Markets & Finance

European Movers: Northern Rock, AXA, Postbank


Plus more European stocks making headlines Monday

UK

NORTHERN ROCK (NRK.L) was down £0.22 to £1.11... UK seeks EU nod / Offers below Friday close - The UK finance ministry says that it may have to get the go-ahead from the EU to rescue the company Any ongoing State Aid measures beyond those currently in the course of notification to the European Commission would represent a potential risk to value and execution, because the European Commission may impose adverse conditions and may take additional time to approve such State Aid, the Treasury says in a statement. the company says current proposals are materially below the market price at the close of business on 16 November. Adds expects to receive further expressions of interest in the next few days. The company says proposals received are of two types: proposals to invest and proposals to acquire parts of the business. The company says the value to shareholders from any of the proposals remains highly uncertain.

STANDARD CHARTERED (STAN.L )was up £0.46 to £17.10... Temasek rejects Chinese approach - China's three leading banks have approached Temasek, the Singapore state investment agency, to discuss the possible acquisition of its 17% in the company , the FT writes. People familiar with the matter said officials of Industrial and Commercial Bank of China, Bank of China and China Construction Bank had in recent months made "informal and discreet" contact with senior Temasek personnel about a possible deal, the paper adds. Temasek is understood to have rebuffed the advances because it considers its stake in the company to be of financial and strategic importance, it writes.

BARRATT DEVELOPMENT (BDEV.L) was down £0.25 to £4.80... Maintains half yr op margin target - Expects operating margin for the half year to be broadly in line with the guidance given at the preliminary results. The company says continues to maintain a strong forward order book, currently at £1.8 billion. Adds that as anticipated interest rate hikes, the recent liquidity squeeze and the cost of mortgage finance, has led to a tightening of the UK

housing market.

France

FRANCE TELECOM (FTE) was up €0.67 to €26.61... ING lifts target to EUR 29.50 from €25.00, keeps buy. Believes management has reinvigorated growth in all key business areas, culminating in the recent guidance upgrade. In ING's view, the current discount to peers is not justified in light of the stronger earnings momentum and visibility.

AXA (AXA) was down €0.86 to €26.28... Friends Provident rumours - The UK

's Friends Provident's days as an independent group are numbered as it is understood that insurance giants Zurich, Old Mutual and the company are all preparing bids for the firm, according to the Sunday Express.

CREDIT AGRICOLE (CAGR.PA) was down €1.05 to €22.22... Buys 14.99% stake in Bankinter - the company buys a 14.99% stake in Spain's Bankinter at €13.60 per share, totalling €809 million. The company says the company now owns 19.53% of Bankinter. Adds it has bought its stake from Ramchand Bhavnani. the company says the purchase is part of its 'strategy aimed at strengthening its position in the Spanish and European markets.' ING thinks the company should make a full bid for Bankinter.

Germany

POSTBANK (DPBGn.DE) was up €1.80 to €54.49... Banks eyeing the company - Several banks, including those from abroad, are interested in acquiring the company from Deutsche Post World Net, even though it is not for sale right now, according to Frankfurter Allgemeine Zeitung.

DEUTSCHE TELEKOM (DT) was up €0.36 to €15.17... Talk of the company to pay higher dividend - Traders note shares rise on market talk that the company 's management wants to pay a higher dividend.

Italy

ALITALIA (AZPIA.MI) was up €0.00 to €0.86... Deadline for offers for govt stake approaches - The deadline for binding offers for the government's 49.9% stake in the company is 20 November. Chairman Maurizio Prato will then have until 23 November to select a partner for the company from this final short-list. An offer is expected to be tabled by AP Holding (Carlo Toto) in alliance with Intesa SanPaolo. Air France-KLM and Lufthansa are also expected to extend separate offers.

BENETTON (BNG.MI) was up €0.24 to €12.65... The brokers positive on stock - Goldman Sachs resumes with buy and sets target at €15 (17% upside). Estimates EPS of €0.78 for fiscal 2007 and €0.96 for fiscal 2008. the company , Folli Follie and Inditex are on Goldman's Conviction Buy List. Cheuvreux upgrades to selected list from outperform and raises target to €15.00 from €14.40. Points out new management might trigger more aggressive expansion. The company says there is significant room to increase margins and hidden real estate value.

Netherlands

GROLSCH (GROLc.AS) was up €20.35 to €47.25... SABMiller intends €48.25/sh bid for the company - SABMiller intends to make a €48.25 per share offer for 100% of the company 's outstanding shares.

Nordic

VOLVO (VOLV) was down SEK7.50 to SEK99.75... Goldman cuts from conviction buy - Goldman cuts from Pan-Europe conviction buy list, keeps buy rating, but trims target to SEK138 vs SEK145. The broker takes off conviction buy list as it argues the company 's non-residential construction exposure makes it particularly vulnerable to any potential sharp slowdown in the economy in Europe and North America. While currently still positive, growth in this end-market typically turns negative in a sharp economic slowdown, the broker says .

ELECTROLUX (ELUXb.ST) was down SEK5.75 to SEK107.75... Goldman adds to conviction sell - Goldman adds to Pan-Europe conviction sell list, with sell rating intact, and cuts target to SEK90 vs SEK120. The broker downgrades 2008 EPS estimate by 16% to reflect higher raw material cost inflation. The broker now forecasts a 2008 EBIT (Pre-NRI) of SEK4.752 billion which is 10% below the post third quarter07 consensus of SEK5.312 billion (according to SME Direct).

Switzerland

SWISS RE was down CHF10.00 to CHF87.55... Expects CHF1.2 billion mark-to-market loss arising from credit underwriting activities following the market deterioration in October. The company reiterates over the cycle targets. The company says the loss arises its from exposure to two, related credit default swaps written by its Credit Solutions unit that provide protection for a client against a fall in the value of a portfolio of assets.

SWISS LIFE was up CHF5.00 to CHF291.75... SNS Reaal buys units - SNS Reaal will buy the Dutch and Belgian businesses from the company for a total consideration of €1.535 billion, with an initial purchase price of €1.445 billion and a price adjustment of up to €90 million.

RICHEMONT was up CHF1.25 to CHF74.25... Considers restructuring / Target changes - the company says it is considering restructuring its business to split its luxury goods operations from its other interests, which include the interest in BAT. The company says this reflects impending changes in the legal environment in Luxembourg. Currently, the company has a 19.3% stake in BAT. In broker action, Landsbanki Kepler increases target to CHF100 from CHF90, reiterates buy. Deutsche Bank lifts its price target to CHF77 from CHF74, maintains hold. JP Morgan lifts its target to CHF85 from CHF84, reiterating overweight. Lehman cuts target to CHF72 from CHF74, underweight. Goldman raises target to CHF91 from CHF88.40; reiterates buy.


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