Morrisons shares take a leap on renewed takeover rumours

Picture by Simon Hulme
Picture by Simon Hulme
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​​Morrisons’ share price jumped nearly five per cent on Thursday following renewed takeover rumours and a positive analyst note from UBS.

​​Shares in the Bradford-based firm rose 7.7p to 170.8p after ​South African billionaire Christo Wiese ​renewed comments that he could look to invest in the UK supermarket sector.

He is staying tight-lipped about possible targets, but analysts believe Morrisons could be ripe for investment following a slump in its share price.

​Mr Wiese has already taken over fashion chain New Look, gym chain Virgin Active and he holds a fifth of supermarket chain Iceland.

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​The share price rise also followed a positive note from analyst Andrew Gwynn at UBS.

“Our latest UBS Evidence Lab UK consumer survey suggests that Morrisons has made good progress across the last six months with consumers recognising an improvement in ‘value for money’ and fresh credentials,” he said.

Morrisons will report first half results next Thursday when new CEO David Potts is expected to give his thoughts on the future of the business.

Mr Gwynn said he expects to hear news of the potential disposal of the convenience stores and there could be a decision on the online operations.

“David Potts (and the CFO and chairman) all came from Tesco which has traditionally been quite critical of Ocado’s business model,” he said.

“We think the Ocado partnership is a good one for Morrisons (at the very least, the least expensive route on-line) and it would be very difficult/ expensive for Morrisons to exit.”