Spat with Vivendi hits Vodafone
SHARES in mobile phone giant Vodafone reversed yesterday on fears that it could lose out on £1billion from the sale of its stake in French operator SFR.
Vodafone, down 4p to 175p, was hoping that it would soon off-load its 44 per cent stake in SFR for £7billion to its majority shareholder Vivendi, the French media conglomerate.
But it is now understood that Vivendi is unwilling to go much beyond £6billion to buy Vodafone out.
Talks are still going on, but analysts suggested that any disagreement over price could result in the deal being delayed.
“They appear to want six and Vodafone wants seven. That’s quite a big gap,” said ING analyst John Davies.
“It’s not as if either of them need to do a deal, so I’m not convinced that anything will happen rapidly.”
Overall, it was a bad day for blue-chip climbers, as the FTSE 100 index fell 53.43 points to close at 5775.24.
Miner Vedanta Resources was one of the few with forward momentum, rising 36p to 2230p.
They appear to want six and Vodafone wants seven. That’s quite a big gap
Hopes grew that India’s market regulator SEBI was set to give it the green light to buy a 51 per cent stake in Cairn Energy’s Indian unit for £5.9billion. Cairn dropped 1¼p to 428¼p. Fellow miner Rio Tinto put on 11½p to 3975p, as it said more shareholders of coal producer Riversdale Mining had pledged to back its takeover bid.
African Barrick Gold, 4½p shinier at 518½p, benefited from investors seeking out the safety of gold.
Other climbers included Shire Pharmaceuticals 1p healthier at 1797p, Standard Chartered Bank, 2p better off at 1593p, and credit checking group Experian, 4p richer at 744p.
Supermarket Morrisons fell 7½p to 278½p, as ING said despite strategically “doing the right things”, it would be hit by a rapidly deteriorating consumer climate in Britain.
It said same-store sales would turn negative as a result of falling food demand.
Tesco dropped 5½p to 386¼p, Sainsbury’s fell 6p to 361¼p and Marks & Spencer fell 2¾p to 333p. Cruise operator Carnival drifted 51p to 2549p in the wake of last week’s fuel-driven profit warning.
Broker Evolution said it expects Carnival’s share price to continue to be volatile. “We would advise investors to buy in the dips,” it said.
Security group G4S surrendered 5p to 257p ahead of today’s annual results. Broker RBS expects figures in line with expectations and notes improved management confidence.
In the FTSE 250, microchip designer Imagination Technologies was 24p stronger at 460p as it was outed as an i-Pad contributor. Electrical chain Dixons Retail fell ¾p to 16½p as broker Nomura said it was not “immune” to a consumer slowdown.
It pencilled in a fourth quarter same-store sales dip of 5.7 per cent, compared with the 4 per cent fall in the third quarter.
Pubs and brewing group Marston’s drooped 1¼p to 93½p ahead of tomorrow’s trading update. Broker Numis said results should meet forecasts, helped by its new pub restaurants.
On Wall Street the Dow Jones Index closed down 51.24 points at 11993.16.
