Investors have reacted to the conclusion of the G20 meeting by bidding up the FTSE100 and FTSE250 on hopes that the US and China may be moving closer to resolving their differences over trade. Click here for The Trader Nicole Elliott's latest thoughts on the markets.
IC TIP UPDATES:
Aston Martin Lagonda’s (AML) largest shareholder Investindustrial - which currently owns 31 per cent of the company - is considering making a cash offer for 6,840,090 shares at £10, equivalent to 3 per cent of the luxury carmaker’s share capital. The offer has received irrevocable undertakings from shareholders representing an aggregate 34.8 per cent of the shares. Sell.
WPP (WPP) has announced the sale of its minority shareholding in Chime Group Holdings Limited – the sports, entertainment and communications group – to the majority shareholder Providence for £54.4m and potential additional amounts based on the future value of Chime. WPP says this transaction is in line with its new strategy outlined last December, to focus on its main areas of business and simplify its operations through non-core disposals. Buy.
Ricardo (RCDO) has announced the acquisition of Melbourne-based environment, planning and infrastructure advisory consultancy, PLC consultancy, for AU$9.64m (£5.36m). The consideration is to be paid in cash, with part paid in instalments over three years subject to the achievement of agreed financial targets and the retention of key management. With the deal expected to complete on 31 July, PLC will operate as part of Ricardo’s energy and environment business, extending its capabilities within the growing Australian market. Buy.
Impax Asset Management (IPX) has landed a $200m mandate from the California State Teachers’ Retirement System, in the latest major client win for the asset manager. The funds will be put towards the Impax Leaders strategy, which actively invests in the “growing resource efficiency and environmental markets”. We remain buyers. Buy.
StatPro (SOG) has won a conversion from its legacy ‘StatPro Seven’ software to its cloud-based ‘StatPro Revolution’ service with a large insurance company. This contract is worth £1.5m and will last three years. Buy.
Eckoh (ECK) has won a three-year contract to provide Coral (its contact-centre agent desktop product) to a US Fortune 100 telecoms company. This represents a significant extension to an existing client relationship. The contract is worth at least $3.8m to Eckoh – entailing $2.1m in licences and $1.7m for maintenance and support over the three years. Buy.
SThree (STHR) has announced that after 25 years with the group, chief operating officer Justin Hughes is to step down from the board effective 1 July, transitioning his duties for the next two to three months. A process to identify his replacement is underway. Shares are up over 1 per cent this morning. We remain buyers.
KEY STORIES:
Hurricane Energy (HUR) has announced its Warwick Deep well is uncommercial, sending its shares down 15 per cent to 44p. The explorer and producer had drilled Warwick Deep to 1,964m with the backing of Spirit Energy in a farm-in deal, and expected 935 million barrels of oil equivalent from the well. Hurricane said the Warwick Deep well “intersected a poorly connected section of the fracture network within the oil column”. This news comes a month after first oil at its Lancaster field when the company’s share price climbed over 60p. Hurricane will now look to the second well of the three-well programme, Lincoln Crestal, and plug Warwick Deep.
OTHER COMPANY NEWS:
Shares in Future (FUTR) were up by around a tenth this morning on the news that full-year results should come in ahead of expectations. The group said positive trends seen in the first half have continued, with a strong performance supported by good audience growth in its media division and the ongoing strong underlying performance of recent acquisitions. The group also said that Penny Ladkin-Brand will take on the position of chief strategy officer in January 2020, simultaneously stepping down from her role as chief financial officer, and from the board, at that time.
Wealth management consolidator AFH Financial Group (AFHP) has announced plans to raise up to £20m for acquisitions and general corporate purposes, via a sale of convertible unsecured loan stock. The stock, whose initial conversion price of 420p is at a 17 per cent premium to last Thursday’s closing price, will pay out at 4 per cent a year. The bookbuild is set to close by 11 July.
Polish lawmakers have amended a draft set of proposals to reduce a cap on non-interest costs lenders can charge on customer loans. This follows a government meeting where a rate cap of 20 per cent (below the current 25 per cent) was proposed. Both developments look to be bad news for doorstep lender International Personal Finance (IPF), which told the market on Friday that it is assessing the financial impact of the proposed changes.
Non-performing loan investor Arrow Global (ARW) has appointed a new chief financial officer. Matt Hotson, until recently the CFO of RSA Insurance (RSA), will join Arrow on a full-time basis from August, after a handover from current finance chief Paul Cooper. Mr Cooper is leaving to take up the role of deputy CFO at M&G Prudential.
Telit Communications (TCM) has agreed settlement terms with the London Stock Exchange for a public censure and fine of £0.35m for breaches of two of the Aim Rules for Companies. The events leading up to the censure pertain to the actions of Oozi Cats – who was chief executive when Telit was admitted to Aim up until his resignation in August 2017. The censure relates to the company’s failures of disclosure regarding his indictment in the US or previous variations of his name. Since then, Telit has reconstituted its board and fully cooperated with the investigation. The Exchange has waived the fine against Telit, recognising that Telit and its advisers faced real difficulties in being able to uncover information relating to Mr Cats’s historical indictment.
Agriculture and engineering company Carr’s Group (CARR) has acquired NW Pump and Valve Limited, a service and manufacturing company specialized in nuclear activity, for £9.6m. The acquisition adds to Carr’s engineering capabilities in the nuclear sector and specialist services. Shares fell 1 per cent in early trading.
