NMC Health surges as two bidders circle firm
IT is unusual to see a doubledigit share price rally from a FTSE 100 firm.
The grand old business giants on London’s blue-chip index usually move at a more stately pace.
So a surge in NMC Health’s stock, which at its peak barrelled ahead by some 40pc, was a welcome show of enthusiasm.
The company, which runs private hospitals in the United Arab Emirates, announced it would buy back around £163m worth of shares and reported robust results for the six months to June.
But it wasn’t the 17pc rise in patients to 4m, or 18pc jump in profit before tax to £115m, that the City was so excited about.
Unconfirmed reports that two groups, including one backed by Chinese investment behemoth Fosun, have made competing offers to buy as much as 40pc of NMC for up to £1.5bn are what did the trick.
NMC is keeping quiet on the investment rumours for now, but shares still ended the day 18.6pc higher, up 360p, at 2296p. The
FTSE 100 shed 1.1pc, or 75.79 points, closing down at 7128.18, after signals from minutes released by the US Federal Reserve hinted that hefty interest cuts are not on the agenda.
Lower interest rates typically boost the stock market by allowing firms to borrow more cheaply.
And recession fears were reignited after gloomy data about Germany from monitors at IHS Markit indicated businesses in Europe’s largest economy continued to underperform last month.
The mid-cap FTSE 250 index was virtually flat, down just 2.43 points at 19,205.32.
Embattled Ukrainian iron ore miner Ferrexpo slid 6.1pc, or 13.2p, to 202.6p, after a brutal downgrade on its stock from ‘buy’ to ‘sell’ from brokers at Liberum.
Analysts almost halved the target price on shares from 300p to 165p. The scandal-hit firm has run into problems over its dealings with a charity called Blooming Land, with former auditor Deloitte resigning after it said money Ferrexpo paid to the charity may have been misappropriated.
Liberum’s downgrade, however, was due to problems faced by iron ore miners more generally.
It claims demand for the ore, which is one of the main raw materials used to make steel, has now peaked and the price will fall.
As a result, it also downgraded stock in mining majors BHP, Rio
Tinto and Anglo American from ‘hold’ to ‘sell’. Shares in BHP closed down 0.9pc, or 15.2p, to 1698.6p, while Rio lost 1.1pc, or 44p, to 3946p and Anglo closed down 2.5pc, or 42.4p, to 1680.6p.
Premier Oil was back in investors’ good books after it released promising half-year results. The oil explorer has been criticised for building up debts of some £2.3bn. These had fallen to £1.8bn at the end of June, and the company is selling off some of its assets off the coast of Mexico to further cut this burden.
Premier will also reduce its holding in a project north of the Falkland Islands to raise extra cash – which will, of course, be put towards further debt reduction.
Chief executive Tony Durrant said: ‘We frankly get quite frustrated around here by continually being referred to as debt-laden.
‘We are no longer out of line with the majority of our peers; the debt’s coming down.’
First-half profit may have slid from £8.9m to £6.7m compared with last year, but Premier’s share price rose 9.3pc, or 6.72p, to 78.98p by the close. Southend Airport owner Stobart
Group advanced 2pc, or 2.2p, to 113p as it revealed a partnership with budget Eastern European airline Wizz Air. Three routes will go from Southend Airport to Bucharest and Sibiu in Romania and Vilnius in Lithuania. Shares in Wizz rose 0.4pc, or 14p, to 3435p.