Market Report: Analysts' tour fuels talk of Thorn EMI demerger

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The Independent Online
HOPES are riding high that Thorn EMI, the rental and showbusiness group, will accompany today's first-quarter figures with a chart-topping demerger performance.

The stock market is intrigued by a series of analysts' meetings the group has lined up. Why, it asks, if there is not a split proposal in the offing, should Thorn arrange an expensive analysts' tour, concluding with a visit to the American home of rock and roll?

In recent months Sir Colin Southgate, chairman, has been dismissive of recurring stock market demerger rumours. Breaking up, he has let it be known, is hard to do.

But his reluctance has not lowered the market's demerger temperature; sooner or later, it is confidently predicted, Sir Colin will confirm what is seen as inevitable - a split of the two main operations of the group. As if to underline its eventual intention, Thorn is busy selling off bits and pieces that do not fit into either division.

Today's profits are likely to come out at around pounds 52m, allowing for a pounds 16m loss on the sale of the security division. The shares, firm early last week but increasingly hesitant as the figures have loomed, were little changed at 1,063p.

The rest of the market found itself weighed down by inflation and interest rate worries. It was, it could be argued, anxious to take a breather after last week's strength, and once early progress was not supported by serious buying, was content to relax into a gentle retreat.

The FT-SE 100 index briefly tested the 3,200 level but rested 20.1 down at 3,171.3 in quiet

trading.

The milk contracts with the newly constituted Milk Marque soured Northern Foods 7p to 216p and Unigate 3p to 374p.

Charter, the conglomerate, put on 15p to 270p as, contrary to earlier indications, it increased its offer for Esab, the Swedish welder.

The revised offer followed strong resistance to the opening shot from Swedish institutions. Charter has, in effect, lifted its bid by pounds 26m to pounds 286m.

Meyer International, the timber group, was lowered 5p to 415p as Richard Reynolds, in charge of the Jewson builders' merchants side, quit 'to pursue other interests'.

The company said trading at its Jewson operation was running ahead of last year.

Plantsbrook, the undertaker, improved 12p to 175p as Service Corporation International, the US group buying Great Southern, lifted its stake to 8.41 per cent.

When SCI first descended on Plantsbrook the shares were a neglected 100p. The Americans will not, however, find Plantsbrook an easy conquest. Pompes Funebes Generale, controlled by Lyonnaise Des Eaux, the French conglomerate, has 46 per cent of the shares and is not a willing seller.

Lloyds Chemists held at 304p. Some chunky trading occurred, probably a reflection of last week's Goldman Sachs deal when it took out the remaining 7.19 per cent shareholding of Lazard Freres, the US management group.

Bristol Scotts, the leisure group, rose 5p to 155p, highest for three years but a long way below the 450p peak of the late 1980s.

Talk abounds that following last week's boardroom changes acquisitions and disposals are high on the agenda.

British Airways fell 4.5p to 399p, a decline that must make shareholders ponder the wisdom of the anniversary price cuts. In the past week, as the lower prices have been publicised at considerable expense, the shares have fallen 25p.

Anglesey Mining, the proud owner of Britain's first new base metal mine this century, gained 1p to 7p, a 3p advance since it was disclosed last week that effective control of its dominant shareholder, a Canadian group, had changed hands.

London Securities, a property struggler which once held a stake in Regent Inns, firmed 0.25p to 3.25p.

It confirmed it was in talks with Nu-Swift, the fire protection group run by Jacques Murray, which could lead to it buying properties.

Any deal will almost certainly be paid for in LS shares, giving Nu-Swift a substantial interest in in the property business.

Through his master company, European Fire Protection, Mr Murray is currently bidding for control of Andrews Sykes, the industrial services group, where he already enjoys boardroom command.

Coal Investments jumped 9p to a 119p peak, partly on continuing support from the stockbroker James Capel. The excitement engulfed Waverley Mining, which touched 82p, ending at 79p, up 5p. Its stake in Monktonhall, the Scottish colliery, remains a leading attraction although its resources interests overseas appear to be commanding increasing attention.

World Fluids, the old Kells Minerals, which is traded on the Dublin exploration market, has had a difficult time, with the shares touching 64p last year. Yesterday they fell 1.5p to 9.5p as the group announced a pounds 1.9m cash-raising exercise, with shares on offer on a four-for-nine ration at 7.5p. The cash is needed for working capital and to redress cash-flow problems.

The FT-SE 100 index slithered 20.1 points to 3,171.3 and the supporting FT-SE 250 index lost 4.1 to 3,749.8. Turnover was a modest 499.1 million shares with 30,758 bargains recorded. Government stocks were firm.

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