Monday 5 December, 5:00 PM GMT (Thomson Financial): European markets ended
the trading session lower, with little earnings news to provide continued
momentum. Instead there was M&A activity, led by the telecoms sector, as
Swisscom, which sided with its majority shareholder, the Swiss government, by
ending M&A talks with eircom, while Virgin Mobile Holdings received a takeover
approach from NTL. Finally, Portugal Telecom and Telefonica Moviles planned 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 acquired a 33.33% stake in Canopus, a Japan-based leader in
high-definition desktop video editing software. Tate & Lyle announced the
acquisition of two food ingredient groups for 74 million pounds, while Airbus,
the commercial aircraft unit of EADS signed a major order to supply China's
leading airlines with 150 A320 aircraft, in a deal worth close to US$10
billion.
London's FTSE-100 Index fell by 17.70 points or 0.32% to 5510.40, while
Paris's CAC-40 Index declined by 11.96 points or 0.26% to 4650.54. Frankfurt's
DAX Index weakened by 41.13 points or 0.77% to 5266.86 and Milan's S&P MIB
Index dropped by 95 points or 0.27% to 34,650. The pan-European blue chip Dow
Jones Stoxx 50 Index slipped by 15.05 points or 0.45% to 3330.50.
* Swisscom's Board of Directors said it would formulate a new strategy for the
company and assured the government that it would 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 had come into
force. Swisscom added that it had broken off talks with eircom of Ireland,
adding that under the current environment it could see 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 prompted speculation that the company may try and
block DP World's bid for P&O or launch a counter-bid.
* Thomson acquired a 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 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 ended 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 fell 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 traded higher after its commercial aircraft unit Airbus secured an
order for 150 of its single-aisle A320 aircraft from China, for some US$10
billion.
* U.K. based Aberdeen Asset Management 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 rose 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 was 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.
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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