Applegreen soars after owners eye private move

The deal-making bonanza that has swept the London market over the last few weeks is showing no signs of slowing down.

Petrol forecourt retailer Applegreen became the target of a bumper takeover deal, while chemicals group Elementis successfully batted away a cut-price bid from an American rival.

Applegreen shares rocketed as bosses and founder Robert Etchingham and Joseph Barrett plotted taking the Irish group private for around 523p per share.

Petrol forecourt retailer Applegreen shares rocketed as bosses and founder Robert Etchingham and Joseph Barrett plotted taking the Irish group private

Chief executive Etchingham and operations boss Barrett already own more than 41 per cent of the company and are being backed by US private equity giant Blackstone for the £630million bid.

The proposed offer is generous by City standards, at a 48 per cent mark-up on Applegreen’s share price from the day before the offer was announced.

A board committee – which does not include the two bosses – has said they would back a firm offer and recommend shareholders get behind it too.

The AIM-listed group’s stock shot up 41.2 per cent, or 146p, to 500p last night, falling slightly short of the offer price.

Elementis shares, on the other hand, sank 11.6 per cent, or 14.4p, to 110.3p as suitor Mineral Technologies walked away from making a higher offer for the firm.

Stock Watch – XL Media
Marketing minnow XL Media was a hit with investors after it bought American betting business CBWG Sports.

The AIM-listed company will pay £9million for CBWG, which has six gambling websites, and could hand over another £7million over the next three years depending on its performance.

XL Media aims to drum up more customers for online betting firms and runs 2,000 websites. Shares rose 16.4 per cent, or 5.5p, to 39p as it made its latest move into the lucrative US market.

Elementis, which makes ingredients used in everything from lipstick and paints to roof tiles and pharmaceutical tablets, rejected a £622million (or 107p per share) bid last month, slamming it as being far too cheap when Elementis’ future prospects are taken into account.

Private equity firms in particular are coming under fire for plundering British groups that have suffered during the pandemic but look set to rebound.

BT also joined the dealmaking fray, as it inked an early deal for undisclosed sums with Telecom Italia to offload a cloud services unit for small businesses and a public administration arm that serves government departments. The telecoms behemoth slid 1.9 per cent, or 2.6p, to 135.7p on the news.

The FTSE 100 made gains despite shares in some of Britain’s biggest banks falling as traders fretted about how long an economic recovery will take.

Lloyds Banking Group fell 4.2 per cent, or 1.58p, to 35.67p, while Natwest dropped 4 per cent, or 6.7p, to 161.1p.

But this was more than offset by a surge in oil companies after crude prices rose by more than 3 per cent and climbed back above the psychologically significant $50 a barrel mark.

BP was the top Footsie riser, climbing 4.5 per cent, or 12.15p, to change hands at 284.75p, while rival Shell edged up 3.8 per cent, or 50.4p, to 1385.2p.

And packaging giant DS Smith helped keep the Footsie in the black after a surge in online Christmas shopping sent demand for its products soaring.

DS Smith rose 3.8 per cent, or 13.6p, to 372.1p, while the index as a whole closed up 0.5 per cent, or 35.47 points, to 6599.76.

The pound wasn’t as fortunate, though, falling by around 1 per cent to $1.33 and by 1.2 per cent against the euro to €1.10, as the UK and EU failed to break the Brexit impasse.

Fears about a No Deal Brexit dragged on the more domestically exposed FTSE 250, which fell 0.6 per cent, or 127.79 points, to 19756.1.

Financial updates hurt pub group Marston’s (down 9.5 per cent, or 6.65p, to 63.35p), as it slid to a £397million loss and said it was being hammered by the lack of Christmas parties, and First Group (down 3.9 per cent, or 2.7p, to 66.25p) as it agreed to end the Avanti West Coast and South Western Railway franchises.

Investors piled into car dealership Inchcape, however, as it reported better than expected sales during the November lockdown in England and said full-year profits will be higher than forecast. Shares climbed 5.7 per cent, or 36p, to 667p.