CORUS was forced into the spotlight as Mittal Steel’s $28 billion (£15.5 billion) approach for rival Arcelor fanned talk that further consolidation of the industry is inevitable.
The steel industry has been consolidating for a decade in the hope of driving efficiencies and reducing volatility in the market. Soaring demand for steel from China, driven by the country’s booming construction industry, has driven a resurgence in the industry.
Analysts said Corus, the Anglo-Dutch steel maker, is an obvious target for consolidators. It is regularly the subject of rumours about predatory interest. Its shares led the mid-cap risers, gaining 9¼p to 72p. The FTSE 250 index ended 126.2 points higher at 9,207.9.
Business Post came under pressure after the mail group gave its second profits warning in three months. The company said that full-year profits would fall some £4.5 million short of expectations after it decided to invest more in its franchise network and failed to achieve an expected improvement in profit margins at its parcel services business.
Numis Securities, the City broker, cut its price target on the shares from 267p to 197p and repeated its “sell” advice. Business Post shares fell 57½p to 352p.
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Maiden Group continued to fall, losing 7½p to 60p, leaving its shares some 30 per cent lower than where they stood at the beginning of the week. The deadline for bids to buy the company was Tuesday, although the group is yet to update on the sale process.
Technology stocks were in demand, with ARM Holdings up 5p at 138½p ahead of the semiconductor designer’s full-year results on Tuesday. CSR, which makes Bluetooth chips for mobile phones, rose 120p to £12.07. Misys, the software group that on Thursday outlined plans to streamline its banking software unit, recovered 17½p to 252½p.
Taylor Nelson Sofres put on 13¾p at 247¼p after Morgan Stanley upgraded its recommendation on the market research group from “equalweight” to “overweight”, moving its target price from 225p to 260p. The broker said the company’s recent trading update showed encouraging organic revenue growth of 5 per cent.
IQE, which makes silicon wafers used in microchips, added 1.12p at 11.37p on winning a five-year outsourcing contract with a major US chip maker. Aukett Group put on 1.25p to 3.62p as full-year results impressed.