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United Kingdom Invensys Share Price Gets the Kiss

It may not be much comfort to those who bought Invensys shares at their peak of more than £3.00 ($5.25) back in the days of Allen Yurko’s stewardship in 1999, but stock market sentiment in London is finally swinging back behind the group—whose businesses include Foxboro, Wonderware and Eurotherm.

As a result, if you’d bought in at the 52-week low of £0.10 (18 cents) back at the end of June 2005, you’d have more than doubled your money by now, and even if you’d left it until almost all the newspaper tipsters included it in their New Year recommendations, you’d still be nearly 15 percent up.

Fire sale

That 12-month low coincided, perhaps unfairly, with the departure of chief executive Rick Haythornthwaite, who had masterminded a huge fire sale of assets and eventual refinancing, and his replacement by the lower-profile (and, some might say, more reassuring) figure of Ulf Henriksson. Haythornthwaite’s refinancing included a five-for-eight rights issue at £0.215 (38 cents). That’s the price the stock is currently hovering around, and analysts predict that if it successfully breaks through, it should go to £0.30 (52 cents).

Other factors driving it include Standard & Poor’s recent upgrading of Invensys’ bonds from “negative” to “stable,” and renewed speculation that the group might either be acquired or taken private. We’ve heard that before, with Siemens and Emerson most frequently named as potential predators, but Invensys’ reduced debt and pension fund deficit could now make it a more realistic prospect.

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