MARKET REPORT: Has vulture hedge fund built stake in Vodafone?


Vodafone’s shares were on the rise as the London market neared a close yesterday, on reports that activist investor Elliott Advisors had begun building a stake.

Shares spiked just before 3.30pm as 3.2m shares changed hands in just one minute. In the next 33 minutes running up to 4pm more than 39m shares were traded, compared to just 50.8m in the entire morning and early afternoon.

Elliott declined to comment on whether it was behind the aggressive buying. But the firm has been embroiled in the telecoms sector recently, after it pulled off a boardroom coup at Telecom Italia following a battle with French media group Vivendi.

Elliott first approached Vodafone several weeks ago, according to the original report run by traders’ news service Dealreporter, which quoted unnamed sources.

Vodafone shares spiked just before 3.30pm as 3.2m shares changed hands in just one minute

Vodafone shares spiked just before 3.30pm as 3.2m shares changed hands in just one minute

Vodafone shares spiked just before 3.30pm as 3.2m shares changed hands in just one minute

It is said to be pressing for changes at the company, though the detail of what this involves is not yet known.

Vodafone has been criticised in recent years for inconsistent revenue growth and write-downs in parts of its business abroad. 

The company announced earlier this year that chief executive Vittorio Colao would step down in October, to be succeeded by the chief financial officer Nick Read. 

The rumour of Elliott’s involvement lifted Vodafone’s shares 3.6 per cent, or 6.5p, to 186.5p at the end of the day.

Shares in Ladbrokes Coral’s owner GVC leapt to an all-time high as the firm revealed it was betting on America for its next venture. 

Stock Watch – Clipper Logistics 

Signing contracts with River Island, M&S and Asos over the last year has not helped warehousing and delivery firm Clipper Logistics from releasing disappointing results.

Shares tumbled 21.7 per cent, or 88p, to 317p as the firm revealed revenue was up 17.6 per cent to £400.1million and profit climbed 14.6 per cent to £14.3million.

The numbers were some way short of what analysts had expected. Clipper’s executive chairman Steve Parkin, however, said he remained confident in the future.

GVC announced it would put £76million into building a betting and online gaming platform in the US, along with US-listed entertainment company MGM Resorts, which would match the £76million investment. 

The move across the pond comes weeks after the US Supreme Court allowed states to start legalising sports gambling, which cracked open the market to international players like GVC.

In a call with analysts, GVC’s chief executive Kenny Alexander sounded ecstatic about the deal which he promised would create ‘billions of shareholder value’.

He said the chance to break into the US was a ‘once in a lifetime opportunity’ and that ‘nothing will compare with this deal’.

His enthusiasm might have been helped along by his strong personal relationship with MGM’s chief executive Jim Murren. GVC’s shares climbed by 5.4 per cent, or 59p, to 1154p, adding £341.1million onto the betting giant’s market value.

Despite a few strong risers, the FTSE 100 ended the day down a fractional 0.01 per cent, or 0.5 points, at 7700.9. Outside the blue-chip index, travel-agent stalwart Thomas Cook was in investors’ good books after a flurry of weekend news.

The firm announced that it was launching city break and hotel-only search areas on its website, using Expedia’s booking technology and increasing the number of hotels available to its customers to more than 100,000.

Investors’ interest was also piqued by reports that the company had talked internally about flogging off its airline, though a spokesman for the company denied there were any ‘current plans’ to sell the division.

Thomas Cook’s chief executive Peter Fankhauser also found time to write a blog post explaining that the company would no longer sell tickets to Sea World in Florida, as well as any other animal attractions that include killer whales in captivity. Shares jumped 7.2 per cent, or 6.5p, to 96.85p.

But investors in Ibstock were bricking it, as the company said earnings for the year would be in the £121million to £125million range – 6 per cent to 7 per cent lower than previously estimated. The brick maker said production suffered in the cold weather at the start of the year.

Shares crumbled by 13.3 per cent, or 37p, to 241p.

 



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