Investors form a queue for a slice of Kensington
AS the FTSE raised 8.2 points to 5539.8, a new four year high, dealers were casting a kindly eye on Kensington Group. It welcomes with open arms those people who experience difficulty in obtaining mortgages or loans from the High Street banks.
Kensington has been a godsend for many couples who have fallen foul of the stricter lending criteria imposed by Britain’s biggest lenders. It obviously charges a premium to those with poor credit ratings, but it does give the less financially fortunate a chance to get on the property ladder. Up from a January level of £4-plus, the shares rose a further 7p to a record 897p on continuing whispers that a private equity player is running the slide rule over the business. A bid approach well north of £9 a share is believed to be a possibility early in the New Year.
Kensington looks in the best of health. It revealed last month that it was on target to meet its full-year earnings forecasts. Lending was up 50pc in the first 11 months of the year and during that period Kensington lent a massive £3bn. It earns a considerable sum by charging its customers early redemption penalties, a necessary evil in this cut-throat market.
Buy to let mortgage expert Paragon gained
61⁄ 2p to 6071⁄ 2p amid speculation that Bradford & Bingley (13⁄ 4p dearer at 4111⁄ 4p) is considering launching a bid for the company.
The Footsie failed to hold on to an early gain of 16.8 points. Wall Street’s early rise of 46 points bolstered sentiment in London but it was healthy gains recorded by heavyweight drug stocks that helped the leading UK indicator peak.
Heavy buying of AstraZeneca came in the wake of Friday’s late announcement that Pfizer’s world’s largest selling cholesterol-busting drug Lipitor will not face generic competition until 2011 after a US court said a version of the drug by India’s Ranbaxy Laboratories would infringe Pfizer’s patents.
AZ, which is significantly involved in cholesterol-reducing product development, soared 118p before closing 83p higher at 2830p. The ruling is the second major patent victory for the pharmaceutical industry this year. In April, Eli Lilly prevailed in a challenge against its schizophrenia drug Zyprexa. It augurs well for AZ, which faces patent challenges to its Nexium ulcer drug and Seroquel for schizophrenia. GlaxoSmithKline rose 23p to 1483p, carried up by the tide.
Housebuilder
Crest Nicholson erected a gain of 16p at 463p after Citigroup lifted its target price to 470p
TECHNOLOGY cash shell Nettworx floats on Aim tomorrow at 10p and should receive a warm welcome. Jonathan Rowland, who trousered a fortune from selling internet investment venture Jellyworks for £60m in 2000, will be running the company along with Jason Drummond, another former dotcom high flier. Investors include Lastminute. founder Brent Hoberman, Julie Meyer of First Tuesday networking club fame and Allan Leighton. from 420p. Revived chatter that Gerald Ronson’s Heron International has been approached for its 23.3pc stake in the company also did the rounds.
Online auctioneer QXL ricardo was all over the shop. It moved between extremes of 12510p and 10745p before closing 119p lower at £ 120. Its rise from £ 70 has been accompanied by persistent takeover speculation and bolstered by tracker fund buying on the assumption it could soon be included in the FT small cap index. A family of bears including the daddy of them all, Evil Kneivil, believes that QXL will never be allowed in the index because its ‘free float’ of shares trading on the LSE is below the required 25pc limit. Florissant, a Dutch private equity group, was left holding a 28pc stake when a £14 a share bid lapsed earlier in the year and Izaki, an investment vehicle of Israeli entrepreneurs Ron Izaki and Shimon Weintraub, sits on a further substantial shareholding.
Conival firmed
1⁄ 2p to 27⁄ 8p after chief executive Jeremy Schwartz whetted investors’ appetites at the agm by revealing an agreement with Heston Blumenthal’s company, Fat Duck Group Limited, to produce a range of soups, gravy and stock.
Victoria Oil & Gas
eased 2p to 951⁄ 2p after announcing plans to raise £12.8m via a placing of 16.4m shares at 78p per share. Funds raised will be used to fund well test operations at its projects in Yamal-Nenetsk, Russia.
Symphony Plastic Technologies jumped 25⁄ 8p to 87⁄ 8p on news the Court of Appeal has dismissed an appeal brought by Environmental Products Inc against a December 2004 High Court decision in favour of the degradeable plastics company.