Speculation over Anglo American mega-deal sends shares soaring
Source: Daily Mail, April 29, 2015. http://www.dailymail.co.uk/money/markets/article-3059513/MARKET-REPORT-Speculation-Anglo-American-mega-deal-sends-shares-soaring.html?ITO=1490&ns_mchannel=rss&ns_campaign=1490
Up an impressive 14 per cent in a matter of a few weeks amid reports of a big buyer stalking the stock, Anglo American rose a further 25 1/2p to 1,129p.
Speculation has intensified of late that a mega-deal in the oversold mining sector is imminent and dealers heard yesterday that a break-up bid north of £16 a share for the multinational mining group could be on the cards.
Anglo American is the world’s largest producer of platinum with around 40 per cent of the world output, and is a major producer of diamonds, copper, nickel and iron ore.
Any potential buyer would love to get its hands on De Beers, the jewel in Anglo’s crown. It performed well in 2014, a year that was difficult for Anglo’s other businesses because of weak commodity prices.
Indeed, De Beers hit a profitability target set by chief executive Mark Cutifani of a 15 per cent return on capital employed two years early.
Dealers were of the opinion that possible buyers of Anglo American, or even just it’s De Beers offshoot, would possibly include Mick ‘the Miner’ Davis. The former boss of Xstrata’s new X2 Resources fund has amassed more than £3bn to spend on acquisitions.
Ivan Glasenberg’s Glencore, up 2.7 at 314.9p, which is now free to have another pop at Rio Tinto, 34 1/2p down at 2,979 1/2p, could decide to chance its arm and make a move on Anglo American. Lonmin, in which Glencore still sits on a 23.9 per cent stake, touched 150.8p before closing 3.3p better at 147.9p.
Profit-taking dragged the Footsie below 7,000 before it rallied to close 73.45 points down at 7,030.53. A weaker-than-expected first-quarter UK GDP figure, which came in at 0.3 per cent, the slowest growth since 2012, gave market-makers an excuse to get blue chips lower, while growing general election uncertainties and a waft of bad news from the eurozone also persuaded fund managers to lock in some profits.
Pharmaceutical majors were under the weather with AstraZeneca the biggest casualty, falling 157.50p to 4,548p. The stock has taken a knock after US rival Merck’s Januvia diabetes drug recently met heart-safety requirements in a Tecos study. Shire lost 175p to 5395p on growing drug competition fears.
Profit-taking following a strong first-quarter trading statement left St James’s Place 31p down at 881.015p. Some investors were disappointed with news that net quarterly inflows were up 9 per cent on a year earlier to £1.3billion. They had expected £1.4billion. Shore Capital remains a buyer ahead of the Capital Markets Day on May 13.
Ophir Energy put on 4.3p to 169.669p after reaching an agreement to acquire four production sharing contracts in Indonesia from Niko Resources. It will conduct operations in Indonesia from a new office in Jakarta, which it acquired following its takeover of sector peer Salamander Energy.
Upmarket housebuilder Berkeley Group reflected general election uncertainties with a fall of 113p to 2,547.58p.
Currently in receipt of a £1.2billion cash and shares offer from America’s Arris, British set-top box maker Pace fell 15.2p to 414.83p.
Maiden results from Allied Minds left the stock 21p off at 677p. The company which aims to identify and commercialise intellectual property generated from US universities and US federal research organisations has attracted the attention of blue chip investors including former Invesco boss Neil Woodford. Peter Dolan, ex chief executive and chairman of Bristol-Myers Squibb has been appointed non-executive chairman.
Superdry fashion chain Supergroup eased 4 1/2p to 985.79p despite bullish comments by broker Berenberg. It says the group is transitioning from a business with significant potential to one which is starting to deliver. It’s target price is 1160p.
Biopharmaceutical company GW Pharmaceuticals fell 48 1/2p to 619 1/2p after announcing plans to sell 1.25million American Depositary Shares on the Nasdaq Global Market in an underwritten US public offering. Each ADS issued will represent one ordinary share of GW.
Shares of Pinnacle Technology soared 1 5/8p or 29 per cent to 7.1p after the IT managed service provider raised £0.86million via a placing of 13.2million shares at 6 1/2p a pop. Funds raised will be used to implement its growth strategy and to fund its working capital requirements.
Buyers chased CentralNic 4 1/2p higher to 34p following strong annual results. The internet platform company reported a 70 per cent leap in earnings to £1.72million on revenues 99 per cent higher at £6.07million. The company ended the year with three profitable operating divisions: registry services, registrar services and enterprise services.
African-focused support services company Atlas Development & Support Services firmed 1|4p to 3.6999p following impressive interim results showing increased revenues and a return to profitability. NetDimensions rose 5 1|2pto 86.2p after the company said that both revenue and invoiced sales for the first quarter were substantially ahead of last year.
Oilex firmed 12 per cent to 0.076p after completing the construction of its Cambay-73 production facilities on budget and ahead of schedule. The facilities are ready for start-up and awaiting arrival of the low pressure gas pipeline to site. Construction of the pipeline has commenced and it is expected to be at site ready for connection to the production facilities during May 2015.