Market Report: Appetite for acquisitions sends Compass higher

It was a busy day for Compass yesterday on the acquisitions front, as the catering company confirmed one deal while rumours flew that it was on the trail of another.

The world's biggest contract caterer announced that it had purchased the cheerful-sounding Life's A Party, an Australian food services company, for just over £14m. Compass said the deal "provides an excellent opportunity for Compass Group Australia to expand its existing presence in [the education and leisure sectors]".

While investors digested the news, market gossips were discussing speculation from the other side of the Channel that Compass may make a bid for the French vouchers group Edenred. The company, which was demerged from Accor last June, specialises in prepaid services and has a presence in 40 countries.

Listed on the NYSE Euronext in Paris, its price shot up nearly 3.5 per cent to €17.14, while Compass was also on the move, climbing 6p to 555.5p. Traders pointed to the fact that when releasing its final results last week, the company said their ongoing strategy involved looking at other businesses, with one adding that Compass "has got a pretty good track record of getting value from acquisitions".

However, Evolution Securities' Nigel Parson said he would be "very surprised" if the speculation was accurate, and he believes Compass is more likely to focus on smaller deals in the catering sector. "Everything about contract catering is discipline and eating in-house, and everything about vouchers is freedom and eating where you want," he said.

Overall the FTSE 100 just failed to finish in positive territory, losing 22.68 points to 5,528.27. It completed a turbulent November for the top-tier index, during which time it retreated more than 160 points despite touching a high of 5,875.35.

Investors continued to worry about the eurozone while data from the US showed house prices in September had fallen again; however, manufacturing and confidence data from the States was more positive.

The markets' recent volatility was blamed for the postponement of an initial public offering of Vedanta Resources' copper business. The miner was expected to list Konkola Copper Mines at some point this month, but an IPO will now not take place until 2011. It is anticipated that it will raise $1.1bn, but following the announcement of the delay Vedanta was knocked back 24p to 1,986p.

Carnival was near the top of the blue-chip index, as it added 53p to 2,622p thanks to a thumbs-up from Numis. The broker called the world's largest cruise company "a high-quality business" and said that the industry outside North America is "young... with low market penetration and significant growth potential", as it raised its advice to "buy". At the bottom, Resolution was still suffering from being given an "underweight" recommendation by JP Morgan Cazenove as it dipped 8.3p to 211.3p. Meanwhile, with the threat of further strike action growing after cabin crew called for a new ballot earlier this week, British Airways shed 5.6p to 255.6p.

On the FTSE 250, Gartmore was among the losers of the session as one of its potential buyers ruled out any chance of it making a bid. The CEO of Aberdeen Asset Management said yesterday that it was "very, very unlikely" that it would attempt to purchase the hedge fund group, which has been for sale since it lost the high-profile Roger Guy at the beginning of last month.

Although he accepted that Aberdeen's statement was not good news for Gartmore, a trader did point out it was not among the major names that have been talked about as a potential buyer. Still, Gartmore was driven back 3.5p to 101.8p while Aberdeen - which released forecast-beating pretax profits - stayed steady on 179p.

Also struggling was the safety equipment company Halma, which shed 15.4p to 313.6p, despite revealing that its first-half pre-tax profits had gone up by 29 per cent. Elsewhere, reports that Taylor Wimpey is looking to sell its US unit Taylor Morrison did not prevent it falling 0.48p to 23.81p.

SThree was doing much better, as it was driven up 7p to 287p thanks to Panmure Gordon. The broker changed its advice on the recruitment company to "buy", and the broker's analysts said that "recent reassuring statements from Harvey Nash, Randstad and Hays should allay fears that the company remains on track".

Among the small-caps, the travel company Holidaybreak was boosted 20p to 290p as it said that its education unit would continue to grow after it announced that it was about to buy a 50 per cent stake in Meininger for €36.5m. The German group provides accommodation for school tours, a market which Holidaybreak sees as resilient.

Meanwhile Silverdell, which is listed on the Alternative Investment Market, revealed a huge 317 per cent jump in pre-tax profits, and the asbestos removal specialist company advanced 0.5p to 8p.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Life and Style
life
Arts and Entertainment
Cold case: Aaron McCusker and Christopher Eccleston in ‘Fortitude’
tvReview: Sky Atlantic's ambitious new series Fortitude has begun with a feature-length special
Voices
Three people wearing masks depicting Ed Miliband, David Cameron and Nick Clegg
voicesPolitics is in the gutter – but there is an alternative, says Nigel Farage
Voices
The veterans Mark Hayward, Hugh Thompson and Sean Staines (back) with Grayson Perry (front left) and Evgeny Lebedev
charity appealMaverick artist Grayson Perry backs our campaign
News
i100
News
people
ebooks
ebooksA special investigation by Andy McSmith
Sport
Chelsea manager Jose Mourinho
footballThe more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Life and Style
Vote green: Benoit Berenger at The Duke of Cambridge in London's Islington
food + drinkBanishes thoughts of soggy school dinners and turn over a new leaf
News
Joel Grey (left) poses next to a poster featuring his character in the film
peopleActor Joel Grey comes out at 82
News
i100
News
business
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Compliance Assistant

£13000 per annum: Recruitment Genius: This Pension Specialist was established ...

Ashdown Group: Market Research Executive

£23000 - £26000 per annum + Benefits: Ashdown Group: Market Research Executive...

Recruitment Genius: Technical Report Writer

£25000 - £35000 per annum: Recruitment Genius: A Technical Report Writer is re...

MBDA UK Ltd: Indirect Procurement Category Manager

Competitive salary & benefits!: MBDA UK Ltd: MBDA UK LTD Indirect Procurement...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee