Market Report: City hopes Siemens will target Aveva after Schneider snub

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Shareholders of Aveva are still licking their wounds after its £1.3 billion deal with France’s Schneider Electric hit the buffers in December.

The reverse takeover, which would have seen the engineering software firm ensnare Schneider’s industrial software unit in turn for a majority stake in the FTSE 250 business, fell through, sparking a stampede for the exit from investors who were hoping it would cut the group’s exposure to the volatile oil and gas sector.

But it might not be long before another suitor emerges, with speculation Germany’s Siemens would be interested.

Broker Jefferies is certainly a believer, especially after Siemens’ spending spree during which it snapped up US oilfield equipment-maker Dresser-Rand for $7.6 billion (£5.3 billion).

It said: “We remain of the view that Siemens would be well-served by acquiring Aveva.”

Shares slipped 14p to 1317p as Jefferies trimmed its target price to 1830p.

The FTSE 100 began the week on the back foot, down 27.39 at 6056.40 as China’s poor run of manufacturing data continued.

Optimism that a deal can be agreed by Home Retail Group and suitor Sainsbury’s before tomorrow’s 5pm deadline helped the Argos owner up 1.54p to 138.24p, although the supermarket giant slid 0.1p to 245p.

Hedge fund Immersion Capital covered its entire short position last week in anticipation of an agreement. 

Fresh from Morgan Stanley’s downgrade to underweight, UBS took another bite out of Just Eat — 8.4p cheaper at 365p — beginning its coverage of the online takeaway delivery firm with a Sell.

The broker warned that “public perception is not strong enough to withstand competitive threats”, naming Deliveroo as one.


Premier Oil rocketed 24p or 126% to 43p as it resumed trading after its $135 million takeover of E.ON’s North Sea assets.

On AIM, Keywords Studios, which tests video games such as Guitar Hero, hit the right note with investors, rising 13p to 217p with annual profits “comfortably” ahead of analyst expectations.

Online ad firm Crossrider, 73%-owned by Israeli billionaire Teddy Sagi, warned profits for 2016 would be lower than expected triggering a 13.5p or 25% slump to 40p, exacerbated by the departure of chief executive and co-founder Koby Menachemi.

Shareholders of Lakehouse suffered a similar fate as the energy services firm plummeted 48p or 57% to 36p when just three months into its financial year, it warned annual profits would be lower than the previous year.

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February 2, 2016 |
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