Enterprise Inns, Ferrexpo set to exit FTSE 100

Wed Sep 3, 2008 1:18pm BST

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By Simon Falush

LONDON Sep 3 (Reuters) - Pubs group Enterprise Inns (ETI.L) and Ukrainian iron ore miner Ferrexpo (FXPO.L) look set to exit the UK's FTSE 100 .FTSE index later this month after a quarterly rejig, data showed on Wednesday.

Declining beer sales and a series of negative broker notes have pushed Enterprise Inns' value down by over 45 percent this year, while weaker metal prices have hit Ferrexpo.

British free-to-air broadcaster ITV (ITV.L) and retailer Carphone Warehouse (CPW.L) are also in danger of leaving the UK's benchmark index, according to the data.

"Enterprise Inns and ITV are suffering from structural changes to the UK consumer that are seeing consumers use terrestrial TV and pubs less," said Colin McLean, managing director at SVM Asset Management in Edinburgh.

He added that the credit crunch and economic slowdown are denting spending at pubs as consumers tighten their belts and hunt for bargains at supermarkets.

Firms expected to enter the UK's blue-chip index are software group Autonomy AUTN.L and satellite operator Inmarsat (ISA.L).

The recent recovery in the dollar, which has seen the pound fall to $1.7705 from over $2.01 in July GBP= have played a part in the possible changes, investors said.

"Autonomy has benefited from the strength of the dollar, as a large proportion of its sales are into the U.S.," said McLean.

Bus and train operator Stage Coach Group (SGC.L) and Britain's biggest household goods retailer Home Retail Group (HOME.L) are also possible promotion candidates.

Index compiler FTSE will formally announce the changes to the FTSE UK index series after the market close on Sept.10.

The review uses the closing prices from Sept. 9 but the changes have to be confirmed by a FTSE committee the next day.

The index changes will be implemented at the start of business on Sept. 22.

Companies outside the FTSE 100 that grow to rank among the 90 largest by market capitalisation are automatically promoted, while the FTSE 100 firms with the lowest value or that fall to 111th spot or below drop into the FTSE Midcap 250 index .FTMC.

(Editing by Erica Billingham)

((simon.falush@reuters.com. +44 20 7542 7681) Reuters Messaging: simon.falush.reuters.com@reuters.net)) Keywords: MARKETS FTSE REJIG . Keywords: MARKETS FTSE REJIG =2

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