European Movers: HBOS, Pernod Ricard, Allianz, AEGON
HBOS Up GBP0.25 to GBP1.72... Agrees to LloydsTSB takeover, FSA satisfied - LloydsTSB is buying Co. for GBP12.2bn. Shareholders will receive 0.83 Lloyds shares for each share they hold. The FSA says is satisfied Co. is well-capitalized bank that continues to fund its business in a satisfactory way. Welcomes takeover by LloydsTSB as it is likely to enhance stability within financial markets and improve confidence among customers and investors in the UK financial sector. Panmure upgrades to buy from sell, lowers target to GBP2.32 (the Lloyds bid price) from GBP2.50.
TATE & LYLE Down GBP0.04 to GBP3.97... Sees 1H profits in line, FD steps down - Co. says it continues to trade satisfactorily and expects 1H profits from continuing operations to be broadly in line y/y and Co.'s own expectations. Says comments on outlook are difficult due to the general deterioration in global economic conditions, increased volatility in commodity prices, energy costs, and exchange rates. Still Co. thinks it is on track to make progress for the year as a whole. Says FD John Nicholas will by mutual agreement step down from the board and leave on 30 September.
KINGFISHER Up GBP0.12 to GBP1.32... 1H adj PTP up 23%, ahead of guidance - Publishes 1H adj PTP GBP214m, +23%; retail sales GBP5.130bn, +11.1% (LFL down 2.6%); B&Q sales GBP2bn, -2.5% (LFL -4.6%). Expects FY cost growth at c.2%, half the level previously expected.
RYANAIR Down GBP0.02 to GBP2.57... Keeps FY guidance, sees profit next yr - Says does not significantly alter FY guidance. Will touch breakeven based on 4Q oil staying at US$100/bbl. Remains unhedged for 4Q. Adds cost reduction program and significantly lower oil prices should lead to a return to substantial profitability in the next fiscal. SocGen upgrades to hold from sell, raises target to EUR 2.73 from EUR 1.90. Ups 2009 forecast net profit forecast to EUR 49m from a loss of EUR 55m and for 2010 to EUR 182m from EUR 99m.
PRUDENTIAL Unchanged at GBP4.87... Scramble for AIG assets - Co. and Aviva are among a handful of European insurers expected to be front-runners in a multibillion-dollar auction of AIG's prime assets, The Times writes. Adds Axa, Allianz and Aegon were all tipped by analysts as being likely to take a look at large swaths of AIG, particularly the booming Asian unit.
BTG PLC Down GBP0.30 to GBP1.71... Launches agreed offer for Protherics - Co. has agreed a takeover offer for Protherics, valuing the group at GBP218.10m. Shareholders will receive 0.291 new BTG shares for every 1 Protherics. Sees annualized merger cost synergies and rationalization of the enlarged group's cost base approaching GBP20m by 2010/11. Expects acquisition to be earnings enhancing (on an EBITDA basis) and cash neutral from 2009/10 and significantly earnings enhancing thereafter.
PERNOD RICARD Down EUR 6.11 to EUR 55.89... FY net profit below expectations - Reports FY net sales of EUR 6.58bn, +9%; profit from recurring operations EUR 1.522bn, +13%; net att profit from recurring operations EUR 897m, +8%; net attributable profit EUR 840m, +1% vs a Bloomberg consensus of EUR 899m. Expects an organic growth in profit from recurring operations of about 8%, a strong positive impact from the Vin & Sprit integration, and double digit growth in net attributable profit from recurring operations in FY08/09.
EDF Up EUR 0.05 to EUR 47.19... Won't raise stake in Constellation - Co. said it has considered increasing its stake in US power company Constellation Energy but decided against the move as 'the conditions are not met to do so.' Co. raised its offer for British Energy by 9 pence a share to GBP7.74 a share, Bloomberg reports, citing two people familiar with the matter.
EUTELSAT Up EUR 0.47 to EUR 18.10... Merrill Lynch upgrades to buy from neutral, keeps EUR 24 target. Co. is broker's preferred pick in the satellite sector. Says Co. is in a growth phase, launching seven satellites in the next two years to satisfy growing demand from European emerging markets and HDTV.
