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* FTSE 100 down 0.3 pct
* Miners drag index lower
* Standard Life at 15-month high on Aberdeen merger
* Ultra Electronics Holding top STOXX gainer after results
* Acacia Mining extends losses on Tanzania export ban
LONDON, March 6 Britain's blue-chip FTSE 100
index edged down on Monday as weakness in mining stocks
outweighed the positive impact of a potential 11 billion pound
merger between Scottish fund managers Standard Life and Aberdeen
The index was down nearly 0.4 percent at 1014 GMT, tracking
losses in the broader European index.
Standard Life was the top gainer, up 5.4 percent
after hitting a 15-month high in early trading on news of a
merger with mid-cap peer Aberdeen Asset Management.
Aberdeen shares were up 4.3 percent.
The funds, seeking synergies and cost savings to fight back
against cheap, index-tracking funds, said they expected to save
200 million pounds through the merger. The deadline for the deal
is April 1.
"The deal makes perfect sense as a defensive play. The
explosive growth in passive investing trends has heaped pressure
on active managers like Aberdeen and Standard Life and
consolidation had to be on the cards," said Neil Wilson of ETX
Shore Capital warned of "grave concerns" over the proposed
board structure of the combined company, particularly the
appointment of co-CEOs.
Anglo American, Glencore, Rio Tinto, Fresnillo and
Antofagasta were all top fallers on the blue-chip index, down
1.4 to 1.9 percent in early trade as copper prices slipped due
to risk-off sentiment in broader markets.
Mid-cap miners Kaz Minerals and Vedanta Resources
also fell 2.5 to 3.7 percent.
EasyJet was a top riser, up 2 percent after it said
passenger numbers had increased 8.2 percent in February.
International Consolidated Air, the owner of
British Airways, gained 1.6 percent.
Strong gains from Aberdeen and Ultra Electronics Holding
helped the mid-cap index outperform.
Ultra Electronics Holding hit an all-time high, up 6
percent, the top mid-cap gainer and best-performing on the STOXX
600, after it posted an increase in full-year profit,
and order intake up 22 percent.
Ultra sees global defence spending rising around 3 percent
this year, according to Edison research analysts.
"We see room for further upgrades should U.S. budget
commentary convert into spend over the medium term," said
Investec analysts, who rate the company a 'buy'.
"For us, Ultra offers the best value in the UK Aerospace &
Defence sector and is deserving of a re-rating."
Acacia Mining was the top mid-cap faller, down 6.2
percent after it dropped 13.5 percent on Friday when the
Tanzanian Ministry of Energy and Minerals issued a surprise ban
on gold/copper concentrate exports.
Acacia operates three gold mines in Tanzania, accounting for
30 percent of its revenues.
The miner said in January it was in preliminary merger
discussions with Canada's Endeavour Mining, but analysts said
the export ban could jeopardise a deal.
"With no clarity over a type or timing of a resolution, we
fear Acacia shares will be suppressed," said Jefferies analysts,
downgrading the stock from 'buy' to 'hold'.
"In our opinion, with a spike in jurisdictional risk in
Tanzania, merger discussions with Endeavour are at the very
least going to be delayed," said Jefferies.
(Reporting by Helen Reid; Editing by Mark Trevelyan)