Market report: William Hill still in the takeover running despite joint bid tumble

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The William Hill takeover saga might have a few more furlongs to run yet, judging by the share price reaction to the joint bid falling through.

Shares in the bookie actually rose 9.83p to 312.93p after Grosvenor Casinos operator Rank Group and online casinos firm 888 walked away from a deal.

The FTSE 250 group revealed annual profits will be at the upper end of its £260 million-£280 million guidance, and investors were also buoyed by chatter that other interested parties could have Hills in their sights.

Liberum analysts claimed that a spending spree in the gambling sector leaves Hills “under threat. In the short term, there could be a value opportunity given the depressed share price,” it said.

The complex joint bid, which was a combination of shares and cash, perplexed analysts and a simpler takeover offer could still be an option, even with one of either 888 or Rank.

William Hill, which sponsors the Scottish Cup, might favour teaming up with 888, which it tried to buy last year for £750 million.

Shares in 888 gained 9p to 214p and Rank rose 5.6p to 227.2p.

The FTSE 100, down 13.20 points at 6855.76, ended the week with a whimper as traders began to wonder if the post-Brexit rally was starting to run out of steam.

The market is turning its attention to the US elections, after which economists predict the Federal Reserve will hike interest rates.

EasyJet glided 38.26p higher to 1116.26p amid gossip about takeover interest from the US.

Hedge funds took advantage of the recent rights issue by engineering turnaround specialist Melrose Industries, up 1p at 140.25p, to make a quick buck.

Hedge funds have taken out short positions in the company as an arbitrage play between the nil-paid shares and ordinary shares during the rights issue.

Guevoura, which has taken out a 6.5% short position, is a specialist in equity derivatives arbitrage.

Atlas Mara, the London-listed African banking vehicle of former Barclays boss Bob Diamond, sank 0.25p to 3.05p, taking its slump this year to 42%.

A note from Johannesburg-based Renaissance Capital sparked the sell-off as it forecast annual profits to dive by more than 50%.  

AIM punters jumped ship from North Sea tiddler Independent Oil & Gas, which plunged 5.48p to 23.65p after it plugged and abandoned its Skipper well when drilling failed to strike oil.

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August 19, 2016 |
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