Footsie peaks again despite Christmas Eve lethargy

British Borneo Petroleum Syndicate, a throwback to the days of the empire, was the outstanding feature as the stock market dutifully went through the motions of share trading on Christmas Eve.

The shares jumped 56p to an 815p peak after the company revealed a deal with Shell. It has been given the right to explore and the option to develop the Leo field in the Gulf of Mexico. Shell retains an overriding royalty. The Shell deal follows two other Gulf of Mexico developments, announced on Monday.

The group's shares are one of the year's high flyers. A year ago they were around 240p, having bumped along at 82p in 1992.

BBPS, in the distant days when the British Empire straddled the world, enjoyed royalty rights in Brunei. In the 1960s it became little more than an oil investment company, with Shell its major investment. A transformation started in 1989 when Alan Gaynor became chief executive with the object of liquidating the investment portfolio without suffering huge capital gains tax bills.

Then BBPS began to emerge as an oil exploration business. A pounds 55m rights issue allowed it to acquire the North Sea interests of Norway's Norsk Hydro. Other North Sea assets were picked up and then BBPS descended on the shallow waters of the Gulf of Mexico, establishing a substantial gas reserve just before the price of gas rose sharply.

The shares have also been beneficiaries of the takeover excitement which has swept through the oil sector since Gulf Canada rolled out its hostile pounds 432m bid for Clyde Petroleum last week.

Since then Halliburton, a US group, has approached OGC International, an oil services group. Today BBPS is capitalised at more than pounds 500m. When Mr Gaynor arrived it was worth just pounds 20m.

In thin trading Footsie managed to reach another peak. It gained 5.3 points to 4,092.5, preserving the festive run which has produced five days of gains and three peaks, with the index progressing 113.2.

Once again new year's tips and special situations generated odd flickers of life. Barclays de Zoete Wedd is adopting a much less robust stance on the market than NatWest Securities. Whereas NatWest is looking for Footsie to end next year at around 4,600 points, the BZW team is retaining its target at 4,300.

Sunderland, the latest football club to tap the market, enjoyed a spectacular debut. The shares, placed at 585p, scored a 147.5p gain to 732.5p.

Northern Electric returned to market at 637p. The Prudential Corporation increased its Northern stake by 0.64 per cent to just over 12 per cent but was unable to block the CE strike. The two surviving regional electricity companies, Southern and Yorkshire, were little changed.

Allied Domecq, one of the year's worst-performing blue chips, enjoyed a late seasonal rally, thanks to rumours that Lehman Brothers, long-time bears of the shares, were planning to produce a buy review. The shares led blue chips with a 10.5p gain to 450p.

The departure of finance director John Grant continued to unsettle LucasVarity, the Anglo-American group. The price fell 1p to 225.5p.

Sears, planning to sell its Freemans mail order side to Littlewoods, firmed to 90p. Nick Bubb at stockbroker MeesPierson points out that break- up value is more than 120p a share. He believes a disappointing Christmas could force the group to make moves to increase shareholder value, such as demerging Selfridges, which is worth 45p a share. He rates the shares a buy.

Brake Brothers, hit by a profit warning on Monday, had another difficult session. The convenience food group lost 26p to 550p, making a two-day decline of 206.5p.

Shield Diagnostics fell 8p to 147p as the company said it knew of no reason for recent strength. Last month it produced half-time losses and said it was confident of the role of AFT as a risk marker for cardiovascular disease. It is still awaiting clinical trial data from AFT studies. The shares were 173p earlier this year.

Proteus, the drugs group, lost 2.5p to 35.5p and Xenova, another drugs business which was floated at 215p last week, encountered further weakness, falling 8.5p to 195p.

Grampian TV, thought to be a target for Scottish TV, fell 28.5p to 279p and Memory Corporation's revival came to an end with the computer chip repairer off 5p to 63.5p.

Halma, the environmental engineer, held at 190p as Greig Middleton forecast its 21st year of profit headway. It expects the year's figure to come out at pounds 39.5m, up from pounds 33.6m.

Taking Stock

Flextech, the television group, jumped 16.5p to 687.5p with Merrill Lynch making confident noises. It believes that, after early losses, the group's joint venture with the BBC will break even in 2001 and make profits of up to pounds 90m in 2003. The securities house sees Flextech moving into profit next year with a pounds 4m offering. It believes the group figure will be as high as pounds 211.6m by 2003.

Deep Sea Leisure, floated at 160p in October, achieved a 24 per cent interim profit advance to pounds 372,000. It runs Deep Sea World, an aquarium at South Ferry, Fife, and has started work developing the pounds 11.7m Chester Oaks Aquarium between Chester and Ellesmere Port. It is expected to open in the spring of 1998. The shares rose 8p to 172.5p.