Market report
CUSTOS
The equity market is now moving into its usual pre-Christmas doldrums, though with the Financial Times ordinary share Index at 494.3 compared with 404.0 twelve months ago, a rise of 22 per cent, investors can look forward to a happy holiday. Not so holders of gilt-edged securities, of course, though since the November trade figures their market has been in much better form.
Dealing reopens in the two classes of News of the World equity this Thursday. The consensus seems to be that the voting shares will be dealt in at 43s or so, which com- pares with a minimum value of 47s 7d placed on them by Mr Robert Maxwell's offer of Pergamon Press ordinary and convertible. News of the World's defence consists of an alliance with News Limited, an Australian pub- lishing group. What is proposed is that in return for 35 per cent of the voting equity (26 per cent of the total ordinary share capital), News Limited will put in Australian publishing assets earning around £1.1 million before tax. These profits will be guaranteed for 1969. Quite as important, I think, is the fact that the highly successful young chief executive of News, Mr Rupert Murdoch, will be sole managing director of the combined group with the right to appoint altogether six out of sixteen directors. This means that News of the World would in effect be under new management. Shareholders are asked to approve this deal in an extraordinary general meeting scheduled for 2 January, and if they do, Mr Maxwell's bid will be blocked. On present evidence that would be a wrong decision.
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