Uber loses London licence over ‘pattern of failures’ on safety - The Globe and Mail

Uber has lost its London operating licence.

Henry Nicholls/Reuters

Uber was stripped of its license to carry paying passengers in London on Monday for the second time in just over two years, pending an appeal, over a “pattern of failures” on safety and security.

Unauthorized drivers were able to upload their photos to others’ accounts so that, on over 14,000 trips, a driver other than the advertised one picked up passengers, the regulator Transport for London (TfL) said.

The ride-hailing firm immediately said it would appeal. The process is likely to include court action and could drag on for months, allowing Uber’s roughly 45,000 drivers in London, one of its most important markets, to keep taking rides despite its license expiring on Monday.

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TfL said it had “identified a pattern of failures by the company including several breaches that placed passengers and their safety at risk,” and that some journeys had been uninsured.

“TfL does not have confidence that similar issues will not reoccur in the future, which has led it to conclude that the company is not fit and proper at this time.”

Uber, whose app-based ordering and demand-sensitive pricing have disrupted operators in many cities worldwide including drivers of London’s “black cabs,” said its systems were robust and that it would also introduce a new facial matching process.

“Over the last two years we have fundamentally changed how we operate in London,” tweeted CEO Dara Khosrowshahi, who took over weeks before Uber first lost its London license in 2017.

“We have come very far – and we will keep going, for the millions of drivers and riders who rely on us.”

Uber’s shares listed in Frankfurt were down over 3 per cent at 1330 GMT.

The Silicon Valley company has run into regulatory barriers and a backlash in several markets, forcing it to withdraw completely from places such as Copenhagen and Hungary.

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In London, black cab drivers who see Uber as a threat to their hard-won livelihoods have blocked streets in protest, arguing that they are being unfairly undercut by an inferior service.

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The more than 22,000 “cabbies” are required to memorize the thousands of streets and landmarks within a six-mile radius of central London and pass a legendary test known as ‘The Knowledge’ in order to be licensed to pick up passengers on the street.

A requirement since 1865, the process can be costly and takes on average three to four years to complete. Drivers for Uber and smaller rivals such as Kapten and Bolt, helped nowadays by satellite navigation apps, face no such stipulation.

Uber and TfL have been at odds since the authority rejected a renewal request in 2017, faulting Uber’s approach to reporting serious criminal offences and driver background checks, before a judge granted a probationary 15-month license in 2018.

The roughly $50-billion firm, which went public in May but is not yet profitable, has implemented a series of changes including 24/7 telephone support and the pro-active reporting of serious incidents to London police to assuage concerns.

In September, TfL granted a two-month extension, far short of the maximum five years, and imposed further conditions.

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Ahead of the latest decision, Uber said it would improve drivers’ safety training and provide a direct connection to emergency services.

Monday’s decision comes around two weeks before a national election and less than six months before Londoners decide whether to re-elect Mayor Sadiq Khan, who is also chairman of TfL and a member of the opposition Labour party.

“I know this decision may be unpopular with Uber users, but their safety is the paramount concern,” he said on Monday.

Uber was first licensed in London in 2012, when the current prime minister, the Conservative Boris Johnson, was mayor.

Shaun Bailey, the Conservative seeking to replace Khan, said that “London’s reputation as a world-class city that is open for business has taken a hammer blow.”

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November 25, 2019 at 06:41PM

Charles Schwab to buy TD Ameritrade in US$26B all-stock deal - BNNBloomberg.ca

Charles Schwab Corp. agreed to buy TD Ameritrade Holding Corp. for about US$26 billion in a deal that will reshape the retail brokerage business.

TD Ameritrade stockholders will receive 1.0837 Schwab shares for each TD Ameritrade share, the companies said in a statement Monday. That’s a 17 per cent premium based on the average share price as of the close on Nov. 20.

Announcement of the deal comes after news of an acquisition broke on Thursday, sending up shares of both firms. Schwab, America’s original discount broker, will now have even more sway over the sector it pioneered nearly a half-century ago.

“Our view is that this is a great deal for the consumer,” Schwab Chief Executive Officer Walt Bettinger said on a conference call Monday with analysts. “We’ve been doing nothing but driving costs down for decades.”

The equity value of the deal is US$28.3 billion based on Schwab’s closing price of US$48.20 on Nov. 22. Schwab shares fell 0.3 per cent at 10:16 a.m. in New York trading. TD Ameritrade, the Omaha-based brokerage that’s partly owned by Toronto-Dominion Bank, rose four per cent.

