Sanofi-Aventis Rebuffed; UK Home Prices Fall

Arthi Gupta
30 Aug, 2010
New York City

The European indexes gained after euro-zone confidence rose in August. UK home prices fell at the fastest pace in sixteen months in August. Inflation index in Spain rose 1.8% in August. Genzyme rebuffed Sanofi-Aventis

[R]4:00 PM Frankfurt – The European indexes gained after euro-zone confidence rose in August. UK home prices fell at the fastest pace in sixteen months in August. Inflation index in Spain rose 1.8% in August. Genzyme rebuffed Sanofi-Aventis’s bid.[/R]

U.S. stocks and Asian markets climbed.

The British Chambers of Commerce raised UK growth outlook and Poland GDP expanded 1.1% in the second quarter.

The Bank of Japan announced that it would introduce a new 10 trillion yen six-month fund supplying measure in addition to the 20 trillion yen three-month loan measure it already has in place, as the nation grapples with a strengthening yen.

In Paris CAC 40 Index decreased 10.39 or 0.30% to close at 3,497.05 and in Frankfurt DAX Index edged lower 28.96 or 0.49% to close at 5,922.21. UK markets were closed today.

The euro-zone economic confidence rose in August to 101.8 from 101.1 in July, according to a monthly survey from the European Commission released today.

Consumer confidence improved to minus 11 in August from minus 14 in July. Confidence in services rose to 7 in August from prior month''s level of 6. Retailers’ confidence remained unchanged at minus 4 in August.

The Bank of England Deputy Governor Charles Bean on Saturday said the world''s central banks may have to extend more stimulus to protect a global recovery that is fragile.

In a speech at the annual central banking conference organized by the U.S. Federal Reserve in Jackson Hole, Wyoming, Bean was quoted as saying the recovery was ""fragile"" and a ""considerable margin"" of spare capacity was yet to be worked off. ""Further policy action may yet be necessary to keep the recovery on track,"" he said.

The UK economy is likely to grow more than initially thought in 2010 and 2011, the British Chambers of Commerce said today.

The business lobby foresees GDP growth of 1.7% in 2010, 2.2% in 2011 and 1.8% in 2012. In June, it had predicted growth of 1.3% for 2010 and 2% for 2011.

Home prices in England and Wales dropped at the fastest pace in 16 months in August, according to figures released by Hometrack today.

The average asking price for a home decreased 0.3% month-on-month to £158,300 in August compared to a 0.1% fall in July. This represents the biggest recorded fall in house prices since April 2009.

On an annual basis, home prices rose 1.5% in August as against 2.0% in the previous month.

The number of new buyers registering with agents declined 2.2% while the number of properties on the market rose 2.4%.

Spain’s harmonized index of consumer prices rose 1.8% year-on-year in August, according to flash estimate from the statistics agency INE released today. In July, the annual rate was 1.9%.

The Czech Republic''s non-performing loans are estimated to rise at the end of this year, although the banking sector remains resilient to potential negative shocks, the Czech National Bank said today.

The central bank said households'' NPL ratio is estimated to rise slightly by around one percentage point at the end of 2010 from 4.5% in June 2010.

The CNB noted that the capitalization of the entire Czech banking sector would remain above the regulatory minimum of 8% even in an extreme and very improbable scenario. ""This is achieved despite the conservative settings of many of the assumptions of the individual scenarios,"" the central bank said.

The Polish economy expanded at a faster pace between April and June compared to three months ago led by investment, consumer spending and construction, according to official figures released today.

The Central Statistics Office said gross domestic product rose 1.1% in the June quarter compared to the 0.7% rise in the March quarter.

On a year-over-year basis, the Polish economy grew 3.8% between April and June, compared to the 3.1% rise between January and March.

Intel Corp. entered into a deal to purchase Infineon Technologies AG''s Wireless Solutions Business for $1.4 billion in cash. Intel expects to close the deal in the first quarter of 2011.

The acquisition expands Intel''s current Wi-Fi and 4G WiMAX offerings to include Infineon''s 3G capabilities and supports Intel''s plans to accelerate wireless connectivity. The acquired technology will be used in Intel Core processor-based laptops, and myriad of Intel Atom processor-based devices, including smartphones, netbooks, tablets and embedded computers.

Genzyme Corp. confirmed the receipt of an unsolicited, non-binding proposal from French drug giant Sanofi-Aventis SA to acquire all the outstanding shares of Genzyme for $69 a share in cash. The company stated that its board of directors met last night and unanimously affirmed its previous rejection of Sanofi''s proposal.

Genzyme said that Sanofi''s letter is identical to last month''s offer. The letter provides no new information and no improvement in price, and therefore fails to establish a basis for engagement by the Genzyme board.

Sanofi-Aventis yesterday announced a public offer to acquire Genzyme in an all-cash transaction valued at about $18.5 billion. The offer price represented a 38% premium over Genzyme''s unaffected share price of $49.86 on July 1, 2010 and a premium of about 27% over the closing price of $54.17 on July 22, the day prior to press speculation on the deal started.

Gainers & Losers

Banco Santander, S.A. soared 3.39% to $11.89 after Spain''s lender said it signed a pact to buy HSBC Holdings Plc''s portfolio of U.S. car loans for $4 billion.

Cameleon Software S.A. surged 3.28% to €0.63 after the e-commerce software developer posted a first-half net loss of €23 million on consolidated sales of €4.07 million.

Etablissements Maurel & Prom SA fell 0.38% to €8.72 after the French oil firm reported first-half net profit soared 2,450% to €51 million versus €2 million a year earlier.

Sanofi-Aventis S.A. gained 0.63% to €45.54 after the French pharmaceuticals giant submitted a non-binding proposal to acquire Genzyme Corp. for $69 per share in an all-cash transaction valued at approximately $18.5 billion.

National Bank of Greece SA edged higher 0.89% to €10.24 after the bank said first-half profit slumped 79% to €146 million from €708 million a year earlier.