Two of the most powerful investors in the world bet against Marks & Spencer

Two of the world’s most powerful investors bet against Marks & Spencer to deal a blow to its new chief executives

Two of the world’s most powerful investors are betting against Marks & Spencer to deal a blow to its new chief executives.

The Mail on Sunday can reveal that BlackRock, the world’s largest asset manager, and hedge fund Marshall Wace are shorting the retailer’s shares.

The funds revealed the combined £35m short position just weeks after the retailer announced food boss Stuart Machin would become chief executive, alongside Katie Bickerstaffe.

Blow: World’s largest asset manager BlackRock and hedge fund Marshall Wace short Marks & Spencer shares

The pair will replace M&S veteran Steve Rowe next month in an unusual joint deal where Bickerstaffe, whose title is co-chief executive, reports to Machin.

Short selling is a way of betting that the stock price will go down. Traders borrow shares, sell them back and then buy them back, ideally at a lower price, before returning them to the owner and pocketing the difference.

BlackRock and Marshall Wace’s shorts arrive as M&S has seen its stock fall in recent months. Shares are down 37% this year, valuing the company at £2.9bn.

Retailers face multiple challenges, including runaway inflation driving up wages and energy costs, as well as pressure on consumers’ wallets.

Machin is credited with helping Rowe and Chairman Archie Norman begin to turn around the long-struggling retailer, which underwent an overhaul during the pandemic.

M&S saw food sales rise over Christmas and clothing sales were boosted by stocking up on outside brands.

The company is expected to confirm next month that its food delivery joint venture with Ocado is meeting its targets. But share sales and short positions – the first bets against M&S ​​disclosed since December – indicate the City are unconvinced of their prospects under new management.

BlackRock Investment Management is betting against a range of consumer-focused stocks, including Sainsbury’s, Dixons and Kingfisher, owner of B&Q. Marshall Wace, chaired by Sir Paul Marshall, targets online retailers Asos, Boohoo and AO World.

Richard Hyman, partner at retail consultancy TPC, said: “The management team at M&S ​​has been too focused on food and not enough on investing in fashion – which is a higher margin. .”

M&S’s decision to employ an unconventional management structure has created uncertainty. Hyman said: “It feels like a cop out to me. It’s very difficult to have two bosses.

M&S, BlackRock and Marshall Wace declined to comment.


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