European Indexes Lower; UPS Acquires TNT Express in $6.77 B Deal

Arthi Gupta
19 Mar, 2012
New York City

European indexes edged lower on global economic worries and the euro area construction output fell in January but UK home prices rose in March. UPS agreed to acquire TNT Express in $6.77 billion cash.

[R]3:30 PM Frankfurt – European indexes edged lower on global economic worries and the euro area construction output fell in January but UK home prices rose in March. UPS agreed to acquire TNT Express in $6.77 billion cash.[/R]

European indexes dropped after investors focused on the global economic worries as the crude oil price traded near recent highs and on mixed economic data from Europe.

In Paris trading, the CAC-40 Index fell 24.09 or 0.7% to 3,570.74 and in Frankfurt the DAX Index edged lower 45.26 or 0.6% to 7,112.32.

Euro-zone Output Drops

Euro-zone construction output declined 0.8% on a monthly basis in January, after a 1.9% drop in December, data from the Eurostat showed today.

Building construction fell 1.5% on a monthly basis in the euro area, after a 0.3% drop fall in December 2011.

Construction output in the European Union members declined 4.1% from a month ago in January and decreased 1% compared to January 2011.

UK Home Prices Up

The UK asking prices of property for sale grew 1.6% on a monthly basis in March, following the 4.1% rise in February, a survey carried out by Rightmove showed today.

The annual rate of growth in home prices surged to 2.2% in March from 1.4% in February.

Separately, the household finance index in the United Kingdom fell to 37.8 in March from 38.7 in February, data from a survey by Markit Economics showed.

UPS Agrees to Acquire TNT Express

United Parcel Service Inc. announced a deal to acquire TNT Express NV for €9.50 cash per share, representing a premium of 53.7% from Friday’s close.

The transaction values TNT Express at approximately €5.16 billion or $6.77 billion and will expand UPS’s reach in emerging markets and Europe.

Gainers & Losers

ArcelorMittal dipped 0.3% to €15.79 after the steel producer. plans to increase output of iron ore, a key ingredient for making steel, in Brazil by about 65% in 2013, Bloomberg reported quoting Sebastiao Costa Filho, the firm''s mining business chief in Brazil.

Carrefour SA fell 1.6% to €19.03 after the French retailer shut an outlet in the Chinese city of Zhengzhou, in central China''s Henan province, on orders from the local government.

Misys plc soared 8% to 356 pence after the supplier of IT solutions to the banking industry said third quarter revenue fell 11% to £89 million from £100 million in the prior-year period, on a pro-forma constant currency basis.