Wednesday market close: Reckitt sale deal helps market rise

Share this article
Have your say

The FTSE 100 pushed higher helped by news that Reckitt Benckiser had agreed to sell a basket of its key food brands in a multi-billion-pound deal.

London’s blue chip index ended the day up by 40.69 points at 7,430.91, with Reckitt shares ranking among the best performers, rising 125p at 7,937p.

The household goods giant confirmed it would sell a raft of brands including French’s mustard and Frank’s hot sauces to McCormick in a $4.2 billion (£3.2bn) deal.

US group McCormick fought off a number of rival bidders to secure the British firm’s food business in a move that will propel it to the number one position in America’s condiments market.

David Madden, a market analyst at CMC Markets UK, explained that the funds raised through the deal will help pay down Reckitt’s debt, which seemed to please shareholders.

“The company’s shares were higher on the day as investors are clearly happy with the deal.”

Construction giant Morgan Sindall raced ahead after announcing it was on course for a hefty jump in profit thanks to a bright performance from its interior refurbishment business.

Pre-tax profits are expected to rise by 45 per cent to £23.5 million for the six months ending in June, boosted by better-than-expected trading from its Fit Out unit, which overhauls office and retail space.

The firm was also helped by improved margins at its construction and infrastructure arm. Shares climbed more than 4 per cent, or 55p to 1,275p.

The biggest fallers included Experian down 32p to 1,532p, Barclays down 4p to 205.1p, and Wolseley down 65p to 4,600p.

Click here to ‘Like’ The Scotsman Business on Facebook