our overhead and other non-operational costs in phases, but weighted towards the end of the process to minimise business risk. “We are transforming Anglo American by focusing on our world-class asset base in copper, premium iron ore and crop nutrients, thereby accelerating the recognition of value inherent in our business. From that compelling platform, I believe our proven project delivery capabilities, global relationship networks and longstanding reputation as a responsible mining company will together help us unlock the outstanding mineral endowment options within our portfolio and other growth opportunities that we will aim to secure over time. “We have taken clear and decisive action to deliver value in the long term interests of our shareholders and other stakeholders, from a portfolio that will deliver the products that underpin the energy transition, improving global living standards and food security.” Original artice – https://business-live.co.uk/all-about/yorkshire-humber

Development company Harworth Group says it is on track to meet two key targets, including growing its investment portfolio to £900m in the next five years. Half year results for the Yorkshire-based land and regeneration specialist include the expectation it will reach £1bn EPRA net disposal value – a key industry measure of performance – by the end of 2027. The listed group said it has already either completed, exchanged, or agreed heads of terms on the 86% of its budgeted sales for the year – excluding the £106.6m deal struck with Microsoft at the former Skelton Grange power station site. Harworth said it had largely reinvested the proceeds from those sales into its core industrial and logistics development programme. Its portfolio of those developments grew to 5.9million sqft, up from 4.6million sqft at the end of 2023. All of the group’s 83,000 sqft of industrial and logistics space completed in the past year has been let, exchanged or in heads of terms. Read more: Humber modular building firm creates cells to solve prisons overcrowding Read more: Grainger buys Manchester housing development The Astley scheme in £31m deal In addition it has secured planning permission for 1.8million sqft and 500 plots, including Gascoigne Wood and Hale Gate Road, and up to a further 1.5million sqft and 150 plots post period end. It also has new draft allocations or allocations in local plans for 5.7million sqft and 2,875 plots. Lynda Shillaw, chief executive of Harworth Group, said: “Harworth has continued to deliver against its growth strategy to reach £1bn EPRA NDV by the end of 2027 and we recently announced our intention to grow the investment portfolio to £900m by the end of 2029. This growth will largely be driven by our existing industrial and logistics pipeline, which now totals 38.8 million sqft and will see the delivery of strategically positioned Grade A assets we intend to retain and hold. “This has been another strong first half for planning approvals and land sales, the highlight being the exchange of contracts on a £107m serviced land sale to Microsoft at a significant premium to book value, our largest transaction to date. We continue to see strong demand for Harworth’s serviced land and employment spaces, with the recent momentum in serviced land sales highlighting the strength of our markets and these sales provide a stable funding channel for our industrial and logistics development programme. “The recently announced evolution of our strategy sets a clear direction for the group. It reflects our strong conviction in the demand for industrial and logistics space in our regions which is underpinned by limited supply, and our ability to unlock the significant embedded value in our extensive development pipeline to meet our growth targets.” Original artice – https://business-live.co.uk/all-about/yorkshire-humber

A Hull climbing centre Rockcity is set to expand its operation in its home city, while also going for gold at the Paris Olympic Games. Rockcity, which marks 30 years of trading this year, has been selected to provide 600 holds for the competition climbing walls at the Games, which launch this Friday, July 26. The award is the latest global success for Rockcity, which also provided the holds for the Olympic climbing qualifiers in Shanghai, China, and Budapest, Hungary, as well as the last Games in Tokyo in 2020, when competition climbing made its debut. Now, Rockcity is planning to expand by launching a new climbing hold manufacturing factory in the city. At present, it designs all of its own holds but has to outsource the manufacturing to companies across the world. Opening a new £400,000 facility next to its climbing centre would allow it to bring the whole process in-house. Managing director Mark English said: “It’s fantastic that a small business in Hull has the expertise to be able to influence the Olympic Games. It’s such a high-profile event to be a part of, and it’s brilliant for our profile. We’ve developed as a business over time, and we’ve always been interested in the design of the climbing holds. We make them from polyurethane, which enables you to have incredible detail and thin holds that would break if they were made from different material. “They’re excellent for competition climbing because they allow the route setters to make changes to the climbs that really force movement. Climbing is one of the very few sports where the field of play is deliberately changed. It’s manipulated to confuse the participants. That’s why these holds are so important.” The company is now applying for £120,000 from the Growing Places Fund, with support from Hull City Council’s business advisors, towards the development of the new factory. The new 10,000 sqft facility, which will create eight full-time jobs, will hopefully be operational in six months. Mr English said: “We’ve proven there’s demand and we’ve built a brand. We have international sales and marketing, now we want to bring the manufacturing under our own control, in our home city. It will allow us to improve the quality, improve the lead times and the pricing. We’ll also be able to be more responsive. “We’ve always been well supported by Hull City Council’s Business Support Team. They’ve provided us with invaluable advice and support over the years, and have helped us navigate any issues we’ve had.” Rockcity currently has climbers from the age of just two up to 80, and Mr English said the sport has grown as enthusiasts discover its health benefits. He added: “It’s been one of the fastest growing sports in recent years. You get a full body workout, using all your major muscle groups. You’re using your own body weight as resistance, and it’s a really good all-round exercise regime. What’s also become more and more apparent over the years is that it’s very good for mental health. It’s a sport for people who don’t like other sports or traditional exercise, and it’s just a really enjoyable activity.” Coun Paul Drake-Davis, the council’s portfolio holder for regeneration and housing, said: “Rockcity is a true Hull success story and it’s great to see a company the council has supported over the years playing a key role in the Paris Olympic Games. “The company’s plans to expand with a new manufacturing facility in the city, creating local jobs, are also very exciting, and further evidence of its continued success.” Original artice – https://business-live.co.uk/all-about/yorkshire-humber

