Market Report: Lonmin leaps amid takeover rumours

The speculators are homing in on Lonmin. The South African platinum miner jumped 16p to 188.3p amid chatter that it could be a takeover target. The theory is that Glencore, Lonmin’s biggest shareholder, will take full control of the business, which lost 44 per cent of its value last year after a five-month strike, resolved in June. Lonmin reached a 10-week high, while Glencore inched up 1.85p to 268.85p.

Rexam, the drinks can manufacturer, confirmed rumours, reported in yesterday’s column, that it is in talks to be taken over by its US rival Ball Corporation. The current proposal values it at 610p a share and Rexam jumped 90.4p to 538p. But the investment bank Jefferies warned that the combined entity would have 70 per cent market share, which could be a sticking point for competition watchdogs.

Solid results helped the FTSE 100 close 5.91 points higher at 6,865.93. Among these were the full-year numbers from Smith & Nephew. The fake hips and wound dressings maker climbed 30p to 1,198p after it revealed that revenue rose 2 per cent and underlying profit 7 per cent. Traders still hold a candle for hopes that Smith & Nephew could be taken over by its US company Stryker, which expressed an interest last year.

The plastics specialist Carclo jumped 15.75p to 116p as it said a strong second half meant full-year figures are set to beat forecasts. Small-cap brokers reported that the company was one of the most heavily traded in the session.

A warning on currency rates, a squeeze on profit margins and the admission that earnings this year will be below expectations left the electronics parts supplier Premier Farnell nursing a 11.3p fall to 158.1p.

The retail investor favourite Quindell climbed 6.5p to 76p amid hopes that a deal with the Australian law firm Slater & Gordon to offload part of its legal arm could soon be hatched. Slater & Gordon reports half-year results next Tuesday and investors believe this will bring with it an update on talks. Rumours are circulating in the City that executives from Australia have also flown in this week to cast an eye over the books of the claims-handling business.