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UK’s Babcock (BAB) sells its power business to M Group

By Angela Barnes

08:34, 24 December 2021

File photo of a Babcock International logo on a mobile phone
Shares of Babcock International went up after the sale announcement – Photo: Shutterstock

British engineering services firm Babcock International (BAB) announced on Friday the completion of the sale of its power business to M Group Services for £50m ($67m).

In a press release, the business, which provides engineering services to overhead line electric transmission and distribution industry, said that following the sale, it would form part of Morrison Energy Services, a division of M Group Services.

Its clients include National Grid, Scottish Power Energy Networks and Western Power Distribution.

Company profit

The company is part of Babcock’s Land sector, which reported total revenues of £70m for the year ended March 2021.

AMZN

147.02 Price
+0.760% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.14

NVDA

467.55 Price
+0.310% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.14

COIN

134.12 Price
+7.790% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.25

GME

15.36 Price
+5.850% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.16

It also reported profit before interest and tax of around £7m. 

Babcock chief executive, David Lockwood, commented on the sale of its power business: “I’m delighted that we continue to make real strides in delivering our plan of streamlining the Group. The business is a great fit for M Group Services, and I wish them every success as they continue to grow their operations,” Lockwood said.

Shares in the company were up 0.97% on the London Stock Exchange on Friday morning.

Read more: Flutter Entertainment (FLTR) bets big on Italian Sisal for £1.62bn

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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