Market report: Wednesday close

CREST Nicholson shares slid 5¼p to 372½p today after Gerald Ronson's Heron Corporation put its takeover bid for the housebuilder on hold.

Heron, which blamed the move on Crest's decision not to open its books, said it would not make an offer for at least six months unless it secures the agreement of Crest's board or a rival bid or a reverse takeover emerges.

Heron, a 23.4% shareholder in Crest, had indicated that it would be prepared to offer between 345p and 430p a share, valuing Crest at up to £481m.

A statement from Crest said it had 'offered to work' with Heron to demonstrate why that range undervalued the business, but Heron was not prepared to sweeten its bid.

Meanwhile, it was another bad day for UK retailers as Lehman Brothers cut ratings on Kingfisher, Boots, Next and Kesa Electricals.

Boots was 8½p lower at 591½p and Next was off 28p at 1475p as Lehman lowered both stocks to equal-weight from overweight, keeping its 645p target on Boots, but cutting Next to 1640p from 1670p.

The broker also reduced Kingfisher to 220p from 260p and Kesa to 258p from 295p, placing both stocks on an underweight footing from equal-weight.

Kingfisher, rumoured to be a takeover target for various predators, fell ¾p to 253p while Kesa was 3p lower at 262p.

Lehman's move, part of a general review of retailers, came as sales figures showed budget clothing company Matalan, 9¼p lower at 183¾p, and HMV, off 9¼p at 218p, falling victim to retail-sector gloom. French Connection also said it had felt the effects of the consumer slowdown, but the shares rose 7¼p to 255p as the company made positive comments about trading since March.

With volume on the low side ahead of tomorrow's general election, the Footsie closed up 21.25 points at 4882.5. Support in the afternoon came from Wall St, where the Dow Jones industrial average was up 77 points at 10,333.95 as London closed.

Biotechnology firm Ark Therapeutics added 4p to 119p after being awarded several patents on its main products. The self-proclaimed oldest stockbroker in the City, Hichens, Harrison & Co, floated on Aim today after 201 years in the business. The shares, placed at 50p, were later changing hands at 55½p, off a high of 57½p.

SIG, which supplies specialist products to the construction industry, said trading so far in 2005 has been good, with like-for-like sales ahead of last year in its three operating regions, the UK and Ireland, continental Europe and the US. The shares rose 15p to 557p.

Specialist software and services supplier XKO was 4½p higher at 82½p despite saying trading for the year to end-March should be in line with market expectations. Following the £13.2m disposal of its offshore division in March, XKO says it will now focus on 'larger potential acquisitions'.

Shares in Cambridge-based mobile phone systems designer TTP Communications rose 2½p to 47p on the back of a deal to license its multi-application software AJAR to phone maker Motorola.

Petrel Resources soared 8p to 43½p amid reports that it may win a contract to develop an Iraq oilfield.

Northern Petroleum, up 0.88p at 10.38p, says an independent valuation puts its proven and probable reserves in the Isle of Wight, Hampshire and West Sussex at about double the company's current market capitalisation of £26m.