Iron ore miner Ferrexpo has fallen back after its two largest investors unveiled plans to sell some of their shares.
Ferrexpo is down 1.5p at 182.5p as chief executive Kostyantin Zhevago and investment group BXR said they would trim their shareholdings to help meet new rules for the amount of a company's shares which available on the market.
In 2011 FTSE Group said to be included in its blue chip indices, a company must have a free float of 25% by next March. Ferrexpo - currently a member of the FTSE 250 - has a free float of 23.3%.
Zhevago will sell around 4.1m shares, or 0.7%, to take it to 24% while BXR will dispose of some of its 25% stake to meet the requirements. A number of companies have to release shares to meet the new rules. Analyst Asa Bridle at Cantor Fitzgerald said:
Though news of share selling may impact the price in the short term, we view this announcement as positive as it should remove any doubts the market may have had over Ferrexpo's position in the FTSE 250 index next year. It also has the potential to improve liquidity in the stock at a time when the company should be offering an improved operational status thanks to its planned production expansion and continued product improvement programme. We reiterate our buy recommendation and target price of 250p.
