Markets & Finance

European Movers: Rio Tinto, Danone, Heineken


Plus more European stocks making headlines Wednesday

UK

AVIVA was down £0.16 to £7.20... Unveils plans unlock value, drive growth - The company says in UK

will grow long-term savings new business sales at least as fast as the market, while maintaining margins. In Europe, the company will grow long-term savings new business sales by an average of at least 10% a year to 2010, while growing new business profit at least as fast. In North America, plans to double the volume of US life new business sales within three years of the acquisition of AmerUs, while maintaining margins. Expects Asia Pacific to grow long-term savings new business sales by an average of at least 20% a year to 2010. Plans to deliver additional annualised cost savings of £350 million by the end of 2009.

RIO TINTO was down £0.63 to £43.56... third quarter prod. nos in line, refined copper up 30% - The company says third quarter refined copper output up 30%; mined copper down 6%; iron ore up 2% and aluminium production flat. Following the quarterly figures, UBS says the numbers are basically in line with expectations.

BRITVIC was up £0.22 to £3.40... fiscal profit to meet market expectations - The company says is confident that fiscal profits will be within the range of current market expectations. Reports robust trading in the 52 weeks to 30th September 2007, with branded revenue growth of 3.7% to £702.5 million, driven by stills up 3.9% and carbonates up 3.0%.

France

DANONE was up €1.94 to €56.15... Reports third quarter sales up 3.9% - the company posts third quarter sales growth of 3.9%; with third quarter Dairy sales growth of 11.9% and third quarter Beverages sales down 11.7%. Confirms fiscal 2008 organic growth target of 6-8%.

CARREFOUR was up €1.39 to €49.10... posted third quarter sales up 5.5%/To sell Italian stores? - the company says third quarter group sales rose 5.5% (CER), or 5.8% on current fx, to €23.109 billion. Confirms fiscal sales guidance of faster sales growth (CER) than 2006. the company is selling 17 wholesale outlets in Northern Italy and 11 supermarkets in the southern region of the country and may raise more than €1 billion, Il Sole-24 Ore reports.

THOMSON was up €0.42 to €11.91... Exits from remaining audio-video businesses - the company has signed a definitive agreement to sell its consumer electronics Audio-Video (AV) activities outside Europe to Audiovox Corporation. Completion of the sale is expected to take place on 31 December 2007. In addition the company says it will progress with closing its European Audio/Video and Accessories activities. The company says the US sale and European closure will cut second half earnings by €135 million.

Germany

MUNICH RE was down €1.08 to €135.46... To acquire Midland Company for US$1.3 billion - the company will acquire all of Midland's outstanding stock for US$65 in cash per share. Midland is a provider of specialty insurance products and services through its wholly owned subsidiary, American Modern Insurance Group. An analyst comments that the company does have a large business in the US (American Re) but a poor track record in doing deals there, so the news may be taken badly by the market. the company goes on to say that it will divest its US transport business, worth US$100 million, as soon as possible, and that it is sticking to its plans for dividends and buybacks after the takeover.

SOFTWARE AG was down €1.85 to €62.41... third quarter in range of the company's expectations - CFO says. the company's stock slid after warning analysts to rethink their assumptions on exchange rates and timing of licence bookings.

WACKER CHEMIE was down €2.53 to €157.46... Market talk of the company guiding lower on US$. But refuting emerges, with the company on a roadshow with UniCredit, trader notes.

FMC was up €0.42 to €36.29... Extension of kidney drugs use in US eyed - The FDA reportedly said a group of kidney disease drugs may be approved in a broader US patient population after the likes of the company presented a case for extending use of these drugs.

