GW Pharmaceuticals gets high on takeover buzz after hiring bankersComments Off on GW Pharmaceuticals gets high on takeover buzz after hiring bankers
Takeover rumours surrounding cannabis-based drug developer GW Pharmaceuticals had investors hooked on the shares.
A report said the company, whose main listing is on AIM but which allows US investors to trade American Depository Shares on Nasdaq, had hired Morgan Stanley to assess bids.
The AIM-listed shares shot up 90p, or 17%, to 616.5p today, even as the report from Reuters suggested the company was not currently interested in a sale and did not name any bidders which were said to have tabled offers.
Sources pointed out that GW already uses Morgan Stanley to raise money, the latest funding round being a $252 million (£188 million) placing in July, which the investment bank ran alongside Bank of America Merrill Lynch and Goldman Sachs.
With a market capitalisation of £1.9 billion after today’s share spike, GW is the third-biggest company on AIM behind Asos and New Europe Property Investments. Its main drug in development is Savitex, which treats patients with multiple sclerosis who suffer from severe spasticity.
A spokesman for GW said the company does not comment on market speculation. Investors were more bullish on the back of Micro Focus’s deal with HP and the FTSE 100 index rose 40.78 points to 6887.36, with traders focused on the European Central Bank meeting.
Education tests provider and textbooks publisher Pearson came under pressure after a US rival J Wiley revealed struggles in its higher education business. Shares in the company dived 40p to 823.5p. “The comments from Wiley suggest a market that is seeing increasing structural pressure,” said broker Liberum, which said it expects Pearson to issue another profit warning this year.
RSA was up 6p at 503p even as its shares went ex-dividend after HSBC upgraded the insurer to buy. However, Hastings Group, whose rating was cut to reduce, fell 1.1p to 218.8p.
Shares in troubled North Sea oil firm EnQuest slipped 0.5p to 28.25p as it lowered production guidance after the slow start-up of one of its oilfields.
It came alongside first-half results, which showed a 12% fall in revenues to $391 million and a pick-up in underlying earnings to $243 million. Net debt at Enquest, which also revealed its veteran chairman Jim Buckee has retired, increased to $1.7 billion.
At the smaller end of the spectrum, Hydrodec advanced 0.12p to 3.5p as it became the only oil re-refining business in the world to receive carbon credits for its output after being approved by the American Carbon Registry.
Elsewhere, drones firm Strat Aero soared 0.3p to 0.72p after a £2.5 million contract to inspect the flood defences of the Thames Estuary.