London pre-open: Stocks to edge higher

9th Jun 2009 07:40

Last night's late recovery in Wall Street is set to give London a modest boost this morning.The FTSE 100 is predicted to open up about 15 points as the Dow Jones erased an earlier 100-point deficit to close just in the blue.Heritage Oil is merging with Turkish exploration and production group Genel to create an oil company big enough to join London's FTSE 100 index. The UK firm, worth £1.5bn before its shares were suspended last week pending an announcement, will issue 260m shares, or 100% of its value, in exchange for Genel. It has entered into a memorandum of understanding regarding a deal which would be classified as a reverse takeover of Heritage under listing rules. Management expects the enlarged firm to have estimated proved and probable reserves of about 300 million barrels of oil with multi-billion barrels of oil potential. Heritage shares are expected to start trading again today.Bus and train operator Go-Ahead's Govia joint venture has retained its South Central rail franchise for another five years ten months, it confirmed today. The UK firm, which owns 65% of the business, says the Department for Transport (DfT) has decided to keep it on until 25 July 2015. The new contract will start on 20 September. Govia, 35%-owned by French transport operator Keolis, has been running the franchise under the Southeastern banner since 2001.Spread betting firm IG Index expects to post a strong rise in profits for the 12 months to March 31 after a good finish to the year. Adjusted pre-tax profits should come in at £125m, compared with £98m the previous year, on revenues that climb to £257m from £184m. The firm said year-on-year organic revenue growth was 18% in the final quarter, compared with 12% over the third quarter, despite lower market volatility.GlaxoSmithKline has entered into an agreement with Chinese gene engineering drug group Shenzhen Neptunus Interlong Bio-Technique to develop and manufacture influenza vaccines for China. The agreement, which will include making vaccines for seasonal, pre-pandemic and pandemic influenza, will result in the drugs being available over the next few years, Glaxo said. It will pay £21m for a 40% stake in the joint venture, while Shenzhen Neptunus will pay £31m for 60%. Punch Taverns has further rationalised its pub portfolio with the disposal of 11 outlets to rival Greene King for £30.4m cash. The pubs to be sold are freehold outlets located in central London, the south east of England and Scotland. The consideration will be satisfied in cash. Net disposal proceeds will be used to reduce debt and reinvest in the estate. For the financial year ended 23 August 2008, the pubs being disposed of generated earnings before interest and tax of £3.55m and had a book value of £32.7m. Punch's gross debt stood at £4.46bn in March. London black cab maker Manganese Bronze is to raise £9.4m through a placing at 187p to speed up the development of its international operations and a new taxi engine. The firm also warned that overall vehicles sales for the four months to the end of April are down 18.7% to 699 vehicles versus 860 vehicles in the comparable period last year. This is due to a combination of the macro economic backdrop and strong comparisons in 2008. As part of the placing, partners and major investors Geely, Hermes and Tosca will subscribe for 2,715,000 new shares in aggregate, or nearly half the new shares to be issued.