Merrill Pours Cold Water On Talk of New Bid by Xstrata for Lonmin ; Market Round-Up

Summary

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BANK of America Merrill Lynch scoffs at suggestions that Lonmin's 25% shareholder Xstrata will launch another bid for the platinum producer when the Takeover Panel's 12-month cooling off period ends next month.

Lonmin has certainly been a strong market of late, with the shares having come up from the 1361p level since last week alone. Today the price ran into profit taking, trading 38p lower at 1679p. That compares with the 3300p a share Xstrata offered last October. The bid was rejected by the Lonmin board and City speculators have convinced themselves that Xstrata, down 8 1/2p at 871 1/2p, will launch a fresh bid now that its proposed merger with Anglo American, down 11 1/2p at 2025 1/2p, looks like being aborted. Word is Xstrata has already instructed its bankers JPMorgan and Deutsche Bank to make a feasibility study of a new bid.

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Extract

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Merrill Pours Cold Water On Talk of New Bid by Xstrata for Lonmin ; Market Round-Up

But Bank of America Merrill Lynch seems to think the shares have run far enough and has cut its rating on the shares from buy to neutral. Merrill says its buy rating on Lonmin wa...

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