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Hikma to replace Inmarsat in FTSE 100 index

Wed, 01st Jun 2016 17:11

LONDON, June 1 (Reuters) - Hikma Pharmaceuticals will be promoted to Britain's benchmark FTSE 100 equityindex after a sharp rally in its shares since March, whilesatellite company Inmarsat will drop out of the FTSE.

A spokesman for the London Stock Exchange announced thechange via telephone on Wednesday.

Getting into the FTSE 100 can often fuel further demand fora company's shares, since funds that track the FTSE or invest inthe index can then add that stock to their portfolio, while theinverse is true if a company falls out of the FTSE 100.

Shares in Hikma, which reiterated its guidance for 2016 lastmonth and said it continued to expect full year group revenue inthe range of $2.0 billion to $2.1 billion, have surged 45percent since mid-March.

On the other hand, Inmarsat has fallen 37 percent sinceearly February as the company is facing tough trading conditionsin its maritime and government markets businesses.

A slowdown in the global economy has hit itsshipping-related operations, one of the main engines for cashflow in the satellite communications group. (Reporting by Atul Prakash; Editing by Sudip Kar-Gupta)