Investors in Forth Ports had some excitment earlier this week when Australian investment group Babcock & Brown announced it had raised its stake in the company from 19.4% to 22.2%. There was much talk that this may presage a full takeover of Forth.
Sadly, however, Babcock's ability to fund such a deal - even if it wanted to - seems to be diminishing. It shares sank overnight in Australia on concerns about its high levels of debt and the state of its banking covenants. So Forth too has fallen back as the takeover hopes faded, closing 115p lower at £18.65.
But overall, with the beleaguered banks and builders recovering, the market managed to stay in positive territory by the close of play. The FTSE 100 added 67.2 points to 5790.5, while the FTSE 250 ended up 131.1 points at 9554.2.
HBOS was the biggest riser in the leading index, up 25p to 283p and moving back above its 275p rights issue price. Taylor Wimpey headed the FTSE 250, up 8.5p to 61p. A fall in Taylor's shares yesterday, and also a drop at Aberdeen Asset Management, prompted tales that hedge fund Toscafund - which has big stakes in both - was being forced to liquidate positions.
But Tosca boss Martin Hughes denied this vehemently, talking darkly of market manipulation. He said the firm had held Taylor Wimpey for four years, and was a long term fund not a trading business. All this helped Taylor recover, and also helped a revival at Aberdeen, up 10.25p to 128.25p.
Retailers were on the rack however after disappointing results from Carphone Warehouse, down 11% to 202.5p, and Argos and Homebase owner Home Retail Group, 8.75p lower at 215p.
DSG International and Debenhams both lost around 5% while computer games retailer Game closed 8.75p lower at 265.25p after a sell note from Investec.
