Yesterday's trading: Rank rising on pensions buzz
Eyes down for a full house at Rank. Shares of the bingo and casinos operator rose 1¾p to 98p on hopes that the imminent sale of its £700m pension scheme to Goldman Sachs will pave the way for one of its major shareholders to launch a full-scale offer for the group.
The Daily Mail's Geoff Foster
Rank was the first major public company to put its pension scheme up for sale last September and has apparently been in exclusive talks with the American broking giant for weeks.
Rank's fortunes and profits have not only been hit by the smoking ban in the UK, but changes in gaming machine regulations and increased casino taxation.
The collapse of the share price from a year's high of 231p to a low of 77¾p has attracted hungry stakebuilders and 26%-plus of the group's equity is now held in potentially threatening hands. Malaysian gaming giant Genting, which already owns Stanley Leisure casinos, sits on 11.03% and is forever tipped as the likeliest bidder.
But Guoco, an investment group run by Quek Leng Chan which acquired the Clermont Club from Rank in 2006, recently increased its shareholding to 6% and could also be interested.
The Richardson family of the West Midlands sits on 9.3% but is believed to be a willing seller at the right price. All in all, dealers say that once Rank gets the pension fund monkey off its back, it will lose its independence before you can shout 'house'.
Swiss bank Credit Suisse put an early spanner in the works by announcing a further £1.5bn write down of assets only a fortnight after its results and suspending a small number of traders over mismanagement.
The shock news for a time overshadowed reassuring annual results and a 10% dividend hike from Barclays, 17p better at 477p. But when Wall Street opened 157 points up in response to better-than-expected fourthquarter figures from retail giant Wal-Mart, London rallied.
The Footsie impressively retrieved a 61.8 point deficit to storm back above 6,000 with an 87 point leap by lunchtime. It boiled over on profit-taking and worries about today's preliminary figures from mortgage bank Alliance & Leicester (17½p off at 528p) to close 20.3 points better at 5,966.9. The FTSE 250 added 124.6 points to 10,208.6.
Record commodity prices once again drove miners forward. BHP Billiton added 38p to 1656p while its bid target Rio Tinto put on 124p more to 5850p for a two-day leap of 357p.
Precious metals producer Hochschild firmed 2¼p to 427p after acquiring a strategic 20% stake in Canada's Long Shore Gold for around £32m, with a right to increase to 40% by the end of 2008. LSG has low-cost, high grade gold assets.
Revived Best Buy of the US takeover speculation helped mobile phone retailer Carphone Warehouse buzz 5½p higher to 310¼p. Rumours persist that co-founders and major shareholders Charles Dunstone and David Ross intend to sell all, or part, of their stakes before April's punitive change in capital gains tax.
Competition concerns dragged the London Stock Exchange 107p lower to 1564p.
Shrugging off a Panmure Gordon sell recommendation in the wake of last month's profits warning, reinsurance broker Benfield rose 11¼p to 269¼p on vague bid talk. The broker says the reinsurance landscape is changing dramatically and the current share price fails to fully reflect the impact of the imminent changes.
Debts.co.uk, the specialist financial advisors, edged up 1p to 45p on news of a £2.73m placing of 6.1m shares at 45p a share to help fund the earnings enhancing acquisition of PB Recovery, which comprise a substantial part of the trading assets of Brightside Group.
Microwave radio and satellite transmission group Vislink soared 5¾p to 45¾p on hearing that former chairman and entrepreneur Bob Morton's family trust, Southwind, has increased its stake to 7.1m shares, or 5.11%.
Encore Oil gushed 1¼p to 45½p after Sterling Resources, the operator of the Breagh discovery in the North Sea, confirmed it has received an upbeat independent evaluation of gas in place on UKCS block 42/13. Encore holds a 15% interest in the licence.
On receiving certain early-stage approaches from third parties, provider of IT security and outsourcing services Netstore rose 5½p to 23½p. Trading is in line with expectations.
• Mid-cap broker Canaccord Capital has a healthy balance sheet and is well positioned to grow in the difficult marketplace while others stagnate. Global head Paul Reynolds' strategy is to build up its London operation over the next six months or so and he has been busy recruiting. Darren Ellis, former finance director at Bridgewell, joins today as chief administrative officer. Shares held at 642½p.
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