Takeover action: Royal Mail, Anglo American and Bloomsbury

Deal action fuelled today’s major stock market moves after Royal Mail’s takeover moved closer, Anglo American (LSE:AAL) resisted BHP Group Ltd (LSE:BHP) and Bloomsbury Publishing (LSE:BMY) made a “game-changing” purchase.

The overall stock market mood continued to be affected by interest rate uncertainty, with US benchmarks down sharply at Wall Street’s opening bell and the FTSE All-Share 0.8% lower.

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Fallers included mining giant Anglo American, which lost 43.5p to 2,514.5p after it rejected BHP’s call for a further seven-day extension ahead of tonight’s bid deadline.

Since Anglo turned down a third takeover approach worth about £38.6 billion last Wednesday, the De Beers owner has held extensive talks with BHP and its advisers.

However, it said these discussions have failed to address its concerns about a complex bid structure that is likely to take more than 18 months to implement.

Its concerns focus on the requirement to complete two separate demergers of its shareholdings in Anglo American Platinum and Kumba Iron Ore prior to the takeover.

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Anglo’s shares were as high as 2,773.5p on 10 May, having jumped from April’s level of 2,160p prior to the disclosure of BHP’s bid interest.

Shares in FTSE 250-listed Royal Mail owner International Distributions Services (LSE:IDS) rose 13p to 334.2p after its board backed a 370p or £3.6 billion takeover led by Czech billionaire and major shareholder Daniel Kretinsky.

Chair Keith Williams said: “The IDS board has negotiated a far-reaching package of legally binding undertakings and commitments which provide our customers, employees and broader stakeholders with important safeguards.”

These include the provision of the one-price-goes-anywhere Universal Service Obligation (USO), the maintenance of employee benefits and pensions and ensuring Royal Mail remains headquartered and tax resident in the UK.

Williams called the offer price “fair and reasonable” given the uncertainties faced by Royal Mail.

Broker Peel Hunt added today: “We see 370p as an excellent price given the risk that USO reform may not deliver all that Royal Mail desires.”

The shares, however, remain a long way short of the takeover price agreed with Kretinsky’s investment consortium, reflecting uncertainty in the City over the possibility the deal may yet be blocked by a future government.

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Today’s price takes IDS above the 330p flotation level of October 2013 for the first time in two years, albeit considerably short of the 630p high seen during the pandemic.

Shares in Harry Potter publisher Bloomsbury Publishing posted one of the strongest performances in the FTSE All-Share, having earlier announced its biggest-ever acquisition in a move that will make it one of the leading academic publishing companies in North America.

Chief executive Nigel Newton said: “This acquisition is a game-changer for Bloomsbury.”

The $83 million (£65 million) purchase of the 75-year-old Rowman & Littlefield business will create a combined portfolio of about 97,000 academic titles.

The acquisition, which is expected to be earnings accretive in its first year, has been financed through cash resources and a new £30 million three-year term loan with Lloyds Bank.

Shares rose 46p to 604p, extending gains for this year to about 28%.