Trade probe hits shares in medical implant firm
VICTREX shares faltered yesterday after the firm revealed that it had been the subject of an inquiry by the Federal Trade Commission (FTC) in the US.
Its medical arm Invibio was at the centre of the probe. The business makes a material known as PEEK which is used in implant devices to treat spinal conditions.
It’s a durable, lightweight product also used in smart phones, aeroplanes, knee implants and dentistry.
The FTC’s gripe was that Invibio was getting its customers, which are typically companies that make medical devices, to sign long-term exclusivity agreements which meant they couldn’t use other suppliers. It meant the firm could keep prices high even when new competitors came into the industry.
The commission has told Invibio that it shouldn’t do this any more – it is not an illegal practice but the regulator is concerned it could be anti-competitive.
Invibio must now contact existing suppliers and tell them they are allowed to use other companies if they wish. The FTC is not taking any punitive action. Invibio accounts for around £50m of the group’s total revenues, which were £263m last year. Still, spooked investors pushed Victrex 6.9pc, or 104p, to 1414p.
The ongoing bidding war for European retailer Darty drew towards its conclusion when Steinhoff chucked in the towel.
The South African firm had been battling French group Fnac for ownership of the electricals retailer and earlier this week Fnac made a third, final offer of 170p a share.
Steinhoff finally said it would not increase its bid of 160p a share as raising its offer would no longer create sufficient value for shareholders.
Darty shares had thrived as the bidding war dragged on, advancing from 131.5p to 172p in a week. Yesterday it finished flat at 168.7p.
After a dismal day’s trading on Wednesday, Sepura bounced back. The firm had suffered after a disappointing trading update.
After sleeping on it, investors had apparently decided that things weren’t as bad as they seemed.
Its shares rebounded 18.4pc, or 9p, to 58p. It still has some way to recover before it gets back to 112p, where it started the week.
The FTSE 100 eased back 2.5 points to 6322.4. Rolls-Royce, among the biggest risers of the day, saw its share price rev up on reports that staff have been told to push cost-savings to £400m. Its shares accelerated 3.1pc, or 21p, to 694p.
Miners accounted for many of the top movers on the market. Anglo
American rallied 8pc, or 56.3p, to 753.2p on news of the sale of its Brazilian phosphates business, while Rio Tinto climbed 4.3pc, or 95.5p, to 2329.5p after it announced plans to repay £0.9bn of its gross debt ahead of schedule.
In the small-cap index mining company Petropavlovsk’s shares sparkled after it revealed an agreement to purchase Russian gold mining business Amur Zoloto. In its annual results Petropavlovsk also announced a joint venture with Russian conglomerate GMD Gold to finance the construction of one of its projects.
Petropavlovsk was hit hard when the gold price crashed in 2013, and a year later refinanced. Investors bullish on bullion pushed the share price on 3.8pc, or 0.3p, to 8.2p after good news yesterday.
Howdens Joinery got a boost yesterday after a trading update for the first four months of the year showed revenue was up 8.7pc.
The firm said its performance was in line with expectations despite currency movements affecting its pricing. Shares gained 1.7pc, or 8.4p, or 493.7p
County Durham-based Kromek, which develops radiation detectors for medical, security and nuclear companies, saw its shares boosted after announcing it had won a fiveyear contract worth £8.6m.
Kromek’s radiation detector technology will be incorporated into bone density diagnostics systems. Shares advanced 5.6pc, or 1.8p, to 33.3p on the news.