FTSE 100 Rises, Led by GSK After Unilever Bid For its Consumer
The FTSE 100 index rises 0.6% to 7589.44, led by pharma giant
GlaxoSmithKline, whose stock increases by 4.5% after it received a
GBP50 billion bid from consumer-goods company Unilever for its
consumer-healthcare business. "GSK is thought to be holding out for
GBP60bn, Unilever is expected to return with an improved offer,"
Marc Kimsey, equity trader at Frederick & Oliver says. Unilever
shares fall 6.5%, while fellow consumer-goods group Reckitt
Benckiser gains 2.8%. Taylor Wimpey rises 2.4% after the
homebuilder said its 2021 performance met its expectations and it
intends to start a share buyback at its full-year results.
Heavyweight commodity and oil stocks are broadly higher. Kimsey
cites "demand for base metal and energy stocks after Chinese GDP
data confirmed strong economic growth in 2021."
Oxford BioMedica CEO to Step Down
Oxford BioMedica PLC said Monday that Chief Executive Officer
John Dawson will retire from the company.
M.P. Evans 2021 Crop, Production Increased; Announces Special
M.P. Evans Group PLC said Monday that crop and production
increased in 2021 and it has announced a special dividend.
Tavistock Investments to Buy Morgans for GBP3.7 Mln
Tavistock Investments PLC said Monday that it has agreed to buy
independent financial advisory group Morgan Financial Group
Holdings Ltd. for 3.7 million pounds ($5.1 million).
Forward Partners Appoints Lloyd Smith as CFO
Forward Partners Group PLC said Monday that it has appointed
Lloyd Smith as chief financial officer with effect from March
Clean Power Hydrogen to Raise GBP50 Mln in AIM Float
Clean Power Hydrogen PLC said Monday that it plans to raise 50
million pounds ($68.4 million) and float on London's junior AIM,
with trading expected to start early next month.
Yourgene Health Raises Guidance Again
Yourgene Health PLC said Monday that it expects to beat upgraded
market revenue forecasts for the year, its third upgrade since
Hurricane Energy Production Met Views, Revenue Rose in 2021
Hurricane Energy PLC said Monday that production met
expectations and revenue rose in 2021, and it expects to soon pay
off its bond debt.
Leeds Group Swung to 1H Pretax Loss, Shares Fall
Shares in Leeds Group PLC fell Monday after the company said it
swung to a pretax loss in the first half of fiscal 2022 as its
performance was hurt by restrictions across Europe to curb the
Omicron coronavirus variant.
H&T Group Expects 2021 Revenue in Line With Market Views
H&T Group PLC said Monday that it expects 2021 revenue to be
in line with market expectations, and that its performance in the
second half of the year was consistently strong.
Angus Energy Shares Rise on Six Approaches to Buy Company
Angus Energy PLC shares rose Monday after it said that it has
received at least six approaches to participate in its formal sales
process, or making offers for the company and its assets.
Clinigen Group Agrees to New, Higher GBP1.3 Bln Takeover by
Clinigen Group PLC said Monday that it has agreed an improved
and final 1.3 billion pound ($1.78 billion) takeover by Triton
Unilever Looking to Reposition Portfolio After GSK Consumer
Unilever PLC said Monday that it has decided to expand its
presence in higher-growth categories after it made an approach for
GSK Consumer Healthcare over the weekend that could potentially be
worth $68 billion.
GSK Consumer Health Arm May be Worth More on its Own
0957 GMT - A potential sale of GlaxoSmithKline's consumer
healthcare business to rival Unilever holds positives and negatives
for the drug company's shareholders, says AJ Bell. While GSK
management would probably welcome being paid a high price for the
division, some long-term GSK investors may not want a sale as they
might have been looking forward to the consumer-goods unit being
de-merged later this year, the brokerage says. "De-mergers can be
beneficial as management are able to run the business with more
freedom, rather than simply being a division of a bigger company
and having to follow group protocol," Bell's investment director
Russ Mould says. "Therefore, the consumer goods arm could be worth
a lot more in time." GSK shares rise 4%.
