All eyes in the City will be on defence giant BAE Systems (LON:BA.) today after it confirmed merger talks with European aerospace firm EADS late last night.
The tie-up would see the new firm – which would be 40 per cent owned by BAE Systems’ shareholders and 60 per cent owned by EADS’ – become the world biggest aerospace firm and challenge US heavyweight Boeing.
Under UK rules, the two parties must now announce a decision on whether to team up or not by 5pm on 10 October.
“The potential combination would create a world class international aerospace, defence and security group with substantial centres of manufacturing and technology excellence in France, Germany, Spain, the UK and the USA,” said BAE in a statement.
Notably, BAE said EADS would have to pay its shareholders £200 mln upon completion of a possible deal to even up the payout ratios of the two parties.
On the high street, Home Retail Group (LON:HOME) boosted second quarter sales at Argos by 1.4 per cent, beating expectations.
Apple’s iPad and Amazon’s Kindle, along with other tablets and e-readers, helped offset weakness elsewhere.
“At this stage, we expect to deliver full year group benchmark profit in line with current market expectations but, as always, the outcome will depend upon trading at Argos in its peak Christmas period,” said Home Retail’s chief executive Terry Duddy.
However, the summer’s wet weather washed out sales at its DIY store Homebase, which posted a 3.9 per cent fall in total sales to £366 mln.
Clothing chain Next (LON:NXT) may have seen profits rise 10 per cent in the first half of the year, but investors will be focusing on the news that August sales have been “disappointing”.
Despite the recent poor sales, the company stuck to its full-year profit target however.
Oil firm Providence Resources (LON:PVR) was on investors’ radars this morning after revealing the drilling programme for Dunquin exploration well has been pencilled in for the first quarter of next year following the signing of a rig contract.
Project operator ExxonMobil has hired the Eirik Raude drill semi-submersible drill rig under a contract with Ocean Rig UDW.
It is expected that the rig will come under contract at the in the first quarter of 2013 and it will be ‘on hire’ for a total of six months.
“The Dunquin well forms an important part of Providence's ongoing Irish multi-basin, multi-well drilling programme,” said chief executive Tony O’Reilly.
Caza Oil & Gas (LON:CAZA) was another closely watched stock as it announced the horizontal phase of drilling is about to start in the Caza Ridge well – the company’s first on the Copperline prospect, New Mexico.
It confirmed that the vertical section has now been drilled to a depth of 11,750 feet. And preparations are now underway to drill through the primary objective – the Lower 3rd Bone Sand.
“The information acquired is positive for this well and for our Bone Spring drilling program in general,” said Caza’s chief Bill Ford.
Oxford Pharmascience (LON:OXP) has snapped up the global rights to a new colonic drug delivery technology for statins used in cholesterol-lowering heart disease treatments, which should see some life injected into the share price today.
Oxford, which specialises in developing or licensing technologies that make it easier to take drugs, is licensing the delivery technology from University College London.
It intends to develop and commercialise a range of re-formulated statins using the generic drugs atorvastatin and simvastatin and launch a range of products under the SafeStat brand.
These will have doses up to four times lower than the original but with the same efficacy, it said.