Markets & Finance

On the Move: Serono, Philips, Danone


From Standard & Poor's European MarketScope

France

PERNOD RICARD was up €3.20 to €142.30. The company's CEO said the company is looking into distributing more than a third of its profits in dividends, in an interview with Le Journal des Finances.

FRANCE TELECOM (FTE) was down €0.34 to €21.18. NTL confirmed that it is in preliminary discussions with Virgin Mobile regarding a possible bid at £817 million (£3.23 per share). NTL said the approach has the backing of Sir Richard Branson, who controls 72% of Virgin Mobile. Separately, the company is interested in Fiat's (FIA) telecoms unit Atlanet, Reuters reported citing Il Corrier Economia, adding that BT Albacom, Fastweb and Eutelia are also interested in it. Meanwhile, UBS lowered its target price for the company to €26.6 from €28.2 but maintained a buy recommendation.

Italy

FIAT (FIA) was up €0.11 to €7.39. During Bologna's motor show the company's chairman revealed he is confident in the company 's recovery, domestic sources said. Among the company 's main targets for 2006 there is the relaunch of Alfa Romeo which should benefit of new models Brera and 159, sources highlighted. Separately, BT Albacom is interested in the company's telecoms unit Atlanet, Reuters reported citing Il Corrier Economia, adding that Fastweb, France Telecom and Eutelia are also interested in it.

Germany

RWE was down €0.52 to €59.33. Der Spiegel reported that the company has known for at least two years that 60% of its utility poles have material defects.

ALLIANZ (AZ) was up €1.35 to €129.00. Deutsche Bank raised its target price to €150 from €135 and reiterated its buy rating as it raised its targets across the board in the insurance sector.

KARSTADT was up €0.04 to €10.45. The company is planning to reduce debt by about €400 million by selling credit and property assets to its pension funds this year, FT Deutschland reported.

DEPFA was down €0.76 to €12.11. Moody's placed the company's ratings on review for a possible downgrade.

Nordics

DANISCO was up DKK6.00 to DKK468.00. The Danish press highlighted the company as the next big takeover in Denmark, following the TDC deal. Berlingske Tidende suggested that the company may be worth DKK27 billion. Note that the company's stocks have been in play after the European Commission approved sugar market reforms in late November, a move that is giving rise to speculation of industry consolidation.

BOLIDEN was up SEK1.50 to SEK55.00. UBS raised its target price to SEK64 from SEK54 and kept its buy rating thanks to copper prices. Note that last Friday shares shot up 3.88% after the company said it had discovered an extensive new mineralization in Garpenberg.

United Kingdom

GLAXOSMITHKLINE (GSK) was down £0.06 to £14.66. Dresdner KW upped its target price to £15.74 from £15.20 and increased its sales and earnings forecasts, with 2008, 2009 and 2010 EPS upgraded by 1%, 4% and 5%, respectively. The broker rated the stock add.

BSKYB was down £0.13 to £4.92. NTL has confirmed preliminary bid talks with Virgin Mobile in a move that would intensify competition with main rivals including the company and BT (BT), the FT reported.

VIRGIN MOBILE was up £0.32 to £3.43 on the news that NTL has confirmed that it is in preliminary discussions with the company.

Netherlands

AKZO NOBEL was up €0.38 to €39.42. UBS raised its target price to €46 from €42 and maintained a buy recommendation.

PHILIPS (PHG) was down €0.32 to €24.52. DrKW downgraded the stock to add from buy, but raised its target price to €26.50 from €25.00. While it sees no short-term obstacles, LCD pricing fell and a potential TSMC price decline remained the key medium-term risks.

Spain

EADS (Sp) was up €0.85 to €32.57. Chinese PM, Wen Jiabao, reportedly has confirmed the acquisition of 150 A320 aircraft from Airbus. The order is worth US$9.7 billion, based on catalogue prices.

Switzerland

SERONO (SRA) was up CHF26.50 to CHF1004.00. Reuters reported late Friday that the company has asked suitors to submit binding bids in a potential US$15 billion auction early next year. Sources said about 6 major drug makers, including Novartis (NVS) and Roche, have submitted indications of interest in order to get access to the company's books and are now conducting due diligence.

SWISSCOM (SCM) was up CHF4.25 to CHF415.25. The company ended talks with Eircom after the Federal Council said the company will not be entitled to acquire stakes in overseas telecom companies until the definitive adoption of the new strategic goals for 2006-2009 are set in place. Prepared by Zaida Espana, Valerie Vidal, Michael Sanderson, Mariella Mongio, Alexander Wisch, Holly Cook, Emma Stevenson, Pawan Girglani, Julien Manrique, and Rocio Opazo-Aniotz (Standard & Poor's); Alex Halperin (BusinessWeek Online)


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