Business World

Thursday 14 December 2017

Tullow's plan gives ISEQ a boost

Thomas Molloy

Thomas Molloy

THE ISEQ gained yesterday, led higher by Tullow Oil after the explorer said it plans to buy assets in Uganda with new partners. Smaller rival Petroceltic fell after it said a partner in its Algerian operations had sold a near 16pc stake in the Irish company.

Shares elsewhere in Europe also gained yesterday with national benchmark indices advancing in all of the 18 western European markets except Greece, Iceland and Luxembourg.

The ISEQ rose 0.3pc while the UK's FTSE 100 and Germany's DAX advanced 0.7pc. France's CAC 40 added 0.6pc. The US stock market was closed for the Martin Luther King public holiday.

Tullow Oil gained 3.5pc in Dublin after the Irish-founded explorer told Heritage Oil it would exercise pre-emptive rights to buy Ugandan assets jointly owned by the two companies. Tullow will match a $1.5bn (€1.04bn) bid from Italy-based Eni to buy Heritage's share of Blocks 1 and 3A in Uganda's Lake Albert.

Petroceltic shares extended recent declines, falling 5.6pc to 17c after the oil and gas company said Spanish utility Iberdrola sold its near 16pc stake in the firm and abandoned an option to participate in an Algerian gas project.


McInerney Holdings rose 2.6pc as the mood towards homebuilders softened and amid hopes that house prices in the UK were rising again.

Exploration companies in the UK did well yesterday with Anglo American, Xstrata and Kazakhmys all advancing more than 2pc. British Airways added 1.1pc as Credit Suisse rated the airline "outperform" in new coverage. Ryanair was also rated "outperform".

Cadbury climbed 1.8pc after 'The Sunday Times' reported Kraft Foods would raise its bid for the chocolate maker to at least 820p per share from 771p a share.

L'Oreal rose 2.1pc after the world's biggest cosmetics maker was lifted to "buy" from "hold" by Deutsche Bank after investing in brands during the economic downturn.

PPR the French owner of Gucci, gained 1.9pc after Morgan Stanley increased its share-price forecast to €100 from €76, saying "the cost rationalisation taken in 2009 gives us confidence in a higher margin expansion opportunity versus peers".

KPMG said in a report yesterday that global mergers and acquisitions were poised for a "modest" rebound this year after companies cut debt and analysts trimmed earnings estimates.

Takeovers dropped by more than a third last year to $1.75 trillion, less than half of 2007's record $4.04tn, according to data compiled by Bloomberg.

Nokia advanced 1.6pc to its highest level since October, after BofA Merrill Lynch Global Research added the shares to its most preferred list.

Irish Independent

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