A Humber offsite construction firm has designed what it believes could solve the UK’s prisons overcrowding crisis. Integra Buildings has designed and manufactured a custodial cell that has been tested at facilities at BRE Science Park in Watford to make sure it complies with Government standards. The Paull-based creator of modular buildings says the unit – which can function as a standalone space or stacked to make a building – is ready to be deployed at pace and could be the “silver bullet” to the prisons overcrowding crisis which has come to the fore in recent weeks. It is hoped the product could be used to quickly ramp up capacity and avoid some of the costs associated with renovating old, sometimes Victorian, prison buildings and building entirely new facilities. Integra is also marketing it as a solution for other detention settings in the criminal justice system. The unit has been developed for Category C prisoners who make up a large proportion of the UK prison population and while considered unlikely to make escape attempts are not trusted in open prisons. The firm said it uses a concrete base and composite materials, to make a robust, non-combustible cell which is compliant with what is referred to as “breach and ligature criteria”. It can be built to a variety of sizes, with the smallest cell measuring 2.6m x 3m, and includes a shower, toilet and washbasin. Chris Turner, managing director of East Yorkshire-based Integra, said: “Prisons overcrowding is without doubt an issue of significant public concern and a major priority for the new Government. We believe modular construction can and should play an important part in addressing this issue. “Our unit is ready to be manufactured and rolled out right now. Modular construction has numerous advantages over traditional building methods and we have a bespoke, fully-tested unit which can help tackle the prisons overcrowding crisis, as well as being deployed in other custodial settings.” Integra has been supplying modular buildings for more than 25 years and specialises in steel-framed products that provide permanent and temporary spaces for sport, leisure, education, healthcare and commercial clients. The company says 90% of its supply chain is within a 30-mile radius of its Humber base, with the remaining suppliers sought nearby to each project. Original artice – https://business-live.co.uk/all-about/yorkshire-humber

Telecoms tech firm Filtronic has landed a $9m (£7.1m) contract from SpaceX to support the US rocket firm’s Starlink satellites. Sedgefield and Leeds-based Filtronic says the deal is a continuation of demand for its E-band solid state power amplifier (SSPA) modules that will help the Starlink constellation to deliver high-speed, low-latency internet to customers around the world. Work on the components is due to be completed this year. It follows a multimillion-pound deal struck between Filtronic and SpaceX, announced in April, that could eventually see the high profile rocket company become a shareholder in the northern tech firm. The £48m ($60m) agreement is based around supply of Filtronic’s SSPAs, but it could also see the two businesses develop new products together for the Starlink system which has brought internet connection to hard to reach areas. As part of the latest order, a further 2,171,211 share warrants have been vested, meaning a total of 8,684,844 share warrants are now vested. That represents 4%, of the maximum 5%, of Filtronic’s share capital at the time of the signed agreement. Nat Edington, chief executive officer, said: “We are delighted to receive this further order from our partner, SpaceX, as we continue to support the rollout of the Starlink constellation. The order demonstrates the continued significant role we are playing in helping SpaceX achieve their mission.” In announcing the original agreement with Filtronic in April, SpaceX’s vice president of Starlink Engineering, Mike Nicolls referred to the London listed firm as an “outstanding” supplier. He said its team had stepped up to meet Starlink’s needs for high quality parts. As the Starlink constellation is being increased, so too is the ground station network with Filtronic’s tech being used to ensure high speeds and low-latency between earth and the orbiting satellites. In June, Filtronic said the tie-up had significantly boosted its trading and investors were told the firm’s Ebitda was ahead of market forecasts, with the expectation that full year totals will be “no less than” £4.8m, up from £1.3m last year. Meanwhile, revenue is expected to be £25.4m, up from £16.3m last year. Filtronic said there had been investment in manufacturing capabilities to make room for further growth potential and provide flexibility as more orders materialise. Mr Edington, who joined the business shortly before deal was announced, said the work with SpaceX provided a platform for development and to capitalise on other work in the market. Original artice – https://business-live.co.uk/all-about/yorkshire-humber

BusinessLive publisher Reach plc has launched a business content partnership with City AM. The two-year partnership will see City AM editorial content appear online across Reach plc titles including BusinessLive and Reach’s portfolio of national and regional titles. In print, content will be published in the Express, Manchester Evening News and the Liverpool Echo. City AM was acquired by THG in 2023 and has seen growth after investing in its journalism across print, online and social media. The title, which is growing a national news desk in Manchester, says the partnership “forms a central part of City A.M.’s ambition to become a truly national business and finance publication.” Reach plc is the biggest commercial publisher in Britain and Ireland, with titles including the Mirror, the Daily Record, Birmingham Live, Chronicle Live and Wales Online. City AM’s content will complement the work of Reach’s award-winning business team. David Higgerson, chief digital publisher at Reach plc, said: “We’re looking forward to this partnership with City AM. Working together will give us the opportunity to strengthen our quality business journalism offering across our portfolio, and them the chance to get their content in front of our engaged audiences, both nationally and locally around our strong regional centres.” BusinessLive editor Alistair Houghton added: “At BusinessLive we’ll be able to bring together City AM’s excellent national coverage with our own award-winning expertise covering business news in the regions and nations of the UK. We’re looking forward to working together.” City A.M.’s chief operating officer Harry Owen said: “This partnership has provided us with an incredible opportunity to combine resources and provide readers with best-in-class journalism that tackles both local and national issues under one roof. As a market-leader, Reach is renowned for its regional coverage. The combination of this footprint THG’s studio capabilities and City A.M.’s deep understanding of UK business is compelling.” Don’t miss the latest news and analysis with BusinessLive’s regular newsletters – sign up here for free. Original artice – https://business-live.co.uk/all-about/yorkshire-humber