Alvis Share Discussion Threads

[alan russell] 14/3/2004 21:02

BAE pulls back from tanks bid
Tom McGhie, Mail on Sunday
14 March 2004

BAE Systems has ruled out making a counterbid for Challenger tank company Alvis after American rival General Dynamics swooped with an agreed £309 million bid.

British defence giant, which has a 29.9% stake in Alvis, says it plans to work with General Dynamics on projects and is prepared to support its American rival if an alternative bid by a foreign company emerged.

French defence group Thales and Germany's Rheinmetall are believed to be considering higher offers for Alvis.

BAE sources dismissed suggestions that as the largest shareholder in Alvis, it was angry that the Americans had not consulted it before making their move.

Formally, BAE has told the Stock Exchange that it is considering all options*, which include bidding for the company, maintaining its stake or selling the share.

But BAE bought its holding in Alvis only last year so that it could work with it to develop a new range of lightweight armoured vehicles.

The Ministry of Defence is considering a £3 billion contract to develop such a vehicle and BAE would be in a good position to profit because Alvis is the favourite to win the deal.

BAE Systems knows General Dynamics well. The companies have worked on several projects, including laser-guided rockets, and the Americans are helping BAE solve the problem of soaring costs in its Astute nuclear submarine programme.

Last year, BAE failed in an attempted merger with General Dynamics.

Shares in Alvis closed at 297p on Friday, valuing the company at £328 million and indicating that investors are expecting a higher bid.

Amicus, the union representing hundreds of Alvis workers, is concerned about the potential impact on jobs.

John Wall, Amicus national officer for defence, said: 'We have real concerns on the industrial and political fronts about the takeover of the UK's armoured vehicle sector by a foreign corporation.'

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Hard to call where this is going from here. If The Mail is to be believed and BAE are out of the picture then to have sold on Thursday begins to look like the right move. Any bids from European defence companies could get bogged down in EU approval issues. If they use their influence to stymie the GD bid then all the more reason for the price to fall back. Quite possible however that holding on may prove the smart move in the long run but that could be a very loooooong run.

[abcd1234] 11/3/2004 15:52

this continues to creep up, with no apparent buys driving it?

[alanrussell] 11/3/2004 09:56

Well I'm out at 290p. Path cleared for rival bid!

[andrewhbruce] 11/3/2004 08:57

i guess bae will want more?? :-)

[alan russell] 11/3/2004 08:33

Trading at 297/298 against 280 offer from General Dynamics. Rival bidder in the offing?

Usually better to sell and take the premium in these cases. A rival bid of 300p would surely be a high price for ALV. Hmmmmm

[alan russell] 11/3/2004 08:28

Recommended takeover at 280p per share.

Always have mixed feelings when this happens. Nice to have a quick boost to the bank balance (in ISA so tax free too) but might it not have been better to have kept the shares in the long run. Not surprisingly it always seems to be the good companies that get taken over.

[andrewhbruce] 05/3/2004 19:13

wots to do ??

[wlfc1] 18/9/2003 09:23

from the man who gave you AHT yesterday (risen 19% since), let me make aware of MDY........they have had 3 product launches within the last 2 months and have recently formed good partnerships with smiths, walmart and others, the current share price is a steal.

with the recent launches and an impending trading statement and speculation of bid talk from smiths (smiths agm next week) at under 20p I would say there is potential for QUICK and significant profit.

worth a look...imho

[casino123] 12/9/2003 14:04

talk in the offices this week was alvis ,the preview results look very good,will be out on the 18th ,first target price seems 225 points ,hope that helps you out kc ,if i find out anything else at work i,ll let you know

[alan russell] 22/8/2003 20:42

Up 25p to 219.50 on GKN>>>BAE deal.

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Both BAE Systems and GKN were higher after BAE agreed to pay 73 mln stg for a 29 pct stake in Alvis -- a manufacturer of armoured fighting vehicles with operations in the UK, Scandinavia and South Africa.
BAE chief executive Mike Turner said: "We believe that this investment will result in new opportunities to work together, in a combination that is good for UK Land Systems capability, and will further enhance Alvis's strong growth potential."
BAE added 3-1/2 pence to 169-3/4 pence after it said it had no plans for an Alvis takeover. GKN rose 8-1/4 pence to 259-1/4 pence.
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When I heard the news I figured BAE had to be going for a takeover but the above news says not. Can only be good for Alvis. BAE can put a lot of business its way and it wants to benefit as well as establish closer working links. I'm glad it's not a takeover - I'm fed up losing good long term investments to takeovers, Clydeport was the last. Very nice at the time but you've got to go out and find another as good.... tricky!

