Jaguar dealership gossip clocks up Inchcape gains

MORE four-star takeover action could be on the cards in the rapidly shrinking car retail sector. Luxury car dealer

Caffyns is valued at only £15m. Inchcape has a strong balance sheet and could buy it with loose change.

Chief executive Peter Johnson wants to grow by acquisition and has been on the lookout for BMW, Mercedes, Toyota, Land Rover and Jaguar franchises.

Caffyns fits the bill and if rumours that Global Asset Management has been touting its 11.9% stake around the City are correct, a deal could be tied up soon.

The consolidation of the motor trade began in 1997 when big players such as Henlys and Lex Service quit the market and D C Cook went bust.

Since then the sector has gradually shrunk and only the strong will survive. The new car market is presently buoyant, with record sales last month.

C D Bramall edged forward 2 1/2p to 418 1/2p, European Motor 3 1/2p to 155p, Pendragon 4 1/2p to 416 1/2p and Reg Vardy 3 1/2p to 431p.

The Footsie hardly got out of first gear. Up 13 points before elevenses, it reversed in thin trading to finish 1.2 points easier at 4073.6. Fund managers sat on their hands ahead of the second-quarter results season on both sides of the Atlantic. Wall Street traded 53 easier at the outset before rallying.

Sterling eased to $1.6328, with the euro at 69p but sliding to $1.1267. It was above $1.19 not long ago.

Insurance giant Prudential was top Footsie performer, rising 19 1/4p to 410p, for a two-day gain of 41 3/4p. Turnover swelled to 40m amid continuing speculation that it is about to sell all or part of its 79.3% stake in online bank Egg (2p easier at 130p).

US takeover talk helped software group Sage rise 6 3/4p more to 186 1/2p.

A sparkling agm trading statement lifted jeweller Signet 6 1/4p to 98p.

After warning last month that conditions in the US - 70% of its sales - were 'very challenging', chairman James McAdam yesterday said sales there showed signs of improvement.

As the City gave the thumbs-up to Argos boss Kate Swann as new chief executive, W H Smith jumped 17 1/2p to 386p.

Underpinned by bid hopes, Manchester United held rock steady at 160 1/4p. Fan Peter Ashworth at broker Charles Stanley advises clients to fill their boots. He attended Friday's upbeat investor presentation at Old Trafford and says the strategy of turning fans into customers is making big strides. The US tour, which kicks off on 22 July with 200,000 tickets sold, will build up the American fan base.

Lower down the Premier League, despite the spate of speculative buying of soccer stocks that followed the Russian takeover of Chelsea, Tottenham Hotspur remained friendless at 20 1/2p. Whispers suggest institutions have been sounded out about supporting a rights issue. Chairman Daniel Levy apparently wants cash to improve Glen Hoddle's Spurs squad.

AIM-listed Medical House rose 2p to 45 1/2p after signing a Turkish distribution deal with Oncu Medical for its needle-free injection system.

Placed on AIM at 91p, laser eye surgery company Custom Vis touched 94 1/2p before closing at 92 1/2p.

Recruiter Hat Pin, where Bob Morton holds 18%, advanced 3 1/2p more to 39 1/2p. Directors have been big buyers of late. Chief executive Gay Haines told May's agm the first quarter was 'tremendously encouraging'.

Quadnetics, the cctv and video networks specialist, soared 45p in a thin market to 227 1/2p after declaring pretax profits for the year to end-May will not be less than £1.35m - well above expectations.

A positive agm helped Telecom Plus buzz 15p higher to 220 1/2p.

A HEFTY 22.6m shares in AIM-listed Advanced Medical Solutions changed hands and the close was 1 1/8p dearer at a peak of 10 3/8p. Buyers piled in for the woundcare company on hearing that the Food and Drug Administration had given US marketing approval for its new antimicrobial dressing, used to reduce infection from ulcers and surgical wounds.