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  1. Retail sales fall 0.3% in January from December
  2. Marmite-owner Unilever rejects Kraft Heinz bid
  3. Unilever's shares soar following Kraft approach
  4. Business rates row intensifies
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Live Reporting

By Daniel Thomas

All times stated are UK

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Have a good weekend

Thanks for joining us for another week of Business Live. Hope to see you again at 6am Monday for more business news, views and analysis. 

Wall Street markets end higher after late push

Wall Street trader
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After a sluggish day, US markets ended higher thanks to a late-afternoon push. 

The Dow gained 0.02% to 20,624.05 and the S&P 500 was up 0.17% at 2,351.16.

The Nasdaq climbed to its fourth record close of the week - up 0.41% at 5,838.58 points.

Despite the positive finish, stocks seem to have lost some momentum in recent days, after weeks of rallying on stronger-than-expected reports on the economy.

Lindsey Bell, an investment strategist at CFRA Research, warned that optimism about Donald Trump's economic policies could again give way to caution. 

"People are focusing on only the good of what his campaign promises were," she said.

"What makes me nervous is that it feels like the market is ignoring what could come on immigration, trade, healthcare - the negative implications that could come from a protectionist government."

Williams & Glyn a 'costly millstone'

BBC personal finance correspondent tweets...

Should you take your phone to the US?

Rory Cellan-Jones

Technology correspondent

Person holding iPhone
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"The next time you plan to cross a border, leave your phone at home."

That is the rather startling advice in a blogpost that is being widely shared right now.

Its author, Quincy Larson, is a software engineer, who has previously written about the importance of protecting personal data. He now fears that data could be at risk every time you cross a border.

His concerns were sparked by the story of Sidd Bikkannavar, an American-born Nasa engineer, who flew home from a trip to Chile last month. On arrival in Houston, he was detained by the border police and, by his own account, put under great pressure to hand over the passcode to his smartphone, despite the fact that the device had been issued to him by Nasa.

Read more.

Wall Street shares flat

US traders
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US stocks are still lacking direction, with all the main indexes broadly flat. 

The Dow is currently 0.17% lower at 20,584.05 points, the S&P 500 is down 0.02% at 2,347.67, and the Nasdaq is up 0.26% at 5,830.08 points.

RBS remedies not a done deal

It's important to remember that the Treasury's proposals have not been confirmed yet. 

It said: "The commissioner responsible for EU competition policy, Margrethe Vestager, plans to propose to the College of Commissioners in the coming weeks to open proceedings in order to gather evidence on the new plan.  

"HM Treasury will carry out a market testing exercise in parallel. The opening of proceedings does not prejudge the outcome of the investigation."

Remedies 'could cost RBS £750m'

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The estimated upfront cost of the proposed package to RBS is expected to be in the region of £750m. 

A Treasury spokesperson said: "RBS must deliver on its remaining state aid commitments and this new plan represents the most effective way of delivering the pro-competition objectives behind them.

“This new plan provides a clear blueprint to increase competition in the UK’s business banking market, and would help RBS resolve one of its most significant legacy issues which has held back the sale of the taxpayers’ stake.”

RBS - Treasury proposes remedies to help SMEs

The HM Treasury said it had been in "constructive contact" with the European Commission in recent months and would now seek "formal amendment to RBS’s State aid commitments".

Its alternative plan aims to "help small and medium sized enterprises (SMEs) access and benefit from greater choice in the banking services". 

The proposed package of measures includes:

  • A fund, administered by an independent body, that eligible challenger banks can access to increase their business banking capabilities;
  • Funding for eligible challenger banks to help them incentivise SMEs to switch their accounts from RBS paid in the form of “dowries” to challenger banks to use to incentivise switching;
  • RBS granting business customers of eligible challenger banks access to its branch network for cash and cheque handling, to support the measures above; and
  • An independent fund to invest in fintech to support the business banking of the future.

UK government proposes RBS drop sale of Williams & Glyn

Williams & Glyn bank

The UK has proposed that RBS abandons its sale of Williams & Glyn as part of an alternative plan to meet its EU State Aid obligations. 

RBS, which is state owned, had been told to divest Williams & Glynn by 31 December 2017 to prevent it from having too dominant a position in the banking market.

But it has struggled to find a buyer, with both Clydesdale and Yorkshire Banks owner CYBG and Santander retracting tabled bids.

