UK MIDDAY BRIEFING: London Gets Another Three New Listings

LONDON (Alliance News) - Exova Group, Polypipe Group, and Cambian Group Friday priced their initial public offerings and began conditional dealings on the London market, as the pickup in new listings this year continued.

However, the resurgent IPO market is being threatened by the recent sell-off of technology and biotechnology stocks that started on Wall Street a week ago and has spread to Asia and Europe. In a sign of that threat, Lombard Medical Technologies Friday delayed its IPO on Nasdaq, blaming the adverse US stock market conditions, and saw its AIM shares hit hard as a result. It still wants to move its listing from London to the New York market.

Exova was the largest of the three new London listings Friday, based on a GBP550.0 million initial market capitalisation. The laboratory-based testing and related advisory services company priced its IPO at 220 pence a share, raising about GBP220 million in gross proceeds, but is trading at 218.5 pence per share in early dealings.

Plastic piping manufacturer Polypipe Group set its offer price at 245 pence, which gave it a GBP490.0 million initial market capitalisation and raised GBP294.0 million. It is now trading at 250.00 pence.

Specialist behavioural health services provider Cambian's IPO will raise up to GBP213.7 million in gross proceeds for the company and selling shareholders. The offer price of 225 pence gave it an initial GBP387.8 million market capitalisation. The stock fell to 198.00 pence per share in early dealings.

Exova, Polypipe and Cambian bring the number of IPOs on the London Stock Exchange's main market to 14 in 2014, joining the likes of Just Eat, Pets At Home and Poundland.

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FTSE 100: Down 1.2% at 6,564.63
FTSE 250: Down 1.6% at 15,887.09
AIM ALL-SHARE: Down 1.0% at 836.06
GBP-USD: Down at 1.6750
EUR-USD: Up at 1.3893
GOLD: Up at USD1,322.05 an ounce
OIL (Brent): Up at USD107.36 a barrel

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Key UK Corporate News

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FTSE 100: Rolls-Royce Holdings has been awarded a GBP19 million contract to deliver deck machinery for four ocean going tugs.

FTSE 250: Investec said it will sell the professional finance and asset finance and leasing business of its Australian operations to Bank of Queensland Ltd, a deal that will boost the South African bank's balance sheet. Jupiter Fund Management reported GBP547.0 million in first-quarter net inflows, boosting its assets under management to GBP32.21 billion at the end of March, from GBP31.66 billion at the end of December. Net inflows were boosted by GBP465.0 million of net inflows into mutual funds, with inflows from the UK and its international channels. Ultra Electronics confirmed that it has sold 1,008 sonobuoys to the Australian Air Force to assist in the search for the missing Malaysia Airlines Flight 370.

AIM All-Share: Equatorial Palm Oil is up after the palm oil development company said it has an agreement with KLK Agro Plantations which will provide up to USD35.5 million in funding for their Liberian Palm Developments Ltd joint venture. URU Metals is up after it completed the acquisition of Umnex Minerals Limpopo and has confirmed its 100% interest in the Zebediela Nickel Project in South Africa. Shares in Cientifica are trading higher after it entered into a call option under which it could take a 49.9% stake in newly-formed graphene company Rainmaker Technologies. Nature Group is doing well after the company said it has been granted planning permission by the government of Gibraltar for the re-building of its waste oil reception facility at the North Mole. The rebuild is expected to take up to 12 months. At the other end of the market sits Lombard Medical Technologies, trading lower after the medical technology company said it has delayed its initial public offering on the NASDAQ, blaming the adverse US stock market conditions that has seen biotechnology stocks sold heavily on Wall Street in recent days.

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Top Economics And General

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Finance ministers and central bank governors from the world's leading industrialized economies are discussing an International Monetary Fund rescue package for Ukraine, on the sidelines of a broader meetings in Washington. The Group of Seven meeting Thursday addressed a proposed IMF package worth up to USD18 billion over two years to keep Ukraine afloat, and other international measures to help stabilize the county after months of unrest and Russia's seizure of the Crimea.
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UK construction output fell by 2.8% on the month in February, after having risen by 2.1% in January. Economists had expected a 1.3% decline.
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Inflation in China was up 2.4% on year in March, the government said. That was in line with expectations and up from 2.0% in February. Among the individual components, food prices jumped 4.1% on year, while non-food prices added 1.5%. The data also showed that producer prices remained stuck in deflation, contracting 2.3% on year.
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The members of the Bank of Japan's monetary policy board said that Japan was seeing a moderate economic recovery which is likely to continue, minutes from the board's March 10 and 11 meeting revealed. The board members added that the country appears to finally be on the right track in its war with deflation, as inflation finally appears to be rising. They did not, however, wish to undertake any action ahead of the new sales tax that has recently been enacted.
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German Chancellor Angela Merkel is in Greece in a show of support for the country's economic recovery, one day after it returned to international bond markets after a four-year exile. Merkel will hold talks with Prime Minister Antonis Samaras on the state of Greece's finances, promising investment and work programmes to help the youth. She is scheduled to take part in a forum for young entrepreneurs during her one-day visit.
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The UN Security Council unanimously approved a resolution authorizing a 12,000-strong UN peacekeeping mission in the Central African Republic. The UN mission will take over peacekeeping operations in mid-September from the 2,000 French and 6,500 African forces currently on the ground battling to contain the protracted violence plaguing the former French colony.
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Japanese Prime Minister Shinzo Abe's government on Friday approved a new energy policy that sees nuclear power as an important source of electricity, three years after the nation's worst atomic accident. The new policy nullifies a nuclear phase-out plan approved by the previous government following the disaster at the Fukushima Daiichi Nuclear Power Station, which was caused by the 2011 earthquake and tsunami.
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Afternoon Watchlist (all times British Summer Time)

All Day IMF Meeting
13:30 US Producer Price Index
14:55 US Reuters/Michigan Consumer Sentiment Index Preliminary

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Monday's Key UK Corporate Events

Carrs Milling Industries Half Year Results
MP Evans Full Year Results

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Monday's Key Economic Events (all times British Summer Time)

10:00 EU Industrial Production
13:30 US Retail Sales
15:00 US Business Inventories
16:30 US 3-Month Bill Auction
16:30 US 6-Month Bill Auction

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By Alice Attwood; aliceattwood@alliancenews.com; @AliceAtAlliance

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