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UK's Royal Mail seals place in FTSE 100 after listing

Source: Reuters - Wed, 11 Dec 2013 06:47 PM
Author: Reuters
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* Royal Mail enters Britain's top share index

* Ashtead also joins FTSE 100 after bullish guidance

* Vedanta the latest miner to drop from FTSE, Croda also out (Adds details)

By Alistair Smout

LONDON, Dec 11 (Reuters) - Newly-privatised Royal Mail Group will join Britain's top share index following a strong share price performance since its stock market debut, FTSE confirmed on Wednesday, two months to the day after its listing.

The postal firm has nearly doubled its share price since its high profile Oct. 11 listing, with the government forced to defend itself against criticism that it sold the company too cheaply.

Around 40 million Royal Mail shares should change hands in trade worth nearly 250 million pounds ($410 million) in the fortnight around the quarterly reshuffle, analysts said.

It is to be joined in the FTSE 100 by Ashtead , which will also make its debut in the top share index. The industrial company confirmed its promotion after a 3.7 percent rally on Tuesday when it guided its profit expectations higher for the year.

The companies will replace Indian miner Vedanta, and specialty chemicals maker Croda in the index.

Vedanta will become the fifth stock from the basic resources sector to leave the index so far this year, following Kazakh miners Kazakhmys and ENRC, steelmaker Evraz and Polymetal in a year that has seen miners in particular suffer due to weak commodity prices. Vedanta has dropped out after a seven-year stint as a blue chip.

Vedanta and Croda will join the FTSE 250 index for mid-caps, along with freshly listed Merlin Entertainments and estate agents Foxtons. JD Sports Fashion , mobile phone retailer Carphone Warehouse, building supplies group Grafton and Riverstone Energy will also join the index.

Leaving the FTSE 250 are bakery firm Greggs, Hochschild Mining, carpet retailers Carpetright , LED makers Dialight, newspaper distributor John Menzies, defence equipment maker Chemring and Schroder Asia Pacific Fund.

The changes take place after market close on December 20 and take effect from the start of trading on December 23. (Editing by Andrew Roche)

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