Investors were checking into the hotels sector today after Hilton Group confirmed talks were underway over a multi-billion pound deal.
More than 77 million Hilton shares changed hands within three hours of trading in London following confirmation that US-based Hilton Hotels Corporation (HHC) was keen on buying the UK company’s international hotels portfolio.
Hilton shares surged 12% as analysts speculated over a £3.6bn (€5.25bn) price tag, but the mood in the wider market was more subdued and the FTSE 100 Index was only 1.4 points ahead at 5266.6 by mid-morning.
Hilton lifted 37p to 341.75p as investors anticipated receiving the proceeds from any sale.
The prospect of consolidation pushed shares in InterContinental Hotels up by 6% or 38p to 727p, while De Vere advanced 9.5p to 592.5p outside the top flight.
But the Footsie was being held back by renewed weakness by oil and gas explorers, with BG Group losing 9.5p to 487p to be the heaviest faller of the session.
Cairn Energy was heavily sold yesterday after a number of its directors trimmed their holdings and the stock was under fresh pressure today – off 10p at 1706p.
But activity was hot in the retail sector where supermarket chain Somerfield backed a £1.1bn (€1.6bn) bid as its long-running takeover saga neared a conclusion.
Somerfield shares lifted 3% or 5p to 192p in the FTSE 250 Index, dragging shares in larger rivals Tesco and Sainsbury’s higher by 2p and 1.75p 305.25p and 284p respectively.
Another retailer to rack up big gains was JJB Sports amid speculation that Sportsworld owner Mike Ashley has taken a 3% stake.
JJB shares jumped nearly 8% or 13p to 177.75p, although traders ruled out a takeover because a combined group would have more than 50% of the sportswear market.