Traders dine out on Peppa Pig
OINK, oink! As far as investments go, it’s certainly brought home the bacon. Shares of Peppa Pig owner Entertainment One advanced 16.6p or 6.17pc to 285.7p after Marwyn Value Investors sold it’s remaining 53m shares, or 18pc, in the company at 269p a pop to the Canada Pension Plan Investment Board.
The £142.4m raised from the sale, added to the £87.5m realised when MVI sold a third of its shareholding in July, makes a total gain of £229.9m or 4.3 times its original investment. Marwyn, the private equity ‘ master fund’ based in the tax haven of the Cayman Islands, brought EOne to AIM in 2007 with a valuation of £85m.
It has since gleefully watched as the popularity of Peppa Pig and her family and friends has become the Number One preschool brand in markets across Europe and South America. It’s film distribution also produced mega films Hunger Games and 12 Years a Slave.
EOne’s shares jumped as dealers celebrated the removal of Marwyn’s stake which has been hanging over the stock since it sold the first chunk in July. Buyers nibbled away at MVI (5.75p better at 219.75p) after it revealed it would increase a planned shareholder payout in November to £15m, from £5m, as a result of the disposal. Around £103m of the £229.9m profit will be attributable to the Marwyn Investment Trust and this will enable the return of £15.3m – or 24.6p per share – to MVI shareholders.
The lion’s shares of the disposal proceeds will be ploughed into MVI’s existing investments. They include BCA Marketplace, 0.75p up at 177.5p.
Elsewhere, ecstatic professional punters raised their glasses to SABMiller after confirmation, at long last, of Anheuser-Busch InBev’s intention to swallow the Peroni brewing giant and create a £177bn colossus. SAB- Miller rocketed to 3737p before closing 599.5p or almost 20pc higher at 3614p. Broker Canaccord Genuity does not doubt ABI’s ability to execute a deal and thinks that a target price of £43 a share for SABMiller is now appropriate, albeit ABI may have capacity to go higher. Diageo got caught up in the excitement and rose 32.5p to 1777.5p.
The proposed mega deal helped intoxicate the rest of the market. The Footsie – already firmer after an overnight leap from Wall Street on hopes the Fed will today leave US interest rates well alone – closed 91.61 points up at 6229.21. The FTSE 250 advanced 100.13 to 17,061.97. Wall Street closed 140.10 points higher at 16739.95.
After successful completion of the placing of £1.6bn (9.9pc) new equity at 125p a pop to help slash it’s mountain of debt, Ivan Glasenberg’s beleaguered Glencore rallied 6.65p to 134.7p. Executives have personally taken up 22pc of the issue as part of a pledge to maintain their holdings.
Bullish comments from JPMorgan Cazenove and a price target of 4350p helped British American Tobacco put on 102.5p to 3575p. It is one of the broker’s top-picks in European Consumer Goods because of its ability to improve profitability. As pricing gets better, it sees a continuation of margin improvement.
A Berenberg sell signal and price target of 870p dragged Inmarsat 20p lower to 1001p. It is facing increased competition in key target growth areas.
Perennial takeover target Hunting, the international upstream energy services provider, gained 33p to 471.1p.
Quadrise Fuels soared 2.5p or 21.3pc to 14.25p after finally reaching a refinery agreement in its Marine project between Maersk, CEPSA and itself. The agreement provides for the supply, installation and commissioning of an MSAR Manufacturing Unit at CEPSA’s San Roque refinery near Gibraltar.
Strong interim results attracted buyers to Smart Metering Systems, 5p better at 341p. First-half revenues increased by 36pc to £25.8m with underlying earnings up 40pc at £12.2m. Broker Cenkos is a fan and describes SMS as unique in being the only listed company to provide direct exposure to the large scale (£12bn) domestic smart-metering programme due to commence in 2016.
Tri Star Resources improved 0.005p to 0.13p after announcing construction can now commence on a 20,000 tonne-per-annum antimony processing facility in the Sultanate of Oman.
Styles & Wood rose 25p to 265p after being selected to carry out the £17.7m refurbishment of Westminster House offices in Manchester for Aviva Investors. It is the company’s single largest project since 2008.
After a confident trading update which highlighted its growing UK operations, People’s Operator managed to edge up a penny to 126p.
Reflecting disappointing interims and omission of the dividend, Vislink plummeted 7.12p, or just above 13pc, to 46.88p.
QUOTED annuity specialists came under the cosh as the FCA produced data showing a dramatic fall in take-up of these retirement products: 71,581 drawdown arrangements were accessed in the first three months of pension freedom, more than the 19,000 reported by the ABI. Another 120,688 people have taken cash out of their pension pot. Just Retirement lost 4.8p to 183.3p and Partnership Assurance 3.75p to 149.5p.