LONDON MARKET OPEN: Equiniti rises as Siris confirms takeover offer

(Alliance News) - Stock prices in London opened slightly higher on Monday, defying calls for a lower open, with the FTSE 100 holding above the 7,000 mark, while shares in Equiniti were sharply higher after receiving a takeover offer.

The FTSE 100 index was up 8.78 points, or 0.1%, at 7,029.31. The mid-cap FTSE 250 was up 43.41 points, or 0.2%, at 22,565.59. The AIM All-Share index was down 0.1% at 1,252.89.

The Cboe UK 100 index was up 0.2% at 699.40. The Cboe 250 was up 0.3% at 20,170.30. The Cboe Small Companies was up 0.3% at 14,550.75.

In mainland Europe, the CAC 40 index in Paris and the DAX 30 in Frankfurt were up 0.2% and 0.3% respectively.

"The UK is also receiving renewed investor attention, as a successful vaccine rollout and resilient economic readings combine with improved sentiment following the next stage of the gradual release from lockdown," said interactive investor's Richard Hunter.

"Long since an investment pariah in global terms, the beaten down indices have seen the benefit of buying interest based on a valuation gap compared to many global markets, while the cyclical nature of the UK indices is also expected to feel the force of a pronounced economic recovery. As a result, the FTSE 100 has regained its level above 7,000, with the index now ahead by 8.6% in the year to date," Hunter added.

In the FTSE 100, Johnson Matthey was up 0.7%. The speciality chemicals firm said it has entered into a strategic partnership with Finnish Minerals Group for sustainable battery materials production.

Johnson Matthey said the partnership will support development of a second commercial plant for eLNO cathode materials, which will be located in Finland and powered solely by renewable energy.

In addition, Johnson Matthey signed an agreement with SQM for supply of lithium hydroxide from SQM's Salar del Carmen plant in Antofagasta, Chile, and with Nornikel for nickel and cobalt supply from Finland and Russia.

At the other end of the large-caps, Flutter Entertainment was down 0.8%. The gambling firm has hired investment bank Moelis & Co to advise on the sale of Oddschecker, a betting odds comparison site, Sky News reported Friday afternoon. Citing "City sources", Sky said the business, which was set up in 1999 and has had several owners, could sell for about GBP150 million.

Melrose Industries was 0.2% lower despite the industrial turnaround specialist said it has agreed to sell its Nortek Air Management business - comprising the Nortek Global HVAC and Air Quality & Home Solutions segments - to Chicago-based Madison Industries for around GBP2.62 billion.

Melrose said it intends to use part of the net proceeds to reduce debt and contribute around GBP100 million to the GKN UK defined-benefit pension schemes, which means that the funding deficit will have been reduced from approximately GBP1 billion to GBP200 million under Melrose's ownership of GKN, a UK-based engineering firm.

Melrose also said it intends to return a portion of the net proceeds to shareholders.

Elsewhere in London, Equiniti shares were up 15% at 158 pence after Siris Capital Group confirmed a press report from Sky News of a takeover offer for Equiniti Group at 170 pence per share. The offer is a 24% premium to Friday's closing price of 137.60p. Equiniti handles most of the FTSE 100's dividend payments.

Over the weekend, Sky News reported that Siris may make a formal approach for a 170 pence per share bid this week, the same price as its most recent offer in January, citing banking sources. This would value the firm at around GBP600 million.

The pound was quoted at USD1.3850 early Monday, up from USD1.3821 at the London equities close Friday.

The euro was priced at USD1.1980 early Monday, flat from USD1.1981 late Friday. Against the Japanese yen, the dollar was quoted at JPY108.47, lower from JPY108.82.

Brent oil was quoted at USD66.60 a barrel Monday morning, down from USD66.70 late Friday. Gold was trading at USD1,789.44 an ounce, marginally higher from USD1,778.24.

Monday's economic calendar has eurozone construction output data at 1000 BST.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

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