Markets & Finance

Allianz Shares Rise


From Standard & Poor's European MarketScope

France

JC Decaux was up €0.37 to €18.48. The company won a 20-year contract covering 300 bus-shelters in the Japanese city of Kobe. Financial details of the deal remain undisclosed.

Casino was up €0.75 to €58.55. The company is selling shares worth between €214 million and €230 million of its Mercialys retail property subsidiary. The offering price ranges between €15.62 million and €18.63 per share, valuing Mercialys at between €1.1555 billion and €1.322 billion.

BNP-Paribas rose €1.40 to €62.50. CEO Baudoin Prot denied today being interested in the SocGen dossier, in an interview with the French daily Le Figaro. Prot said this operation carried considerable risks after a report by UBS published on Monday put the story back in the rumor mill. Meanwhile, Goldman Sachs upgraded the shares to outperform from in-line.

Germany

Munich Re gained €1.44 to €94.56 as hurricane losses were not as high as feared. For Hurricane Katrina, the company sees a possible burden of €1.1 billion gross and €500 million in the red after retrocessions and taxes. It sees the overall market loss at up to US$30 billion. Munich Re says its Katrina losses could rise to €1.3 billion if insured losses are higher. Its loss burden from Rita could be around €230 million gross; €150 million after retrocessions and tax. Altogether, the company's bill for hurricanes Katrina and Rita will be net €650m. The company added that it can now only achieve its 2005 earnings goal by selling its stake in HVB.

Allianz rose €2.76 to €110.11. The company may reorganize its Dresdner unit by merging the investment bank of DrKW with the corporate client division of Dresdner Bank. An article in Frankfurter Allgemeine Zeitung cites CEO Diekmann on the matter. This goes against what the company's CFO said on Sept. 12. On the broker front, Deutsche upgraded the shares to buy from hold, lifting the target to €127 from €115. The broker says the valuation does not reflect franchise quality and benefits of ongoing operational improvements.

DaimlerChrysler rose €1.02 to €44.95. The company announced job cuts of 5,000 at its Mercedes unit.

Netherlands

Versatel was up €0.01 to €2.20. The company says it is pleased that the Enterprise Chamber denied the request from Centaurus and other shareholders to order provisional measures in relation to Tele2's €2.20/share recommended cash offer for the company Adds that the offer process will now go ahead as planned. Note: the company is due to hold an extraordinary general meeting on Thursday.

Nordic

H&M rose SEK2.00 to SEK272.00. The company reported a third quarter pretax profit at SEK3.324 billion, beating forecast in a Reuters' poll at SEK3.15 billion, up from SEK2.45 billion a year ago. Third quarter sales were SEK15.158 billion, higher than expectations of SEK14.87 billion, up from SEK12.84 billion last year. Gross margin also beats expectations, landing at 58.8%, up from 57.4% previously, vs. 55.9% in the year-earlier quarter. The company says it will open 70 new stores and close 10 in the fourth quarter. Separately, German retail sales will decline by more than expected this year, to a drop of 1% in nominal terms from a drop of 0.5%, due to the political uncertainty, says the HDE retail association.

Spain

BBVA gained €0.25 to €14.47. Speaking at a conference in Mexico, the company's chairman Francisco Gonzalez said that 2H profit is likely to beat that ofthe first half. He also said that he sees important opportunities for the company to make acquisitions in Europe but there is no hurry. He added that acquisitions must create value and make strategic sense. He added that the company will obtain a gain of over €600 million from its investment in BNL. Urquijo ByV says it prefers Santander to the company, partly because of the acquisition risk. Keeps accumulate with €16.2 target.

Switzerland

UBS was up 1.60 Swiss francs to 112.10 francs. The company confirmed Monday's report in the China Business Post that it is investing around US$210 million in Beijing Securities. In return, the company will restructure the operations of Beijing Securities into an entity that it will manage and own a 20% stake in it. The newly formed securities company would provide, among other services, domestic debt and equity underwriting in China. Additionally it will be able to conduct secondary trading and distribution in both equity and debt markets and domestic wealth management services in China.

United Kingdom

Compass Group was down £0.20 to £2.12. The company confirms decision to focus on its core contract catering operations and, in this context, sell the UK and Continental European travel concessions operations (SSP). It also simplified its management structure, cutting the number of operating divisions to four from eight. Compass says overhead savings announced in May has been accelerated with the full £50 million target being achieved in 2006. It says second half trading has continued the trends seen in the first half and has been strong in North America and the rest of the world. The company expects operating profit (before goodwill and exceptional items) for the full fiscal year at about £710m.

HMV was down £0.23 to £2.15. The retailer says total group sales were flat in the first 21 weeks of the financial year, which commenced on May 1, with same-store sales down by 4.4%. It says conditions for high street retailing in the UK deteriorated during the period, particularly in London and other major city centers following the terrorist bombings in July. In this context, the company says it is aggressively managing variable costs. It says that, despite increases in rents and rates, it expects comparable costs to be approximately 2%-3% below last year.


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