Newspaper article The Evening Standard (London, England)

Whispers of a Takeover See Tribal Group's Shares Leap; MARKET ROUND-UP

Newspaper article The Evening Standard (London, England)

Whispers of a Takeover See Tribal Group's Shares Leap; MARKET ROUND-UP

Article excerpt

Byline: Rosamund Urwin

THE spotlight was on Tribal Group today after its bosses revealed that suitors are circling the school inspector. The whisper is private equity is interested in the consultancy group at a price of 125p a pop.

But other traders thought it was possible that one of its larger outsourcing peers could be a bidder, with Capita being mentioned.

Tribal said the expressions of interest are preliminary, and may not result in an offer being made for the group.

Its shares shot up 13p to 77.7p.

Tribal added that trading in the short term has been affected by Government cuts in spending on consultancy work.

However, in the longer term, Tribal is tipped to be one of the winners from George Osborne's axe, with the public sector turning to the company for advice on how to cut costs.

Traders reckon this is why a trade buyer might be interested, believing that a takeover of Tribal would give them exposure to a part of the industry which would prosper during the cutbacks.

Shares in London fell sharply after the Fed's gloomier outlook on the US economy made investors jittery.

The Bank of England's lowering of its forecasts for growth was widely expected, but nonetheless didn't help the mood, helping the FTSE 100 index lose 71.61 points to 5304.80.

Although losses from the banks and miners were the main drags on the benchmark, the sell-off spared few: only three top-flight stocks managed to stay in positive territory.

It was another day of thin trading, typical for August.

"God, it's boring out there," said one trader. "Monday was even worse than Christmas Eve. Everyone's scrambling around for ideas."

He was gloomy about the outlook for shares: "The markets are very choppy. There's no particular reason to buy as we've got almost another month of it being this dead, so I suspect the FTSE will drift down to 5200."

But some in the City had a smug smile on their faces after it emerged that Richard Breeden's fund had lost a ton of cash on Connaught.

Breeden European Partners, which was founded by the former chairman of the US Securities and Exchange Commission, has more than halved its holding in the crisis-hit social housing repairs provider after the value of the stake plunged by around [pounds sterling]14 million. …

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