Raid talk fires up Doulton

BULLS entered the china shop amid speculation that

Loss-making Royal Doulton, which has been struggling against a tough market for formal tableware and facing fierce competition from overseas, recently announced a £19.9m rescue rights issue at 8p. It warned that if shareholders do not cough up, it will have to renegotiate its banking covenants. The fund-raising comes less than three years after it raised £31m in a placing at 115p.

Waterford Wedgwood bought 14.9% of Doulton at 90p a share in November 1999. WW and venture capitalist Alchemy have long been rumoured bidders. With Royal Doulton now cracking and chairman Hamish Grossart desperate for cash, O'Reilly could pounce with a knockout cash offer. He would dearly love to get his hands on the Doulton, Minton and Royal Albert brand names.

But sceptics said O'Reilly could, if he wished, use the increased holding to block RD's rights issue plans, leaving its finest assets to be cherry-picked.

Wall Street's jump on Friday in celebration of data that suggested that the US recession was over and a recovery in manufacturing had begun, sparked a 5.9% jump in Japan's Nikkei index overnight.

That gave a kick-start to the FTSE 100 which raced higher. It was ahead 101 points when Wall Street opened with another impressive surge. The Footsie closed 73 points up at 5242. Sterling rose to $1.4240 with the euro holding at 61.1p.

Financial Times publisher Pearson was the day's top Footsie performer, jumping 106p to 876p on better-than-expected figures. Impressive results also helped banking giant HSBC advance 59p to 837p.

Still awaiting a crucial ITV Digital restructuring, joint owners Granada rose 10 1/2p to 130p and Carlton 16p to 232p. The two called off merger talks last week. Punters remain hopeful that a European media group will bid.

Colt Telecom rallied 6p to 50 1/2p after buying back £5.9m of its own bonds for £2.2m.

Telewest slumped 3p to 13p on hefty turnover of 106m after broker Schroder Salomon Smith Barney downgraded it to 'underperform'. It slashed its 12-month target price from 75p to 10p, citing the firm's hefty debt. Credit rating agency Moody's also put the boot in with a downgrade.

Engineer Morgan Crucible gained 15 1/2p to 180p following the appointment of accountant Nigel Young as finance director.

Nervous investors cashed in their chips at London Clubs, 5p down at 11p. A weekend report suggested the casino group is in crisis talks with its bankers.

Waste Recycling rose 9 1/2p before closing unchanged at 417 1/2p after broker ING Baring Charterhouse reiterated its bullish stance following in-line full-year figures. Aim-listed Harrier Group rose 3p to 42 1/2p on satisfactory earnings in a poor marketplace.

Broker Beeson Gregory advised clients to buy Aquarius Platinum (unchanged at 337 1/2p) ahead of an investor roadshow prior to its promotion to a full listing. Beeson believes the stock is worth 565p.

Dealers expect more action at Chapelthorpe, unchanged at 6p, now a big seller has been cleared out. The fibres, wallcoverings and umbrella frames maker called off bid talks a year ago. That was soon after chief executive Brian Leckie failed with a management buyout at 32 1/2p

Aim-listed Petrel Resources firmed 3/4p to 5 1/2p following a successful £340,000 placing at 5p to fund oil exploration in the Middle East. Directors were big buyers.