Market Report: Continuing bid clamour keeps Fisons turnover up

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THE INCESSANT bid clamour that has engulfed Fisons, the ailing pharmaceutical group, since the surprise departure of its chief executive Cedric Scroggs a month ago, shows no signs of abating.

Fisons shares fell to a low of 107p on the Scroggs blow, which was accompanied by news that instead of a pounds 100m profit the group would only break even and the dividend would be cut from 8.7p to 4.3p.

But 107p has not been seen since. Yesterday the shares edged ahead 3p to 142p.

Much of the buying has been discreet, with little inclination to drive the shares sharply higher. But daily turnover has often been high. So far this year Seaq has registered a volume of 40 million shares.

There is talk of that near-forgotten exercise, a dawn raid, being mounted. Many speculate that the offer will be 182p a share. Zeneca, down 17.5p to 825p on Kleinwort Benson caution, remains the favourite predator, although some suggest Canadian or Italian strikes.

Fisons' multitude of difficulties have devastated the shares, riding at more than 500p in 1991. Last year they touched 251p.

If a hostile bid materialises the group could have problems mustering City support. Many institutions believed it had undertaken to hold its dividend and moved into the shares on yield considerations. But the signalled cut destroyed the yield appeal.

Another drugs group, Medeva, was in demand, jumping 14.5p to 157p as it disclosed it had repaired badly damaged US bridges.

Whether this heralds a new start remains to be seen. Last year Medeva had an awful time, hit by regulatory and management problems that shook City confidence, sending the shares crashing from a 236p peak to 85p.

The group said the US Food and Drug Administration had cleared its US offshoot to restart supplies to government agencies. The operation involved, producing a drug for hyper-active children, was closed for two weeks last year after the FDA banned Medeva from supplying government bodies.

The Medeva advance from last year's low will be welcomed at Templeton Investment Management. It lifted its stake sharply when the shares were in the dumps and went on to build a 5 per cent interest.

SmithKline Beecham rose 6p to 407p on the launch of Famvir, a shingles drug, but Wellcome, ahead of expected criticism of its anti-Aids drug, fell 24p to 650p.

Blue chips suffered their fourth consecutive fall but with investors again banking on the second and third-liners the FT-SE 250 index climbed 17.5 to 3,882.1.

Dwindling hopes of an early interest rate cut and a dull New York were the main restraining influences.

The better-than-expected TSB results sent the shares 15p higher to 267p, dragging Abbey National up 21p to 507p. Rank Organisation was another with well received figures, up 20p to 1,001p.

Great Universal Stores gained 10.5p to 603p as the market debated the fate of Smith New Court's 13-million share placing for an unidentified institution (not, it seems, the Wolfson Foundation with 8.6 per cent).

Some suspect that some of the shares linger but there are signs SNC has unloaded the residue, about 6 million, albeit at 590p against its 600p buying price.

With the majority of the shares sold comfortably above 600p, SNC seems to have escaped from the venture with a reasonable profit.

Blue Circle Industries, with support from NatWest Securities, rose 12p to 363p but Guinness, with Kleinwort negative, dipped 5p to 479p.

Reuters, which confirmed the acquisition of the Quotron market dealing service from Citicorp, improved 28p to 1,853p. Analysts have been called to an investment meeting next month. In the meantime Henderson Crosthwaite is bullish, looking for profits of pounds 430m for last year and pounds 500m this year.

GKN, the engineer, shaded 1p to 568.5p. Hoare Govett downgraded from pounds 100m to pounds 92m and from pounds 125m to pounds 120m.

MFI Furniture put on 9p to 174p, with James Capel saying buy; Hillsdown Holdings rose 10p to 184p as SNC provided the support.

LIT Holdings, soon to be Johnson Fry, appeared in its new consolidated form, gaining 38p to 338p, but Atreus, the shower screen group, fell 4.5p to 15.5p following its profit warning. Brown & Jackson, the Poundstretcher chain, was another hit by a warning - of higher than expected losses - falling 2.5p to 9.5p.

Courtyard Leisure, the wine bar operator, lost 3p to 20p, after touching 17p. It is in talks about a possible acquisition although negotiations with the impressario Harvey Goldsmith have ended.

Cemetone, the chemical newcomer, improved 6p to 94p after raising pounds 1.3m from the sale of investments in Edenbrook Property and Exmoor Dual Investment Trust.

The FT-SE 100 index fell 12 points to 3,360 but the FT-SE 250 resumed its progress, gaining 17.5 to 3,882.1. Turnover was 899.1 million shares from 36,866 deals. The account ends today with settlement on 24 January. Government stocks were weak.

The expected shake-up at Ladbroke is drawing attention to Hampden, operating do-it-yourself stores in Ireland. Ladbroke has nursed a 29.9 per cent stake since Hampden was floated nine years ago. But some suspect the Hilton and Texas group may be tempted to bid for full control or pave the way for a takeover by selling its holding. Hampden shares rose 2p to 23p.

Gold Greenlees Trott, the advertising agency best known for its Red Rock cider campaign, has substantially increased its European operations by taking control of a jointly-owned advertising network. It has renegotiated ownership terms from 40 to 80 per cent. Gold Greenlees shares have been strong this year, climbing from 206p. They closed at 246p, up 2p.