11.50am: TP Group soars on Science Group bid
Shares in TP Group PLC (AIM:TPG) rocketed 187% after Science Group PLC (AIM:SAG) said it had struck a deal to buy the remaining shares in TP Group that it does not already own in a £17.53mln deal.
The deal valued each share in TP at 2.25p per share, a premium of around 190% to the closing price of 0.78p on Friday.
TP Group recommended the deal to its shareholders stating “the certainty of the cash offer should be weighed against the inherent uncertainty of the delivery of the future value that exists in the business, including general uncertain economic and market conditions.”
11.01am: Centrica jumps as Citi raises price target
Shares in British Gas owner, Centrica PLC (LSE:CNA), received a boost this morning as Citi increased its price target to 93p from 81p and reiterated its buy rating.
In a note analyst Jenny Ping said the share price already reflects a punitive power generation windfall tax in the form of a revenue cap and an extension of the tax on oil and gas.
But it does not reflect the upside risk from optionality and growth potential offered by a very profitable Rough storage asset, its core cash generative retail business and the prospect for earnings clarity once there is visibility on any government intervention, she commented.
Ping thought a windfall tax would provide a “much needed clearing event for the shares.”
“Furthermore, in a rising rate environment, we prefer companies with little debt and robust balance sheets, qualities which Centrica already possesses” she said.
Last Friday the company announced it had reopened its Rough gas storage facility, increasing the UK’s storage capacity by 50% and "boosting the UK’s energy resilience.”
Mid-morning and shares in Centrica are up 4.5% at 76.50p.
10.08am: Easyjet flies high on BA bid talk
Shares in budget airline operator, EasyJet PLC, surged 5.2% today on reports that the group could be a takeover target for International Consolidated Airlines Group SA (LSE:IAG) (International Consolidated Airlines Group SA (LSE:IAG)).
The Times reported that British Airways-owner is eyeing a potential acquisition as part of renewed plans to consolidate the European airline industry.
AJ Bell investment director Russ Mould said the reports “make perfect sense.”
Mould suggested “Many airlines will have been watching EasyJet’s share price collapse and weighing up their options.”
“An opportunistic takeover bid now could net them a bargain in the long term, but equally it’s a bold move to take given the gloomier economic outlook which could cause further disruption to earnings over the coming year.”
“Wizz Air has been linked as a potential suitor for EasyJet in the past and there is also logic behind a tie-up of those two companies” and Mould suggested that International Consolidated Airlines could face competition from other parties should it decide to make a move on the low-cost airline operator.”
Shares in Wizz Air Holdings PLC (AIM:WIZZ) (Wizz Air Holdings PLC (AIM:WIZZ)) also rose, up 4.6%.
8.42am: Royal Mail owner, International Distributions Services PLC (LSE:IDS), rises as strikes called off
Shares in Royal Mail owner, International Distributions Services PLC (LSE:IDS), enjoyed better fortunes today, rising 6.55% after Royal Mail workers dropped plans for a series of mass walkouts over the next two weeks after the company reportedly queried the legality of the action.
Around 115,000 members of the Communications Workers Union (CWU) had been planning to strike on 2, 3, 4, 8, 9 and 10 November.
Union representatives insisted that this did not mean the industrial action was over even though talks are set to get underway at arbitration service ACAS this week in an attempt to settle the dispute about pay, conditions and modernisation.
Victoria Scholar, head of Investment, interactive investor said: “Although this is a short-term reprieve for Royal Mail, helping to alleviate some pressures on the company’s ability to deliver its services, longer-term the tensions between workers and the postal service remain.”
“The postal service has been struggling with a perfect storm of heavy strike action, a structural decline in letter demand, a fading pandemic parcel boom, pressures from cost inflation and an onslaught of dynamic competitors to the market” she said.