Now the Treasury says has proposed a radical new plan that would see RBS fund and deliver a series of initiatives, "worth around £750 million, to boost competition in today’s UK business banking market".

Kraft-Unilever 'an unwelcome bid' - Labour

Opposition MPs are cranking up the pressure on ministers over Kraft's $143bn bid. Unilever is one of the UK's biggest companies, with 7,500 British workers, three major factories in the UK and some of the world's best-known household brands.

Senior politicians from Labour and the Lib Dems suggested the US food giant might be targeting Unilever as a result of the fall in the value of sterling.

Rebecca Long-Bailey, Labour's shadow business secretary, said: "With sterling depreciating against the dollar and the euro since last summer, unwelcome takeover bids aimed at buying UK business assets could well increase." 

Business department comments on Kraft's Unilever bid

Unilever brands
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It's been a busy few days for Business Secretary Greg Clark, who has faced questions about the future of the Moorside nuclear power plant, and about a potential tie-up between GM's Vauxhall and French carmaker Peugeot-Citroen. 

Now the Department for Business, Energy & Industrial Strategy (BEIS) has another potential merger it might want to look at. Kraft's takeover bid for Anglo-Dutch firm Unilever would be one of the biggest corporate deals in history.  

“This is clearly an important potential deal for a major company in the UK and its workforce," a BEIS spokesperson said.

"We continue to monitor the situation closely.”

Unilever-Kraft merger 'could mean higher prices'

World Business Report tweets...

Saudi stock exchange gets first female chief

Saudi Arabia's stock exchange
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Saudi Arabia's stock exchange, "Tadawul", has appointed Sarah al-Suhaimi as its first female chair, breaking from a tradition of reserving top economic posts for men in the conservative kingdom.

Al-Suhaimi will keep her current job at the helm of NCB Capital, the investment arm of Saudi Arabia's National Commercial Bank. 

In 2014, she became the first woman to head an investment bank in Saudi Arabia. 

Since Deputy Crown Prince Mohammed Bin Salman announced an ambitious plan to prepare his country for the post-oil era, several decisions seem to indicate that authorities will loosen restrictions on women working in order to boost labour-force participation among nationals.

Samsung CEO Jay Y Lee arrested

Government warns on transition to new pound coin

New pound coin

The public is being urged to spend hundreds of millions of £1 coins before they become worthless later this year.

A new 12-sided pound coin will come into circulation in March, and by October the current round £1 coin will become obsolete.

The Treasury believes around £433m of these round pound coins are in circulation.

"We are calling on everybody - from conscientious children saving pocket money in piggy banks, to families who like to hold on to their coins for a rainy day - to be ready for this change,” David Gauke, chief secretary to the Treasury, told the FT. 

“You have until autumn to spend your round pounds or exchange them for the edgy new version at your bank.”  

Tui fined 48 times for breaching Abta's code of conduct

By Jon Douglas Reporter, You & Yours

TUI logo
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The UK's biggest tour operator has been repeatedly fined for failing to stick to the travel industry's own code of conduct.

Tui, owner of Thomson and First Choice, was fined 48 times during 2015 and 2016 by the travel association Abta.

The breaches included inaccurate advertising and sending holidaymakers to resorts where significant building work was being carried out.

Tui said it was committed to resolving any issue a customer experiences.

Read more. 

Reality Check: Are there more winners than losers on business rates?

Unilever pushes FTSE 100 higher

UK traders
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The FTSE 100 closed higher after the pound fell against the dollar and Unilever shares jumped following a takeover bid. 

The index gained 0.3%, or 22.04 points, to 7,299.96.

Unilever was by far the best performer, gaining 12.6%, while bottler Coca Cola HBC and tobacco firm Imperial Brands climbed 2.71% and 2.47% respectively. 

The pound fell 0.55% to $1.24210 after a weak set of retail sales figures, although it held up against the euro. 

A weak pound boosts the FTSE 100, as many of its constituents make their profits in foreign currencies. 

Man planned to 'blow up supermarkets to drive down share price'

Target store
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A US man has been accused of plotting to blow up several Target supermarkets in a bid to drive down the firm's share price.

According to an affidavit, Mark Charles Barnett offered to pay another man $10,000 to place at least 10 "improvised explosive bombs" disguised in food packaging in shops from New York to Florida. 

The hope was the explosions would drive Target's shares lower, allowing Mr Barnett to snap up the stock at a huge discount, prosecutors allege. 

