Markets & Finance

European Movers: Rio Tinto, Air France-KLM, Alitalia


Plus more European stocks making headlines in Tuesday's market

UK

SHIRE PHARMA Up GBP0.61 to GBP10.59... UBS sees AstraZeneca as possible bidder - Following speculation of a large pharma group bid interest in Co., UBS says it does not rule out interest from AstraZeneca interest, even at around 40% premium, as AstraZeneca has growth challenges. Broker calculates AstraZeneca can pay up to GBP14.25 per share and create value.

LEGAL & GENERAL Up GBP0.03 to GBP1.23... FY EEV op profit down 26%, misses estimates - Co. reports FY EEV operating profit of GBP912m, -26%; IFRS profit GBP718m; FY DPS 5.97p, +7.6%; LGIM new business GBP53m; LGIM FuM GBP297bn; Investment management op profit GBP155m, +17% on IFRS basis. Takes GBP269m charge for longevity strengthening. Says GBP1bn share buyback ongoing, with GBP516m completed as at 29 February. Outlook is positive for Risk unit and sees further market share growth in protection. Panmure cuts target to GBP1.35 from GBP1.50, retains hold following a robust set of FY figures. Says target cut reflects the negative sentiment on the UK life sector rather than the results which should be seen as positive.

TUI TRAVEL Up GBP0.18 to GBP2.62... Confident will hit FY tgts, trading strong - Based on the current outlook, Co. says is confident that will meet expectations for the year. Adds current trading is strong with UK Mainstream sales up 4% for Winter 2007/08 and sales up 9% for Summer 2008 with 20% less product left to sell y/y, with particularly strong performances in medium and long haul. Says 1Q underlying loss before tax GBP60m, -51%. Adds plans to deliver GBP150m of synergies by 2010 are well on track.

RIO TINTO Up GBP2.09 to GBP52.70... Chinalco could raise stake in Co. - Chinalco's president has reportedly said that in the current circumstances, the possibility of his company raising its stake in Co. is higher than cutting it. Co. and BHP Billiton have been banned from selling iron ore in China, The Times writes citing reports.

FRANCE

ARCELOR-MITTAL Up EUR 0.79 to EUR 49.78... Nucor takeover would raise antitrust issues - analyst - Traders report market rumour of Co. interest in US steel player Nucor, which has a market cap of c.US$20.6bn. Further rumour suggests Co. has made a friendly US$100/sh bid - it currently trades at c.US$71.40/sh. Co. offers no comment. One market source is sceptical, suggesting that in the current market environment, it is a rumour and nothing else. A US-based analyst says that even if there were something more to this rumour, such a takeover would raise serious antitrust issues in the US due to the size of Nucor. In other news, Co. refused to comment after press reports that its CEO plans to buy Bulgaria's Global Steel, which is run by Lakshmi Mittal's brother. US$4.5bn, The Sunday Times reports.

AIR FRANCE-KLM Up EUR 0.75 to EUR 16.03... Alitalia deal backed by caretaker government - At a meeting last night, the caretaker Italian government gave its approval to Co.'s all-share offer of EUR 139m for Alitalia (1 Co. share for 160 Alitalia shares), though union opposition persists, Reuters reports.

EDF Down EUR 0.63 to EUR 57.61... British Energy and Distrigas in sights - press - The Times says Co., as well as Germany's RWE and E.ON, are thought to be the leading contenders for British Energy. The paper adds Spain's Iberdrola is also believed to be in the running. Notes Co. has been involved in collaborative discussions with British Energy for several months. Edison, along with Co. and E.ON, will bid for the Belgian utility Distrigas, according Il Sole 24 Ore. The paper reports that Edison has presented a binding offer for a 57.25% stake in Distrigaz. Explains that Edison, which is selling Distrigaz due to its merger with GDF, is scheduled to announce by the end of the month a shortlist of two to three candidates which will need to be approved by the European Commission.

TECHNIP Down EUR 0.90 to EUR 51.65... JP Morgan downgrades to underweight from neutral, while reiterating its EUR 54.50 target. Relative to the European oil and gas sector, Co.'s shares have recovered 28% following the EUR 270m of write-downs it announced on 31 Jan 2008. Broker reminds investors of the long-term accounting risks following the Qatar announcement.

