UK Indexes Climb; Vallares IPO Raises $2.2 Billion

Arthi Gupta
17 Jun, 2011
New York City

The UK indexes climbed on optimism for a resolution to the Greece sovereign debt crisis. ARM agreed to acquire U.S.-based Obsidian Software. CSR and Zoran agreed to revised terms for proposed merger. Vallares raised

[R]3:20 PM London – The UK indexes climbed on optimism for a resolution to the Greece sovereign debt crisis. ARM agreed to acquire U.S.-based Obsidian Software. CSR and Zoran agreed to revised terms for proposed merger. Vallares raised £1.35 billion in its initial public offering.[/R]

UK stocks rebounded after a sharp decline in the previous trading day. The euro-zone troubles remained in the centre but investors focused on earnings and deals news. For the week, the benchmark index declined 1%.

Greek Prime Minister George Papandreou reshuffled cabinet to garner support for the government''s austerity measures. Evangelos Venizelos will be the country''s new Finance Minister, a government spokesperson said today, replacing George Papaconstantinou.

The Greek government is under immense pressure from the European Union and the International Monetary Fund to impose more unpopular austerity measures that include public-sector pay-cuts and tax hikes to save an extra €28 billion, or $40.5 billion and asset sale of as much as $70 billion.

In London, FTSE 100 Index gained 11.57 or 0.20% to 5,710.38 and the pound edged higher to $1.6169. For the week, the FTSE 100 Index declined 1%.

Vallares IPO Raises $2.2 Billion

Vallares Plc, the energy investment vehicle raised gross proceeds of £1.35 billion or about $2.18 billion in a placing of 133 million shares at 10 pounds per share, which is more than its original target of £1 billion.

Vallares said the proceeds will help to pursue its objective of acquiring or business or asset that has significant operations in the resources sector.

ARM Acquires Obsidian Software

ARM Holdings Plc acquired Obsidian Software to augment its drive in matching its verification strategies with the rate of change in its high performance, complex SoC IP components.

CSR and Zoran Amend Merger Terms

CSR Plc, the British chipmaker and the U.S.-based imaging and video technology company Zoran Corp. announced that the boards of the companies have approved amendments to the terms of their merger originally announced in February this year.

The revised offer by CSR now values Zoran at about $484 million, down from the earlier valuation of $679 million.

Shareholders of Zoran will now receive $6.26 in cash and 0.589 shares of CSR in the form of American Depositary Shares for each share of Zoran stock held.

Gainers & Losers

Balfour Beatty plc rose 1.31% to 302 pence after the infrastructure business company said its US Construction Services division acquired Fru-Con Construction LLC, a water and wastewater infrastructure contractor, for a net cash consideration of $20 million, or £12 million.

Capital Pub Co. Plc surged 23.22% to 191.60 pence after the pub owner rejected the proposal of Fuller, Smith & Turner Plc to acquire for £53.9 million or about $87 million.

Environmental Recycling Technologies plc plunged 4.42% to 4.54 pence after the recycling service provider stated fiscal year 2010 revenue dipped 7.3% to £1.02 million from £1.1 million a year ago. Net loss for the year narrowed 24.4% to £3.4 million or 0.83 pence per share versus £4.5 million or 1.44 pence per share last year.

H&T Group plc gained 1.93% to 344.00 pence after the pawn-broker estimates strong first-half results.

Provexis Plc slumped 26.84% to 1.99 pence after the food technology group reported fiscal year 2011 revenue surged 239% to £50.09 million from £14.77 million in the previous year. Net loss for the year rose 25% to £2 million or 0.17 pence per share compared to the loss of £1.6 million or 0.18 pence per share last year.

Valiant Petroleum plc increased 2.91% to 618.00 pence after the independent oil and gas company said it plans to acquire Sagex Petroleum ASA for a total consideration of NOK 64.1 million, or £7.1 million.