News

M&S shares jump on Qatar bid reports

Mar 19, 2013

Traders set their sights on Marks & Spencer this morning and sent the shares in the retailer as high as 9pc on weekend reports Qatar is considering a bid for the high-street stalwart.

 

In a falling market, M&S shares recorded the biggest rise on the FTSE 100 and were up 7.7pc in early deals. The stock climbed as much as 9.4pc during morning trade, but pared some of its gains on subsequent reports today that Qatar Holding is not considering a bid for the blue-chip retailer.

 

Bid rumours around M&S are not new and only last Thursday there was vague chatter of a takeover, dismissed by many in the market, that pushed the shares higher. Analysts, however, remained cautious on the possibility of a bid this morning.

 

“As we have not yet seen any statement to the market from any party, we conclude that nothing firm is currently on the table for the M&S Board to consider,” said analysts at Shore Capital, adding that they “can understand why there is renewed potential interest in an iconic British brand still much appreciated by the average Briton”.

 

The M&S talk also had a knock-on effect on J Sainsbury shares, up 0.9pc today. The Qatar Investment Authority, the Gulf state’s sovereign wealth fund, holds a 26pc stake in supermarket group and the QIA-backed Delta Two fund attempted a bid in 2007.

 

But while M&S climbed higher, the broader FTSE 100 tumbled in the wake of the controversial plans to bailout Cyprus by levying a tax on bank deposits. The blue-chip index shed 1pc and the mid-cap FTSE 250lost 0.9pc, following the lead of markets in Asia that all moved sharply lower. Mike van Dulken, head of research at Accendo Markets, said the Cyprus rescue terms set “a new precedent in the Eurozone debt crisis” and heightening “fears of bank runs and contagion risk back to Greece, Spain and Italy.”

 

Elsewhere on the benchmark index, Eurasian Natural Resources Corporation lost 5.2pc following press reports the miner was working on a rights issue.

 

Source