Market report: Takeover talk ratchets up shares and excitement

 

There is nothing like bid talk to get the Square Mile excited,
and there was plenty to whet the appetite yesterday. The news that
Vodafone is eyeing up Cable & Wireless Worldwide was not the
only prospective deal on investors' minds amid claims that
companies are eager to start splashing the cash.

Takeover activity may hardly have been booming recently, but Credit Suisse believes the worst appears to be over. Citing a survey in which over half the companies questioned said mergers and acquisitions were their "prime focus" in terms of corporate actions, the broker said there was "an ongoing appetite" for deals and picked out a number of possible bid targets.

One of them was Old Mutual, and the financial conglomerate was pushed up 4.5p to 127.6p with it also lifted by break-up talk. UBS analyst Michael Christelis claimed the recent sale of its Nordic operations "positions the business for further consolidation and simplification", adding that a full break-up between its developed and emerging-market operations could give its share price a major boost.

Credit Suisse also picked out RSA Insurance, another frequent subject of takeover speculation. The insurer was bumped up 2p to 112.2p as Exane BNP Paribas' Andy Hughes highlighted a number of positive recent updates from its peers, while the financial stocks were rallying generally after Greece passed austerity measures late on Sunday.

The miners' takeover potential was also in focus, with the spotlight on BHP Billiton as a possible aggressor. After its boss Marius Kloppers said over the weekend the digger planned to make further acquisitions, market gossips were reviving vague speculation BHP may be considering a potential move for either Anglo American or US coal producer Walter Energy.

With the rumours suggesting a possible bid could be priced at 3,800p, the former jumped up 70.5p to 2,817p, although Mr Kloppers had refused to comment on whether Anglo could be a target while traders were unimpressed by the chatter.

Vague takeover speculation was being revived around ENRC as it moved 17.5p higher to 702p despite some City voices believing its bid potential has significantly diminished in the wake of the decision by Glencore (down 5.95p to 429.25p) and Xstrata (up 15p to 1,213p) to merge. Meanwhile, the latter was helped by hopes that calls for the pair's deal to be changed to value Xstrata higher may be successful.

Finally, bid rumours continued to strengthen around Kenmare Resources, which has been the subject of talk recently that it could be a target for Rio Tinto (73.5p higher at 3,845.5p). The Irish digger shot up another 5.4p to 58.5p on the FTSE 250 amid vague speculation an approach could be imminent, meaning it has added over 18 per cent in just four sessions. That was nothing compared with CWW, however, which surged 44.54 per cent to 28.54p on Vodafone's admission of interest while the telecoms giant closed 1.75p better off at 174.4p.

While the weekend's events in Greece were enough to push the FTSE 100 to a six-and-a-half-month high, it again failed to move much past the 5,900 point level, finishing 53.31 points ahead at 5,905.7.

Morrisons could only climb 0.3p to 291p after coming under attack as Oriel Securities pointed out that while the ban on cigarette displays in supermarkets is less than two months away, it will be another three years until smaller stores have to follow suit. Saying as a result there could be a shift of as much as £1bn in sales to convenience shops, Oriel's analysts reiterated Morrisons' reduce rating and criticised the fact that, unlike its rivals, the group's move into this area has been rather limited.

On the mid-tier index, Henderson ticked up 4.5p to 127.6p as Credit Suisse upgraded the Anglo-Australian fund manager's rating to buy. Meanwhile, SuperGroup was left with the wooden spoon after sinking 28.5p to 528p, falling for the fourth straight day following its disappointing third-quarter figures last week.

It was a mixed session for the AIM-listed energy groups, with Faroe Petroleum sliding 5p to 165p following the admission it was plugging and abandoning its Kalvklumpen well in the Norwegian North Sea.

Sound Oil was even worse off, as it was smacked back 15 per cent to 1.34p on the news that the Cataka-1 exploration well, in which Sound has a 20 per cent interest, is to be abandoned thanks to drilling difficulties.

In contrast, Gulf Keystone Petroleum continued its steady march forwards, despite Seymour Pierce's Dougie Youngson saying the recent bid rumours were "premature". Still, the analyst did add that the speculation was "likely to be accurate in the longer term" while initiating coverage with a buy rating, and the explorer spurted up 14.25p to 397p.

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