Thomas Cook in Chinese sights
THOMAS Cook could get swept up in a wave of mergers in the travel industry, according to City chatter.
Rumours abounded that Chinese conglomerate Fosun International, which bought a 5pc stake in Thomas Cook for £92m in March, could buy the rest of the British tour operator.
In June, Cook formed a Chinese joint venture with Fosun, which is backed by billionaire Guo Guangchang, dubbed ‘China’s Warren Buffett’.
Cook has faced problems including a hit from a terrorist attack in June in which 38 tourists died, sparking cancellations.
There was also talk that rival TUI Travel or Fosun – bidding directly or via Cook – may launch a play for Swiss tour operator Kuoni.
Kuoni sold its UK arm and its operations in Switzerland, Scandinavia and the Benelux region to German rival DER Touristik in June.
It said last month that the strong Swiss franc had hit first-half turnover as it refocused itself on selling services to the global travel industry.
Shares in Thomas Cook were 0.2p down at 114.1p while TUI Travel gained 5p to 1215p.
The FTSE 100 ended the session 33.17 points adrift at 6084.59 as traders remained on edge about the US Federal Reserve rate decision later this week.
Eurozone industrial production data for July provided some cheer, with month-onmonth growth of 0.6pc outstripping expectations and representing the best since February.
Howard Archer at IHS Global Insight said the data ‘lifts hopes that industrial production can make a significant contribution to eurozone growth in the third quarter’.
However, UK economic news was downbeat, with shopper numbers in August falling 1.6pc, although the August bank holiday was not included. Business activity in most regions of England and Wales slowed during the month – the fourth month in five that it had weakened, according to a survey from Lloyds Bank.
Back on the corporate front, oil majors and miners lost out amid widening losses in copper and Brent crude prices.
The price of a barrel of Brent dropped by as much as 3.3pc to $46.60, hitting shares in BP by 1.5p to 332p and knocking Royal Dutch Shell by the same amount to 1613.5p.
Anglo American lost 1.5p to 716.9p and Glencore was off 5.9p at 127.9p.
Drug group Astrazeneca declined a penny to 4284.5p despite an upgrade from Germany’s Deutsche Bank. Deutsche said it was increas- ingly confident in the company’s potential to return to strong growth from 2017.
AZ’s peer Shire back-tracked 72p to 4743p after reports claimed it was considering ways to sweeten its $30.6bn offer for US biotechnology firm Baxalta.
News that sales of Apple’s iPhone6S were set to beat records lifted shares in chipmaker ARM Holdings by 14p to 948p. Smoke and carbon monoxide alarm maker
Sprue Aegis rang up 20p to 332.5p after it more than doubled revenue to £56.5m and hiked its dividend by a quarter.
UK Oil & Gas Investments failed to impress investors with a study claiming that its Markwells Wood oil field about seven miles northeast of Portsmouth contained 1.25m barrels of oil. Shares in UKOG, which is involved in the Horse Hill discovery near Gatwick Airport, fell 0.05p to 1.75p.
News of record half-yearly production and an 187pc rise in revenue to €12.9m boosted shares in Côte d’Ivoire palm oil producer
DekelOil by 0.08p to 1.08p. Investors dropped shares in Haike Chemical Group by 4p to 9p as the Chinese company said it may not make a full-year profit due to the turbulent economy in China. Haike blamed lower turnover on cuts in prices of flagship products such as dimethyl carbonate and isopropyl alcohol.
Shares in Abzena were flat at 69p after the life sciences group bought PacificGMP, a privately owned contract biopharmaceutical developer and manufacturer based in San Diego, California, for about £5m.
Medical device group Akers Biosciences was 5p healthier at 167.5p as it began sales of a device able to tell whether people are burning off body fat for energy.
Another healthcare company, PureTech Health, ticked up 1p to 146p after appointing Michael MacLean as its finance chief. MacLean was finance boss of the North American business of US global storage and information management group Iron Mountain.
Collagen Solutions, which makes collagen for regenerative medicine and medical devices, was on its sickbed by 0.12p to 12p as it acquired all the assets and an intellectual property licence related to collagen-based cartilage and bone implant ChondroMimetic.
÷ SEEING Machines has shifted its off-road vehicle safety monitoring business to US digger giant Caterpillar. Shares in Seeing Machines, which makes technology able to detect when drivers are tired or distracted, rose 0.12p to 4.62p after it revealed the $17.5m deal, which also paves the way for royalty fees. Caterpillar will take over responsibility for manufacturing, marketing and sales of the AIM-listed group’s off-road product.