The Santy rally continues with another small gain.
IC TIP UPDATES:
Brewin Dolphin (BRW) has made its first acquisition since 2011, purchasing the private investment management business of Camellia (CAM) Duncan Lawrie Asset Management. The acquisition will bring with it £735m in funds under management and 1,000 clients. Around 84 per cent of these funds are managed on a discretionary basis. Our recent buy tip will pay cash of £25.5m, as well as a payment to reflect the net assets of the business, estimated to be around £2.5m. Buy.
Arbuthnot (ARBB) has bought the private banking portfolio of Duncan Lawrie, which is mainly secured against residential property. At the end of October the portfolio had customer balances of around £45m, comprising 83 customer accounts. The average loan to value of the portfolio was 43 per cent. The group will pay £43m in cash for the portfolio. Buy.
Online gambling outfit GVC (GVC) has disposed of its payments processing business Kalixa to Senjō Group, a global payments operator and investment firm headquartered in Singapore. It is selling the business for €29m (£24m) in cash on completion, subject to a completion accounts adjustment. The total consideration receivable by GVC is capped at €35.5m.
Hurricane Energy (HUR) is up another 16 per cent this morning, after the oil exploration company found another “significant” fractured basement discovery at its Lincoln well. Chief executive Dr Robert Trice said current analysis indicated resources of 250 million barrels of recoverable oil. Our recommendation – up nearly 300 per cent this year – is under review.
As expected, the copper plant which Atalaya Mining (ATYM) renovated this year at Riotinto in Spain hit full capacity. Over a period of 10 consecutive days this month, the miner treated an average of 28,685 dry metric tonnes each day, putting it on track to process 9.5Mt in 2017. Buy.
Gemfields (GEM) shares are two per cent higher this morning on news that its latest rough ruby auction in Singapore recorded the fourth highest revenue result in its history. The gemstone miner raised $30.4m in the sale, at an average price of $27.79 a carat. Buy.
KEY STORIES:
The multi-faceted Camellia (CAM) is to become slightly less so as the agriculture-cum-banking-cum-engineering group sells one of its businesses. The company is set to sell most of its private bank business Duncan Lawrie. At its results in August, it had suggested it would invest in the business to help stem the losses in its banking division, which doubled to £2.8m for the six months to 30 June. The majority of its UK and Isle of Man loans - 95 per cent of the value of outstanding loans - will be sold to Arbuthnot Latham (ARBB) for £42.7m. It will wind down deposit taking and banking operations in both jurisdictions. Camellia will also sell Duncan Lawrie Asset Management to wealth manager Brewin Dolphin (BRW) for £28m.
There was a flood of news this morning from BP (BP.), which had clearly waiting for an Opec-backed stabilisation of the oil price before sanctioning a series of large capital-intensive projects. The oil major is to invest more than $1bn in West African oil, by taking a 62 per cent interest in Kosmos’ blocks in Mauritania and a 32.5 per cent working interest in its Senegal exploration block. Chief executive Bob Dudley also signed a deal for a 10 per cent interest in Abu Dhabi’s ADCO oil concession, a deal which is being funded through the issue of £1.8bn worth of shares.
Shares in San Leon Energy (SLE) are up 24 per cent this morning, after the Aim-listed oil explorer confirmed it has received a takeover approach from an unnamed group. The news follows the group’s recent sale of a stake in a Polish gas field for €9m, following the settlement of a number of legal disputes in the country.
