Category: Market News

Some shareholders in Unilever (LSE:ULVR) are expected to seek reassurances that the company’s environmental and anti-deforestation standards will be maintained after the planned spin-off and merger of its food business with U.S.-based McCormick (NYSE:MKC).

The $65 billion transaction, announced in March, will combine Unilever’s food division with McCormick to create a major global food company featuring brands such as Hellmann’s mayonnaise and Cholula hot sauce. The enlarged business will significantly increase McCormick’s scale and introduce a more complex global supply chain tied to agriculture, commodities and smallholder farming operations.

Investors Seek Commitments on Sustainable Sourcing

Given Unilever’s longstanding reputation for sustainability leadership, several investors are closely watching how the merged company intends to manage sourcing policies and environmental standards.

“We will be seeking assurances about the intention of the combined company to uphold and build upon best practice with regard to deforestation-free sourcing of commodities,” said Vemund Olsen, senior analyst at Norwegian asset manager Storebrand, which is among the top 100 shareholders in Unilever and also owns shares in McCormick, according to LSEG data.

Olsen said these standards include avoiding sourcing from deforested or converted land, maintaining a public complaints mechanism and ensuring complete traceability of commodities back to plantations.

A spokesperson for Frankfurt-based Union Investment, which is a top-40 shareholder in both companies according to LSEG data, said the firm would seek transparency “about how it integrates sustainable practices moving forward”.

U.S. Sustainability Disclosure Rules Less Demanding

Unlike Unilever, McCormick is not subject under U.S. regulations to the same level of detailed sustainability disclosure required in Europe. Although companies with substantial European operations are expected to comply with EU sustainability reporting standards, implementation could take several years, creating a transition period where disclosure levels depend largely on voluntary corporate commitments.

“If Unilever-McCormick decide to turn their backs (on sustainability), this could create significant risk for shareholders and the new entity,” said Cailin Dendas, environmental health program senior coordinator at shareholder advocacy group As You Sow.

“We saw this happen when Kellanova separated from Kellogg in 2023 and dropped its pesticide commitments, among other sustainability goals.”

Unilever Expected to Retain Influence After Deal Completion

Unilever is set to remain the largest shareholder in the combined company with an ownership stake of close to 10% and four board representatives. However, smaller investors are likely to have more limited direct influence over strategic decisions and governance.

Asked whether Unilever intends to use its ownership position to encourage McCormick to maintain similar sustainability standards, a company spokesperson told Reuters: “We are working closely with McCormick ahead of the completion of the transaction to support the transition of our Foods related sustainability programmes and commitments.”

McCormick Faces Pressure to Expand Sustainability Capabilities

Hannah Schalk, an analyst at ESG ratings provider Sustainalytics, described McCormick as carrying “medium-risk” sustainability exposure. She noted that the company’s sustainability reporting does not currently include a formal company-wide no-deforestation pledge and provides less detail regarding traceability, auditing and certification procedures.

Schalk also said McCormick may face challenges scaling its sustainability systems as its supply chain expands significantly following the merger.

McCormick has acknowledged in previous reporting that achieving emissions and sourcing targets depends partly on improving supplier engagement and data collection across its network.

“While we cannot comment on future targets at this time, we are already well underway on a comprehensive strategic update process for our sustainability program, and we’ll share more details on our approach as the process unfolds,” McCormick said in written comments.

Tern plc (LSE:TERN) has announced the results of its latest open offer to qualifying shareholders, revealing that valid applications were received for approximately 67.7 million new ordinary shares, representing around 63% of the 107.3 million shares made available under the offer.

Subject to shareholder approval at an upcoming general meeting and admission of the new shares to AIM trading, the fundraising is expected to generate roughly £406,000. Trading in the newly issued shares is anticipated to commence on 11 May 2026.

Board and Management Participation Signals Confidence

The company said members of the board and senior management team are participating in the fundraising. Interim Non-Executive Chair Iain Ross and PDMR Albert Sisto both subscribed for additional shares, modestly increasing their holdings in the business.

Management participation in the raise may be interpreted as a sign of confidence in Tern’s strategy and supports the company’s efforts to secure additional funding for ongoing operations and investments across its Internet of Things-focused portfolio.

Weak Financial Performance Continues to Pressure Outlook

Tern’s outlook remains heavily constrained by weak financial performance, including a sharp decline in revenue, substantial losses and negative operating and free cash flow. Technical indicators also continue to point toward a prolonged downtrend, although some tentative signs of oversold stabilisation have emerged.

Valuation metrics remain difficult to justify given the company’s negative earnings profile and the absence of dividend yield data.