If convicted he faces up to 10 years in prison.

UK estate agents see bumper pay rises as property booms

House for sale
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Britain's estate agents, so often maligned by the house-buying public, are enjoying another year of bumper pay rises, research suggests.

On average, they have received increases of 7.2% over the past year, according to the Royal Institution of Chartered Surveyors (Rics).

That figure exactly matches the rise in house price in 2016, as measured by the Office for National Statistics (ONS).

However the industry body said the number was "an exaggeration".

Read more.

History's biggest corporate mergers

Marmite jar
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According to research firm Dealogic, at $143bn, Kraft-Unilever would be the second biggest corporate merger ever and the biggest acquisition of a UK company.

Here's a list of the top five corporate deals as they stand:

  1. Vodafone AirTouch bought Mannesmann AG for $172bn (1999)
  2. AB InBev bought SAB Miller for $134bn (2015)
  3. Verizon Communications bought a 45% stake in Verizon Communications for $130bn (2013)
  4. AOL bought Time Warner for $112bn (2000)
  5. Pfizer bought Warner-Lambert for $111.7bn (1999)

Merkel comments on Opel-PSA merger plan

German Chancellor Angela Merkel
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German Chancellor Angela Merkel has said she will do everything she can to protect jobs in Germany if carmaker Opel is taken over by France's PSA. 

The merger plans have sparked fears in Germany that PSA could cut German jobs that doubled up existing posts in France. 

Unions have called for commitments to prevent factory closures, both in Germany and Britain where Opel trades as Vauxhall.

Earlier today, UK Business Secretary Greg Clark said he'd had "constructive meetings" with PSA executives and French ministers on Thursday - although he made no firm assurances about Vauxhall's futures.  

Find out where you fit in spending stakes

ONS tweets interactive video

How the UK spends it

Retail expenditure video from the ONS

Takeovers 'like strange mating rituals'

Jonty Bloom

BBC Business correspondent

Seals in a mating ritual
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Takeovers are like those strange mating rituals you see on Planet Earth narrated by David Attenborough. Kraft Heinz has approached Unilever about getting together and making an even bigger business with a huge family of brands. 

Unilever has spurned the offer and is looking aloof, saying not only the proposal was too cheap but also that it "sees no merit, either financial or strategic... Unilever does not see the basis for any further discussions."

Quite a slap in the face you might think but faint heart ne'er won fair hand, and if Kraft Heinz offered a lot more money it might look a bit more attractive to Unilever. Although whether the competition and takeover authorities will bless the union is another matter. 

It would create a behemoth that could dominate many consumer sectors from food to soap and might stifle competition; many societies have rules against that kind of relationship. 

Kraft shares jump in early trade

Kraft share price
Google Finance

Shares in Kraft Heinz have jumped in New York after the firm tabled a takeover bid for Unilever. 

The stock is 7.9% higher at $94.14, as this chart shows. 

Unilever has also surged on the news, climbing 12.1% in London.

Wall Street opens lower

Wall Street trader
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US stocks opened lower today, signalling a pause in the rally seen earlier this week.

The Dow Jones is 0.29% lower at 20,559.38 points, the S&P 500 is down 0.09% at 2347.22, and the Nasdaq has shed 0.08% to 5814.90. 

Kraft and Unilever face 'difficult trading conditions'

Michael Hewson of CMC Markets says Kraft Heinz and Unilever are both facing tough trading conditions at the moment.

"In numbers released yesterday Kraft reported a rise in profits but it can’t disguise a decline in Q4 sales, not only in the US, but also in Europe which saw a decline of 13.3% year on year," he says.

"As it is the company is already well into a major cost-cutting programme as a result of its 2015 merger." 

But he adds: "Unilever in its most recent trading update also attested to difficult trading conditions after seeing a 1% decline in revenues.

"Despite this profits were up despite difficult trading conditions in Brazil and India as the company focussed on its margins and keeping a rein on costs."

Pound down as FTSE bounces back

Pound coin and dollar note
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Sterling is still down after data showed a surprise fall in retail sales in January - the third consecutive monthly decline. 

It has lost 0.46% against the dollar to $1.24330 and 0.28% against the euro to 1.16660 euros. 

The FTSE 100 has pared earlier losses, though, in part due to a 13% jump in Unilever shares after Kraft made a takeover bid. The index is up 0.21%, or 15.13 points, at 7,293.05 points. 

Who is behind Kraft Heinz?