The tie-up creates a mega-firm with US$5 trillion in assets — a Goliath that may attract the attention of antitrust regulators, analysts say. Smaller brokerages like E*Trade Financial Corp. will have to contend with a much more formidable competitor.

The combined firm will relocate its headquarters to Schwab’s new campus in Westlake, Texas. Schwab’s San Francisco operations will remain a sizable hub.

TD Bank, which holds 43 per cent of TD Ameritrade, will own roughly 13 per cent of the new business. Its voting stake will be limited to 9.9 per cent, with the rest of its position in a non-voting class of stock. The Canadian lender will have two new seats on the combined firm’s board, while TD Ameritrade will name a single director.

As a result of the deal, Schwab will see its business add 12 million client accounts, US$1.3 trillion in assets, and roughly $5 billion a year in revenue.

Bettinger downplayed the potential antitrust risks of the combination.

“We have numerous competitors, many of which are far larger than us today and far larger than a combined organization,” he said on the call. “They’re going to continue to come right after us, as they are now in all aspects of the business.”

Schwab said in the statement that the new firm will have “the resources of a large financial services institution that will be uniquely positioned to serve the investment, trading and wealth management needs of investors across every phase of their financial journeys.”

Schwab last month eliminated commissions for U.S. stock trading, forcing other brokerages to follow suit and sweeping away an important revenue stream. Analysts speculated that online brokerages might have to cut deals to survive the increased industry pressure.

TD Ameritrade has relied more on commissions than some competitors, drawing 36 per cent of its net revenue from commissions in 2018, compared to seven per cent at Schwab.

Founder Charles Schwab hinted he was open to dealmaking in an interview with Bloomberg Radio in October.

“I don’t know whether we’ll be successful in that pursuit, but in the industry you’re going to see more consolidation, more firms getting together,” he said. “You just have to have that scale and volume.”

If the deal goes through, the combined company will have unparalleled clout as top custody service providers to independent financial advisers. That may give authorities pause, Keefe, Bruyette & Woods analyst Kyle Voigt wrote Thursday. He estimates Schwab has about a 50 per cent market share of registered investment adviser custody assets, while TD Ameritrade may have as much as 20 per cent.

The acquisition comes after TD Ameritrade announced in July that CEO Tim Hockey would leave early next year. Hockey denied at the time that his departure had anything to do with a potential deal.

Credit Suisse Securities was Schwab’s financial adviser. PJT Partners and Sander O’Neill Partners were financial advisers to TD Ameritrade’s board. Davis Polk & Wardwell and Wachtell Lipton Rosen & Katz were legal advisers to Schwab and TD Ameritrade, respectively.

--With assistance from Matthew Monks.

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November 25, 2019 at 06:29PM

Posthaste: CN Rail strike has already disrupted the economy — now it's taking a toll on jobs - Financial Post

Good Morning!

Agriculture, manufacturing and energy, sectors that are already reeling from a mix of trade uncertainty and low prices — are expected to see more pain if the Canadian National Railway workers’ strike drags on.

And it’s already taking a toll on jobs. The Canadian Press reported that the ongoing CN strike has cost scores of Halifax rail workers their jobs — at least for now — as the labour stoppage continues to impact shipping across the country, according to the the union representing the employees.

More than 250 staff at Canadian National Railway Co.’s Autoport terminal, which handles cars shipped in and out of Canada, recently received layoff notices, but CN later rescinded the notices for 180 employees, according to Unifor, CP reported.

The strike is also impacting every aspect of the Canadian economy that relies heavily on trade. TORQ Energy Logistics Ltd. said it won’t be able to get any more crude at its CN-serviced rail terminals once all the empty rail cars are filled up, forcing oil producers to find another place to put their crude, Kent McDougall, chief commercial officer, told Bloomberg on Friday. Altex Energy Ltd. is also in a similar situation with its terminals in Lashburn, Lynton, Unity and Falher.

“Rail transportation may only account for about 0.5% of GDP, but past experience shows that these types of disruptions can be significant enough to impact the national GDP figures,” TD Bank said in a note to clients. “A nine-day labour disruption at CP Rail in 2012, for instance, drove a 6.8% drop in the sector that month – large enough to bear mentioning by Statistics Canada at that time.”

A strike that persists till the first few days of December could cost the Canadian economy as much as $3.1 billion in lost output, TD estimates.

