SAB’s glass half full on bid talk
PROFESSIONAL punters placed a big cross in SAB Miller’s square as rumours of a £50-ashare cash bid from the world’s largest brewer of Budweiser and Stella Artois, Anheuser-Busch InBev, did the rounds.
Shares of the Peroni and Grolsch brewer soared to 3578p before closing 124.5p higher at 3531p as excited dealers heard whispers that AB InBev and the Warren Buffett-backed Brazilian private equity firm 3G Capital were holding final discussions with backers regarding a mouth-watering offer for the world’s second-largest brewer.
Speculation about AB InBev’s desire to swallow SAB Miller has been circling for ages with gossip intensifying in recent months. SAB Miller’s shares touched a peak of 3857p in September when rumours that it was in talks with banks about financing a possible £81bn takeover were rife. The stock has since drifted sharply lower on profit-taking in the absence of corporate activity, but dealers now believe something could be afoot.
The same could be said for Smurfit Kappa, which climbed a further 3.2pc to €26.99 on continuing talk of a €36-a- share cash bid from International Paper.
Tony Smurfit, who is taking over the role of chief executive from the retiring Gary McGann, has said in the Irish press that the group is up for sale at the right price. The board apparently would accept €40 a share.
As Joe and Joan Public went to the polls to vote on what was expected to be the closest General Election in decades, the Footsie dropped 123 points on fears of a hung parliament and months of political paralysis, before closing 46.79 points off at 6886.95.
Sentiment in London wasn’t helped either by an early 40-point loss on Wall Street following Fed boss Janet Yellen’s warning that high stock market levels in North America and Europe could pose ‘potential dangers’. However, the Street of Dreams rallied to trade 80 points up following better-thanexpected US jobs data which showed the number of Americans filing new claims for unemployment benefits rose marginally last week, staying close to a 15-year low.
The figure is a precursor to today’s crucial non-farm (employment) figures with the market discounting an increase of 230,000 in non-farm payroll employment and a further decline in the unemployment rate to 5.4pc.
Drugs giant GlaxoSmithKline fell 67.5p to 1447p with analysts overall underwhelmed by Wednesday’s Capital Markets Day performance. Broker Berenberg says the pharma business will see margin erosion in 2015 on the disposal of the oncology unit.
Buying ahead of the AGM helped Circassia Pharmaceuticals put on 11.75p to 313.25p. Broker Stifel lifted its target price to 350p from 320p.
Backed by star fund manager Neil Woodford and Standard Life, and placed at 202p a share by broker Cenkos Securities, drug delivery group Verseon Corporation was supported up to 220p before closing at 214.5p, for a premium of 12.5p.
The company uses proprietary platform technology to generate computer designed molecules to potentially speed up the drug delivery process.
Woodford is also a big fan of ReNeuron, 0.38p dearer at 4.75p. He has increased his stake in the stem cell therapy research company to 21pc. The company recently received a boost from the US Food & Drug Administration’s approval of a clinical trial for its stem cell therapy for the treatment of retinitis pigmentosa, and from positive data in the phase-one trial of its stroke therapy.
Another market debutant was Curtis Banks, one of the UK’s leading self-invested personal pension providers with a portfolio of 26,000 SIPPS. Placed at 190p by Peel Hunt, the shares closed at 206.5p.
1Spatial, the global spatial software and solutions company, firmed 0.38p to 6p after placing 42.4m shares, and issued 32m shares in the capital, to Azini Capital Partners. Following the transaction, Azini will hold 10.9pc of the equity.
Stellar Diamonds, the diamond production and exploration company, jumped 7pc to 0.72p after announcing dates for the sale of the second parcel of diamonds from its trial mine project in Guinea.
The 4,439 diamond parcel, which includes 12.6 carat gems, is to be offered for sale through eDiamond in both Dubai and then in Antwerp this month.
Profit-taking dragged Pantheon Resources 1.75p lower to 18.25p. The onshore US company has formally contracted the Nabors Rig F-12 for the drilling of two wells in its upcoming drilling programme.
Panmure Gordon is positive and says it appears drilling the first well is expected in the next five to six weeks.
The targets are onshore, among abundant infrastructure and economically viable at an oil price below current levels.