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Bids fly but Syria fears keep FTSE in check
Takeover bids and reports excite investors but FTSE 100 stays planted ahead of possible US air strikes against Syria.
Markets
Shire (SHP) has jumped to the top of the FTSE 100 on reports Japan's Takeda Pharmaceutical (4502.T) was moving closer to tabling a deal for its UK rival.
Shares in the pharmaceutical group jumped 2.8% to £36.90 after Reuters reported Takeda was sounding out major creditors to support a bid.
Japan's largest drugmaker said last month it was considering a bid for Shire, and has until 25 April to lodge an offer.
But Takeda is smaller than Shire, meaning any takeover is likely to require share issuance or additional debt. Shares in Takeda are down 10% since it announced it was considering a bid.
Citywire AAA-rated Michael Lindsell, who holds Takeda in his £216 million Lindsell Train Japanese Equity fund, has voiced his concerns over the deal, citing Shire's 'chequered reputation'.
On the FTSE 250, shares in FirstGroup (FGP) jumped 6.6% to 108.5p after the transport operator rejected a takeover approach from US private equity firm Apollo Global Management (APO.N).
FirstGroup disclosed the offer, which it claimed 'fundamentally undervalues the company and is opportunistic in nature' after its shares jumped 7.4% to 101.8p yesterday.
Playtech (PTEC) was up 4.7% at 797.4p after the gambling technology company agreed to buy a 70% stake in Italian rival Snaitech (SNAI.MI) for €291 million (£253 million).
The FTSE 100 was flat at 7,257 amid fears over possible US action against Syria following its suspected chemical weapons attack.
'Fading fears of a full-blown trade war between the US and China have been a big positive for global stockmarkets, but equity investors are now taking money off the table ahead of possible air strikes against Syria,' said Lee Wild, head of equity strategy at Interactive Investor.
'Already at odds with Russia over the poisoning of former spy Sergei Skripal, the risk here is of serious escalation of hostilities in the Middle East if Donald Trump and the West provoke Syria's allies Russia and Iran.'
It wasn't only takeover bids and reports powering the big movers on the UK market.
Among 'mid-cap' stocks, Greene King (GNK) jumped 11.6% to 518.8p after the pub operator said annual pretax profit would be largely in line with forecasts, despite fears over the impact of cold weather in February and March.
Dunelm (DNLM) was up 10.6% at 579.5p after the retailer reported a 4.6% jump in third quarter sales.
Man Group (EMG) rose 7.4% to 188.6p after the hedge fund reported a 3% rise in assets in the first quarter.
Saga (SAGAG) was up 5.8% at 123.8p after the travel and insurance group for the over-50s lifted its full-year dividend to 9p.
Among 'small-cap' stocks Carpetright (CPRC) slumped 14.2% to 36p as the struggling retailer said it would seek creditor approval to close 92 stores.
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- Shire PLC (SHP.L)
- FirstGroup PLC (FGP.L)
- Playtech PLC (PTEC.L)
- Greene King PLC (GNK.L)
- Dunelm Group PLC (DNLM.L)
- Man Group PLC (EMG.L)
- Saga PLC (SAGAG.L)
- Carpetright PLC (CPRC.L)
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The Expert View: Tesco, Asos and St James’s Place
by Michelle McGagh on Apr 12, 2018 at 05:00
1 comment so far. Why not have your say?
Nick-
Apr 12, 2018 at 20:51
Once again FTSE 100 controllers demonstrated their usual yellow streaks by their dislike moving into positive territories by making negative comments like Syria. One may ask why Syria didn't affect the other major markets today? They all established a healthy positive Northwards shift.
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