FRIDAY MARKET CLOSE: Takeover battles push FTSE higher

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YET another bout of fierce merger and acquisition activity helped the London market outperform its peers on the Continent.

The FTSE 100 Index was 17.09 points higher at 6,825.2, boosted by a shot in the arm from takeover target Shire. The drugs firm saw its shares surge by 17 per, up 633p to 4,371p.

David White, a financials trader at Spreadex, said: “Shire continues to be in focus, as stories broke that AbbVie is said to be weighing an increased offer after the British pharmaceutical company rejected its first.”

A fierce battle brewing between GE and a Siemens-led group for the acquisition of select Alstom assets also helped sentiment.

The other focus of the session was on the banking sector after the start of conditional dealings in TSB. The offer was priced at 260p per share and the stock rose by around 12 per cent to 290p, adding almost £200 million to TSB’s market value. Seller Lloyds was down 1 per cent at 76.7p.

Royal Mail shares were lower after it provided some stark warnings to the regulator over the threat to the universal delivery service posed by competitors such as TNT Post.

The recently privatised company said the lack of intervention from Ofcom would undermine its ability to reach a 5-1 per cent earnings margin and that TNT Post’s plans would reduce its revenues by more than £200m in 2017-18. Royal Mail slipped 0.6p to 483.7p.

Elsewhere, the market was unimpressed by Debenhams announcing plans for a trial run of Sports Direct and Costa outlets in some of its stores, which sent shares 1.3p lower at 70.8p.

The company added that its outlook for the year was unchanged after like-for-like sales for the 14 weeks to 14 June rose 0.7 per cent on an underlying basis.