Stocks in London open 2017 in the black with deal-making action at London Stock Exchange (LSE), Britvic (BVIC) and BBA Aviation (BBA) dominating news flow.
FTSE 100 shares trade 0.27% higher at 7,162 after closing 2016 at an all-time high.
Despite a rash of acquisitions and disposals, Intercontinental Hotels (IHG) is the biggest gainer on the blue chip index, gaining 3.8% to £37.75
Intercontinental’s gains come after online rental platform Airbnb moved to curb London users renting out property for more than 90 days a year, which can be in breach of UK law without valid permits.
Investors are snapping up Intercontinental's shares in the hope competitive pressure from Airbnb, which now commands close to an 8% share of overnight stays in London according to Financial Times data, may start to ease.
LSE-EURONEXT TIE-UP
London Stock Exchange’s proposed €550m (£468m) disposal of LCH Clearnet to Netherlands-headquartered exchange business Euronext is the day’s stand-out corporate event.
LSE’s stake in LCH Clearnet, which handles clearing of key trades across Europe, had been eyed as a potential takeover target since LSE received a bid from rival Deutsche Boerse.
Euronext’s offer is for LCH’s France-regulated operating subsidiary and LSE is retaining clearing businesses including LCH Group’s UK division. The disposal could help speed regulatory approval of the Deutsche-LSE deal.
Shares in LSE trade 0.2% lower at £29.07 while Euronext gains 2.3% to €39.85 in Amsterdam.
MID CAP DEALS
FTSE 250 stock Britvic (BVIC) froths up 5.5p to 572.5p as investors applaud the proposed R$218m (£54m) acquisition of high growth Brazilian concentrates and juice business Bela Ischia. Building on 2015's takeover of ebba, the deal strengthens Britvic's brand portfolio in the large and growing Brazilian soft drinks market.
Also on the mid cap index, BBA Aviation is pairing up with AIM-quoted Gama Aviation (GMAA:AIM) to combine the two companies' business aviation charter units in the US.
BBA has been taking steps to tidy up its operations since paying $2.1bn (£1.7bn) to buy Landmark Aviation from private equity outfit Carlyle Group in 2015.
It is also in the process of selling its ASIG refuelling business for $202m to John Menzies.
LITIGATION GAINS
AIM-listed litigation funder Burford Capital (BUR:AIM) also enjoys a boost after selling part of one of its portfolio investments at a premium of 10 times more than the asset is currently being carried on its books. Managing director Elizabeth O'Connell cautions the accounting treatment of these sales have not yet been cleared with auditors and may not enable Burford to recognise the sizeable uplift in book value implied by the transactions. Shares trade 11.1% higher at 636p.
