UK equities were flat on a relatively quiet morning for London-listed companies, aside from the Diageo takeover rumours. Click here for The Trader Nicole Elliott’s view of the markets.
IC TIP UPDATES:
Shares in our buy tip, property investment company Palace Capital (PCA), moved higher today after it announced submitting a planning application to convert the majority of its York office block Hudson House into 82 apartments. The company has been discussing the project with the council “for some time” and a decision is expected in the autumn. Buy.
Tritax Big Box REIT (BBOX) suffered a 1 per cent share price fall against a relatively flat market after announcing an institutional placing of new ordinary shares at 113p a share as part of a £125m fundraising. The company said it expected the placing to boost net asset value for existing shareholders. Tritax also confirmed an interim dividend of 1.5p per ordinary share for the period from 1 March to 31 May, and that it had agreed to provide forward funding for a distribution warehouse for soft furnishing retailer Dunelm. We keep our buy call.
WPP (WPP) has bought a minority stake in WANDA Digital through its J.Walter Thompson subsidiary. The Turkey based digital agency offers services including campaigns, social media and platform development. Buy.
KEY STORIES:
Diageo (DGE) led the market after reports of a bid by Brazilian private equity billionaire Jorge Paulo Lemann. His 3G private equity vehicle is no stranger to big deals, having joined up with Warren Buffett's Berkshire Hathaway to buy Heinz back in 2013, which has recently moved to snap up rival Kraft.
Cloud computing company Iomart Group (IOM) has bought London-based IT consultancy SystemsUp for an initial total of £9.5m in cash, with as much as £3.5m extra to be paid contingent on revenues for the year to March 2016. Iomart hopes the purchase will help it engage at a strategic level with companies wanting access to cloud services.
Software provider Idox (IDOX) suffered a small drop in its share price today after reporting adjusted cash profits down a tenth at £7.1m for the half-year to 30 April, compared to the same period of the previous financial year. Revenues were flat at £29.6m, as difficult trading conditions for sales of its information management services to oil and gas companies were offset by increased public sector business.
Phoenix IT Group (PNX) made pre-tax profits of £9m for the year to the end of March 2015, compared to its £30m loss in the previous 12 months. But the company’s revenues were down 9 per cent at £212m, and its order book was down 19 per cent at £249m. The results will be overshadowed by its imminent takeover by Daisy Group, whose 160p per share offer announced last month has been accepted by the board.
Auto retailer Pendragon (PDG) will no longer be buying the trade and assets of California-based Lexus of Glendale after the car manufacturer exercised an option to purchase the dealership.
Aim-listed Manx Telecom (MANX) is rolling out its ‘strongest signal’ mobile services available direct to UK customers and businesses under the brand name Chameleon Direct.
OTHER COMPANY STORIES:
Aim-listed platform provider ULS Technology (ULS) has launched estateagent4me, a website that will allow consumers to compare estate agents based on criteria including success rate, sale prices, and the number of properties on their books. “Our research shows that the average UK house seller would have received an additional £27,456 had their estate agent performed as well as the best,” said managing director Ben Thompson.
Drax Group (DRX) has reported trading conditions remain challenging, as weak gas prices keep power prices down. Expectations for the full year remain in line.
Engineering and fit-out services provider ISG (ISG) has acquired another 49 per cent interest in its Brazilian partner ACE, for which it paid £335,000. It now owns 69 per cent of the company.
