S&N said to be Stryker’s goal
SHARES in Smith & Nephew (S&N) perked up yesterday on talk that US rival Stryker was planning a £12.1bn bid for the artificial hip maker.
The stock advanced 52p, or 4.6pc, to 1172p on a report that the US surgical implant company had revived its interest in S&N following rumours earlier this year of a potential bid. Stryker also said last year that it had explored an offer for the company.
The US firm has appointed investment bank Goldman Sachs to advise on the potential deal and talks could move quickly, US market website StreetInsider.com reported an unidentified source as saying.
Mergers and acquisitions continued to be Stryker’s first priority in terms of using cash, the website quoted the company’s chief executive Kevin Lobo as saying in a thirdquarter results conference.
Both Stryker and S&N declined to comment. If it went ahead, a tie-up between Stryker and S&N would be the latest merger and acquisition deal in the drug industry.
Big firms are increasingly considering takeovers as a way to refresh their medicine cabinets as rival generic companies produce copycat versions of established treatments that have lost patent protection.
Elsewhere in the health sector, Scancell brightened 0.38p to 14p as the cancer vaccine developer teamed up with scientists from Harvard Medical School and elsewhere to form a US investigation team to lead a study with its flagship SCIB1 vaccine.
The FTSE 100 index closed 50.12 points adrift at 6052.42 as US service sector data came in worse than expected.
Markets also closed down in Spain, France and Germany ahead of this weekend’s Spanish general election.
The poll is being touted as the most uncertain in modern Spanish political history and could result in a coalition government replacing the ruling centre-right Popular Party.
Back in London, analysts predicted dealers may continue to trade through the Christmas holidays as they take advantage of the highest six months of Footsie volatility since the second half of 2011.
Market analyst at spread-betting firm IG, Joshua Mahony, said: ‘Despite seeing a very clear directional response to the Fed’s interest rate hike on Wednesday, there are significant market jitters.’
On the markets, miners rose as copper prices found some support on reports that Chinese copper smelters are meeting on Saturday to try to put a floor under prices.
BHP Billiton rose 17.2p to 717.2p, Rio Tinto progressed 3.5p to 1862.5p and Anglo Ameri- can put on 15.1p to 278.65p. Hedge fund manager Man Group ticked up 0.8p to 169.9p on news that it had appointed former BT chief Lord Livingston as chairman.
Zincox Resources ticked up nearly 35pc to 0.78p as shareholders approved a proposed placing and a possible fundamental change of business.
The developer of a zinc recycling plant in South Korea said talks with potential investors were continuing with the aim of securing at least £3.4m of funding by the end of 2015, although there was no certainty of a successful outcome.
But Armadale Capital fell 0.62p to 3.12p as the AIM- quoted investment company focused on natural resource projects in Africa placed 14m shares at 3p apiece with institutions to raise £420,000. Armadale plans to use the cash to develop a gold scheme in the Democratic Republic of Congo.
Shares in Electric Word sparked 0.75p to 3.75p after the specialist media group, which focuses on the education, compliance and management markets, agreed to sell its 70pc stake in iGaming Business to Clarion Events for £13.8m.
Another company in the sector, Mediazest, saw its shares rise 0.02p to 0.16p after the audio-visual specialist told the market that it had won material contracts and had completed several significant projects.
The deals included an agreement with Specsavers to install its technology in the optician chain’s head office.
Investors took profits in Octagonal, leaving it 0.05p down at 0.72p, after the provider of global settlement and safe custody services to investors made a pre-tax profit of £139,000 in the six months to September 30 against a loss of £1.1m in the year to March 31.
Drone services group Strat Aero flew 0.12p lower to 6.12p despite news that the European Aviation Safety Agency had published a report setting out guidelines for all future work to ensure that unmanned aircraft can fly safely.
Currently, commercial drones can only be flown within certain distances from the ground and their operators, but the industry is hoping to develop systems that will allow firms to use them to deliver goods and carry out remote inspections and surveys.
÷ Investors checked out of Marks & Spencer as the high street retailer fell foul of City analysts. The stock dropped 6.6p to 451.4p as Exane BNP Paribas became the latest broker to slash its target price on the stock, cutting it to 580p. On Thursday, Peel Hunt reduced its price to 400p from 450p, while HSBC removed it from its “Europe Super 10” list and cut its target price to 680p from 700p.