Two of the main stories this morning concern companies "chasing the dragon".
First, Thomas Cook (LON:TCG) is hitting the headlines – for good reasons, for a change – after announcing the formation of a joint venture (JV) to target the fast-growing Chinese tourism market.
The minority partner in the JV is Chinese conglomerate Fosun International, which is not only a significant shareholder in Thomas Cook but also owner of the Club Med brand.
According to the Daily Telegraph, Chinese tourists are forecast to spend £1bn in the UK by 2017, helped by more simplified tourist visas and the growing wealth of the country's middle classes, so it is no surprise that Thomas Cook is interested in this market.
“Today, there is a lack of innovation and differentiation in the travel product offerings for Chinese tourists in China and abroad, presenting an excellent opportunity for our new joint venture to gain a competitive advantage,” claimed Qian Jiannong, president of Fosun's Tourism & Commercial Group.
Thomas Cook is still reeling from the torrent of bad publicity over the way it handled the tragic case of two youngsters that died in Corfu while on one of its holidays. The company, a pioneer in the travel business, nearly went bust a few years ago and is still in the process of reshaping its business.
Meanwhile, Dragon Oil (LON:DGO) shares received a lift as majority shareholder ENOC secured board approval for its revised offer to buy out minority shareholders.
The cash offer has increased to 750p per share, up from 735p, and it values the whole of the London listed exploration & production (E&P) group at £3.7bn, while the outstanding shares would be worth £1.7bn.
On the subject of minority buy-outs, FTSE 250 firm Vedanta has unveiled plans to acquire the remainder of Cairn India in a deal that will create India’s leading diversified natural resources company.
Vedanta Limited, a partially owned subsidiary of the London listed group, which already owns 59.88% of Cairn India, will acquire the interests of minority shareholders. It will issue one Vedanta share and one redeemable preference share for each outstanding Cairn India share.
The deal represents a premium of 7.3% to Cairn India’s previous closing price, Vedanta highlighted.
The word “cairn”, which signifies a man-made pile of stones, often used to mark burial sites, is probably a good search engine keyword to use today, as Irish house-building outfit Cairn Homes (LON:CRN) is making its début on the London Stock Exchange today.
It is off to a decent start, with the shares rising from the flotation price of a penny to 1.06p.
There is a dearth of trading updates from FTSE 350 companies as per usual on a Monday, which means Majestic Wines (LON:MJW) probably qualifies as the company with the highest name recognition reporting today.
The wine seller's shares are sinking after it revealed like-for-like sales in the UK in the 52 weeks to 30 March 2015 were up just 1.9% year-on-year, while the gross margin slipped from 23.0% the year before to 22.7%.
The retailer recently bought up Naked Wines and appointed the latter's boss as its new chief executive, in an attempt to rejuvenate the brand.
New boss Rowan Gormley said new investments to reinvigorate the business will suppress profit in the short-term, but said he is confident the initiatives will create significant value for shareholders over the medium-term.