MARKET REPORT: Punch Taverns raises a glass to debt deal

PUNCH Taverns yesterday moved within sight of removing a large chunk of its debt hangover from an acquisition spree as equity investors and bondholders backed a rescue plan.

punch taverns, david shand, market report, pubs, barratt development, cairn energy, johnson matthewPunch is edging closer to getting rid of a large proportion of its debt[GETTY]

The restructuring, which follows two years of tough negotiations and amended proposals, now just requires the consent of creditors Royal Bank of Scotland and Lloyds Bank and is expected to complete next month. It will lead to shareholders in the pubs group being diluted to just 15 per cent ownership.

Punch eased 0.1p to 9¼p. Catalytic converter group Johnson Matthey moved up a gear on hopes for a recovery in vehicle sales on both sides of the Atlantic. Its shares accelerated 31p to 3131p as Berenberg upped its hold rating to buy with a 3650p target and raised its earnings forecasts for this year and next by 6.7 per cent and 16.3 per cent respectively.

Suggestions that premium fares are holding up on transatlantic routes despite overcapacity concerns provided a tailwind for British Airways owner IAG

The broker flagged a boost in profits from a higher share in the lucrative diesel passenger car market for light duty vehicle catalysts, while the heavy duty diesel catalysts market, which Matthey dominates with a 60 per cent global share, should benefit from growing North American and European truck demand.

Suggestions that premium fares are holding up on transatlantic routes despite overcapacity concerns provided a 9p tailwind to 375¾p for British Airways owner IAG. Private equity firm 3i Group 18c53ftse added 5p to 379p after it made about £85million from the sale of its stake in Vedici, a leading provider in private acute care in France, having invested £44million four years ago.

Cairn Energy was pumped up 6½p to 184½p by the discovery of three new oil fields in western Rajasthan by Cairn India, in which it has a 10 per cent interest.

Solid trading updates boosted chip company Imagination Technologies 10½p to 199½p and packaging group DS Smith 14p to 287p, while an upgrade from UBS lifted interdealer broker Icap 17¼p to 376½p.

Hopes that interest rates will not be raised until well into next year underpinned housebuilders Persimmon and Barratt Developments, up 20p to 1352p and 11¾p to 392p. Boardroom buying lifted Lakeside and Metrocentre shopping centre malls owner Intu Properties 7p to 343p. The FTSE 100 Index closed 11.34 points lower at 6780.90.

On Wall Street, the Dow Jones closed the day up 24.88 points at 17,156.85.

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