Court confusion hits Hambros price

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The Independent Online
SHARES in Hambros gyrated on the Stock Exchange yesterday after the market misinterpreted an announcement from the merchant bank as implying it had lost a pounds 160m court case in Norway. The announcement said the judgment was being considered.

In fact Hambros had won. But in the 35 minutes between a preliminary announcement saying the court had made a decision and the statement saying it was in Hambros' favour, the shares dropped 50p from 293p to 243p at the low point.

When Hambros' second announcement appeared on screens the price recovered to 313p, a rise of 15p on the price at which it started the day.

Some analysts said Hambros shares should have been suspended ahead of the announcement. However the Stock Exchange did not blame Hambros, saying the company fulfilled its obligations by keeping the market informed throughout. The exchange is certain to have conducted a check of dealings, which is routine after unusual price movements.

A Hambros spokesman said: 'We made it perfectly clear in our announcement that the judgment had been issued and that we would make a further announcement. We said the text was being considered. What we meant was that it was being read because it was in Norwegian.'

The Oslo City Court decided against the Norwegian Guarantee Institute, which had asked for a 1982 agreement to be set aside and for Hambros to pay Kr1.6bn ( pounds 160m). The case concerned the estate of the Norwegian shipping millionaire Hilmar Reksten.

The events surrounding the case go back to loans made in 1976, but the argument appeared to be settled in 1982 until the Guarantee Institute reopened proceedings.

Hambros still faces two other suits in Norway, from the bankruptcy trustees of the Reksten estate and another litigant.

Hambros would give no estimate of the costs of the action it won, which it will pay from the bank's secret reserves.