Babcock’s bet paid off and Rosyth now has guaranteed refitting orders until 2007.The disposal of a 50 per cent stake in a water treatment venture has reduced turnover, but profits still leapt last year to pounds 25.3m, 10 per cent ahead of forecasts. Earnings per share doubled to 11.44p from 5.93p.Prospects are good. Babcock is in consortiums bidding for forthcoming weapons and decontamination contracts. The shares tipped up just 2p to 121p yesterday, giving Babcock a forward p/e of 11. That’s higher than its peers, but it undervalues the turnaround Buy.. SO MUCH of Securicor’s fortunes depends on its stake in Cellnet, the mobile telephone business in which it owns a 40 per cent stake, that it took some time yesterday for the market to wake up to the positive news in the group’s interim results. The shares fell 2p in early trading, but later added 6.5p to close at 556.5p.

The market was braced for a poor contribution – pounds 26m as opposed to pounds 43m – from Cellnet following a recent presentation by BT.
The results marked another opportunity for the group to utter the usual array of platitudes about examining all options to enhance shareholder value when quizzed on the possible sale of the Cellnet stake.More exciting is the progress in the core security, non-Cellnet communications and distribution divisions. The group has brought forward margin targets for the latter two after the security division hit them this year.Meanwhile, the group said its distribution division’s joint venture with Deutsche Post, established in March by the sale of 50 per cent of the division to the German group, had made more progress in three months than was expected in three years.Analysts expect pounds 96m of post-exceptional pre-tax profits and earnings of 11.2p per share this year.But, while Securicor’s core business is looking impressive, until the Cellnet issue is resolved the shares are likely to remain volatile.. PAUL DRAYSON, founder and chief executive of Oxford-based Powderject Pharmaceuticals, and his wife Elspeth yesterday netted pounds 17m from the sale of 15 per cent of their shares in the company. The couple, who gave their life savings of around pounds 100,000 to found Powderject, put an undisclosed proportion of the funds into a charitable trust and gave pounds 1.2m to the John Radcliffe hospital in Oxford. Dr Drayson said they had made the donation after his wife gave birth in the hospital on Saturday.
The placing, at 800p, of over 9 million shares belonging to founder shareholders followed the expiry of a lock-up period initiated upon the company’s flotation two years ago.The Draysons’ options were exercised at just 10p per share. The couple have entered a new agreement which forbids them from selling their remaining 12 per cent Powderject holding until the company is profitable. The rest of the management have signed a new lock-up lasting one year.Meanwhile, Powderject said Glaxo Wellcome had paid $3.4m (pounds 2.2m) for two further licences to use its patented powderject system, an alternative to needle-based drug delivery methods, in vaccines The shares closed up 15p at 845p..

PHILIP GREEN’S break-up of the former Sears conglomerate is nearing completion after retail group Arcadia confirmed yesterday that it is in talks to buy the company’s womenswear stores. Separately, Mr Green’s group also announced that talks are nearing completion regarding a management buy-out of its Adams childrenswear chain.
Arcadia, which controls the Dorothy Perkins, Burton and Evans chains, is keen on adding Sears’ Miss Selfridge, Wallis, Warehouse and Richards formats to its portfolio in a deal thought to worth around pounds 180m. The deal would give Arcadia around 9 per cent of the UK clothing market, second only to Marks & Spencer.It would also enable Arcadia, led by John Hoerner, to shuffle Sears’ group of stores with many of the struggling Richards shops likely to be re-branded. The sale of Adams is expected to fetch pounds 80m-pounds 90m with the deal backed by NatWest Ventures and led by managing director Michael Hobbs.With the pounds 150m sale of Freemans to Otto Versand gaining clearance from the competition authorities yesterday, the break-up of the once mighty Sears group is almost complete Mr Green paid pounds 548m for the group in January. If all the deals go though he will have recouped around pounds 420m so far with around pounds 150m of property interests remaining.Mr Green, whose Sears deal has been backed by the Barclay Brothers, appeared happy with his five months work yesterday saying he was already looking for the next deal. “A billion pounds wouldn’t stretch us,” he said.The City reaction to Arcadia’s move was mixed.

The shares rose 2p to 247.5p but some industry experts expressed surprise at the deal. Richard Hyman, of Verdict, the retail consultants said: “Wallis and Warehouse are good businesses but Arcadia is showing signs of having more balls in the air than it can realistically manage.” One analyst added: “Is this deal covering up problems or even creating new ones. They don’t seem to be managing what they have at the moment very well.”Arcadia reported interim profits of pounds 23m in April – more than halved from the previous year’s pounds 50m as harsh trading conditions over Christmas hit sales.The group, which was demerged from Burton last year, also announced it would cut jobs at its head office.. THE RUMBLE of giant deals echoed through the market yesterday, and Sainsbury was right in the thick of it.