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Talk of Australian bid hits Allied Domecq A SELL-OFF in Southcorp after a hefty profit warning served only to fuel speculation that Allied Domecq may be weighing a bid for Australia’s biggest winemaker. Expectations of an approach for Southcorp were revived last Friday after it asked for its shares to be suspended on the Australian stock market as it reviewed profit forecasts only a month after a profit warning. The stock duly fell 19 per cent yesterday on its return to trading after Southcorp filed a 97 per cent collapse in first-half profits and said that it would not meet its previous guidance on full-year earnings. That retreat was seen to give credence to weekend speculation that Allied, owner of Montana, the New Zealand rival, may swoop on Southcorp, whose brands include Lindemans, Penfolds and Rosemount. Other possible interested parties are thought to include Pernod Ricard of France, which owns Jacob’s Creek, and Lion Nathan, Australia’s second-largest brewer, which lost out to Allied in last year’s Montana auction. However, Stuart Price, an analyst at WestLB Panmure, believes that a mooted take-out price of £1.2 billion for Southcorp now looks a bit steep, and suggests £850 million could be nearer the mark. At that price, he calculates that an acquisition would dilute Allied’s current-year earnings by 2 per cent, and could also entail a share issue. He also suggests a deal would put pressure on Allied to split into three divisions, comprising wine, spirits and fast food. Although Allied has problems of its own, as revealed by last month’s annual meeting statement, investors felt that yesterday’s events made a move on Southcorp more likely rather than less, and sent its shares down 10¼p to 282¾p. The wider market was firmly in the grip of the insurance sector, where the abandonment by Prudential, off 69¼p at 323¾p, of its dividend policy, produced a wholesale sell-off that engulfed its peers. The FTSE 100, also hampered by weak US consumer confidence data, closed 80.3 points lower at 3,621.5. Invensys showed no signs of reversing its post-profit- warning slide, 2p lower to 12¾p, valuing its equity at just £438 million. Although it is saddled with £1.6 billion of debt, some analysts believe it is now at a level where the likes of GE and Honeywell of the US, or Schneider of France, may consider a break-up approach. Bunzl, down 3p to 369¼p, caught followers by surprise by launching a share buyback programme, despite making no mention of such plans in Monday’s full-year results presentation to investors. After purchasing 250,000 at 377.89p on Monday, Cazenove, house broker, mopped up a further 180,000 at 370½p yesterday. GILT-EDGED: The £2.75 billion auction today of Treasury 4¼p per cent 2036 continued to weigh on long-dated issues, which underperformed their peers as overseas markets continued to rise. The March gilt future gained 6p to £122.44 on brisk turnover in 65,000 contracts. Treasury 8½ per cent 2005 rose 1p to £113.18, against a 32p loss to £145.06 for Treasury 8 per cent 2021. NEW YORK: Stocks staged a comeback, after a 138-point fall in the Dow Jones industrial average, as investors picked up bargains and shrugged off an unexpectedly steep drop in consumer confidence. The Dow closed up 51.26 at 7,909.50. |
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| aus der Diskussion: | Allied domecq - hochprozentiges konservatives Investment? |
| Autor (Datum des Eintrages): | mr.lukoil (05.04.03 00:57:38) |
| Beitrag: | 11 von 11 (ID:9088895) |
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