Colt bolts for higher ground on takeover talk
By Yvette Essen, Stock Market Reporter
Last Updated: 1:01am GMT 19/01/2007
Hopes that Colt Telecom could now be a takeover target sent the telecoms group up 5pc to 170p. Credit Suisse touted the idea as it upgraded the shares from neutral to outperform and lifted its target price from 130p to 165p.
"Colt has been mentioned frequently in conjunction with potential take-over interest over the last two years," it explained. "We have dismissed these reports in the past but our view is changing."
The broker argued that as telecoms operators seek to increase their competitiveness outside their own domestic markets, Colt's exposure in 32 of the largest European commercial centres "could become increasingly attractive given the high costs of wholesale access in much of Europe".
UK equities were in positive territory, with the FTSE 100 rising 39.9 in early dealings to 6244.4 and the FTSE 250 advancing 28.8 to 11123.
The financial stocks were in demand with hedge fund manager Man Group up a further 3pc at 574p, interdealer broker ICAP putting on 2.6pc to 509p and insurer Old Mutual 2pc higher at 179p.
Mining shares made headway as the price of nickel struck a new high. Vedanta Resources gained 2.6pc to £11.19, Xstrata was chased 2.1pc higher to £22.90 and BHP Billiton was 1.9pc richer at 906p.
Whitbread was one of the biggest blue-chip fallers, shedding 1pc to £16.13. However, Panmure Gordon repeated its buy rating on the shares, following the sale yesterday of its TGI Friday's business for £70.4m. It said once the turnaround is complete, management should consider whether to expand its David Lloyd Leisure brand or sell it.
Misys topped the list of FTSE 250 risers as the software group unveiled first half figures in line with guidance and the market welcomed sweeping management changes. The shares rallied 5.8pc to 240p.
Support services group Mitie gave back 4pc to 245p. The shares had spiked in late trading yesterday, aided by bid speculation.