Adds the management team is excellent, and has upgraded guidance in two out of every three quarters since IPO in late 2005.
ALLIANZ Down EUR 5.23 to EUR 89.40... Dresdner deal still on - IR spokesperson - Traders say weighing on Co.'s shares is talk that the Dresdner Bank deal with Commerzbank is off. However, an Allianz spokesman says this is a false rumor and it is a closed deal, which won't be affected by market movements.
DEUTSCHE BANK Down EUR 0.06 to EUR 50.25... Risk aversion sets in as Co. is reportedly slowing down CDS trades that expose it to risk of failure among Wall Street firms.
ALITALIA CAI withdraws - press - Italian investor group, CAI has withdrawn its offer for Co., dooming it to bankruptcy, according to Radiocor. Co.'s unions were given today a final deadline to accept or reject investor group CAI's rescue offer. Meanwhile, several newspapers write that Roberto Colaninno, chairman of CAI, has offered to distribute 7% of profits to employees.
MEDIOBANCA Down EUR 0.04 to EUR 9.26... Unicredit satisfied with Mediobanca new governance - Co.'s key shareholder, Unicredit, has said that it is satisfied with the change to a single-board structure system. Reuters writes that Marina Berlusconi will take a seat on Co.'s new single board. Adds that Co.'s new board will have 22 members, as expected. Ahead of Co.'s FY results due out today, Dresdner expects Co. to meet its EUR 1bn net income target. Updates the value of Generali and RCS equity stakes and also increases provisions forecasts in 2009 and 2010.
AEDES Up EUR 0.04 to EUR 0.89... Board votes to start talks with Sopaf on cap hike - Co. has said that its board has examined several non-binding offers for a capital hike, and has decided to start talks with Sopaf on the matter. Explains that the capital increase would be up to EUR 171m.
AEGON Down EUR 0.45 to EUR 6.22... Could bid for AIG assets - Continues in Canada - Co. is among a handful of European insurers expected to be front-runners in a multibillion-dollar auction of AIG's prime assets, The Times reports. Adds Axa, Allianz, Prudential and Aviva were all tipped by analysts as being likely to take a look at large swaths of AIG, particularly the booming Asian unit. Meanwhile, Co. announces that it will continue its operations in Canada after strategic review.
DANISCO Up DKK11.00 to DKK323.50... 1Q EBIT above forecast - ups guidance - Co. reports 1Q08/09 results with revenues of DKK3.235bn vs DKK3.127bn y/y (Reuters forecast: DKK3.231bn), EBIT of DKK403m vs DKK448m (DKK385bn), and profit from continuing operations of DKK230m vs DKK259m. Raises FY08/09 revenue guidance to DKK13bn vs a previous forecast of DKK12.6bn and profit after tax before share based payments to DKK1bn vs DKK900m.
CARGOTEC Down EUR 1.80 to EUR 16.50... Cuts FY08 guidance and launches restructuring - Co. cuts FY08 guidance given in July and launches restructuring initiatives. Says operating margin is expected to be lower than the 7.3% achieved in 2007 vs previous guidance of above 8%. Says restructuring will affect 700 people.
FERROVIAL Up EUR 1.66 to EUR 33.94... Gatwick sale could add EUR 3.5/sh - CS - Credit Suisse says that if Gatwick were sold at a 20% premium to March 2010 RAB, this could add EUR 3.5 pre-tax per share. Citigroup thinks a price of GBP2bn-GBP2.5bn could be achievable. Thinks potential buyers could include infrastructure funds as well as corporates. Adds the announcement and sale should help to shift the market's focus away from negative short-term trading data and highlight the value of Co.'s remaining airport assets.
REPSOL YPF Down EUR 0.07 to EUR 18.79... Morgan Stanley upgrades to overweight from equal weight with EUR 31.50 target. Says a potential sale of Sacyr Vallehermoso's 20% stake to a strategic buyer opens the door to restructuring at Co., potentially accelerating the process of realizing the c.50% upside implied by broker's SOTP value.
SWATCH GROUP Down CHF8.30 to CHF211.70... Swiss watch exports up 6.3% in August to CHF1.1bn.