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Guinness Peat didn’t get the backing of shareholders but it has ensured that management is under pressure

Posted on 28 September 2010

Guinness Peat didn’t get the backing of shareholders, but it has ensured that management is under pressure to improve shareholder returns.If the company can reach the financial targets set by the management, then its shares look cheap. Not only has consumer confidence stubbornly refused to pick up, but Kesa’s furniture business is going backwards. It blames a lack of contemporary furniture for the near 21 per cent fall in BUT’s retail profit to £18.2m but promises to start building funkier ranges. Its priority has been paying down the debt it was saddled with, but soon it will be able to get on with the sparkier business of expanding its European store network and raising its dividend.Yesterday’s announcement that it plans to expand its French electricals business, Darty, into Italy from next summer suggests it is comfortable with its £300m-odd borrowings.Although Kesa is best known here for Comet, its fortunes hinge less on how many flat screen tellies us Brits are buying and more on whether our French cousins are in the mood for le shopping. Kesa Electricals, the owner of Comet, may sell the very latest electrical goodies but unless you know your MP3 player from your elbow, it isn’t a business to set the pulse racing.
Kesa (that’s pronounced Kayzer, not Keezer) has been a pretty low-voltage performer since it was spun out of Kingfisher last summer. Mr Walker now holds 2.8 million shares or 1.9 per cent of the company.Punters should keep an eye out for BDI Mining.

The group will float on AIM today and is tipped to raise £1.5m. Brokers hear that RAB Capital, the hedge fund, has bought a large slug of the issue.. JOHCM accompanies K Capital, also a hedge fund, as major shareholders of Jarvis, although K Capital controls a more substantial 25 per cent of the company.Bid speculation returned to Goshawk, pushing the insurer 4.25p higher to 44.75p. Dealers talked of a 55p-a-share offer for Goshawk.Anite dropped 1.25p to 50.75p after Altium Capital cut its rating on the software group to “hold” from “buy”. Inveresk ticked 0.5p higher to 12p as its chief executive, Alan Walker, picked up 125,000 shares at 11.25p each.

The broker warned that the recovery at the group’s public sector unit had been slower than expected and so downgraded its earnings forecasts for the whole of Anite. Dealers believe Columbia built up its stake in the wake of Thus’s recent profits warning. Following the setback, analysts have persistently suggested that the group’s days as an independent player are numbered.Jarvis gained 3.5p to 34.75p as JOHCM Alternative Investments upped its holding in the troubled PFI group to 4 per cent. Thus added 0.75p to 14.5p as Columbia Ventures Corporation declared a 5.2 per cent holding in the telecoms group. Columbia is a private US company with diverse investments ranging from the telecoms sector to aluminium smelting in Iceland Its plans for Thus are unclear at this stage. It referred to the drop in the stock over the past two weeks as “unwarranted” and concerns regarding growth at the group’s UK division as “misplaced”.

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