[alan russell] 17/7/2003 06:58

From today's Guardian

Alvis jobs at risk as MoD pulls out of Boxer programme
David Gow
Thursday July 17, 2003
The Guardian
The government is pulling out of a key pan-European defence project to build a new armoured vehicle, putting at risk several hundred jobs at Alvis's Telford plant in the West Midlands.
But the cash-strapped Ministry of Defence is expected to sugar the pill by awarding Alvis the contract to produce a new scout car to replace the ageing Ferret. Alvis is the British partner in the Artec consortium of Germany's Krauss-Maffei Wegmann and Rheinmetall, and Holland's Stork, which is building prototype multi-role armoured vehicles known as Boxers.
The government initially planned to buy 200 wheeled Boxers in an order worth some £200m to Alvis and, eventually, to take on a further 400-600 in a £800m programme.
Alvis, which employs some 450 at Telford and 1,100 in the UK, refused to comment but industry sources indicated that the Boxer programme no longer fitted MoD requirements. The government is instead to press ahead with a new family of armoured vehicles, including personnel carriers, known as Future Rapid Effects System, which are seen as more suitable for the flexible deployment of modern armed forces.
The outcome is yet another blow to pan-European defence collaboration, with Lord Bach, defence procurement minister, hailing Boxer only last December as a shining example of cooperation. Britain's new Type 45 destroyers were also once part of a collaborative programme with the French and the Italians.
"Sadly, we cannot afford everything," one Whitehall insider said, reflecting severe pressure on the MoD budget which has also cast renewed doubt on the scale of the government's order for new Hawk trainer jets. BAE Systems had hoped that the cabinet would approve a multi-billion pound order for 31 of its advanced Hawks today, but a decision is now unlikely until later this summer, with intra-Whitehall battles still raging over Treasury demands to scale back the order.
It is not known whether Alvis could save jobs by building Boxer parts for Artec, but the £100m contract for the new scout car, known as the Future Command and Liaison Vehicle, will help.

[alanrussell] 26/5/2003 16:05

According to today's Telegraph yesterday's Sunday Express commented that Alvis is about to be awarded a mega UK tank order. Any Sunday Express readers (go on, own up) care to post details?

[superdealer] 09/5/2003 08:14

Strong performance recently. Any views?

[ashtongray] 13/3/2003 10:17

Value of recent upgrade work for MOD quoted in prelim results @ £20m.

[ashtongray] 12/3/2003 23:03

seen some of the video of the boys out in Kuwait. Looked a bit like the £500m for upgrades/desertisation was spent on black tape to seal up all the hatches etc. Buy shares in Focus instead??

Simon: know what you mean, I'm out at present also. If anything, it should probably be in my ISA, just leave it there for a few years.

[simonevans] 12/3/2003 21:43

You could be right - price has held up well recently. We'll have to wait and see. Given my luck at the moment, given I've sold out, they are bound to announce a major contract win!

[99] 12/3/2003 07:59

Today's FT states that the UK government has spent 500m on 'last minute' upgrades to tanks & artillery in preparation for possible conflict in the Gulf.
Could Alvis have won a slice of these 'last minute' contracts ?

[ashtongray] 09/3/2003 19:57

That is my position also. I think it not impossible that post- an Iraq war, Gordon will seek to recoup some of the additional costs to the Treasury involved by delaying/downsizing contracts for new kit for the armed forces, which clearly would not be good for Alvis. Just imo, dyor etc.

[simonevans] 09/3/2003 19:23

I think that news could be bad actually. Contracts need to be won! I sold a while back, but will get back in when they start to win some contracts. I think that they will, but it may take a while.

[boram] 09/3/2003 17:47

Alvis, Finals are out on Thursday 13th.

[ashtongray] 02/2/2003 19:52

Agree on this one - lack of contract news not so good, especially for the UK ops which very short of work right now. Could it be that Treasury pressure on MOD procurement programs is pushing new projects timescales out to the right?

Agree that there could be more short term price weakness, although would personally doubt sub £ unless there is some BAE-style project management going on :(

[simonevans] 02/2/2003 16:55

Unfortunately, I am no longer optimistic on this one. No news on contracts = bad news and I sold at the end of last year, giving them until the end of the year to announce badly needed new contracts. The chart now also says SELL following the sharp movement down last week. I think there is a chance of a profit warning or two on the horizon. Longer term, I still think this company has a good future, but I think I may be able to pick the company up for well below a £1/share sometime soon. Any views?

[limpsfield chartist] 11/9/2002 15:45

I am still in these and it looks like they are bouncing off their two year uptrend and 200 day moving average:



140 looks to be good support, first target is for a run back up to the recent highs at 165/70. Divi yield still 3.5%+