Shareholders in Kraft Heinz

Interestingly, Kraft Heinz is controlled by Warren Buffett's Berkshire Hathaway and the Brazilian investment house 3G capital. 

The firms hold stakes of around 27% and 24% respectively. The next largest shareholder (as this chart shows) is Capital Group Companies with around 4%.

Love it or hate it?

More reaction to the big story of the day - the rejected bid for Unilever by Kraft Heinz.

Marmite jars

This deal is likely to prompt a Marmite response, with the markets love the idea given the share price reaction, there is a good chance that governments will hate it, and it is inevitable that competition authorities and regulators will want to have a look at it.

Michael HewsonChief market analyst, CMC Markets

How deep are Kraft's pockets?

A key question is how would Unilever shareholders react to a higher bid from Kraft Heinz? Would they be looking for jam today?

The long term boost to [share] portfolios that Unilever has delivered has been enormous. A short term premium today is no compensation for losing the growth that Unilever could produce for decades to come. So to win over a majority of Unilever’s shareholders, we think Kraft Heinz will need to dig very deep indeed.

Steve ClaytonFund manager, Hargreaves Lansdown

Why does Kraft want Unilever?

Unilever yellow spread brands
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Putting portfolios of brands together can create huge synergies across marketing, manufacturing and distribution, even before you think about cutting the combined HQ back to size. Kraft Heinz are attempting a massive push on the Fast Forward button, for to acquire the sheer scale of brands that Unilever represents through one-off acquisitions could take decades. With debt cheap and abundant right now, Kraft have spotted their opportunity.

Steve ClaytonFund manager, Hargreaves Lansdown

Will Kraft make a firm offer or won't it?

More detail on that proposed takeover offer from Kraft ...

In its statement, Unilever said under the terms of the deal Unilever shareholders would have received $50 per share in a mix shares and cash which valued Unilever at about $143bn (£115bn).

Kraft has until 5:00pm on 17 March 2017 to say whether it has a "firm intention" to make an offer for Unilever or say it does not intend to make an offer.

Unilever reacts to Kraft bid

Unilever London HQ

Unilever has just put out a statement about the Kraft bid in which it says the proposal "represents a premium of 18% to Unilever's share price as at the close of business on 16 February 2017. 

"This fundamentally undervalues Unilever. Unilever rejected the proposal as it sees no merit, either financial or strategic, for Unilever's shareholders. Unilever does not see the basis for any further discussions.

Unilever PLC and Unilever N.V. recommend that shareholders take no action. Further announcements will be made as appropriate."

US share futures react to Kraft bid

Looking to the start of the trading day in the US, stock futures in Kraft climbed by 4.4% after it offered to buy Unilever. 

Despite rejecting the offer, Unilever's US-listed shares leapt by 11%.

Mondelez, rumored to be a Kraft acquisition target, fell by more than 6%. 

Grocery giant would have 'huge footprint'

Marmite jar

If Kraft Heinz were to take over Unilever, it would be one of the biggest corporate tie ups ever. One analyst has been mulling the implications ...

Few initial thoughts – would competition authorities let this one through? It could come up against a number of hurdles as it would create a giant in the sector. EU regulators in particular could be against it. Kraft Heinz has the experience to drive the integration. Costs synergies are the name of the game – combing ops and supply chains. Both are coming into this on the back foot a touch. Unilever sales growth has slowed and come in below expectations while Kraft posted a 3.7% drop in the fourth quarter. The combined entity would have a huge brand footprint and be able to flex bargain muscles even more with supermarkets. As seen vis-à-vis Unilever-Tesco this could be useful.

Neil WilsonSenior market analyst, ETX Capital

Unilever share price hike

Here's what that Unilever share leap looks like in a graphic ...

Unilever's share rise following news of Kraft offer

Unilever offer 'testing the water'

Unilever shares rocketed up 11% after the Kraft Heinz Company confirmed that it has been in talks to buy the group. Unilever rejected the proposal, which was rumoured to be was around £40 a share - a premium of just shy of 20% on the opening price this morning. With Kraft Heinz saying it’ll be coming back to the table, it looks like the initial offer was just to test the water.

Nicholas HyettEquity analyst, Hargreaves Lansdown:

How much is Unilever worth?

Unilever's market capitalisation is more than £100bn - which means Kraft would have to dig deep to gobble up that particular prize ...

It would make it one of the biggest deals in corporate history ...