“This disruption comes at a challenging time for the Canadian economy. A 0.2 p.p. impact may not seem like a lot in isolation, but must be considered in context,” TD analysts said. A pre-disruption growth expectation for Q4 of only 1.3 per cent, like the Bank of Canada’s, or TD’s similar tentative 1.4 per cent annualized growth tracking, doesn’t leave a lot of wiggle room for negative shocks, the bank said.

CN rail strike are also impacting supply chains for timber, lumber paper and packaging products. “We estimate that almost 50% of Canadian forestry products is transported by CN rail,” RBC Capital Markets noted.

This is the re-elected government’s first big economic test, but so far the government seems reluctant to force strikers back to work. Agriculture Minister Marie-Claude Bibeau is expected to meet farm leaders and Saskatchewan Agriculture Minister David Marit in Regina today, which may provide some colour on the government’s latest thinking.

Here’s what you need to know this morning:

• Gov. Gen. Julie Payette delivers a presentation at the start of a panel discussion on innovation and entrepreneurship in Vilnius, Luthinia
• Statistics Canada to release wholesale trade figures for September at 8:30 a.m. ET
• The Federal Court holds a hearing in the case of the Attorney General of Canada v. First Nations Child and Family Caring Society of Canada and others
• The Association of Manitoba Municipalities holds its annual convention
• National Farmers Union national convention in Winnipeg
• Agriculture Minister Marie-Claude Bibeau meets with farm leaders, Saskatchewan Agriculture Minister David Marit in Regina
• Notable Earnings: Organigram Holdings Inc.

Legal recreational cannabis sales declined across the country in September, with New Brunswick charting one of the largest month-over-month drops, according to the latest data from Statistics Canada released Friday morning.

Approximately $123 million in legal adult-use cannabis was sold across Canada, down 2.4 per cent from $126 million in sales in August, writes Vanmala Subramaniam. 

— Please send your news tips, comments and story ideas to Yadullah Hussain at yhussain@postmedia.com. or @Yad_Fpenergy

With files from The Canadian Press, Thomson Reuters and Bloomberg

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November 25, 2019 at 08:36PM

Kirkland Lake to buy Detour Gold for $4.9 billion in stock - BNNBloomberg.ca

Canada’s Kirkland Lake Gold Ltd. agreed to buy Detour Gold Corp. for $4.9 billion, furthering an M&A spree that’s swept the gold mining industry.

With an all-share deal, Kirkland will take advantage of a record stock price to acquire the company, which operates the Detour Lake mine in northeastern Ontario. The agreement values Detour at $27.50 a share, a 24 per cent premium to the closing price on Friday.

There’s been constant speculation about gold mining acquisitions after huge deals rocked the industry in the last year: Newmont Mining Corp.’s acquisition of Goldcorp Inc. and Barrick Gold Corp.’s takeover of Randgold Resources Ltd. The two combinations created companies that dwarf the rest of the industry and mean that smaller miners feel the need to consolidate if they’re going to stay relevant to shareholders.

“The addition of Detour Lake provides an opportunity to add a third cornerstone asset that is located in our backyard,” Tony Makuch, chief executive officer of Kirkland, said in a statement.

Detour shareholstateders will receive 0.4343 share of Kirkland, according to the statement. After the deal is completed, existing Kirkland shareholders will own 73 per cent of the new company, with Detour owners holding the rest.

Kirkland’s stock price has surged in the past three years, climbing more than 800 per cent, as profits soared. That’s put the company in a strong position to expand.

The Detour Lake gold mine is expected to produce for more than 20 years and can generate 600,000 ounces a year. It’s about the same size as Kirkland’s biggest project, the Fosterville mine in Australia.

Detour shares have almost doubled this year, helped by a rally in gold prices. Paulson & Co. led an overthrow of the board in 2018 after a bitter proxy battle, in which he called for the company to put itself up for sale.

The new entity would have gold production of about 1.5 million ounces in 2019 and free cash flow of US$700 million, Kirkland said.

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November 25, 2019 at 07:38PM

Luxury conglomerate LVMH to buy Tiffany for $16.2B US - CBC.ca

Louis Vuitton owner LVMH has agreed to buy Tiffany for $16.2 billion US in its biggest acquisition yet as the French luxury goods maker bets it can restore the iconic U.S. jeweller's lustre.

The $135-per share cash deal will boost LVMH's smallest business, the jewelry and watch division that is already home to Bulgari and Tag Heuer, and help it expand in one of the fastest-growing sections of the industry.

