MARKET REPORT: Asos shares surge 7.1% on Turkish takeover talks

Asos shares were in demand following reports over the weekend that it had received a £1billion takeover bid last year.

The fast-fashion group, which owns Topshop and Miss Selfridge, was recently booted out of the FTSE 250. It was valued at between £10 to £12 a share in an offer from the Turkish online retailer Trendyol in December.

That was much higher than Asos’s closing share price of £3.50 on Friday.

While talks with Trendyol – which is backed by China’s ecommerce giant Alibaba – appear to have ended, the approach was seen as a sign that Asos was attracting interest from potential bidders. 

That could see Asos become the latest household name to be taken off the London stock market.

Potential target: Asos, which owns Topshop and Miss Selfridge, was valued at between £10 to £12 a share in an offer from the Turkish online retailer Trendyol in December

Asos shares soared 7.1 per cent, or 24.8p, to 375.2p.

But the stock remains some way off its peak of more than 7700p in March 2018.

Asos declined to comment. The London-listed group last month tapped investors for £75million to shore up its finances and help fund a turnaround plan. 

The retailer revealed losses of over £290million for the six months to the end of February as it was hit by pressure on household budgets.

Russ Mould, investment director at AJ Bell, said: ‘Takeover interest often emerges when a broken company lays out a recovery plan and there are early signs it is working.

‘Those green shoots can give a suitor confidence it is worth making a bid now rather than waiting for the company to be repaired and then having to pay a much higher price when the risks are lower.’

The FTSE 100 slid by 0.1 per cent or 7.29 points to 7599.99 and the FTSE 250 fell 0.2 per cent, or 35.76 points, to 19113.55.

Oil prices rose more than 2 per cent to over $78 a barrel after Saudi Arabia said it will cut output by 1m barrels per day from next month.

Stock Watch – Chill Brands

Shares in Chill Brands rose after it secured shipping arrangements for the home delivery of its nicotine- free vapour products to US customers in all 50 states.

Firms have been restricted from making direct sales because the United States Postal Service cannot ship vapour products.

But Chill Brands, whose vapes contain cannabidiol, a chemical found in cannabis plants, has secured alternative shipping arrangements. Shares rose 6.7 per cent, or 0.75p, to 12p.

The decision came on Sunday following a meeting with Opec+, a group of oil-producing countries, which also said production targets would fall by a further 1.4m barrels per day from 2024.

Such moves are aimed at increasing oil prices. The rise in the oil price failed to help BP as shares slid 0.3 per cent, or 1.4p, to 472.95p and Shell, down 0.2 per cent, or 5p, to 2285p.

There was good news for Indivior after it settled a seven-year litigation with dozens of US states at a lower price than forecast.

The pharma group, which makes drugs to treat opioid addiction, has agreed to pay £82.7m following claims that it illegally suppressed generic competition for its product Suboxone.

This was far lower than the £242million it set aside to cover the lawsuit which began in 2016. Payment is expected to be made this month, the company added.

Shares rocketed 7.8 per cent,  or 115p, to 1590p.

Fund manager Abrdn was among the top blue-chip gainers after it launched a share buyback programme worth up to £150million. Shares added 3.2 per cent, or 6.5p, to 210p.

Housing developer Watkin Jones landed a deal to sell a built-to-rent project in Belfast’s Titanic Quarter. 

The buyers, Legal & General (down 0.7 per cent, or 1.6p, to 234.4p) and Clanmil Housing Association, will pay £155million and become owners of The Loft Lines development once it is completed.

The brownfield site will be transformed into a community with 627 built-to-rent units and 81 ‘social rent affordable homes’ built on the site of the former Harland & Wolff (0.7 per cent, or 0.1p, to 13.75p) shipyard. Shares rose 1.6 per cent, or 1.1p, to 69.4p.

There was little respite for Dr Martens after the bootmaker’s target price was cut by Morgan Stanley and Barclays. Shares fell 4.1 per cent, or 5.7p, to 134.1p.

This post first appeared on Dailymail.co.uk