RPC Group (RPC) got investors fired up as it confirmed it was in talks with two US private equity firms. The FTSE 250 company, which is one of Europe’s largest plastic packaging manufacturers, rocketed 18%, or 123p, to 806.6p after admitting that it was in ‘preliminary discussions’. Though RPC warned that neither suitor may yet make an offer, investors’ expectations of a bidding war were ignited as they pushed the company’s market value up by £499.7m.
Relx plc (REL) announced it had completed its move to the UK. Unlike Unilever, which has decided to combine its UK and Netherlands arms in Rotterdam and is asking shareholders to approve the move, Relx has brought its business to Britain. This caused its market value in London to nearly double to £33m, as shares in the Dutch entity were added to the UK listing.
Associated British Foods (ABF), which owns clothing chain Primark and a host of grocery and sugar brands, found itself in a sticky spot. In a rare win for the struggling High Street, Primark actually propped up the company’s sales in the face of lower sugar prices and a £20m currency hit. John Bason, ABF’s finance director, said that sugar production in the EU ‘is going through a very painful period of restructuring’. Last year the EU removed quotas which had limited the production of sugar beet and held up prices. Following that, producers rapidly upped their output.
Debenhams (DEB) was plunged into turmoil last night after £15.9m was wiped off its value and short-sellers swooped in to bet against the retailer. Shares fell more than 10%, or 1.3p, to 11.5p amid reports it is considering a restructuring plan that could involve axing some of its 165 stores from the High Street. Debenhams is the second most-shorted stock in London, behind Pets At Home, as hedge funds, betting the share price will fall, pile in.
Dignity (DTY) – The UK’s biggest funeral director has ramped up a price war with a pledge to undercut its rivals. Co-op Funeralcare said it would beat any quote given by its competitors – offering a like-for-like service for less cash. It is the latest move by the firm to slash the cost of funerals, with the guarantee on offer from today.
Higher profits at pub operator Wetherspoon (J.D.) (JDW) could result in glasses being raised this week after the chain was given a lift by the summer heatwave. The sales boost, also driven by England’s successful run in the World Cup, has not yet been fully factored into City profit forecasts, said Douglas Jack at stockbroker Peel Hunt. Jack estimates profit in the year to the end of July was £108.1 million – ahead of the average City forecast of £105.5 million.
