Market report: Wednesday close
IT LOOKS like all change on the High Street, which managed to get City speculators up and running today.
Early talk focused on a possible £500m break-up bid for Woolworths, which was the best-performing secondliner with a rise of ½p to 34¾p as more than 60m shares changed hands.
Ten per cent shareholder Iceland's Baugur, which already owns a swathe of Britain's retailers ranging from Hamleys toyshops to the Karen Millen fashion chain, is said to be bringing pressure to bear on the 800-strong stores chain.
But the speculators were also busy chasing car and bicycle parts specialist Halfords 1½p lower to 325½p on hopes of a bid from its 5% Japanese shareholder and rival Autobacs Seven. Halfords has impressed the City in recent years, steadily improving profits against a tough retail backdrop.
Brokers say a merger with Autobacs would make a good fit. The Japanese have been expanding rapidly in western Europe while Halfords has been busily building up its operations in eastern Europe. At these levels, Halfords boasts a price tag of almost £750m.
Shares generally continued sliding following an uninspired performance on Wall Street overnight and losses in Asian markets today. The FTSE 100 index lost 52.4 at 5929.3.
Among leaders, Barclays fell after US broker Citigroup repeated its sell advice and 575p target price.
Speculators are also hoping Lady Luck will smile on them by eventually finding someone to bid for Rank, 7p higher at 232p. They point out that the Mecca bingo and Grosvenor casinos operator could soon be the only pure gaming stock left in play.
Rival London Clubs International, ½p cheaper at 132½p, has agreed terms of a £279m bid from Las Vegas-based Harrah's Entertainment while its former merger partner Stanley Leisure, up ½p at 840½p, confirmed last week it had received a bid approach. Brokers say further consolidation cannot be ruled out ahead of the shake-up of Britain's betting and gaming laws.
Shares in the London Stock Exchange itself have more than doubled since the start of the year and now look set to go even higher after chairman Chris Gibson-Smith hung the For Sale sign up outside the group's headquarters in Paternoster Square.
Today they closed at down 19p at 1182p, compared to their record high of 1275p reached in May this year after one of its main rivals, New York-based electronic trading platform Nasdaq, increased its stake to 25.1%. Nasdaq built the stake ahead of launching an offer worth 950p a share, which was rejected by the LSE.
Gibson-Smith now says he would consider a higher offer from Nasdaq, although he declined to say whether the LSE had received another approach. 'Money is always an issue, but the wellbeing-of our shareholders is the true issue', he said in Seoul, where he is visiting Korea's financial markets. Nasdaq is the LSE's biggest shareholder.
The LSE had planned to merge with the New York Stock Exchange but its hopes were dashed when the NYSE launched a takeover of Euronext, the Paris-based operator of the Amsterdam, Lisbon and Brussels bourses.
Meanwhile, one of the LSE's rivals in London, PLUS Markets, firmed 1¼p to 24p, despite increasing its operating loss in the first half of the year from £291,000 to £869,000. The group started the year with 17 member firms and now has 46 that have either applied for or been granted membership.
It was the first day of trading on Aim for GMO, a provider of mobile phone content in China. Corporate Synergy has raised £5m via a placing of shares at 50p, which values the company at £20m. The shares opened at 52½p before touching 97½p.
It was also the first day of dealings on Aim in Rubicon Software after a placing at 10p by broker WH Ireland. The shares opened at 11p.
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