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Tue 23rd Mar 2021 - Update: Deliveroo, Cineworld and Everyman
Shadow cast on Deliveroo £9bn listing: Deliveroo is facing investigations in Europe over the legal status of its riders, potentially casting a shadow over its £9bn stock market listing. The company revealed in the prospectus for its initial public offering (IPO) that it is battling legal claims or regulatory probes in Britain, France, Spain, the Netherlands and Italy over the classification of its couriers, reports The Times. Deliveroo warned it may have to rewrite its business model if it was forced to provide riders with holiday and sick pay, minimum wages and other benefits. The company is among the most prominent of the “gig economy” companies accused of exploiting outdated labour laws to reduce their operating costs. Its riders are deemed to be independent contractors, paid by the number of meals they deliver rather than a hourly wage. The status of gig economy workers was in the spotlight last month when the Supreme Court ruled Uber had broken British employment law by refusing to supply benefits such as a pension and the living wage. Last week, Uber granted its UK drivers worker status in a move seen as heralding a shake-up in the gig economy. Deliveroo has argued the Supreme Court ruling does not create a precedent for its couriers and claims its riders value the flexibility it offers. However, the London-based company warned it could have to tear up its business model if it has to treat couriers as workers. The company said on Monday (22 March) it was targeting a valuation of between £7.6bn and £8.8bn when it prices the IPO at the end of the month. Deliveroo will sell about 384 million shares at between 390p and 460p each, worth £1.6bn at the midpoint of the range. The company will keep about £1bn, with the remainder going to existing investors. Deliveroo founder Will Shu will reap as much as £31m by selling stock and will retain 6.3%of the company – a pot valued at £554m at the upper end of the range. He has a further £122m in unvested options. Under a dual-class structure, Shu will have the power to block unwanted takeover approaches, but this will expire in 2024. Amazon will sell about £100m of stock, but will remain its largest shareholder, with an 11.5% stake.

Cineworld plans to reopen UK cinemas in May: Cineworld has said it plans to reopen its UK cinemas in May, in line with current government guidance. Meanwhile, the company has announced its Regal cinemas in the US will begin reopening in April, for the first time in six months. The phased reopening will kick off with a limited number of cinemas opening for “Godzilla vs Kong” on Friday, 2 April and going wider with “Mortal Kombat” on Friday, 16 April. Cineworld chief executive Mooky Greidinger said: “With capacity restrictions expanding to 50% or more across most US states, we will be able to operate profitably in our biggest markets. We will also be monitoring developments closely in the UK and across Europe as we set to gradually reopen across the world in line with local government guidance.” In addition, Cineworld has reached a multi-year agreement under which films from Warner Bros Pictures Group will be exhibited in Cineworld’s cinemas in the US as of their opening. Beginning in 2022, Warner Bros Pictures Group theatrical releases will have a 45-day window of theatrical exclusivity, with certain provisions. As for the UK, Warner Bros and Cineworld have agreed to an exclusive theatrical window of 31 days prior to premium video on demand, and an extended window of 45 days for films that open to an agreed upon box-office threshold.

Everyman agrees £10m increase in debt facilities: Cinema operator Everyman has agreed an increase in its debt facilities from £30m to £40m, “to improve the group’s liquidity position for growth going forward”. The facilities continue to be provided by Barclays and Santander and the increase is subject to an ordinary resolution being passed at the company’s annual general meeting.

Brixton Village announces Eat Out To Help Out-style campaign for April opening: Brixton Village has announced a new Eat Out To Help Out-style campaign for the first three days of lockdown lifting in April. The Evening Standard reported from 12-14 April, when restaurants are allowed to open for alfresco eating and non-essential retail can return, the #BackToBrixton drive will offer diners a 50% discount on food, up to the value of £10 per person. Like the government’s scheme last summer, alcohol will be excluded from the offer. The cost of the scheme will be shared between Hondo Enterprises, the area’s landlord, and the market’s restaurants, which include Cornercopia, Okan and barbecue spot the Joint. Those running the market said reopening will come with strict health and safety measures, including frequent staff testing, increased security and signage, and thorough cleaning measures. 

Premium subscribers to receive most comprehensive multi-site operator database in sector on 31 March: An updated list of UK multi-site operators, the most comprehensive database in the sector, is almost ready and if you are a Propel Premium subscriber, the list will be with you on Wednesday, 31 March. A new multi-site list will then be sent to Premium subscribers at the end of each month with a report on new companies and changes in the list, which stands at 1,629 companies. It provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different, and what each business specialises in. In a new feature this year, there is a synopsis of what the business does and significant news associated with it. The list will then be updated at the end of each month. Being a Propel Premium subscriber not only entitles you to the most comprehensive list of businesses in the sector today; those signed up also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out, regular video content, and regular exclusive columns from Mark Wingett. An annual premium subscription costs £395 plus VAT for operators and £495 plus VAT for suppliers. Email anne.steele@propelinfo.com to sign up.

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