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CCP Group shares quadruple in value in only 2 days.
CPP Group Plc (LSE:CPP) is a leading provider of Life Assistance products and services with approximately ten million live policies in 14 different countries. Looking at CCP Group’s recent share prices might indicate that they could assist in filling your wallet too…
In the past 48 hours CCP Group has sky rocketed, with shares rising 200%. Shares are now up at 13p, highs which haven’t been seen for over 4 months. The public company saw a fall in value back in mid-March, although it still has a little way to go to get to a new yearly high. January 25th saw share prices up at 23p.
The significant rise started on Tuesday 30/08/2013 at around 11:09am with the share price more than doubling from 3p to 6.5p within an hour. This uptrend soon petered out, and after a slight drop, shares stuck at approx. 5p for the rest of the day. Wednesday morning proved to be quite uneventful up until just after 02:00pm where the price level then shot up again. This uptrend continued up until 10:37am today and has now once again levelled out, but this time at 13p.
Yesterday’s close was 7.75p.
How big is this rise in the grand scheme of things?
Look at the graphs below to help put things into perspective:
Top left we have the intraday graph, showing CPP Group’s share activity from 08:00am this morning. Top right we have a 6 month graph, showing CPP Group’s share activity from Febuary this year. Finally at the bottom we have a 2 year graph, Showing CCP Group’s share activity since July 2011.
Why the rise?
There has recently been a new, long-term financing arrangement for the business. The group has been in advanced and constructive discussions with its existing lenders and certain Business Partners and now has a new long term funding plan for CPP.
What do these new financing arrangements entail?
According to the RNS: “The Group agreed new banking facilities to refinance the Group for a period of three years. This financing will be with its existing lenders (the “New Facility”), and an agreement with some of its Business Partners to defer payment of commission that would otherwise become due over the twelve months up to 30 June 2014 for a period of up to four years (the “Commission Deferral Agreement”).
The New Facility and Commission Deferral Agreement (the “New Financing Arrangements”) together represent longer term financing for the Group to the value of £36m and will be used to pay redress to customers where appropriate through the proposed Scheme of Arrangement and provide working capital for the Group’s three year business plan”.
Will it continue?
“CPP will continue to face significant financial challenges, particularly until the redress programme is completed. However, the New Financing Arrangements represent a significant milestone and create a more stable platform to support the repositioning of the Group”.
How does CCP Group compare with the rest of the market?
CPP was founded back in the 1980s and is now firmly a part of the FTSE 100 and maintains operations in Asia, Europe, and North America. Assurant Inc. (NYSE:AIZ) is a public American company which was founded over 100 years ago and is on the Fortune 500. Assurant’s share price has been on the up since the beginning of the year and is currently at 54p. You might think there is no competition between the two global giants, however back on 17th January 2011, CCP Group’s share price was at 329p, whereas Assurant was at a pretty pathetic 39p.
