LIVE BUSINESS: Wage growth accelerates; The acquisition of Britvic is authorized; Capita will cut more staff

The proposed sale of Royal Mail to a foreign billionaire for £3.6bn will be a windfall for some investors, but others will lose out if the deal goes ahead.

Ministers have given the go-ahead to Czech tycoon Daniel Kretinsky to buy the postal service’s parent company, International Distribution Services (IDS), for 370 pence per share.

Outsourcing giant Capita has raised its cost savings target from £160m to up to £250m, and the group’s AI push has led to further job losses.

The London-listed company, which employs about 41,000 people worldwide, said it was increasing its use of artificial intelligence, which has helped reduce costs further.

Capita said voluntary employee attrition – that is, when staff decide to leave the business – of around 21 per cent will contribute to the savings target and reduce the need for redundancies.

Capita also revealed it expected an annual hit of around £20m due to the employer’s national insurance levy increase next year.

A £4bn Greek industrial conglomerate has confirmed plans to seek a primary listing in London, which would be a further boost for the City.

Athens-listed Metlen Energy & Metals said yesterday it had submitted paperwork to the watchdog, the Financial Conduct Authority (FCA).

It is the first step in a regulatory process that would see the company listed in London in 2025, the company said.

Thomas Pugh, economist at RSM UK:

‘The jump in wage growth, excluding bonuses, to 5.2% puts another nail in the coffin of an interest rate cut on Thursday. What’s more, there was little sign that companies have reduced hiring ahead of the budget. Our base case is that the MPC will cut rates once a quarter next year, but strong wage growth and a second Trump presidency raise the risk of fewer rate cuts.

‘There was little evidence that pre-Budget concerns caused businesses to radically alter their employment plans. Employment increased by 173,000 people in the three months to October and the unemployment rate remained at 4.3%. Admittedly, employment statistics are unreliable at this time, so the jump may have been driven by revisions to the data rather than a genuine increase. It may also be that most of the impact on the labor market will come after the budget. In fact, the number of employees on payroll dropped by 35,000 in November, but this metric is extremely volatile and we don’t put a lot of faith in one month’s numbers, so this is a time to watch.

‘However, wage growth figures are more reliable and will make the MPC nervous. With private sector ex-bonus wage growth rising to 5.4%, wage growth will most likely be slightly faster in the fourth quarter than the 5.1% the MPC had forecast. That gives the MPC a strong reason to keep rates at 4.75. % on Thursday and will make him even more cautious about cutting interest rates next year.’

Britain’s competition regulator has cleared Carlsberg’s takeover of soft drinks maker Britvic, saying it will not refer the £3.2bn transaction for an in-depth investigation.

Carlsberg reached a deal to acquire the British soft drinks maker in July, with the aim of establishing a drinks “powerhouse” in the UK.

The deal, which is expected to close on January 16, will see the Danish brewer take over Britvic’s bottling deal with PepsiCo. Carlsberg already bottles PepsiCo beverages in several markets and sees potential to expand into other geographies in the future.

Carlsberg and Britvic said in a separate joint statement that all regulatory conditions have been met, including clearances from the European Commission and the UK Competition and Markets Authority.

Wages in the UK grew a more than expected 5.2 per cent in the three months to October, new data from the Office for National Statistics shows.

The data, which beat forecasts for 5 percent growth in average weekly earnings before bonuses, could further weigh on expectations about the pace and scale of the Bank of England’s interest rate cuts.