Fashion and accessories brands including Christian Dior generate the bulk of earnings at LVMH, run by France's richest man, Bernard Arnault, though growth in jewellery has shone in recent years.

LVMH shares opened up around 1.8 per cent on Monday and Tiffany's Frankfurt-listed stock was up 6.6 per cent.

Tiffany CEO Alessandro Bogliolo said the transaction would "provide further support, resources and momentum."

The companies said they expected to close the deal in mid 2020. Tiffany said in the statement its board of directors recommended that shareholders approve the transaction with LVMH.

Tiffany CEO Alessandro Bogliolo, seen in this 2018 file photo, said Monday that the deal would 'provide further support, resources and momentum' to the brand. (Nicholas Hunt/Getty Images for Tiffany & Co.)

The $135 price tag represents a 7.5 per cent premium over Tiffany's closing share level on Friday, and is more than 50 per cent higher than where the stock price stood before LVMH's interest emerged.

Founded in New York in 1837 and known for its signature robin's egg blue packaging, Tiffany is one of the best-known names in the jewellery industry, and featured in the movie Breakfast at Tiffany's starring Audrey Hepburn.

The label, which has more than 300 stores worldwide and made almost half of its sales at home last year, has been struggling to win over younger shoppers in recent years and compete with lower-priced rivals such as Denmark's Pandora A/S and Signet Jewelers.

It now also has to contend with a Washington-Beijing trade war and shifting spending patterns as Chinese shoppers retreat from the United States and spend more at home.

Tiffany, based in the U.S., has faced increasing competition from lower-cost rivals. (Gonzalo Fuentes/Reuters)

"Tiffany's brand equity and the strength of the image of its iconic 1837 Blue Box are more valuable than the current financials suggest," Jefferies analyst Flavio Cereda said in a note published just before the deal was confirmed.

"LVMH can leverage off these to launch a more concerted 'attack' on the Asian millennial market."

Chinese consumers in their 20s and 30s are helping to fuel growth across the luxury goods industry.

Growth in jewelry outpaced that of other businesses such as fashion in 2018, according to consultancy Bain & Co, which forecast comparable sales in the $20 billion global jewelry market were set to grow 7 per cent this year.

The acquisition positions LVMH, the world's biggest luxury conglomerate, squarely on the turf occupied by its rival Richemont, the owner of Cartier.

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November 25, 2019 at 07:16PM

Here's what advisors can anticipate amid the $26 billion Charles Schwab-TD Ameritrade tie-up - CNBC

A pedestrian passes in front of a Charles Schwab Corp. office building in New York.

Gabriella Angotti-Jones | Bloomberg | Getty Images

Charles Schwab's proposed acquisition of TD Ameritrade is stirring up worry among financial advisors.

Schwab on Monday announced it would acquire TD in a $26 billion all-stock transaction. Together, the firms will serve 24 million brokerage accounts, accounting for more than $5 trillion in client assets.

Both firms also have massive footprints in the registered investment advisory industry, where they custody investors' assets and execute trades.

They also provide firms with the technology to simplify their workflow and allow advisors to focus on financial planning.

"Together we can deliver the ultimate client experience for retail investors and independent registered investment advisors," said Stephen Boyle, TD Ameritrade's newly announced interim president and CEO, in a statement.

The merger will create a massive custodian in a field that often has little choice for these RIAs.

Clients may stay put

Clients are likely to keep their financial advisor, even amid a change in custodians, industry experts say.

That's because RIA businesses generally have so-called negative consent provisions in their paperwork when they take on new clients, meaning if the firm changes a service provider, the client has agreed to go along.

"I might change custodians if I think it's the best thing for you, and by signing this you are agreeing that you will go, unless you opt out," said Danny Sarch, founder and owner of Leitner Sarch Consultants.

Nevertheless, a client who is content with the service he or she receives will likely stay put.

"The client is generally loyal to the advisor, as long as the advisor keeps the client front of mind as he makes a decision," Sarch said.

Market concentration

Ariel Skelley | DigitalVision | Getty Images

In the RIA world, there are four custodians that make up the lion's share of the market: Fidelity, Pershing, Charles Schwab and TD Ameritrade.

Schwab, Fidelity, TD and Pershing collectively hold 80% of the RIA firms' $4 trillion in advisory assets, according to Cerulli Associates.

