Bad is good at Close
At first glance, the idea of buying Close Brothers looks foolhardy. As a medium-sized London investment bank, you might think that Close is struggling to survive the credit crunch. Neither is the case. Chaired by City veteran Rod Kent, Close is a conservatively run bank with a variety of businesses, which include stockbroking, corporate lending and a mergers and acquisitions advisory arm. It's not involved with any aspect of the housing market. Still, it doesn't seem like a must-have in these troubled times, until you consider that one of its biggest departments is its financial restructuring arm. In the past, the bank has worked for basket cases such as Eurotunnel and property group Erinaceous. With storm clouds gathering over the economy, no wonder it has attracted predatory interest from Blackstone, the private equity firm, and Cenkos Securities. Close is a play on bad news, but even here, there is money to be made.
Bet on BG
BG has had a good run, taking its share price up from 649p at the beginning of 2007 to 1,036p on Friday. Investors have piled in on rumours of Chinese stake-building and possible bids from the likes of Shell, Exxon and BP. The company has also attracted interest as it controls 25 per cent of the Tupi oilfield offshore of Rio de Janeiro, where huge quantities of the black stuff were discovered at the end of last year. What has been missed, however, is the huge spread of BG's operations elsewhere. It has operations in India, Egypt, Kazakhstan, Tunisia, Oman and Nigeria, as well as a big liquified natural gas business. Although the stock has soared, brokers expect it to go higher still. Deutsche Bank, for example, has increased its price target to 1,200p.
All go at AstraZeneca
AstraZeneca is in vogue. The Anglo-Swedish drugs group is seen as a safe haven in times of uncertainty; dealers say that the shares could hit 2,400p before 2008 is out. The company is also cited as a bid target for GlaxoSmithKline.