Takeover frenzy picks up pace in fresh blow to City

Two more firms look set to leave the London stock market after becoming the latest to succumb to takeovers.

Regeneration specialist Harworth Group backed a ‘best and final’ offer from its largest shareholder Peel Holdings worth £632million after rejecting an earlier bid.

Shares in Capricorn Energy, meanwhile, raced to a 15-year high after its board backed an improved £330million swoop from rival Genel Energy after a bidding war.

That put the pair on course to join the exodus from the London Stock Exchange in a takeover frenzy that has seen a string of British firms snapped up by predators.

Shares in two of those firms – Lloyd’s of London insurer Beazley and City institution Schroders – will cease trading next week after they agreed deals with foreign buyers earlier this year.

Others targeted include warehouse giant Segro, budget airline easyJet, ingredients maker Tate and Lyle and Evoke – the owner of bookmaker William Hill. 

The takeovers have come during a shortage of arrivals through initial public offerings (IPO), fuelling fears over the health of the UK stock market.

However, the City received a much-needed boost this week when payments company Airtel Money announced plans to float in what would be London’s biggest listing for five years.

Dan Coatsworth, head of markets at AJ Bell, said: ‘The departure of Beazley and Schroders will leave investors with less choice in the listed insurance and asset management sectors, respectively.

‘The delistings provide a stark reminder that the UK stock market is slowly shrinking.

‘While changes to listing rules have made it easier and more attractive for companies to join the market, we’re still not seeing big enough flows of new listings to offset the ones heading for the door.

‘Airtel Money’s IPO announcement this week is a positive, but the market needs the taps to fully open on new listings, not the odd drip we’ve seen in recent years.’

FTSE 250 land developer Harworth finally agreed to be taken over after Peel raised its offer to 187p a share. Infrastructure, ports and property group Peel has also raised its stake in Harworth to 52 per cent.

Capricorn, meanwhile, backed a sweetened offer from British rival Genel Energy worth 433p a share.

That valued Capricorn at £330million, an improvement on Genel’s earlier £270million swoop, which was accepted in July before being beaten by a £300million counter-offer from Norwegian energy firm DNO, which declined to comment when asked if it would raise its offer.

Capricorn shares rose 14.7 per cent, while Harworth gained 5 per cent.