Two of the largest paper and packaging companies listed in London are the latest to be swept up in the acquisition rush.
Just a day after housebuilders Barratt Developments and Redrow outlined their merger plans, FTSE 100 group DS Smith revealed it has “received a very preliminary expression of interest” from rival Mondi, although no proposal has been made. .
Mondi is weighing an offer and must declare whether it wants to proceed by March 7.
Shares in DS Smith soared 9.8 per cent, or 27.5p, to 308.6p, valuing the business at around £4.27bn. Mondi, worth around £5.9bn, fell 3.3 per cent, or 45p, to 1,336p.
DS Smith has been public since 1986 and manufactures products such as trays for carrying cans and bottles, and food packaging.
Acquisition fever: FTSE 100 group DS Smith revealed it has “received a very preliminary expression of interest” from rival Mondi, although no proposal has been made
Mondi has 22,000 employees in more than 30 countries. It manufactures wooden containers, printing paper and boxes for storing fruits and vegetables.
In the broader market, the FTSE 100 fell 0.4 per cent, or 33.27 points, to 7,595.48, while the FTSE 250 fell 1.81 points to 19,102.72.
The Competition and Markets Authority is opening an investigation into Aviva, which agreed to buy AIG’s UK life insurance business last year for £460m.
The watchdog is concerned about “a substantial decrease in competition.” Aviva fell 1 per cent, or 4.2p, to 420.7p.
On Britain’s High Street, Primark has pledged to invest more than £100m in stores this year and will open three stores. Shares in its owner, Associated British Foods, rose 0.3 per cent, or 6 pence, to 2,247 pence.
Rolex seller Watches of Switzerland reported a 3 percent drop in third-quarter revenue to £397 million. Sales in the United States were up 3 percent, but in the United Kingdom and Europe they were down 7 percent. It fell 2.5 per cent, or 9.4p, to 372.4p.
Stock Watch – Sanderson Design
Luxury interiors group Sanderson Design fell 13%, or 16.5p, to 110p after a poor performance in the UK.
Sales fell 3.1% to £108.5m in the year to the end of January, while profits of £12m were slightly lower than a year earlier. Business was tough in the UK, its biggest market, as revenue fell 11% to £37.9m.
It warned that trading will remain “challenging” in the UK and Europe amid a “backdrop of subdued consumption”, and expects similar revenues and profits next year.
Infrastructure Digital 9 (down 23.7 per cent, or 5.5p, to 17.7p) suffered a setback after the data center and wireless network investor said the sale of its prized asset will be investigated by the Icelandic antitrust authority.
The group agreed to sell Verne Global to Ardian France SA for around £465 million in November.
He expected the deal to be approved by the end of March, but it could be approved later than expected.
Revenue at Compass, the world’s largest catering company, rose 11.7 percent in the three months to the end of December, maintaining its forecast for the year.
It spent £280m in the period buying companies and last month agreed to acquire CH&CO in the UK for £477m. The shares rose 2.8 per cent, or 61p, to 2,211p.
Mining giant Anglo American reported a positive fourth quarter following strong copper production in Peru and record iron ore production in Brazil. The shares fell 0.9 per cent, or 15 pence, to 1,739.6 pence.
Advertising giant WPP rose 0.2 per cent, or 1.6p, to 783.4p after buying a minority stake in a new German agency OH-SO Digital.
Cosmetics company Revolution Beauty wants to generate £1bn in sales by 2030 and save £10m over the next three years, but has warned its revenue is likely to rise less than expected for the year ending in February.
The shares fell 8.9 per cent, or 2.85 pence, to 29.15 pence.
And technology company Nanoco (up 1.6 per cent, or 0.32p, to 20.18p) received the final benefit of its £124m deal with Samsung after it alleged patent infringement , alleging that the South Korean tech giant used its “quantum dot” technology without permission in televisions.
Nanoco said yesterday it had received £58.8m in the second payment and would return between £33m and £40m to shareholders and use some of the money to invest in business opportunities and expand R&D.