The takeover targets Morrisons and Meggitt look set for a brief return to the FTSE 100 index of blue-chip UK companies, after their share prices were boosted by bidding wars between rival US suitors.
The index’s manager, FTSE Russell, has placed both companies on its indicative FTSE 100 additions list and said it would make a final announcement on the quarterly stock market reshuffle on 1 September, based on the data collected at the close of share trading on 31 August.
However, Morrisons and Meggitt’s return to the FTSE 100 is likely to be short-lived, as the supermarket chain and aerospace engineering firm will be delisted from the stock market if the takeovers go ahead.
The engineering company Weir Group and broadcaster ITV, which returned to the FTSE 100 in March and June respectively, are expected to be demoted to the FTSE 250.
Just Eat is expected to lose its London stock market listing, after FTSE Russell ruled that the company’s nationality should be reassigned from the UK to the Netherlands. This opens the way for a third FTSE 250 company, the veterinary-focused business Dechra Pharmaceuticals, to be promoted to the FTSE 100.
Morrisons’ share price has surged more than 60% since receiving an initial offer from the US private equity firm Clayton, Dubilier & Rice (CD&R) in June. The company is at the heart of a £7bn bidding battle between CD&R and a consortium led by the SoftBank-owned US rival Fortress Investment Group.
Coventry-based Meggitt continues to recommend the US aerospace company Parker Hannifin’s £6.3bn takeover offer over the approach of its rival TransDigm Group, which has until September to decide if it will make a firm offer.