Unilever pushes FTSE higher on takeover approach by Kraft Heinz
Source - SMW
Marmite owner Unilever (ULVR) rejected a £115bn takeover bid from US rival Kraft Heinz. Management said the offer undervalued Unilever, despite the proposal representing an 18% premium to its share price on Thursday's close.
Kraft indicated it would consider a new deal, which excited investors and boosted Unilever by 12.8% to £37.75. Unilever, however, said it didn't see any merit in the business combination.
As Unilever is the third biggest stock on the FTSE 100, it helped lift the index 0.3% higher to 7,299.
Large index constituents Reckitt Benckiser (RB.) and Imperial Brands (IMB) also rose in value, helping to offset weakness in mining stocks.
Oil prices remained weak as West Texas Intermediate and Brent crude oil were $53 and $55.45 per barrel, respectively.
Gold was 0.2% lower at $1,237 per ounce and copper fell 1.2% to $5,908 per tonne.
On the consumer front, UK retail sales reached its lowest growth rate since November 2013 as the general public started to feel the pinch of rising inflation.
US stock markets failed to rally as investors pondered when potential US interest rate rises would occur, leading to weakness in banking stocks. Kraft Heinz jumped 9% on Wall Street.
Asia's largest stock market, Japan's Nikkei 225, was dragged 0.6% lower by banks and car manufacturers.
FTSE 100 RISERS AND FALLERS
Pharma giant AstraZeneca (AZN) received a shot in the arm on positive results from its Phase III OLYMPIAD trial. It said patients treated with Lynparza (olaparib) showed a statistically significant improvement in progression-free survival compared with those who received chemotherapy.
FTSE 250 RISERS AND FALLERS
Healthcare packaging specialist Essentra (ESNT) revealed a 26% slump in full year adjusted pre-tax profit as sales flagged at its health and personal care packaging unit. Integration issues around its 2015 Clondalkin acquisition were blamed.
Engineering company Morgan Advanced Materials (MGAM) announced it will sell its European rotary transfer systems business for €40m on a cash and debt neutral basis. US manufacturer of motion and fluid control systems Moog was revealed as the buyer.
Upscale hotel operator Millennium & Copthorne (MLC) reported group revenue per available room (RevPAR) rose 6.6% to £76.71 in its full year results.
Property developers Segro (SGRO) beat analysts' bleak post-Brexit predictions as its full-year earnings per share and net asset value exceeded forecasts. It hiked its dividend by 5% to 11.2p per share.
SMALL CAP RISERS AND FALLERS
Arix Bioscience (ARIX) saw a muted response to its first day on the stock market. The business pumps money into drug developers.
Ncondezi Energy (NCCL) said it didn't know why its share price jumped 25%. It reiterated that it continued to be in talks to finalise a joint development agreement with Shanghai Electric Power.
Struggling industrial dispute resolution business Driver Group (DRV) launched an £8m fund raise as it desperately tried to revive its fortunes. Full year pre-tax losses widened more than doubled from £1.9m to £5.3m.
Asa Resources (ASA) disappointed the market as revenue fell by 14% to $18.4m and gold production/sales declined by 3% to 15,365 ounces. Investors overlooked lower costs and marked the stock 11.8% lower to 1.7p.
Social video broadcaster Brave Bison Group (BBSN) struggled in the second half of 2016, resulting in a 7% decline in revenue. The stock slumped by 30% as revenues in 2017 were expected to be materially lower compared to 2016.