Taylor Wimpey's 2021 Update Should Reassure Investors
0930 GMT - Taylor Wimpey's 2021 update was reassuring,
reiterating 2021 performance will meet expectations on the back of
a support backdrop, and committing to return excess cash, Citi
says. The house builder's outlook remains positive, though the
update is unlikely to significantly change market consensus, the
U.S. bank says. "[The] group's reassuring update--on track to
deliver on its medium-term guidance and committed to return excess
cash by way of share buyback--should support sentiment on the
shares and drive a re-rating in our view," Citi says, adding that
the stock's price looks relatively cheap given Taylor Wimpey's 2022
targets. Citi retains its buy rating and 225 pence price target on
the stock. Shares are up 2.6% at 158.0 pence.
Unilever Bid for GSK Consumer Healthcare Leaves Questions
0916 GMT - While Unilever's approach for GSK Consumer Healthcare
has its attractions, Jefferies says it still would need a lot more
convincing on the strategic and economic logic. The U.S. bank sees
the benefit of a combination in oral care as well as vitamins,
minerals and supplements, but OTC remains a risk, it notes.
Unilever's approach should also encourage other OTC participants
like Procter & Gamble and Reckitt Benckiser to pay attention.
Any auction would be a test of the Anglo-Dutch consumer-goods
group's resolve, Jefferies adds. Shares in Unilever trade down 6.7%
at 3,672.5 pence. GlaxoSmithKline trades up 4.6% at 1,716
Unilever Deal for GSK Consumer Healthcare Would Give It Rev
Growth Stream in Developed Markets
0840 GMT - A Unilever deal for GSK Consumer Healthcare would
give the Anglo-Dutch consumer-goods group what it has been missing
over the past few years: a steady stream of revenue growth in
developed markets, Citi says. After three rejected offers, Unilever
could come back with a bid of around GBP55 billion, Citi says.
However, it says it is very doubtful this will be sufficient to
persuade the GSK board or the company's investors. Further, Citi
questions whether such a deal is necessary given its implications
surrounding financing and integration at a time when the group is
facing significant headwinds in its core business. Shares in
Unilever trade down 6% at 3,698 pence. GlaxoSmithKline shares trade
up 5.1% at 1,726 pence.
Unilever's GSK Consumer Healthcare Approach Raises Questions on
0830 GMT - Unilever's approach for GSK Consumer Healthcare
raises questions on its conviction about being able to accelerate
growth with its current portfolio, Berenberg says. The German
brokerage says that some might point to a food & refreshment
disposal funding the transaction, however, it thinks the unit
offers some of Unilever's most attractive categories such as ice
cream and cooking ingredients. Competitive bids from Procter &
Gamble or private equity also can't be ruled out, it says.
Berenberg expects a GBP55 billion offer to secure the asset, after
a GBP50 billion offer was rejected. Shares in Unilever trade down
6.4% at 3,688 pence.
Omicron's Toll on Economic Activity in U.K., Eurozone Expected
to Be Mild
0827 GMT - The Covid-19 pandemic's drag on economic activity has
lessened from wave to wave, Berenberg says. Even if most people who
are infected don't fall seriously ill, they still need to be in
quarantine. Against the backdrop of the Omicron variant, staff
shortages may be a major factor for about four to six weeks,
shaving around 0.5 percentage point off 1Q GDP in the U.K. and the
eurozone, according to Berenberg's estimates. Together with
restrictions and more-cautious consumer behavior, this suggests
that economies may roughly stagnate in 1Q, Berenberg says. However,
if supply shortages start to ease in early 2022, gains in
manufacturing output could still underpin GDP growth of around 0.7%
in 1Q in both the U.K. and the eurozone, Berenberg forecasts.
Sterling Expected to Remain Unmoved by UK Political
0822 GMT - Sterling has been little moved by U.K. political
uncertainty amid calls for Prime Minister Boris Johnson to resign
and that is unlikely to change, ING says. "We think that even in
the event of a change in leadership, the downside risks for the
pound (which is currently being supported by aggressive Bank of
England tightening expectations) should be contained," ING analysts
say. Meanwhile, a slew of U.K. economic data this week including
labor market figures on Tuesday and inflation on Wednesday should
support sterling, although mostly against non-dollar currencies as
the U.S. currency is likely to rise, they say. GBP/USD is flat at
1.3679 and EUR/GBP rises 0.1% to 0.8350.
Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka
Halas at email@example.com
(END) Dow Jones Newswires
January 17, 2022 05:16 ET (10:16 GMT)
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