Invensys is leading the FTSE 250 risers following overnight news of a possible £3.3bn or 505p a share offer from France's Schneider Electric.
Despite the prospect of a possible rival bid, not least from US group Emerson Electric, Invensys shares are hovering at the proposed offer price although this still represents a near 15% jump on Thursday's close.
But close behind Invensys is Oxford Instruments, up 12% or 150p to £14 after a period of relative share price weakness. The catalyst is a positive update from the technology group, which showed improving orders, sales and profits in the third month of the first quarter after a slow start to the year. Analyst Scott Cagehin at Numis Securities said:
We believe that the shares should start to trade higher after recent weakness and retain our positive stance as we believe that Oxford is a high quality business that possesses defensive characteristics. Structural demand for Oxford's product portfolio is apparent and we believe that these factors, along with new products, technology upgrades and market share gains, position Oxford strongly to grow in excess of general global GDP growth.
Demand for Oxford's products is being driven by the shift to smaller applications and the ability to analyse and manipulate matter at the atomic level. As a consequence, nanotechnology research is growing strongly with funding levels expected to increase between 10%-20% per annum, creating a good platform for growth. Additionally, industrial facing hand-held applications are set to enjoy good demand, with increasing requirements from industry to analyse on the ground, increase productivity and comply with tighter regulatory testing requirements.
