Mixed signals from major international markets - a stronger New York and a weaker London - left the Irish market looking for direction yesterday with modest losses by the banks countered by a recovery from CRH after the recent heavy profit-taking.
The main corporate event of the day was confirmation of the planned management buyout of Clondalkin. Shareholders stand to get €385 million (£303 million) but the net cost of the buyout will be substantially more to the management group and Candover, given Clondalkin's end of June debt of €90.6 million (£71 million). Elan was little changed as a possible bidder for the British pharmaceutical group Medeva, which said that it is in talks on a possible bid. Certainly, finance will not be a problem for Elan with Medeva currently capitalised at £413 million sterling (€635 million). Among the leaders, CRH rebounded from recent profit-taking and dealt up 32 cents to €20.02 (£15.77) but Eircom continued to slide and closed down at a fresh post-flotation low at €4.14 (£3.26), a drop of 5 cents on the day. Financials were marginally easier, with AIB down 23 cents on €11.97, Bank of Ireland unchanged on €9.00 (£7.09) and Irish Life also unchanged on €9.85 (£7.76).
Valuing Internet companies leaves many people absolutely perplexed, and Esat's £115 million splurge on PostGEM/IOL will do nothing to change that situation. Esat, by all accounts, is delighted with its purchase which brings in An Post as a 3 per cent shareholder and opens up the prospect of a share issue to fund the deal. The shares were trading marginally firmer on NASDAQ at the Irish close.
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