STOCKS TO LOOK FOR: Crispin Odey snapped on Metro Bank
STOCKS A LOOK AHEAD: Crispin Odey stung as Metro Bank shares explode on bid fever
This year’s agreement fever has finally reached the long unloved banking sector.
U.S. private equity firm Carlyle has started talks with dog-obsessed challenger bank Metro over a possible bid, pushing shares up 26% last week to £ 1.31 and valuing the lender at 227 million pounds sterling.
This will have stung the mainstay of hedge fund Crispin Odey, which has been betting against Metro shares for years.
In negotiations: US private equity firm Carlyle has started talks with Metro over possible offer
Its Odey fund has reduced its position, but remains the biggest short seller.
Carlyle has until December 2 to file a firm intention to bid. A takeover would be an intriguing turning point for Metro, founded by Donald Trump’s golf buddy Vernon Hill, a brash American keen to shake up the British banking establishment, and not just with free dog treats.
However, an accounting error in 2019 destroyed stocks and cost boss Craig Donaldson his job.
Sources in the city say a Financial Conduct Authority report on the case could be released in January. Awkward timing in the context of the offer.
Rodger Sargent increases stake in Oberon
Small-cap investor Rodger Sargent has made deals with tycoons such as Sir Martin Sorrell and Nick Candy.
It now appears that Sargent is increasing his stake in Oberon Investments, a wealth manager and brokerage, listed on Aquis.
The company, named after Shakespeare’s Fairy King, recently raised funds for medical device maker TruSpine and data company Silverbullet.
Sargent’s approval might provide some practical fairy dust.
Morgan Stanley analysts believe NatWest, Lloyds could rebound
Bullish tones from Morgan Stanley analysts, who believe NatWest and Lloyds could rebound.
The investment bank’s most bullish forecast calls for a 60% gain in their stocks, helped by rising interest rates next year.
Analysts also say the risk of “stagflation” – slow economic growth, rising prices and high unemployment – has been overstated.
They are less bullish on Virgin Money, saying the rate hike will benefit their rivals more.
Its shares have already taken a hit last week, amid rising restructuring costs.
This was bad news for Sir Richard Branson’s Virgin Group – his stake was worth £ 600m when CYBG bought Virgin Money in 2019, and is now worth £ 333m. Ouch.
Rivalry between GlaxoSmithKline and AstraZeneca intensifies
The rivalry between drug giants GlaxoSmithKline and AstraZeneca is intensifying.
GSK appears to have stolen a walk on Astra with positive test data on daprodustat – a pill for patients with anemia due to chronic kidney disease.
Astra’s efforts in this area hit a stumbling block over the summer.
Chris Corsico, Head of Development for GSK, tells me: “This is an important moment.”
But Astra chief Pascal Soriot should not be discouraged. Astra has beaten GSK in the race to bring a Covid vaccine to market and is expected to post dynamic numbers in the third quarter this week.