Conservative party donor and deputy chairman Lord Ashcroft astonished dealers today with news of an extraordinary deal that will bring a timely multimillion pound boost to his personal fortune.
Shares in loss-making OneSource Services, in which Ashcroft has a 74% stake, rocketed from Friday's close of 655p to £44.50 as it agreed terms of a deal worth £48.10 a share - a 630% premium.
Quoted on the junior Aim market, OneSource is incorporated in Belize and operates in the US, offering building repair and maintenance services. The bidder is ABM, an American janitorial services company that was founded in 1909 as a one-man window-washing business.
Although OneSource will bring some hefty tax breaks to the buyer, dealers were at a loss to explain the huge premium offered by ABM. The total value of the deal is £179m in cash.
This caused some excitement in an otherwise relatively uninspiring market, with the FTSE 100 down 54.9 points at 6540.9, as a production warning at copper miner Kazakhmys had a negative impact on other miners, and some of the banks also weighed down on the index of 100 leading shares.
Kazakhmys fell 94p to £15.02 after it warned that its South Mine in central Kazakhstan would not return to full production for some weeks due to flooding at the mine at the beginning of September. The group said: "This incident, combined with a slower than planned pick up in output from new concentrators in the second half of 2007, is likely to lead to copper cathode production from own ore in 2007 being moderately below the level of 2006."
The news, coupled with a fall in metal prices, weighed down on the other big miners. Anglo American, for example, fell 87p to £32.56, Xstrata was down 108p at £32.12, and Vedanta Resources dropped 94p to £20.86.
HSBC, meanwhile, fell on reports the second largest pension fund in the US had sided with rebel shareholder Knight Vinke, the hedge fund that has called for a strategic review of the bank. Shares in the group fell 17.5p to 944p.
Royal Bank of Scotland was also down after a downgrade from Bear Stearns following the successful outcome of its offer for ABN Amro, the Dutch bank. Bear Stearns cut its ratings on the bank from outperform to underperform, sending shares in RBS down 9p to 560.5p.
On the upside, however, Northern Rock, the beleaguered bank, was the top riser on the FTSE 100, up 14p to 172.5p, amid rumours of more private equity interest. The Wall Street Journal reported that Blackstone and Apollo Management had expressed an interest in the bank last week. The bank has been looking for a suitor since the credit crunch led to trouble on the money markets, which in turn led to an emergency loan from the Bank of England. The news triggered a run on the bank, leading to what some have described as scenes reminiscent of events in a banana republic.
SABMiller, the brewer, was also up on the back of a bullish Credit Suisse note, following an analyst visit to the group's operations in Colombia and Peru. Analysts at the bank said: "Operational evidence supports our view of SABMiller as an exceptional emerging markets operator. Strategically, the success of SABMiller in the region enhances its position as the most attractive M&A or partnership candidate for the remaining Brazilian, Mexican and Venezuelan brewers. The confluence of these factors could lead SABMiller to overtake AmBev [Latin America's largest beverage company] as the Latin American beverage leader." Shares in the company rose 15p to £14.66.
Mitie, the cleaning and maintenance firm, was also up after Credit Suisse started coverage of the group with an outperform rating. Shares in the company rose 2.25p to 264.75p. Analysts said: "We view Mitie as an attractive play on structural growth with strong visibility of future earnings and significant exposure to the defensive public sector."
Further down on the FTSE, Emblaze, the Israeli telecommunications group, rose 15p, or 26%, to 73.5p on news the group's president, Eli Reifman, had bought 7.6m shares at 150p a share, a 160% premium to Friday's closing price, increasing his stake in the company to 15.4%.
On Aim, Brinkley Mining, the company focused on South Africa and the Democratic Republic of Congo, fell 1.25p, or 11.6%, to 9.5p after a statement issued by the government of the DRC late on Friday seemed to indicate that its licences to mine and export uranium from the country had been revoked. The company said it was seeking clarification from the government.
On the positive side, Alkane Energy, the company that recovers methane emissions from disused coal mines and uses them as fuel for renewable electricity, soared 2.75p, or 15%, to 21.5p. The group confirmed it had held informal takeover talks with an unnamed party, although it said the talks were at an early stage.
And finally, Pentagon Protection, the company that specialises in the development and application of glass protection window film, saw its shares soar 0.25p, or 26%, to 1.2p. The firm announced it had been awarded a contract worth £445,000 to supply and install its glass containment system to 2,800 panels of toughened glass on the Andromeda Tower in Vienna.