Italy

ENI was down €0.27 to €26.41... Goldman Sachs trims target to €31 from €32, rates buy. Lowers EPS estimates to €2.54 from €2.61 for fiscal 2007 and to EUR 2.87 from €2.93 for fiscal 2008. ABN Amro downgrades to sell from hold. Lowers target to €23 from €26.20. Believes the company will invest significantly more in its upstream activities than guidance suggests, primarily due to cost pressures. Revises spending estimates accordingly. the company has won a 25-year extension to its oil & gas contracts in Libya but will face tighter commercial terms under the new deal, writes the FT. Paolo Scaroni told the FT that the company exchanged new terms more favorable for Libya than old contracts for an extension of old contracts and an expansion of activity, particularly in gas, which was a crucial point for the group.

Netherlands

ASML was up €1.85 to €24.35... Bounces on solid quarterly earnings - the company's third quarter net profit topped expectations at 4.3% higher q/q to €168 million. the company received orders for 40 machines in third quarter, rebounding from second quarter. Sal Oppenheim upgrades to neutral from reduce.

HEINEKEN was up €0.50 to €46.47... In talks with Carlsberg to form consortium - the company and Carlsberg say they are in talks regarding the formation of a consortium to make an offer for Scottish & Newcastle. Any offer, if made, would likely be in cash. The two companies say it is currently intended that Carlsberg would acquire S&N's interest in BBH, France and Greece, and that the company would assume control of its business in the UK and other European markets. No formal approach has been made, and the two groups add that there can be no certainty that an offer will be forthcoming.

Nordics

ERICSSON was down SEK0.32 to SEK19.78... The brokers cut en masse - Following the company's profit warning yesterday brokers cut ratings and target en masse. Lehman downgrades to equal weight vs overweight and cuts target to SEK22 vs SEK30. JP Morgan downgrades to neutral vs overweight. ING downgrades to hold vs buy and cuts target to SEK22 vs SEK35. UBS lowers target to SEK21 vs SEK29, keeps neutral. Citigroup cuts target to SEK28 vs SEK35, keeps buy. ABN Amro lowers target to SEK21 vs SEK24, keeps hold. Goldman cuts target to SEK22 vs SEK28, keeps neutral. Cheuvreux cuts target to SEK20 vs SEK24, keeps underperform. Morgan Stanley lowers target to SEK27 vs SEK33, keeps overweight.

TIETOENATOR was up €1.59 to €17.69... WestLB ups to add vs hold and raises target to €20 vs €18. Points out that the company said it will not make its target of fiscal operating profit of €124 million. The broker highlights that, the average expectation was c.€100 million vs broker at €94 million. The pre-release of third quarter numbers gives revenues as €404 million and EBIT as €25 million. Consensus was €385 million and EUR 18 million, respectively. The company says this is, relative to market expectations, not a warning but a statement that things have recovered very well. The company says the release is dressed up as a technical warning because the CEO is being fired 'due to the company's financial performance'.

Spain

SOGECABLE was up €1.04 to €27.67... nine months EBITDA tops forecasts - the company reported nine months EBITDA of €247 million and net profit of €50.3 million. Numbers are ahead of consensus. The company says third quarter revenues were €359.8 million. Adds Digital+ subscriber base sits at 2.046 million.

TELEFONICA was up €0.28 to €22.40... Anatel delays Telco talks / Broker action - Lehman Brothers raises target to €22 from €17, equal weight. Increases 2008 EPS estimates by 4% to reflect better performance expectations across the board, particularly in LatAm. Anatel, the Brazilian telecoms regulator, will not discuss the entry of the Telco consortium into Telecom Italia today, reports La Repubblica. The company says the decision will be pushed back to the end of the month. The paper adds the company's Chairman Cesar Alierta has flown to Brazil to try to resolve the issue. Meanwhile, Argentina's antitrust authority is reportedly assessing the impact on its telecoms market of the company buying an indirect stake in TI.

Switzerland

UBS was down CHF0.15 to CHF66.35... CCR deal announcement expected next week - The FT writes that the company is finalising a deal to buy Commerzbank's French asset management arm, CCR, and that the two sides could make an announcement as early as next week. The company says the deal is expected to value CCR at about €400 million.


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