GERMANY

METRO AG Down EUR 3.69 to EUR 51.53... CEO says no break-up / Guidance softer than expected - Co.'s 2007 EBIT rose 8.8% to EUR 2.1bn on sales 10.4% higher y/y at EUR 64.3m. The outlook statement (sales +6%, EBITA before special items +6-8%) is weaker than expected. Proposes a 5.4% rise in its dividend payment to EUR 1.18 per share. Says it may sell its Galeria Kaufhof department stores, and plans to turn around its Real hypermarkets within two years.

TUI AG Down EUR 0.27 to EUR 16.87... Voices optimism about business in 2008 - saying it expects a rise in group profitability. For 2007, Co. posted earnings attributable to shareholders of EUR 175.1m versus a loss of EUR 890.3m last time. On the broker front, Equinet downgrades to accumulate from buy; target EUR 19.

WACKER CHEMIE Up EUR 10.45 to EUR 125.26... Reports 2007 profit of EUR 422m - up 36% y/y - and is optimistic about earnings in 2008. On the broker front, WestLB downgrades to hold from add.

ITALY

ALITALIA Down EUR 0.12 to EUR 0.28... Italian govt reaches agreement over Malpensa - The Italian government has reached an accord with unions and local authorities over the future of Milan's Malpensa airport. The government has also asked the airport operator SEA to drop a lawsuit against Co. At a meeting last night, the caretaker Italian government gave its approval to Air France's all-share offer of EUR 139m for Co. (1 Air France share for 160 Co. shares), though union opposition persists, Reuters reports.

FINMECCANICA Up EUR 0.98 to EUR 20.89... FY net profit fell 49% to EUR 521m - Co. unveiled that its FY net profit fell 49% to EUR 521m from EUR 1.021bn in 2006. Says that net profit, excluding capital gains, rose 49% to EUR 503m. Adds that adj EPS, stripping out extraordinary operations and minorities, rose to EUR 1.10 while sales increased 8% to EUR 13.429bn. Says EBIT rose 19% to EUR 1.084bn.

CAMPARI Up EUR 0.36 to EUR 5.50... Reports FY07 net profit at EUR 125.2m - Co. has closed 2007 with a 6.9% rise in its net profit to EUR 125.2m on higher sales. Says that board will propose a 10% increase in its dividend to EUR 0.11/sh.

NETHERLANDS

AMG ADVANCED MET. Down EUR 6.00 to EUR 40.00... Will not pay dividend - Co. says will not pay a dividend for the full year. Analysts say its FY07 figures look week with net income of US$51.6m, sales of US$1.16bn and EBITDA of US$119.4m. Co. does not provided an exact outlook for 2008.

SUPER DE BOER Up EUR 0.16 to EUR 4.32... Casino raises stake in Co. - Casino has increased its stake in Co. to 57%.

NORDIC

VOLVO Up SEK2.00 to SEK89.25... Feb truck deliveries up 52% y/y with North American -15% y/y and European +40% y/y.

ASSA ABLOY Up SEK3.75 to SEK106.75... Acquires Beijing Tianmings - Co. says it will acquire Beijing Tianmings, which is expected to achieve a turnover of c. SEK100m in 2008.

KONE Up EUR 1.07 to EUR 24.30... Books order in Portugal - Co. says it has booked an order in Portugal to deliver 22 lifts, 55 escalators and 24 ramps to new Dolce Vita Tejo shopping centre in Lisbon. The project is due to be completed in April 2009.

SPAIN

SANTANDER Up EUR 0.45 to EUR 11.62... Citigroup cuts target to EUR 16.0 from EUR 18.5 to reflect a higher cost of equity assumption and weaker underlying fundamentals in Latin America operations. Says in Mexico, Co. has seen its loan provisions increase ten-fold over the same period, with its loan loss ratio increasing from an artificially low 0.4% to 3.1%. Adds the higher loan losses have been due to a mix shift into riskier retail lending, especially credit cards. Keeps buy.

IBERDROLA Up EUR 0.22 to EUR 10.41... Possible interest in British Energy - British Energy could soon fall to one of its European rivals, The Times writes. The paper says France's EDF, Germany's RWE and E.ON are thought to be the leading contenders for Co. but adds Co. is also believed to be in the running.

SWITZERLAND

BASILEA Down CHF36.50 to CHF148.50... FDA issues Approvable Letter for ceftobiprole - Co. announces that the FDA has issued an Approvable Letter for ceftobiprole. The Approvable Letter indicates that the ceftobiprole application is approvable, subject to completion and assessment of clinical study site inspections; assessment of clinical and microbiological data provided but not yet reviewed; and further characterization of patients with diabetic foot infections.


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