Monday 5 December, 1:00 PM GMT (Thomson Financial): European markets
continue to trade in mildly negative territory ahead of the opening session on
Wall Street with crude oil futures rising on the back of higher demand for
heating oil as snowstorms move into North Eastern parts of the United States.
M&A activity is providing the focus, led by the telecoms sector, as
Swisscom bows to pressure from its majority shareholder, the Swiss government,
by ending M&A talks with eircom, while Virgin Mobile Holdings has received a
takeover approach from NTL. Finally, Portugal Telecom and Telefonica Moviles
plan to merge their Brazilian subsidiaries.
In other M&A news, Singapore's state-owned investment group Temasek may
try and block DP World's bid for P&O or launch a counter-bid, while technology
group Thomson has acquired a 33.33% stake in Canopus, a Japan-based leader in
high-definition desktop video editing software. Tate & Lyle has announced the
acquisition of two food ingredient groups for 74 million pounds, while Airbus,
the commercial aircraft unit of EADS is reported to have signed a major order
to supply China's leading airlines with around 150 A320 aircraft, in a deal
worth US$10 billion.
London's FTSE-100 Index has fallen by 16.50 points or 0.30% to 5511.60,
while Paris's CAC-40 Index is slightly lower, by 2.16 points or 0.05% to
4660.34. Frankfurt's DAX Index has slipped by 10.42 points or 0.20% to 5297.57
but Milan's S&P MIB Index has added 38 points or 0.11% to 34,783. The pan-
European blue chip Dow Jones Stoxx 50 Index has weakened by 9.98 points or
0.30% to 3335.57.
* Swisscom's Board of Directors has said it will formulate a new strategy for
the company and has assured the government that it will not make any decisions
on acquisitions of holdings in foreign telecoms companies with a public
service mandate until the government's strategic goals for 2006 to 2009 have
come into force. Swisscom added that it had broken off talks with eircom of
Ireland, adding that under the current environment it sees no possibility of a
takeover bid.
* In a stock-exchange disclosure, Singapore's state-owned investment group
Temasek said it had purchased a 3.24% stake in Peninsular & Oriental Steam
Navigation's (P&O). This has prompted speculation that the company may try and
block DP World's bid for P&O or launch a counter-bid.
* Thomson has acquired 33.33% stake in Canopus, a Japan-based leader in high-
definition desktop video editing software, through a private transaction with
Chairman and Chief Executive Officer, Hiroshi Yamada, and members of his
immediate family. It will also launch a public tender offer for the remaining
Canopus shares. The value of the private transaction combined with the pending
tender offer would come to 91.3 million euros.
* Tate & Lyle has announced the acquisition of U.S. specialty food ingredients
group Continental Custom Ingredients and the Italian based Cesalpinia for 74
million pounds.
* Shares in Virgin Mobile Holdings remain sharply higher after receiving an
approach from NTL that may or may not lead to a formal offer being made for
the company. Meanwhile, shares in rival British Sky Broadcasting Group are
falling on competition fears as it does not have a telephony business.
* Vivo, the Brazilian mobile telecoms joint venture between Portugal Telecom
and Telefonica Moviles will be restructured with a plan to merge their stock-
market quoted units into a single listed company, to be named Vivo
Participacoes, designed to foster major synergies. On the back of 28.8 million
subscribers, Vivo is the largest mobile phone group in Brazil.
* EADS is trading higher on press reports that its commercial aircraft unit
Airbus has secured a major order for 150 A320 aircraft from China for US$10
billion. There is also an agreement to jointly develop a new helicopter with
another EADS unit, Eurocopter.
* Engineering group Bilfinger Berger is outpacing the European construction
sector on robust comments from chief executive Herbert Bodner, in an interview
with the Boersen-Zeitung newspaper. He said the company has 100 million euros
in cash on hand for potential acquisitions, citing Australia, Eastern Europe
and the U.S. as possible regions for expansion.
* U.K. based Aberdeen Asset Management has returned to profit, with full year
pre-tax profits of 13 million pounds compared to a loss of 87.6 million pounds
in the prior year. Turnover has risen to 155.9 million pounds from 140 million
pounds last year, with funds under management more than doubling to 59.7
billion pounds from 22.1 billion pounds in the previous year. The company said
the acquisition of Deutsche Asset Management had substantially increased its
scale, diversification and expanded product range.
* BHP Billiton is under pressure after a report in the Australian Financial
Review suggested the mining group may write off its US$250 million Typhoon oil
and gas platform in the wake of extensive damage caused by hurricanes in the
Gulf of Mexico region.
* Shares in Hypo Real Estate continue to trade higher on expectations that
Deutsche Boerse's Working Committee for Equity Indices will add the company to
the DAX30 index.
Simon.Tse@Thomson.com; Thomson Financial
This is Thomson Financial Corporate Services Europe Market Commentary. The
information herein is believed to be true and accurate. If you have any
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SOURCE Thomson Financial Corporate Group
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