Markets & Finance

On the Move: Schering, BP, STM


From Standard & Poor's European MarketScope

France

CARREFOUR was up €0.40 to €38.02. Klepierre has acquired the company's Assago Center in Milan for €152 million.

TOTAL (TOT) was down €2.20 to €217.00. The company's office in Venezuela faces closure for up to two days over accusations that it has violated national taxes. The government had priced the debt at more than US$3 billion. Meanwhile, oil prices extended their rally, with West Texas Intermediate crude breaking the $60 a barrel mark to trade at $60.98 at midday. Meanwhile, the company has won a contract from the French government to build a wind farm. Separately, OPEC will meet in Kuwait on Monday, and is expected to maintain current quotas.

SUEZ (SZE) was down €0.10 to €24.65. The company has reportedly denied being interested in acquiring Cegelec, a former subsidiary of Alstom, according to Boursorama.com. the company had been previously linked to Cegelec by a report in Les Echos.

STM (FR) (STM) was down €0.16 to €15.53. Intel (INTC) slipped on narrowed fourth-quarter forecasts. Intel said it expects fourth-quarter revenues in the range of $10.4 billion to $10.6 billion, vs. a previous $10.2 billion to $10.8 billion.

Germany

SCHERING (SHR) was down €1.62 to €54.91. The FDA has extended the review period for YAZ, the company's new oral contraceptive. The company now expects a decision from the FDA in the first quarter of 2006, with YAZ available in first half of the year. Merck Finck said it is quite positive that the company did not receive an approvable letter asking for additional information and that just the review period was extended, as a potential approval will, thus, only be slightly delayed. It rated the stock a buy. In another development, the company may have to pay €1 billion to keep the exclusive rights to market multiple sclerosis treatment Betaseron. The company is in negotiations with Betaseron inventor and producer Chiron (CHIR), majority-owned by Novartis (NVS). The company could lose its exclusive marketing rights if it doesn't strike a deal by the end of January, according to news reports.

DEUTSCHE BOERSE was down €0.02 to €88.05. LSE rejected the Macquarie Bank bid outright, arguing that it fundamentally undervalues the London Stock Exchange and lacks strategic and commercial credibility. Macquarie set an indicative cash offer of at least £5.80 per share yesterday. The Australian bank asked the LSE to open its books to help further discussions.

PORSCHE was down €9.95 to €628.50. The CEO didn't rule out increasing the company's stake in VW. Wiedeking criticized VW's lack of vision for where the carmaker wants to be in five years' time. Porsche's ten-strong strategy team is supposed to help develop a strategy for VW according to an interview in Handelsblatt. On the broker front, Cheuvreux lifted its target to €660 from €510and maintained an underperform rating.

SIEMENS (SI) was up €0.93 to €67.80. The company plans to sell part of its troubled Siemens Business Services (SBS) unit to Fujitsi Siemens Computers, Sueddeutsche Zeitung reported. A source familiar with the situation told Reuters the joint venture may take over the hardware maintenance division of the company's SBS.

Netherlands

VNU was up €1.33 to €28.60. Two private equity firms are considering bids for the company, the WSJ reported. The newspaper said the bid could surpass the company's market value of about $8 billion.

ROYAL DUTCH SHELL (NL) (RDS) was down €0.28 to €26.82. Crude oil prices surged amid rising concerns of unusually cold weather in the northeast U.S.

Nordics

VOLVO was up SEK9.50 to SEK364.50. The company won an order for 2,000 B6R buses from Shanghai Ba-Shi Industrial. Half of the buses are due for delivery by summer 2006, with the remaining 1,000 due the following year.

Switzerland

NOVARTIS was up CHF1.00 to CHF69.00 on the news that Schering may have to pay to keep the exclusive rights to market multiple sclerosis treatment Betaferon.

ROCHE was down CHF1.50 to CHF205.10. The company was said to have reached agreements with 15 generic drugmakers regarding the manufacture of Tamiflu generics. Separately, HSBC upped its price target to CHF233 from CHF209, and retained its overweight rating. The broker cited new treatment approaches in rheumatoid arthritis.

United Kingdom

BRADFORD & BINGLEY was up £0.20 to £4.04. Shares rallied on high expectations. The company anticipates underlying pretax profit for the fiscal year to be comfortably ahead of the consensus, at the top of the range of analysts' forecasts.

BP (BP) was down £0.11 to £6.40. Merrill Lynch upped its target by 4% to £7.00, and retained a buy rating. Shares headed lower as Kuwait sold part of its stake at £6.45 per share. The Kuwait Investment Office (KIO) in London has entered into an agreement with a consortium of banks to dispose of 185 million shares of the company, amounting to 0.89% of the company 's issued share capital. The KIO will continue to hold approximately 2.56% in the company. It explained that the sale was part of a portfolio rebalancing exercise and noted that KIO's remaining shareholding is subject to a lock-up period of 90 days from Friday.

BAA was down £0.04 to £6.44. The company said the planned second runway and associated facilities at Stansted Airport is now estimated to cost almost 30% less than the cost of the option shown in the Government's White Paper on Air Transport. The project, known as Stansted Generation 2, is now estimated at around £2.7 billion vs. a Government estimate of around £3.7 billion.

INTERCONTINENTAL HOTELS (IHG) was up £0.06 to £7.99. The company will sell approximately 79 million Britvic at an offer price of £2.30 per share, equivalent to total proceeds (before deducting any commissions or expenses) of approximately £182 million. The company said this represents approximately 77% of its holding in Britvic in conjunction with the company's floatation. 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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