Market Report: Blogger reports rumours that Weir could add cash to its offer
Friday 11 April 2014
It looks like Weir Group's attempt to merge with Finnish rock-crushing major Metso might not be as simple as it hoped.
Oil and gas engineer Weir last week confirmed it was proposing an "all-shares merger" with Metso, but financial blogger Ben Harrington yesterday reported rumours that Weir could be preparing to add a cash element to the offer, amid fears of a rival bid and lukewarm reception of the offer from Metso investors.
Gossip in the City named US mining-equipment specialist Joy Global as a potential rival bidder, as well as General Electric's mining division.
A spokesperson for Weir said its bid remains unchanged, adding: "We're not going to speculate on what we may or may not do in the future."
Metso's spokesperson confirmed the company is still considering Weir's offer and is not engaged in dialogue with the company.
Weir fell 14p to 2,567p.
Sentiment on the blue-chip index was listless yesterday, with low volumes and no big news. The FTSE 100 closed up 6.36 points at 6,641.97.
Associated British Foods (ABF) rebounded after falling earlier in the week. Investors were worried that a profit warning at its sugar business could be looming, but Morgan Stanley yesterday highlighted the strength of Primark, a key part of its business. ABF put on 68p to 2671p.
Shareholders snapped up 95.67 per cent of shares offered by RSA yesterday as part of the insurer's rights issue. The company added 0.5p to 94.95p.
On the FTSE 250, Hays surged to a seven-year high after predicting four years of strong growth ahead. The recruiter revealed an 8 per cent increase in fees for the third quarter, helping it add 6.7p to 151.4p.
Pig-semen supplier Genus lost 59p to 940p, overshadowed by news that China's WH Group, the world's biggest pork supplier, is planning a record-breaking stock-market listing in Hong Kong.
On Aim, African budget airline FastJet struck a funding deal with billionaire Stelios Haji-Ioannou. His investment vehicle, easyGroup, is putting in £1m as part of an £11m private placing. FastJet was off 0.12p at 1.67p.
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