Market Report: Virgin Money falls as Wilbur Ross offloads shares again

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Could it be job done at Virgin Money for restructuring specialist Wilbur Ross?

Private-equity funds owned by the US billionaire are selling another chunk of their shareholdings in the FTSE 250 challenger bank through an accelerated bookbuild.

It mirrors a move made in April when he dumped 60 million shares at £4 a pop to bank £240 million.

This time around, Ross is offloading 50 million shares at 405p for upwards of £200 million, which dragged the Richard Branson-backed group towards the bottom of the mid-cap index, down 16.3p, or 3.9%, at 407.2p.

The rise from shares in Virgin Money, which took the “good” assets of Northern Rock off the government’s hands in 2011, has levelled off since its IPO last November and has failed to make much progress since Ross’s last share sale.

Ian Gordon at Investec said Ross cutting his stake to 12% — he owned 45% before the float — was good news for investors as it means more shares can now be freely traded on the market.

“Notwithstanding any transitory ‘market indigestion’, we see the temporarily reduced entry level as highly attractive,” Gordon told Investec’s clients.

The promise of monetary stimulus in China helped Japanese stocks to their best day for seven years and in turn gave the FTSE 100 a 102.55-point leg-up to 6248.65.

However, traders waiting for a sustained recovery from markets might have to sit on their hands a while longer as the three-month period until November is a typically choppy stint for global stocks.

Online betting group, 0.54p pricier at 107.14p, confirmed the end of takeover talks with rival 888 as it opted to go with the sweeter offer from Sportingbet owner GVC, up 2.8p at 411.8p.

A first-quarter trading update from Entertainment One, the company behind hit kids’ TV show Peppa Pig, spooked the City as foreign exchange movements took their toll on revenues.

The shares dropped 12.3p to 289p.


On the junior market, Quindell, off 0.51p at 98.49p, revealed it is to buy the remaining 51% it does not already own of Canada’s PT Healthcare Solutions.

The scandal-ridden insurance tech firm first invested in PT Healthcare in September 2013 under the guidance of Rob Terry, its controversial founder.

Mobile payments firm Monitise, another former darling of AIM, tanked 1.46p, or 25%, to 4.35p as chief executive Elizabeth Buse stepped down after a 6% fall in full-year revenues to £89.7 million.

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September 9, 2015 |
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