AIM-listed Sensyne Health got a boost after its founder and chief executive launched plans to take it private.
Lord Drayson has approached the board with plans for a management buyout and wants approval to seek third-party investors.
The 61-year-old Labour politician and former science minister floated it in 2018 and is its largest shareholder with a 12.2 per cent stake. His wife, Lady Elspeth, owns around 10.6 per cent.
Takeover talks: Lord Drayson (pictured) has approached the Sensyne Health board with plans for a management buyout and wants approval to seek third-party investors
His leadership has not been without controversy, with former chief financial officer Lorimer Headley alleging last year that Drayson had created a ‘culture of fear’ at the firm.
The proposal for a buyout comes after Sensyne last month flagged up ‘material uncertainty’ around its ability to continue trading in its results.
The low market value also meant it ‘cannot execute on opportunities that may create novel treatments for patients’.
Stock Watch – Warpaint London
Shares in Warpaint London, the owner of the W7 make-up brand, rose after it said results for 2021 will be ‘ahead of market expectations’.
This meant sales would be similar to the £49.3million achieved in 2019 before the pandemic struck.
Profit margins were also being maintained despite higher supply chain costs.
Chief executive Sam Bazini said: ‘We have significant opportunities for further growth, with our existing retailers, those such as Boots where we are expecting to launch soon, and with others we are in discussions with.’
The stock rose 14.2 per cent, or 21.5p, to 174p.
Aside from Drayson’s offer, the firm has brought in brokers JP Morgan and Peel Hunt to explore potential interest in the group from other parties, saying its current market cap ‘does not reflect’ the value of its vast trove of patient data.
‘The board is fully aligned with Lord Drayson’s proposal to explore a management buy-out as one route towards maximising value for all stakeholders’, said Sensyne chairman Bruce Keogh.
Shares jumped 6.9 per cent, or 6.5p, to 100.5p on the news.
The FTSE 100 dropped 0.2 per cent, or 13.81 points, to 7,274.81 while the FTSE 250 dipped 0.3 per cent, or 71.22 points, to 23,140.
Miners weighed on the blue-chip index as commodity prices weakened. Anglo American was down 3.3 per cent, or 92.5p, at 2720p while BHP fell 3 per cent, or 56.8p, to 1867.2p, Glencore slipped 3.2 per cent, or 11.65p, to 355.25p, and Antofagasta flopped 5.5 per cent, or 78.5p, to 1360p.
Banks were also on the slide, with Lloyds dipping 0.2 per cent, or 0.08p, to 51.03p while HSBC sank 0.4 per cent, or 1.95p, to 444.55p, Barclays dropped 1.2 per cent, or 2.39p, to 198.46p and Natwest lost 0.5p, or 1.1p, to close at 223.4p.
Traders were spooked by a decision from the Reserve Bank of Australia to tighten monetary policy to rein in inflation, raising fears that the US Federal Reserve and the Bank of England could follow suit.
Standard Chartered fell 7.9 per cent, or 39.7p, to 466.1p after warning of an ‘uneven’ economic recovery from the pandemic and that its profits for 2021 would be mostly flat year-on-year. This was despite posting a 44 per cent rise in pre-tax profits to £806million in the third quarter.
Hostmore, the owner of restaurant chain Fridays, formerly known as TGI Fridays, got off to a bleak start after completing its split from Electra Private Equity.
It listed on the main market with a share price of around 150p but dropped 11 per cent, to 133.58p.
Revenues at stockbroker TP ICAP’s energy and commodities division jumped 16 per cent year-on-year to £92million in the three months to the end of September amid the global crisis in energy costs.
But it fell 10.9 per cent, or 17.16p, to 140p as revenues from its global broking arm dropped 4 per cent in the first nine months of 2021, to £827million.
Cybersecurity firm Darktrace fell 7.2 per cent, or 49p, to 632.5p ahead of the end of a ban on insider investors selling their stakes.
The expiry of the so-called ‘lock-up’ agreements today will allow prominent backers including tech investor Mike Lynch to offload their shares. Its value plunged last week after analysts at Peel Hunt said it was overvalued.
Elsewhere, office landlord IWG climbed 0.1 per cent, or 0.4p, to 307.4p after it said it was looking at separating its digital, technology and property assets, with a progress update expected in the first half of next year.
