Ladbroke places its bets on the US casino market
Wednesday 04 December 1996
Ladbroke, it would appear, wants to set up casinos throughout the US, many in partnership with its new ally, Hilton Hotels Corporation. First joint venture will almost certainly be in Las Vegas.
For a long while Ladbroke was seen as a likely takeover victim. HHC was just one of many predators bandied around. With Ladbroke it shares the world-famous Hilton hotel name; the UK group owns the international franchise and HHC the US operation. The betting and hotels chain was also seen as bid fodder for the likes of Bass and a variety of international leisure groups.
Ladbroke was able to outrun the speculation and in August agreed a collaboration deal with Hilton which gave it the opportunity to participate in HHC's US gaming operations.
Bass, up 17p at 811p, is due to roll out results today. They could be accompanied by the Government's reaction to its controversial bid to buy control of Carlsberg Tetley, the struggling brewer. The view is that to get the deal through Bass could be forced to make big concessions, selling off chunks of its pub estate. One possible buyer is Michael Cannon, who recently sold The Magic Pub Co to brewer Greene King for pounds 197.5m.
The rest of the stock market adopted a more aggressive approach, with Footsie up 23 points at 4,061.5 and the supporting indices on the uproad.
The Government's utilities raid was the centre of interest. British Energy held at 147.5p as, through HSBC James Capel, Westminster unloaded 81 million shares at 146p. Other unwanted Government utility rumps were sold, helping inflate what was a rather mundane day's turnover. Severn Trent used the Westminster sale as an opportunity for a buyback, picking up 2.5 million shares from ABN Amro Hoare Govett which had acquired the stock from the Government. Hoare sold on the shares at 661p against a 668.5p closing price.
Associated British Foods gained 6.5p to 452p. A special dividend from its Australian off-shoot prompted the interest.
LucasVarity was the worst-performing blue chip, suffering a 16.5p fall to 234p as it provided details of its restructuring which carried an implied profit warning.
Racal Electronics managed to survive its profit setback with an 11p gain to 236p and Pilkington, the glass group, continued its recovery, firming to 153p.
Oils were buoyed by the Santa Fe North Sea deal. Norway's largest independent oil group, Saga, is paying $1.23bn for the Kuwaiti group's North Seas interests. Such a deal clearly casts a beneficial light on other North Sea assets. But, the old adage it is better to travel than arrive was again evident with the likes of British Petroleum, Enterprise Oil and Lasmo giving ground.
Dorling Kindersley provided the shock of the day, citing the strength of the pound for a profits warning. The shares slumped 81p to 437.5p, dragging down such groups as Pearson, off 8.5p to 729p.
House of Fraser, the department stores chain, was drawn back into the takeover spotlight, gaining 4p to 166p.
Barcom, a coal services and plant hire group, gained 3p to 52.5p as it pushed profits to pounds 2.71m from pounds 652,000. The group has been reshaped by Doug Rogers, no stranger to turn-around situations.
Rage Software,the computer games group which used to be called BCE, held at 11.25p. A long-standing shareholder, Rose Noble, has lowered its interest and now has nearly 24 million shares, 9.84 per cent of the capital. Rage has indicated it is in talks with publishers and there are stories it could forge a link with Virgin. The shares were 23p a year ago.
Trocadero, the London leisure complex, held at 51p. Some believe this Burford spin-off could be the subject of a Japanese bid.
Bruntcliffe Aggregates was another drawn into bid speculation. There are stories the company, which has been haunted by a threatened boarding party, could have attracted the attention of Bardon, itself a long-standing bid target. The shares rose 2p to 25.5p. Takeover hopes lifted Lamont, a textile group, 5p to 191p.
Lorien, a personnel group, is launching a pounds 18.5m placing and open offer. It is paying pounds 14.5 for two resourcing companies. The shares held at 344p.
o Chieftain, an insulation supplier, firmed 5p to 57.5p, its highest for a long while. There is talk bid action could soon materialise.
The group, after a difficult run, is now trading well and interim profits suggested it was well on its way to hitting pounds 500,000 for the year, which would represent a pounds 1m-plus swing. The shares were 18p in January.
o CNC, a property group, is another which could be destined for bid action. The shares held at 7.25p, although there is talk the company has received and rejected a bid at 9.5p.
The group used to be a confectionery maker called Clarke Nickolls Coombs. It moved into property, changing its name after winning control of Brightstone Properties in a pounds 9.2m deal.
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