Market Report: Takeover talk drives up Stagecoach shares

The rumour mill cranked into action yesterday, driving Stagecoach up the mid-tier index after speculation swirled that it could be in line for a potential bid.

As the transport group pushed forwards 11.1p to 228.8p, market gossips were mulling over vague rumours that it could receive an offer, with Deutsche Bahn and an unnamed group from Hong Kong both being linked and a price mentioned of 350p-a-share.

However, sceptics played down the idea. "Ultimately nothing happens without the say-so of Stagecoach's CEO Brian Souter and co-founder Ann Gloag," said Arbuthnot Securities' Gerald Khoo. "Between them, they own about 26 per cent of the company... and I do not think Mr Souter is in the mood for retirement."

In addition, the analyst said, given the fact that Deutsche Bahn owns Arriva, the issue of market share in the UK bus sector is "a complete show-stopper" in terms of the German rail group making an approach.

Stagecoach also benefited yesterday from positive comments from Liberum Capital, which issued a "buy" note and said it believes "there is an increasing likelihood that [the group] will return capital to shareholders".

Overall the FTSE 100 fell to its lowest for two weeks, finishing 46.64 points behind at 5,963.8.

Growing fears that the release of China's inflation figures on Friday will show a large increase, meant the miners were under pressure, with Antofagasta, Kazakhmys and ENRC dropping 51p to 1,355p, 41p to 1,368p and 21.5p to 909p respectively.

Xstrata edged back 1p to 1,467.5 as the commodity trader Glencore finally confirmed the details of its initial public offering, scheduled for next month. There has been persistent speculation that the move will be the first step towards a merger between the two.

InterContinental Hotels was lifted 7p to 1,288p after Morgan Stanley reiterated its "overweight" rating and raised the group's target price to 1,650p from 1,500p. The broker was generally upbeat on the sector, saying that "with robust corporate demand and low new supply, we are in the middle of a strong hotel cycle", prompting Whitbread to add 12p to 1,685p while Millennium & Copthorne was bumped up 7p to 540p.

Unilever was also among the risers, as sentiment around the consumer goods giant was given a boost by results from across the Channel. The group, whose diverse portfolio of brands stretches from Ben & Jerry's to Vaseline, climbed 14p to 1,942p after its French peer Danone shrugged off fears over the economic climate to reveal an impressive growth in sales.

However, Evolution Securities' Warren Ackerman warned that the read-across between the two was "fairly limited", saying that he did not expect Unilever to be as positive on pricing as its peer.

Market voices pointed to Unilever's announcement earlier this week that it is closing its final salary pension scheme as another driver behind its shares, and said investors were also switching from Reckitt Benckiser.

The owner of Cillit Bang was at the foot of the top-tier index after it was knocked back 251p to 3,115p following the surprise revelation that its chief executive is retiring. Bart Becht has led Reckitt since 1999, but Guardian Stockbroker's Atif Latif said the sell-off was "overdone" and described his replacement Rakesh Kapoor as an "able candidate".

There was also upheaval at the top of Debenhams, but the announced retirement of its chief executive, Rob Templeman, did not have the same effect, with the department store edging down 0.25p to 66.55p. The news came with its half-year results, in which the group's underlying pre-tax profit just beat expectations and it revealed it was restarting its dividend.

Debenhams was one of many companies on the FTSE 250 updating the market yesterday, including its fellow retailer WH Smith which powered up 24.4p to 475.1p after posting a rise in profits of 3 per cent.

Filtrona was also near the top, advancing 14.8p to 322p, with the plastics and fibre group's first-quarter revenue enjoying a jump of nearly 10 per cent. However there was no such joy for PZ Cussons, 13.3p behind at 328p, after it warned of a number of near-term headwinds including rising raw material costs.

There was a surge of 11.75p to 166.5p for Gulf Keystone Petroleum on the Alternative Investment Market as the oil explorer increased its estimates for its Shaikan block in Kurdistan to 4.9 billion barrels.

Meanwhile, the small-cap care home group Southern Cross shot up 1.81p to 11.75p after issuing a brief statement that it had met with its major landlords over its financial problems. Although it said no decisions have yet been made, the troubled company added that there was "a general recognition of the value to all parties of moving forward to a solution in an orderly fashion".

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA special investigation by Andy McSmith
Arts and Entertainment
This weekend's 'Big Hero 6' by Disney Animation Studios
arts + ents
News
i100
News
Budapest, 1989. Sleepware and panties.
newsDavid Hlynsky's images of Soviet Union shop windows shine a light on our consumerist culture
Arts and Entertainment
Eleanor Catton has hit back after being accused of 'treachery' for criticising the government.
books
News
In humans, the ability to regulate the expression of genes through thoughts alone could open up an entirely new avenue for medicine.
science
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: Software Development Manager

£40000 - £50000 per annum: Recruitment Genius: This is an exciting opportunity...

Ashdown Group: Product Manager - (Product Marketing, Financial Services)

£30000 - £35000 per annum + Benefits: Ashdown Group: Marketing Manager - Marke...

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...

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