UK Manufacturing Expands; Melrose in $590 M Deal

Arthi Gupta
06 Jun, 2011
New York City

The UK indexes fell after manufacturing expanded in the second quarter boosted by overseas demand. Aegis confirmed talks with France-based Ipsos over sale of Synovate. SABMiller subsidiary agreed to sell stake in Kenya Breweries for $225 million. Melrose disposed Dynacast division for $590 million.

[R]3:30 PM London – The UK indexes fell after manufacturing expanded in the second quarter boosted by overseas demand. Aegis confirmed talks with France-based Ipsos over sale of Synovate. SABMiller subsidiary agreed to sell stake in Kenya Breweries for $225 million. Melrose disposed Dynacast division for $590 million.[/R]

In London, FTSE 100 Index gained 15.67 or 0.27% to 5,873.03 and the pound edged lower to close at $1.6395.

UK Manufacturing Expands

Manufacturing in the UK expanded for the sixth consecutive quarter on strong export-led demand. The latest data for the second quarter survey conducted by Engineering Employers'' Federation and BDO LLP showed today.

The output balance rose to plus 28% in the second quarter from plus 25% in the previous quarter. The new order balance rose to plus 30%, from plus 20% in the previous quarter. The improvement was led largely by export markets, where the balance of responses remains near record highs at plus 28%.

UK Car Registrations Decline

Auto registrations in the UK declined for an eleventh consecutive month in May, data from the Society of Motor Manufacturers and Traders showed.

The number of registrations declined 1.7% annually to 150,431 in May. During the first five months of the year, registrations dropped 7.3% to 846,513.

Aegis Confirms Discussions with Ipsos

Aegis Group Plc, the media and market research group confirmed that it is in talks to sell its market research unit Synovate to French research company Ipsos S.A. The company added that there can be no certainty that any agreement will be reached.

Daimler and Rolls-Royce Hold 60% of Tognum Shares

Daimler AG and Rolls-Royce currently hold a total of 59.87% of Tognum shares through their Joint Venture Engine Holding GmbH following the expiry of the acceptance period for its public takeover offer for Tognum AG.

SABMiller Africa Sells Stake

SABMiller Plc, the brewer said its subsidiary SABMiller Africa BV agreed to sell its 20% shareholding in Kenya Breweries Ltd. to East African Breweries Ltd. for a cash consideration of about 19.53 billion Kenyan Shillings or $225 million.

Melrose Sells Dynacast Division

Melrose Plc signed an agreement to dispose of its Dynacast division to KDI Holdings Inc. for $590 million in cash that will be paid on completion. Dynacast will also take with it its net pension liabilities of $17.1 million, thus making an enterprise value of £370 million for the deal.

Gainers & Losers

AMEC plc dipped 0.09% to 1,123.00 pence after the provider of consultancy, engineering and project management services completed the acquisition of MACTEC for a cash consideration of $280 million.

easyJet Plc gained 0.58% to 361.80 pence after the low-cost airline reported for the month of May, passengers, representing the number of earned seats flown, increased 11.3% to 4.74 million from 4.26 million a year ago.

Load factor for the period declined 1.7 percentage points to 84.1% from 85.8% in the prior year.

e2v Technologies plc fell 2.62% to 130.00 pence after the electronic components manufacturer said fiscal year 2011 revenue improved 13.6% to £228.58 million from £201.25 million in the year ago period.

Profit for the year amounted to £19.49 million or 9.05 pence per share compared to a loss of £2.27 million or 1.66 pence per share in the prior year.

Workspace Group Plc dropped 2.54% to 28.75 pence after the company engaged in property investment stated fiscal year 2011 revenues grew 3.5% to £68.8 million from £66.5 million in the previous year.

Profit for the year climbed 121% to £53.5 million or 4.6 pence per share from £24.2 million or 2.2 pence per share in the prior year.

WS Atkins Plc declined 0.18% to 810.00 pence after the engineering and design consultancy company reached agreement with the Trustee of the Atkins Pension Plan with respect to the 2010 triennial actuarial funding valuation and associated recovery plan.