Resolution Lifts Friends Provident Bid

Mayank Mehta
10 Aug, 2009
New York City

Resolutions revised offer for Friends Provident values the insurer at

[R]7:00PM London, 2:00 PM New York – Resolutions revised offer for Friends Provident values the insurer at £1.85 billion. Lloyds is exploring to raise up to £15 billion. Morgan Sindall profit slides 28%.[/R]

UK stocks edged lower after investors worried that market valuations may be ahead of fundamentals. After a rally in stocks for four weeks, stocks are struggling to sustain valuations.

In London FTSE 100 Index closed down 10.35 or 0.2% to 4,723.27 and the pound closed at $1.65 and 1.16 euros.

Gainers & Losers

Rio Tinto declined 3.2% to 2,343 pence. China stepped up its allegations in the on-going row with the company and said that the company may have overcharged Chinese steel mills as much as $100 billion in the past six years.

Forbidden Technologies plc increased 2.9% to 17.50 pence after the Internet video streaming firm has narrowed losses over the six month period on the revenue surge of 344%.

Friends Provident plc surged 7.5% to 75.40 pence after the life insurer received a revised offer from Resolution Plc. The offer proposes to exchange 0.9 Resolution share for every Friends Provident share and values the company at £1.85 billion.

Geong International Limited rose 28.2% to 50.00 pence after China based enterprise software company signed contracts with second tier banks worth 7.1 million yuan. The AIM-listed company provides content management and collaboration tools to small and medium businesses.

Harvey Nash Group plc advanced 4.9% to 40.38 pence after the recruitment firm said that business in the first half of the year is in line with its expectations.

Lloyds Banking Group plc dropped 3.0% to 98.86 pence after media reports suggested that the company is exploring to raise as much as £15 billion.


Mallett Plc closed unchanged to 61.50 pence after the antique furniture and art dealer first half revenues declined to £6.78 million from £8.17 million and net loss increased to £702,000 or 4.98 pence compared to £184,000 or 1.45 pence. The company blamed the weak results on poor economic conditions.

Morgan Sindall plc decreased 1.2% to 617.50 pence after the construction company said first-half revenues fell 8% to £1.14 billion from £1.24 billion a year ago. Net profit in the first-half fell 31% to £14.6 million or 34.2 pence per diluted share compared to net profit of £21.1 million or 49.4 pence per share a year ago.

Petrofac Limited rose 1.0% to 833.50 pence after the oil company estimated gross production at Don Development project this year between 3 million and 5 million barrels.

Southern Cross Healthcare Group PLC declined 6.5% to 140.00 pence after the occupancy at care home operator over the last three months declined to 87.5% compared to 89.8%.

Telephonetics Plc was unchanged at 8.50 pence after the speech recognition and voice automation specialists expects adjusted operating earnings for the current year to be ahead of expectations.

Vindon Healthcare plc sank 18.9% to 15.00 pence after the maker of environmental control products warned that full-year results will be “materially” below market expectations.

WorldSpreads Group plc fell 1.6% to 60.00 pence after the financial spread-betting services provider has agreed to sell its Irish business to local management and fund international expansion.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 52 increased, 48 declined and 2 were unchanged.

Lloyds Banking Group Plc decliners in the FTSE 100 index with a loss of 4.03% followed by losses in Fresnillo Plc of 4.02%, in The Royal Bank of Scotland Group Plc of 3.58%, in Rio Tinto Plc of 3.24%, in Xstrata Plc of 3.14%.

Friends Provident Plc led gainers in the FTSE 100 index with a rise of 6.99% followed by increase in Petrofac Limited of 3.27%, in Hammerson Plc of 3.11%, in Prudential Plc of 3.01%, in The British Land Company Plc of 2.89%.