Shares in Virgin Money jumped higher this morning after the bank notified the market that Nationwide Building Society had tabled an all cash offer of 218p per share for the business. Including a dividend payment of 2p per share, that represents a 38% premium to last night’s closing price in a move that both boards believe would combine two highly complementary businesses. The bigger picture here however – that a London-listed bank is being bought out by a mutual building society – adds further weight to arguments that so many UK equities are trading at quite remarkable discounts. Just after 9am Virgin Money was trading 36% higher.
Full year numbers from Funding Circle impressed the market this morning too. Management note that despite losses growing last year, as from FY24 H2 the UK business will be profitable and that the prospect of selling its US arm remains very much on the table. The note added that the board considered the share price as undervalued so would initiate a share buyback of up to £25m. Just over an hour into trade and the shares were up 29%.
And more good news in full year numbers from Rentokil. The company made a significant acquisition in the US which completed towards the end of FY22. That’s made a material contribution in FY23 revenue growth and the purchase of Terminix is leading to greater synergies than had been expected. That’s playing into a more upbeat financial outlook too, which was capped by a dividend increase to boot. In early trade, Rentokil was up by more than 12%, adding well over a billion pounds to the market cap.
Headlines we expect on Friday
Informa Full year results
This time last year Continuing revenue £2,262m, adjusted operating profit £496m, dividend 9.8p
