Market Report: Rolls-Royce shares power up


Click to follow
The Independent Online

Rolls-Royce shares powered higher after a US activist investor emerged as its largest shareholder.

Rolls, up 44.5p to 794p, revealed that the San Francisco-based hedge fund ValueAct now owns a  5.44 per cent stake, igniting speculation about a possible shake-up at the aerospace engineering giant.

ValueAct, which has $18bn (£11.5bn) of funds under its watch, has influenced decisions at the likes of Microsoft.

It tends to push for improved performance rather than drastic moves such as management changes or M&A, which activist investors are  known for.

The move comes three weeks after the latest profit warning at Rolls, which came just as Warren East took the reins as the new chief executive.

On Thursday, Rolls revealed a 32 per cent fall in half-year profits.

The engineer was the top riser on the FTSE 100, which made up for lost ground for the fourth day in a row, up 27.41 points at 6,696.28, lifted late in the day by a rise from Wall Street stocks.

Shares in copper miner Antofagasta crumbled 13.5p to 567p as it bought half of Barrick Gold’s Chilean operation for $1bn.

It will become the operator of the Zaldivar copper mine, despite the price of copper languishing at six-year lows.

Marketing group Chime Communications gained another 15.75p to 361p as it agreed to a £374m takeover by ad giant WPP and private equity firm Providence, a day after confirming talks.

UBM was 24.5p higher at 531.5p as the events group bucked the trend with no sign of slowing growth in its Chinese business.

Investors bet on Stride Gaming, up 20.5p at 242.5p, as the recent AIM entrant splashed out up to $39.2m on Israel’s InfiApps as part of its push into US social gaming.

Shares in Stride have soared since floating at 132p in May.

Drug developer Oxford Pharmascience dropped 1.5p to 7.5p after some disappointing results from its clinical study. Star fund manager Neil Woodford owns a third of the company after the latest fundraising, which brought in £20m.