Scottish Power Rises on Upgrade
From Standard & Poor's European MarketScope
Scottish Power gained 3.11% Monday after Dresdner KW upgraded the shares to add from hold, and raised its target price to £5.80 from £5.00. The broker says acquiring Scottish Power would finally gear up E.ON's balance sheet, and add growth. It believes E.ON could afford to bid up to £6.650 and still meet its acquisition criteria. Scottish & Southern is keen to acquire the company, but will wait for E.ON to make an offer before making a move, according to The Sunday Telegraph.
Punch gained 1.83% after news that it is in detailed talks with Mitchells & Butlers over a £2.50 billion joint bid for rival Spirit Group, according to The Sunday Times. The report adds the talks are said by insiders to be fluid,and notes City regulators may ask both groups to clarify their intentions to the stock market. Mitchells & Butlers shares rallied 4.09%.
Centrica declined 0.1% on word that Malaysia's Petronas has built a 4% stake in Centrica, but says it is not about to take the company over, the FT reports. The report says the news came as Centrica put its gas and electricity bills up by 14.2%, blaming rising natural gas prices, and said its profits for the year would be at the lower end of expectations. The company is considering the sale of its telecoms arm OneTel, after receiving several approaches from potential buyers, The Sunday Times reports.
Partygaming declined 7.28%. It is believed to have appointed Deutsche Bank to advise it on the potential purchase of Empire Online, which provides marketing services to internet poker sites, according to the FT, which notes Empire is currently in talks with Sportingbet about a deal that could value it at £700 million.
L'Oreal gained 0.23%. The company could be considering buying into the luxury cream business including peer groups such as Clarins, PPR's Yves Saint Laurent Beaute and Estee Lauder's Clinique to expand growth, according to Le Journal des Finances.
Alstom declined 1.09% after a report published by La Tribune said it is selling its power conversion arm to Barclays Private Equity for an estimated €500m, according to a report published by La Tribune. Both Alstom and Barclays have refused to make any comments.
Allianz declined 1.92% after news that it is to buy the minority interest in RAS - 44% for €5.7 billion, which is a 13% premium over six month average. RAS sgareholders will receive €19 per ordinary share and €26.5 for each RAS savings share. Allianz's dividend will raised 14% to €2 in 2005. Allianz is also adding several new board members in order to spread its geographical influence. RAS rallied 7.1%.
Gas Natural declined 0.71% after Expansion reports that the company will have to pay as much as €60m to dismiss Endesa's executives, should Gas Natural succeed in its takeover.
Crucell gained 3.76% Monday. Kempen notes there is a lot of interest now from big pharma in manufacturing flu vaccines, as the flu market may more than double to US$3.7 billion by 2010. Furthermore, Kempen says capacity issues are driving them to do acquisitions. At around US$6-US$7 a shot, the broker says a lot of money is at stake if one can supply more. It believes Crucell is best positioned to address the capacity issues, as its PER.C6 technology should allow for production of large quantities of flu shots. The broker maintains its buy recommendation on the shares with a €20 target.
Pahjola gained 6.27% after news that Oko Bank has paid €1.2 billion for a majority stake in Pahjola through the purchase of its Suomi Mutual and Ilmarinen, which have been instantly transferred to Oko, giving the Finnish bank a 58.5% stake in the company. Oko also made a tender offer for the remaining stock at the same price per share (about €13.35). Oko climbed 6.27%.