TD's specialty has been on the small RIA market, centering to firms with fewer than $100 million in assets under management, Sarch said.

"Pershing ignores that space, but Fidelity, Schwab and TD have traditionally competed," he said.

Advisors have raised concerns about the prospect of less competition.

"What does it mean for costs for advisors like me and for our end clients?" asked Daniel Tobias, a certified financial planner with Passport Wealth Management in Cornelius, North Carolina. His firm handles custody of client assets with TD.

"Or what if the service goes down, we have fewer options and we're that much more captive?" Tobias asked.

Small firms

Compassionate Eye Foundation | Getty Images

RIAs who are just starting out on their own or whose business model isn't centered on gathering assets have also turned to TD for their services.

In 2016, XY Planning Network, a network of fee-only advisors who charge clients a subscription fee rather than a percentage of assets under management, partnered with TD to make its services available to those advisors without requiring them to manage a minimum level of assets under management.

Indeed, 600 of the 1,100 fee-only advisors on XY Planning Network are using TD's services through this agreement and manage less than $10 million, said Alan Moore, co-founder of XY Planning Network.

"The question is, 'Will they continue to support the smaller RIA market?'" Moore asked. "I hope they see the value of working with people who are starting in the business and growing their firms and who may never have $50 million in assets."

"The custodians have to make money, but there are firms that will never meet those minimum asset requirements, and we're losing the only option we have," he said.

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2019-11-25 15:05:00Z
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Uber stopped from operating in London - The - The Washington Post

Henry Nicholls Reuters A photo illustration shows the Uber app and a bus in London, Britain, June 25, 2018.

LONDON — London’s transport authorities on Monday announced they will not renew Uber’s license to operate in the British capital after thousands of trips were made with someone other than the booked driver.

In a statement, Transport for London (TfL) said that there were “several breaches that placed passengers and their safety at risk.”

Uber’s license expires at midnight on Monday. The company, which announced it will appeal the decision, can continue to operate until a final decision is made. 

This is the second time in two years that transport authorities have rejected the ride-hailing app’s bid to renew its operating license in London, one of its largest European markets.

[Uber: The ride-hailing app that says it has ‘zero’ drivers]

The app, which employs tens of thousands of drivers, is hugely popular with users in London — and unpopular with London’s iconic black cabbies.

Uber said it will appeal the decision and that, for its 3.5 million users in London and 45,000 drivers, it will be business as usual during that time. “We have fundamentally changed our business over the last 2 years, setting the standard for safety in the industry. TfL’s decision on our London licence is wrong and we will appeal,” the corporation tweeted.

Dara Khosrowshahi, Uber’s chief executive, said even though the company should be “held to a high bar,” the decision was “just wrong.”

This is the latest setback for Uber, which has clashed with transport bodies and traditional taxi-driver markets around the world. Uber has been banned, or stopped service in, countries including Denmark, Hungary and Bulgaria.

In London, transport authorities in September 2017 dropped the bombshell that they would not renew Uber’s license amid safety concerns. The company successfully appealed that decision and was granted an extension.

TfL said that Uber had made a number of improvements since then, but they didn’t go far enough. One key concern, they said, was a change to Uber’s system that “allowed unauthorised drivers to upload their photos to other Uber driver accounts.” They said that this allowed at least 14,000 trips where passengers were picked up by someone other than the booked driver.

The transport body also said that some of the drivers that were dismissed or suspended were able to open new Uber accounts, potentially “compromising passenger safety and security.”

Uber’s rivals wasted little time in applauding the move.

The Licensed Taxi Drivers Association, a trade body for London’s black cab industry, said that “The Mayor and TfL have taken the right and only decision to keep Londoners safe.”

Bolt, an Estonian ride-hailing company that has thousands of London drivers on its books, said in a statement that “we continue to pay the utmost attention to the credentials of drivers we permit to use our platform.”

London Mayor Sadiq Khan, who will face a mayoral election contest next year, said “I know this decision may be unpopular with Uber users but their safety is the paramount concern.”

Read more

When rides go wrong: How Uber’s investigations unit works to limit the company’s liability

Inside the new Uber: Weak coffee, vanishing perks and fast-deflating morale

Internal data shows Uber’s reputation hasn’t changed much since #DeleteUber

Could Europe’s Uber ruling affect the future of the gig economy?

Today’s coverage from Post correspondents around the world

Like Washington Post World on Facebook and stay updated on foreign news

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2019-11-25 14:03:00Z
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