European Movers: Rio Tinto, Soc Gen, Nobel Biocare
Down GBP0.91 to GBP52.41
No truth to Chinalco rumour – Source
Traders point to market talk that Chinalco may take a further 8% stake in Co. at GBP60/sh. Chinalco and US aluminium company Alcoa have already picked up a 9% stake in Co., gatecrashing BHP Billiton's takeover plans. A source says that 'there is no truth to this rumour at this time'.
Up GBP0.04 to GBP3.30
Credit Suisse ups target, estimates
Credit Suisse lifts target to GBP4.15 from GBP4, keeps outperform. Says in addition to the underlying progress, the weakening of the GBP vs both the US$ and EUR drives our estimates. Broker previously looked for US$/GBP 2.06 and GBP/EUR 1.40 and now looks for 1.97 and 1.34 respectively for FY08. Says this is the largest single upgrade driver. Also believes that the acquisition of the Brazilian j/v will be immediately modestly accretive. Raises EPS estimates for FY08 and FY09 by 4%. Adds new target has potential upside of over 30%.
Up GBP0.00 to GBP2.63
Brokers cut numbers on worsening scenario
Morgan Stanley trims target to GBP4.50 from GBP5.50; keeps overweight. Says change reflects a material contraction in peer valuations and worsening economic conditions. Citigroup lowers target to GBP3.60 from GBP5.44, to reflect weak 4Q trends and uncertainty going forward. Sees 0% UK/US organic growth, but adds that the share price reaction suggests that the market expects worse. Given that sees recessionary pressures as transient. Therefore, keeps buy.
Down EUR 3.13 to EUR 74.59
BNP will not launch hostile bid - press
BNP Paribas' board has not officially discussed a bid and would not launch a hostile attempt at a takeover, according to a source quoted by Reuters. However, a friendly approach is apparently not ruled out. Earlier in the day, a report in La Lettre de l'Expansion said BNP was preparing a bid at EUR 93 - this has been rubbished by Reuters' source. Co. announces the terms and conditions of its EUR 5.5bn capital increase. Says the subscription will be EUR 47.50 on the basis of one new share for four existing shares - a discount of some 39% vs Friday's close. Co. has also announced subprime-related write-downs of EUR 2.6bn - some EUR 600m above Co.'s previously stated position.
Down EUR 0.04 to EUR 48.07
Venezeula oil deal / GS cuts target
To receive US$834m in oil shipments from Venezuela as payment for shares of a j/v project to pump tar-like oil and convert it to light, sweet crude for export. Goldman Sachs cuts target to EUR 58 from EUR 60, keeps neutral, adjusting earnings estimates for 4Q07 and the following years to reflect a tougher environment for the refining and chemical divisions.
Down EUR 1.10 to EUR 18.38
UBS downgrades to sell from neutral and cuts target to EUR 18 from EUR 25. Says Co. and Schneider have the highest exposure to end markets at risk (construction, general industrials). Cuts EPS ests by c.10% to reflect the risks broker sees to earnings. UBS is now c.10% below consensus. Anticipates downward pressure on consensus earnings, which should impact shares.
Up EUR 0.50 to EUR 59.62
Decision on sale this spring (press)
A decision on the sale of Co. will be made this spring, according to Tagesspiegel, citing banking sources. The newspaper reckons German politicians will support a potential takeover of Co. by Deutsche Bank because such a tie-up would put pressure on Germany's regional state banks to consolidate.
Down EUR 1.26 to EUR 4.94
Still no suitor in sight / Broker downgrades
German banks met at the weekend to negotiate a rescue package for Co., but so far no solution found. Co., which nearly folded because of its subprime investments, is understood to be searching for up to EUR 2bn to stay afloat. Equinet says it would not be surprised if Co. really needed additional capital. Downgrades the stock to sell. Also downgrading the stock to sell, UniCredit thinks there are clear signs of diminished interest in a takeover of Co. in its current shape. See Broker Views & News - Germany.
Down EUR 0.70 to EUR 25.30
Shares lower on profit warning rumours - note traders.
Up EUR 2.90 to EUR 25.08
Swisscom could consider delisting - press - Swisscom could be considering delisting Co. from the Italian Stock Exchange, according to La Repubblica. The paper also writes that Swisscom is expected to acquire the minorities of Co. from end-June.
Down EUR 0.25 to EUR 1.68
Denies rumours of takeover
Co. has confirmed that it has not received any expression of interest, adding it is not studying any extraordinary operation. Italian press reported last week that Uk's BT and Vodafone showed interest in bidding for the telco.
ROYAL DUTCH SHELL (NL)
Down EUR 0.04 to EUR 23.10.
Woodside buys Co.'s stake in Australia venture
Woodside Petroleum buys Co.'s oil stakes in Australia's North West Shelf venture for US$398.5m.
Down SEK0.60 to SEK86.50
Wants Sampo CEO on the board
Co.'s nomination committee has proposed Sampo's CEO Wahlroos as board member. One London based analyst says he suspects Wahlroos will try and become chairman, adding Sampo will then have a larger interest in Co.'s running. Sampo currently holds a 10.01% stake in Co. and will not be required to pay tax on the dividend Co. pay out.
Down SEK6.50 to SEK205.00
Market talk of sector consolidation
Market talk has it Odd Reitan aims to form a Nordic wholesale group together with Co, after the Norwegian company flagged 10% in Co. last week, Dagens Industri reports.
Up NOK0.25 to NOK47.50
Italian bid to block STX
Italian public shipyard group Fincantieri wants to buy 51% in Co., Italian weekly Il Mondo writes citing investment banks. According to the paper Fincantieri has support from the Italian, French, Norwegian and Finnish governments, as they want to avert Co. being bought by STX Shipbuilding. The South Korean group holds a 39.2% stake in Co., acquired in October last year at NOK97/share.
Up EUR 0.23 to EUR 21.09... Chavez oil threats / Chukchi Sea licences
Venezuelan President Chavez has threatened to cut the supply of crude oil to the US, in response to a legal challenge mae by ExxonMobil against Venezuelan state oil company PDVSA. Co. has been awarded licences for the Chukchi Sea - northwest of Alaska - to explore for oil in 93 blocks, according to Saturday's edition of Expansion.
Down EUR 0.05 to EUR 82.55
Sees profit up 22% a year through 2010 - reportedly saying asset sales and stronger rental income are helping offset a fall in house sales. Net profit fell 29.9% last year to EUR 1.26bn when it counted 12 months of earnings from French unit Gecina.
Down CHF21.60 to CHF238.40
2007 profit misses expectations - coming in at EUR 166m on sales 11% higher y/y at EUR 666m, also short of the consensus estimate. Co. proposes conversion to registered shares an a 1:5 share split. Co.'s outlook for 2008 is revenue (organic) growth in mid-teens (lc); EBIT margin of approximately 34%. Target for 2010 is revenue growth of CAGR greater than 18%; EBIT margin of approximately 36%. Vontobel comments that guidance for 2008 is modest but more aggressive for the more distant future indicating management's confidence in the market.