More about Tern plc

Tern plc is an AIM-listed investment company focused on building value through investments in Internet of Things technology businesses. The company targets both early-stage and growth-oriented IoT ventures, seeking to support their development through strategic investment and active portfolio management with the goal of enhancing shareholder returns.

Altona Rare Earths (LSE:REE), a London-listed explorer focused on African critical minerals including rare earths, fluorspar, gallium, copper and silver, continues to build a diversified project portfolio centred on the Monte Muambe Project in Mozambique and the Sesana Copper-Silver Project in Botswana. The company’s Monte Muambe asset includes a 25-year mining licence, established mineral resources and support from a U.S.-backed prefeasibility grant, positioning the project to supply materials used in clean energy, defence, industrial and high-technology applications.

Company Says No Fundamental Reason Behind Recent Share Price Swings

The company stated that its board is not aware of any fundamental developments that would explain the recent volatility in its share price. Management also reaffirmed confidence in the Monte Muambe Project following the release of updated mineral resource estimates.

Altona further clarified that a growth capital facility arranged with Zeus has not yet been utilised and that no shares have been sold under the agreement. The company added that any future drawdowns are expected to occur only at or above a price of 4 pence per share, in an effort to reassure investors regarding potential dilution and valuation concerns.

Financial Weakness Offset by Strong Technical Momentum

Altona Rare Earths’ outlook remains constrained by weak financial fundamentals, including the absence of revenue generation, ongoing losses, continued cash burn and increasing leverage levels.

However, technical indicators remain supportive, with the shares trading above major moving averages and the MACD signalling positive momentum. Valuation metrics remain limited by negative earnings and the lack of dividend-related data.

More about Altona Energy

Altona Rare Earths is a London Main Market-listed exploration and development company focused on critical raw materials projects across Africa, including rare earths, fluorspar, gallium, copper and silver. Its flagship Monte Muambe Project in Mozambique contains multi-commodity mineralisation and benefits from a 25-year mining licence, a maiden JORC resource estimate and support from a U.S. development grant. The company is also advancing high-grade fluorspar production initiatives and evaluating gallium recovery opportunities, while the Sesana Copper-Silver Project in Botswana provides additional exposure to growing demand linked to clean energy and advanced technologies.

Gulf Marine Services (LSE:GMS) reported a weaker first quarter after war-related disruption in the Gulf led to the precautionary evacuation of four vessels operating in a Gulf Cooperation Council state. The disruption reduced fleet utilisation to 74%, contributing to a 10% year-on-year decline in revenue to $38 million and a 24% fall in EBITDA to $19.5 million.

Despite the operational challenges, the company continued to benefit from higher average day rates and reported an increase in backlog to $660 million.

Fleet Expansion and Geographic Diversification Support Long-Term Strategy

The group has expanded its fleet through the addition of a new mid-class vessel, partly financed via a bridge loan facility. Gulf Marine Services has also redeployed assets into Europe and Latin America as part of efforts to strengthen its renewables exposure and diversify geographically.

Management said leverage remains below its target of 2x and reaffirmed 2026 EBITDA guidance of between $105 million and $115 million. The company also postponed a decision regarding shareholder distributions while crews continue returning to evacuated vessels and the order book improves further to $666 million. The developments highlight the balance between near-term geopolitical risks and the company’s broader long-term growth ambitions.

Financial Strength Offset by Free Cash Flow Weakness

Gulf Marine Services’ outlook continues to benefit from improving financial fundamentals, including ongoing deleveraging, sustained profitability and generally positive free cash flow generation.

However, these strengths are partly offset by a decline in net income during 2025 and a sharp reduction in free cash flow. Technical indicators remain mixed, while valuation metrics are viewed as broadly mid-range, providing limited additional upside support.

More about Gulf Marine Services

Gulf Marine Services is a London-listed offshore marine contractor established in Abu Dhabi in 1977. The company specialises in advanced self-propelled, self-elevating support vessels serving the offshore oil, gas and renewables industries. Operating a fleet of 15 vessels across the Middle East, Europe, the Americas and Africa, Gulf Marine Services supports activities including platform maintenance, well intervention and offshore wind installation for global energy clients.

Arrow Exploration Corp. (LSE:AXL) has brought the Mateguafa HZ12 appraisal well into production at Colombia’s Tapir Block, adding restricted gross output of approximately 564 barrels of oil per day. The company said the well confirmed multiple hydrocarbon-bearing zones within the Carbonera C9 and C7 formations.

