Deutsche Bank trims Cairn stake

DEUTSCHE Bank has made profits of nearly £100m by trimming its stake in soaraway oil explorer Cairn Energy on the back of the company's bumper discoveries in India.

The bank's asset management arm now holds just under 10% of the company's shares, compared with 16% at the start of the year.

Cairn's shares have rocketed from 370p in January to a high of 1,489p and the company is now on the brink of promotion to the FTSE 100 index with a market value of £2.2bn.

Deutsche first bought into the company in 1989 when its main asset was an onshore oil well at Palmers Wood next to the M25. The bank held a 13% stake three years ago.

Richard Curling, head of Deutsche's small-cap team, said: 'We have been gradually running down our holding now for a couple of months. That reflects the fact we have made 10 times our money on this investment.

'We have had 300% alone this year and decided to lock in some profits, to sell into the strength. I'm still a big believer in the company and think it will make money from here.'

Another big winner is Fidelity, which held a 13% stake last October.

For the past two months, US oil reserves consultant DeGolyer and McNaughton has been putting together a report on Cairn's Mangala field which holds some 1.1bn barrels of oil.

Recoverable reserves are expected to come in way above Cairn's initial estimate of 275m barrels.