City File: Stake disposal takes shine off Mirror

LORNA TILBIAN at SG Warburg has become strongly bullish of Mirror Group Newspapers. Anticipating its return to paying dividends, she says the shares are a buy up to 220p (they are currently 168p).

The question is, when will MGN resume payment? Its current banking arrangement precludes pay-outs, but MGN is renegotiating and hopefully it should be able to announce a new agreement with its half- time results next month.

The boost from resumed payments, though, has to be balanced against the 54.8 per cent stake held by the administrators of the Maxwell private companies. This is due to be placed in the market in the near future. MGN's shares look good value, but with so many soon to be sold, they are not worth chasing.