The well was completed on schedule and below budget, helping support gross corporate production of around 5,000 barrels of oil equivalent per day. Arrow also highlighted its strong financial position, reporting cash holdings of US$24.2 million and no debt, despite temporarily shutting in its Pepper gas field in Alberta because of weak gas prices.

Icaco Exploration Well and Tapir Workovers Target Further Growth

In addition to the Mateguafa development, the company has started drilling the Icaco-1 exploration well from the Icaco pad and is preparing a series of workover operations on the Tapir block aimed at increasing production through recompletions.

Management said discussions regarding an extension of the Tapir block contract remain constructive. The company believes ongoing success at both Mateguafa and the Icaco prospect further strengthens Arrow’s growth outlook within Colombia’s Llanos Basin and could support future development programmes and sustained production increases.

More about Arrow Exploration Corp

Arrow Exploration Corp. is a publicly traded oil and gas producer focused on underdeveloped, high-growth assets across Colombia’s Llanos, Middle Magdalena Valley and Putumayo basins. The company operates a predominantly Brent-linked light oil portfolio characterised by high working interests and low royalty exposure, and its shares trade on both London’s AIM market and the TSX Venture Exchange under the ticker AXL.

Airtel Africa (LSE:AAF) delivered strong results for the year ended 31 March 2026, supported by increasing demand for mobile data and digital financial services across its operating markets. The company’s customer base grew 10.5% to 183.5 million users, while data subscribers increased 14.8% and Airtel Money customers rose 21.3%.

The growth in digital adoption also contributed to higher data consumption and a 49% increase in mobile money transaction values during the year.

Revenue and Profitability Strengthen Across Key Segments

Group revenue increased 24.0% in constant currency terms, or 29.5% on a reported basis, reaching $6.4 billion. Data services became the company’s largest revenue contributor, while mobile money operations also recorded strong expansion.

Underlying EBITDA rose 30.4% in constant currency to $3.2 billion, helping margins improve to 49.3%. Profit after tax climbed sharply to $813 million, supporting a 9.2% increase in the annual dividend. Airtel Africa also increased capital expenditure to expand network infrastructure, home broadband capabilities and data centre capacity, although management noted that rising energy costs could create near-term pressure on margins.

Strong Cash Generation Balanced by Leverage and Technical Weakness

Airtel Africa’s outlook continues to benefit from strong operating profitability and healthy cash flow generation, supported by a positive earnings outlook and improving financing metrics discussed during its latest results presentation.

However, the company still faces challenges linked to balance sheet leverage and historical earnings volatility. Technical indicators also remain relatively weak, with the shares trading below key moving averages, while valuation metrics are less supportive due to a relatively high price-to-earnings ratio and only a modest dividend yield.

More about Airtel Africa Plc

Airtel Africa Plc is a major telecommunications and mobile money services provider operating across 14 countries in sub-Saharan Africa. The company delivers integrated mobile voice, data and digital financial services, with a strategic focus on improving customer experience while expanding digital and financial inclusion throughout its markets.

SRT Marine Systems (LSE:SRT) has been awarded a £5 million one-year support agreement with a long-standing sovereign customer to provide technical support and data services for an existing maritime domain awareness deployment. The contract covers the period from January through December 2026 and represents the customer’s second consecutive annual support agreement with the company.

SRT said the increased value of the deal reflects growing usage of the system and highlights the platform’s expanding role in daily maritime surveillance operations.

Recurring Revenue Opportunity Expands Through Sovereign Partnership

The latest agreement is larger than the equivalent contract signed in the previous year and is expected to contribute to a growing stream of recurring support revenues as the customer continues expanding its SRT-MDA system through additional future projects.

Management described the deal as further evidence of SRT’s long-term business model, which combines multiple recurring revenue streams with strategic sovereign partnerships. The company believes the relationship demonstrates strong growth potential while reinforcing its position within the high-value digital maritime surveillance market serving government customers.

Cash Flow and Valuation Concerns Continue to Weigh on Outlook

Despite strong revenue growth and improving operational efficiency, SRT Marine Systems’ outlook remains affected by weaker cash flow performance. Technical indicators are also currently negative, with momentum remaining weak, although the shares may be approaching oversold territory.

Valuation metrics remain stretched due to a very high price-to-earnings ratio and the lack of dividend support.

More about SRT Marine Systems

SRT Marine Systems is a global provider of maritime intelligence, surveillance and navigation safety solutions focused on maritime domain awareness. Its technologies are used by coast guards, fisheries authorities, ports and both commercial and leisure vessel operators to support intelligence-led maritime operations and enhance navigation safety and security.