LONDON (Alliance News) - The following stocks are the leading risers and fallers within the main London indices on Tuesday.
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FTSE 100 - WINNERS
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3i Group, up 0.6%. The private equity investor said it agreed to invest EUR181 million in Schlemmer, which develops and produces cable protection for automotive and industrial applications, teaming up with management to buy the company from German private equity firm Hannover Finanz and the Mackprang Holding. 3i said that Schlemmer's international growth over the past 20 years is reflected in a "double digit" annual revenue growth rate, and the private equity firm thinks the company's cable management segment is "well-positioned" to benefit from "megatrends in the automotive industry such as connectivity, e-mobility, autonomous driving and safety".
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FTSE 250 - WINNERS
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Alliance Trust, up 3.4%. RIT Capital Partners said more "analysis and discussion" is required to determine whether a combination with Alliance Trust is in the best interests of shareholders. The Financial Times had reported over the weekend that RIT, the FTSE 250 investment trust chaired by Jacob Rothschild, had approached Alliance Trust about a tie-up. A deal would create a company with a value by market capitalisation of more than GBP5.0 billion. Under takeover rules, RIT must announce a firm intention to make an offer for Alliance Trust by 1700 BST on June 27 or walk away. In a separate statement, Alliance Trust confirmed that RIT had approached it with an "informal proposal" for a merger. RIT Capital was down 1.3%.
Brewin Dolphin Holdings, up 1.1%. Shore Capital upgraded the wealth manager to Buy from Hold saying Brewin looks vulnerable to a takeover approach after reporting weak half year earnings. The broker said the current management team has performed well over the last two to three years in turning round a struggling business and strengthening its position. "But progress looks to have stalled somewhat which leaves the company looking vulnerable to an approach in our view. Our standalone fair value falls to 270p from 285p on the earnings downgrades but bid scenarios could be in excess of 400p so we now see the risk/reward as attractive."
Ophir Energy, up 1.3%. The oil and gas explorer was upgraded to Buy from Hold by Deutsche Bank, according to traders.
IG Group Holdings, up 0.4%. The online trading company said it now expects its full-year earnings to be slightly ahead of previous expectations. In a trading update for the final quarter of the financial year ending Tuesday, IG said it performed "well" during what turned out to be a "relatively quiet" fourth quarter of the year in financial markets. All key operating and financial metrics remained strong, IG said. Numis analyst James Hamilton said this means full-year revenue growth is "almost certainly" going to come ahead of Numis's forecast of GBP110.5 million. In its financial year 2015, IG's underlying revenue was GBP400.2 million, while reported revenue was GBP388.4 million.
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FTSE 250 - LOSERS
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Cairn Energy, down 2.9%. The oil and gas explorer was downgraded to Hold from Buy by Deutsche Bank.
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MAIN MARKET AND AIM - WINNERS
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HaiKe Chemical Group, up 27%. The China-based chemicals company said 2015 was a "challenging year" due to depressed oil prices and "fierce" competition in the isopropyl alcohol market. To "counteract" a weak market and "better position" the business, Chairman Xiaohong Yang said, the company decided in the third quarter to focus on higher-margin specialty chemical products, new product development, and tighter cost controls. Those steps began to deliver an improved performance in the fourth quarter, according to the chairman, who said that "has satisfactorily continued into the first four months of 2016". Although that required an initial cost, the company said the positive results of doing so began to "be evidenced" in the fourth quarter.
Stellar Diamonds, up 21%. The diamond miner said it has been verbally informed that the Minerals Advisory Board has approved its mining licence application for its Tongo project in Sierra Leone, taking a further step towards being granted a mining concession. Stellar said following this initial approval, it still requires approval from the National Minerals Agency, which is the licensing body of the Sierra Leone Ministry of Mines. The NMA must formally write to Stellar to inform the company of its decision and then draw up a licence agreement to be forwarded to the Minister of Mines for approval. The fiscal terms of the mining licence will be negotiated between Stellar and the government of Sierra Leone, Stellar said, and the resulting mining concession agreement will then require ratification through parliament.
Proton Power Systems, up 14%. The fuel cells producer said it has signed a seven-year framework agreement with an unnamed German company for fuel cell emergency power units. The deal is worth a total of EUR15.0 million and will cover a number of systems due to be delivered over the seven-year period. The agreement currently only covers the Bavaria region of Germany, Proton said. "This framework agreement is another milestone that will provide year on year revenue streams as commercialisation of our core technology is now realised," said Faiz Francoise Nahab, Proton's chief executive.
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MAIN MARKET AND AIM - LOSERS
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PCG Entertainment, off 40%. The Asia-Pacific online gaming and media company said it is in disputes with a supplier and a principal customer which could "materially affect the company's trading and financial position going forward". PCG said the dispute with the supplier arose from a debt repayment due to be paid to the supplier by Kolarmy Technology. PCG said it has become aware that Kolarmy has not repaid the debt, resulting in a dispute between PCG and the supplier, the latter which is now seeking repayment from PCG. On top of this, PCG said it is also in dispute with a principal customer over trading terms previously agreed. PCG added that it is taking advice and is seeking to resolve the disputes amicably.
Minco, down 18%. The exploration and development company said it swung to a loss in the first quarter of 2016 after being hit by negative movements in foreign exchange rates. Minco said it made a CAD426,000 loss in the three months ended March 31, having made a CAD482,000 profit in the same period in 2015. It said this was due to it suffering a CAD159,000 foreign exchange loss, compared with a CAD665,000 foreign exchange gain the prior year. Meanwhile, administrative expenses increased to CAD281,000 from CAD203,000 due to higher professional and legal fees. Minco is not revenue generating.
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By Arvind Bhunjun; arvindbhunjun@alliancenews.com; @ArvindBhunjun
Copyright 2016 Alliance News Limited. All Rights Reserved.
29 Jan 2016 08:32
