MARKET REPORT: Tech veteran’s swoop on Saatchi boosts firm’s fortunes

Shares in M&C Saatchi surged by more than a quarter after a tech industry veteran took a hefty stake in the advertising network.

Serial investor Vin Murria bought 13.25 per cent of the AIM-listed company’s shares on April 30, according to a stock market announcement yesterday.

Murria is an adviser at Hgcapital, was previously chief executive of Advanced Computer Software, which she also founded, and is on the boards of Softcat and Bunzl.

Serial investor Vin Murria bought 13.25 per cent of the AIM-listed M&C Saatchi's shares on April 30, according to a stock market announcement yesterday

Serial investor Vin Murria bought 13.25 per cent of the AIM-listed M&C Saatchi’s shares on April 30, according to a stock market announcement yesterday

The Indian-born businesswoman might not have been top of the list of expected investors, but shares have climbed by two-thirds since April 30 and closed 29.7 per cent higher, up 13.5p, to 59p last night.

The vote of confidence in the beleaguered group comes as businesses slash their advertising budgets as they struggle to survive the pandemic.

M&C Saatchi had a turbulent couple of years even before Covid-19 disrupted stock markets and any form of ‘business as usual’ trading in February. 

Founded by brothers Maurice and Charles Saatchi in 1995, it is under investigation by watchdog the Financial Conduct Authority for an £11.6million accounting scandal, which led to the departure of four major directors – including Maurice.

It was already restructuring pre-coronavirus and is expected to reveal more about recent trading – it has already scrapped its financial guidance – when it releases 2019 results later this month.

Stock Watch – 1pm 

Shares in 1pm jumped 9.5 per cent, or 1.5p, to 17.25p after it was approved to offer loans through the Government’s Coronavirus Business Interruption Loan Scheme.

The small business lender is still working out how much it will be able to provide under the scheme and hopes to start loans this month.

1pm, which joined AIM in 2006, said around 25 per cent of its customers had asked for payment delays, holidays or other forbearance as revenues dried up.

Brokers were also looking keenly at stake-building at another firm – this time at Royal Mail, which was down 1 per cent, or 1.6p, to 167.2p. Deutsche Bank brokers moved their rating on the 504-year-old postal service’s stock from ‘sell’ to ‘hold’ after Czech billionaire Daniel Kretinsky disclosed he had bought more than 5 per cent of the company, becoming the group’s fourth-largest shareholder.

Analysts said the possibility he could launch a takeover bid, which he previously tried with German retailer Metro, was the main reason to keep its stock.

The wider stock market recovered from a downbeat start to the week, with the FTSE 100 rising 1.66 per cent, or 95.64 points, to 5849.42 and the FTSE 250 climbing 0.89 per cent, or 141.46 points, to 16,093.14.

The easing of lockdown restrictions in Spain and Italy and plans to return to normal in the UK reassured traders – also sent oil prices higher.

After dipping to the lowest prices this century, Brent crude rose 10 per cent to around $30 a barrel to the highest price in more than a fortnight. This lifted Royal Dutch Shell 5.1 per cent, or 61.8p, to 1283.4p and BP 6.1 per cent, or 18.3p, to 318.9p.

Cairn Energy rose 4.8 per cent, or 5.4p, to 118.8p, despite abandoning an exploration well in Mexico because it failed to find oil there.

Elsewhere, cruise operator Carnival fell 0.4 per cent, or 3.8p, to 960.6p as European rival Norwegian Cruise Line shares plunged by almost a fifth after it warned it might go out of business. It will try to raise £1.3billion to keep going.

Paddy Power-owner Flutter Entertainment rose 0.7 per cent, or 64p, to 9548p – its highest level since mid-2016 – after completing its merger with Canadian firm The Stars Group.

Investors cheered Anglo American’s platinum subsidiary completing repair work at a plant, where it will resume work on May 12. Shares edged 1.6 per cent higher, up 21.2p, to 1375.6p.

And after launching coronavirus antibody testing kits and commencing sales to European countries, shares in BATM rallied 15.5 per cent, or 9p, to 67p.

Security services provider G4S has added former Microsoft European chief Michel van der Bel to its board, from tomorrow. It inched 1 per cent, or 1p, up to 100p.

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