Morrisons bidding war could boost grocer back into FTSE 100 index

Tue, 24th Aug 2021 18:16

(Alliance News) -Â FTSE Russell late Tuesday indicated that, ahead of next week's quarterly UK index review, Wm Morrison Supermarkets PLC could re-join London's blue-chip FTSE 100 index.

Based on data from Friday last week, FTSE Russell said that Morrisons - which has seen its share price surge in recent weeks amid a bidding war for the London-listed grocer - could re-enter the FTSE 100 just six months after March's demotion.

However, with Morrisons last week accepting a GBP7.0 billion takeover offer from New-York based private equity firm Clayton, Dubilier & Rice and rival suitor Fortress Investment Group LLC weighing up its position, the UK supermarket chain may not remain in the FTSE 100 long if promoted in next week's index review.

Also poised for promotion to the UK flagship index are veterinary pharmaceutical business Dechra Pharmaceuticals PLC and aerospace components maker Meggitt PLC - which, like Morrisons, is also in the middle of a takeover bid.

Meggitt last week said it continues to recommend Parker-Hannifin Corp's takeover offer over the approach of rival TransDigm Group Inc, which has until next month to decide if it will make a firm offer. The board of the Coventry, England-based firm continues to "recommend unanimously" Parker's 800 pence-per-share offer, worth about GBP6.3 billion.

These three could be booting out broadcaster ITV PLC, engineer Weir Group PLC and food delivery firm Just Eat Takeaway.com NV from the FTSE 100.

FTSE Russell noted: "The nationality of Just Eat Takeaway.com has been reviewed in accordance with the FTSE Nationality Rules and as a result, the company's nationality has been reassigned from the UK to the Netherlands, making the company ineligible for the FTSE UK Index Series."

Indicative additions to the mid-cap FTSE 250 include Baltic Classifieds Group PLC, Bridgepoint Group PLC, Darktrace PLC, Draper Esprit PLC and Endeavour Mining PLC.

In contrast to Just East, Endeavour's nationality has been reassigned from Canada to the UK, making the company eligible for inclusion in UK indices.

Up for FTSE 250 deletion are Avon Protection PLC, Civitas Social Housing PLC, Tullow Oil PLC and Wickes Group PLC.

The quarterly FTSE index review will use data from next Tuesday's close, with confirmed rebalance changes announced after the market close on Wednesday, September 1 - meaning the actual results of the review could differ from these indicative changes.

The index changes are effective on Monday, September 20.

By Lucy Heming;Â lucyheming@alliancenews.com