MARKET REPORT : BSkyB hit as Granada dumping claim proves a myth

It was one of the best, certainly the most successful, rumour for many a moon. As the stock market shivered in the wake of New York's fall, a story gathered strength that Granada was in the process of dumping its 10.8 per cent stake in BSkyB, the satellite television station.

By mid-morning, with City screens trumpeting the sale, BSkyB had fallen and Granada advanced. The deals were said to be at 525p a share which seemed a reasonable enough discount to the then ruling BSkyB price.

But the rumours were wide of the mark - someone, somewhere got their wires crossed. Whether they also made a turn out of the rumours only a Stock Exchange investigation has any chance, and its probably a remote one, of discovering.

At one stage BSkyB shares were down 18p; they closed 13.5p off at 566p. Granada, after gaining 12.5p, ended 7.5p higher at 867.5p.

It is widely believed Granada will eventually sell its stake and it would be surprising if it has not received bids from leading investment houses.

The leisure group has made slow progress realising the assets captured with its pounds 3.9bn Forte acquisition and has shown an inclination to hang on to bits of Forte which had appeared to be early candidates for its hit list.

The rest of the market had a hangover session after Thursday's ebullient party. Footsie fell 52.7 points to 4,218.8, cutting the week's gain to a marginal 11.1 points. The supporting FTSE 250 index fell 18, reducing its week's progress to 14.6.

New York did the damage. After trading strongly throughout most of Thursday it plunged sharply in late trading and continued to wallow in the doldrums while London was open yesterday.

Racal Electronics enjoyed a late run as a variety of rumours flowed - ranging from a possible bid to the sale of a big subsidiary. The shares jumped 19.5p to 268.5p with a few chunky buyers appearing as the market closed.

SmithKline Beecham and Zeneca lost their way in the general malaise. A rumour in the futures market that long-tipped bidder Roche had turned its sights on a US company added to the unease. SmithKline fell 16.5p to 863.5p and Zeneca 38.5p to 1,685p.

J Sainsbury made a significant contribution to the gloom. The Footsie constituent tumbled 51p to 341p. Its poor trading statement contained a profits warning and it also produced, as feared, exceptional do-it-yourself charges. The Sainsbury setback unsettled other superstore groups.

House of Fraser underlined the retail sector's problem, falling 3.5p to 142p. It is due to trot out its festive trading statement on Monday and MeesPierson forecasts miserable growth of 1 or 2 per cent. Last year HoF announced worse-than-expected half-year losses of pounds 13.6m. It should give details of its store closure programme.

London Clubs International spun 22p higher to 367p following its US expansion and GKN put on 10p to 998.5p on Merrill Lynch backing.

Williams Holdings was little changed at 333.5p. Barclays de Zoete Wedd sees profits for last year advancing to pounds 327.8m.

Sears fell 2p to 86p as Greig Middleton said the shares were riding more on hope than judgement and should be sold.

BTR slipped 3.5p to 263p. NatWest Securities suggest it should buy in its 1997 warrants which offer the right to take-up shares at 258p. Such an exercise would cost pounds 28m but send a clear message to the market that "management is determined to pursue the creation of shareholder value".

Big mover of the day, a remarkable 34 per cent gain to 231p, was English National Investment Co, the Joseph Lewis vehicle which has popped up as a 25.1 per cent shareholder in Glasgow Rangers. More high-profile deals are promised. Enic last year acquired a 20.1 per cent interest in AutoNomy, which has a software package for searching the Internet. The shares were 47p a year ago.

Verity, with a new-style sound system, gained 3p to 37p after a presentation to institutional investors. Flying Flowers rose 2p to 202.5p; stockbroker Beeson Gregory is forecasting profits of pounds 3.8m will be announced on St Valentine's Day. Electronic Retailing Systems, raising pounds 95m through the sale of discount notes and warrants, held at 325p.

After the market closed TT, the mini-conglomerate, said it had sold its 8.46 per cent in Roxboro, the electronic equipment group. The deals appeared to have taken place at 183p, lowering the market price from 191p to 183p. TT's average buying price was 139p.

Taking Stock

The Whitbread leisure group seems to have sold its 4.5 per cent shareholding in Surrey Free Inns.

The deal went through at 460p, a 20p premium to the then ruling market price. SFI, known for its Litten Tree chain, ended 21.5p higher at 460p, a peak. The shares are thought to have been picked up by institutional investors with Regent Inns, sitting on a threatening 6.1 per cent, not increasing its stake. This week SFI rolled out a 72 per cent interim profits advance and Martin Hawkins at Greig Middleton expects year's profits to come out at pounds 2.3m with pounds 3.5m next year.

Surrey, an unrelated betting group with golf ambitions, placed 21 million shares through stockbroker Ellis & Partners, raising pounds 209,000. The price held at 1p.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: HR Benefits Manager

£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...

Recruitment Genius: Office Manager / Financial Services

£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...

Jemma Gent: Year End Accountant

£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...

Jemma Gent: Management Accountant

£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...

Day In a Page

The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn
Yvette Cooper: We can't lose the election. There's too much on the line

Yvette Cooper: We can't lose the election. There's too much on the line

The shadow Home Secretary on fighting radical Islam, protecting children, and why anyone in Labour who's thinking beyond May must 'sort themselves out'
A bad week for the Greens: Leader Natalie Bennett's 'car crash' radio interview is followed by Brighton council's failure to set a budget due to infighting

It's not easy being Green

After a bad week in which its leader had a public meltdown and its only city council couldn't agree on a budget vote, what next for the alternative party? It's over to Caroline Lucas to find out
Gorillas nearly missed: BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter

Gorillas nearly missed

BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
Downton Abbey effect sees impoverished Italian nobles inspired to open their doors to paying guests for up to €650 a night

The Downton Abbey effect

Impoverished Italian nobles are opening their doors to paying guests, inspired by the TV drama
China's wild panda numbers have increased by 17% since 2003, new census reveals

China's wild panda numbers on the up

New census reveals 17% since 2003