Did UBS Snap Up Henderson Stake for Mystery Predator? MARKET REPORT

Article excerpt


ON the same day that 115-year- old Swiss bank Julius Baer paid a generous [pounds sterling]2.5bn in cash to broking giant UBS for four asset-management businesses, eyebrows were raised by news of a large stake changing hands in UK-based fund manager Henderson Group.

Australian insurer AMP sold its 14.7pc shareholding to broking giant UBS and another unnamed fund at around 67p a share. The close was 21/4p cheaper at 671/4p on hefty turnover of 223m.

Dealers expect plenty more consolidation in the cutthroat asset-management arena. Earlier this year HHG sold its life insurance funds to Hugh Osmond for [pounds sterling]1bn and left Henderson to trade as an independent company. It consists of investment manager Henderson Global Investors and financial advisory firm Towry Law. It has more than [pounds sterling]69bn in assets under management and [pounds sterling]190m cash in the bank.

Rumours have been rife for months that bidders are circling Henderson.

American Express, which acquired UK asset manager Threadneedle in 2003, and investor 3i (9p better at 7301/2p) have been mentioned as possible bidders. The question now being asked is whether UBS has bought AMP's holding to 'warehouse' it for a client or predator.

Henderson could come under corporate attack before chief executive Roger Yates can spend the group's cash on either a share buyback or a special dividend payment for shareholders.

With a Spanish utility merger looking likely after London dealings in Gas Natural (2p up at 1683p) and Endesa (23p higher at 1295p) were suspended pending developments, excited punters continued to be all over ScottishPower like a rash. They chased the Glasgow-based utility up to 554p before it closed a further 211/2p better at 5461/2p.

Buying will continue this morning because German utility E.ON confirmed after hours that it is thinking about launching a bid. SP effectively hoisted the For Sale sign in May when it announced the [pounds sterling]5.1bn sale of its ailing PacifiCorp business in America to Warren Buffett's MidAmerican Energy.

Dealers believe that now the Germans have threatened to head up North, SP will try to arrange a defensive merger with Scottish and Southern Energy, 18p higher at 10141/2p. …