[April 28, 2007]

Carlsberg bid thoughts provide boost for S&N

(Evening Standard Via Thomson Dialog NewsEdge) FOSTER'S and John Smith's brewer Scottish & Newcastle led blue-chips higher with a rise of 291/2p to 615p as one City player gave its blessing to a bid by S&N associate Carlsberg.

Broker ING says in its latest review of the European brewing sector that only two merger scenarios would make sense, one of them being the Danish brewer and Scottish & Newcastle, the latter of which boasts a price tag of GBP5.5 billion.

The two companies have a joint venture in Russia and are already firmly established as the country's biggest brewer.

Curiously, ING reckons S&N shares are already overvalued and has therefore repeated its sell rating with a target of 526p.

Shares generally nursed small losses following an unconvincing performance on Wall Street overnight and losses in Asian markets this morning. The FTSE 100 index fell 12.4 to 6457.0.

Colt Telecomwas an early casualty, losing 171/2p to 1551/2p after warning about dif f icult trading conditions.

SurfControl surged 175p to 675p after agreeing a 700p-a-share offer fromCalifornian web security company Websense Inc. The terms value the internet security solutions provider at about GBP201 million and represents a 63% premium to the closing price of 4283/4p on 6 December last year when SurfControl announced it had received a bid approach. SurfControl posted pretax profits of $700,000 (GBP350,000) last year on revenues of $101.9 million.

Marketing services g roup Cagney plans to raise about GBP1.9 million before expenses by placing 38 million shares at 5p. It has also arranged banking facilities of a further GBP1.2 million with the Queen's banker, Coutts, in addition to its existing GBP400,000 overdraft facility.

Proceeds from the placing and bank facilities will be used to satisfy outstanding acquisition cash considerations, repay debt and convertible loan note obligations and provide additional working capital.

Cagney is "excited" about prospects going forward.

Grove Energy has applied to the London Stock Exchange to cancel its share listing on AIM following its merger with Stratic Energy Corporation, which was completed earlier this week. The cancellation will become effective from 18 May.

Grove has received GBP28 million as proceeds concurrent with the acquisition. In New York overnight, shares traded nervously as investors pondered their next move after the Dow climbed above 13,000 for the first time on Wednesday. In the event, the Dow finished 15.61 higher at 13,105.5.

In Tokyo today, shares lost an early lead, which was blamed on selling in the futures market and investor caution ahead of the weekend.

Next week sees the Golden Week series of public holidays. The Nikkei 225 closed down 28.76 at 17,400.41.

Dealers said institutional investors were switching out of stock futures and into Japanese bonds after inflation and industrial output numbers increased and they pondered when interest rates might rise.

Shares were also on the slide in Hong Kong as investors' thoughts turned to the extended weekend break. The Hang Seng index ended the morning 157.09 lower at 20,510.2..

TRADERTALK

INVESTMENT boutique Liontrust Asset Management has trimmed its stake in engineering and environmental consultant Waterman.

Liontrust, whose fund managers include Jeremy Lang and Anthony Cross, has cut its holding in the GBP58 million firm from 10.88% to 9.32%. Waterman has recently struck a deal to buy Essex-based Boreham Consulting Engineers for GBP9.64 million in a bid broaden its reach in the transport planning and engineering sector. It expects Boreham to maintain its annual profitability and revenue levels of GBP2.2 million and GBP9.9 million respectively when it is merged into the group.

www.citywire.co.uk

Copyright 2007 Evening Standard. Source: Financial Times Information Limited - Europe Intelligence Wire.

[ Back To TMCnet.com's Homepage ]

Discussions: