Reynolds Rejects $47 B Offer from BAT, Vodafone Net Loss Widens

Sarla Buch
15 Nov, 2016
New York City

Reynolds American rejected $47 billion takeover offer from British American Tobacco. easyJet net declined 22% but carried 73 million passengers in the year so far. Merck profit and revenues surged and lifted operating profit forecast. Vodafone net loss widened.

[R]4:00 PM Frankfurt – Reynolds American rejected $47 billion takeover offer from British American Tobacco. easyJet net declined 22% but carried 73 million passengers in the year so far. Merck profit and revenues surged and lifted operating profit forecast. Vodafone net loss widened.[/R]

In London trading, FTSE 100 index increased 42.40 or 0.6% to 6,794.85 and in Frankfurt the DAX index added 10.26 to 10,702.87.

In Paris, CAC 40 index rose 4.86 to 4,513.27.

British American Tobacco Plc gained 0.5% to 4,302 pence and the U.S.-based cigarette maker Reynolds American Inc rejected $47 billion offer from the company and held out for a higher offer.

Analysts are speculating that BAT may be forced to revise its offer by at least $1 billion.

easyJet Plc soared 5.3% to 1,087 pence after the U.K.-based airline group reported total revenues in the year ending in September slid 0.4% from a year ago to £4.7 billion.

Net income in the year declined 22.1% from a year ago to £427 million compared to the £548 million and diluted earnings per share slumped to 107.6 pence from 138 pence.

""We have carried a record 73 million passengers and achieved a resilient performance in 2016,” chief executive officer Carolyn McCall said.

“Our strategy to strengthening our positions at our key airports will see double digit growth in key bases in London, Manchester, Venice, Berlin and Amsterdam,” added McCall.

Merck KGaA dropped 2.4% to €92.70 after Germany-based pharmaceutical products maker said group sales in nine-month period ending in September soared 19.3% from a year ago to €11.2 billion.

Net profit in the quarter surged 37.2% from a year ago to €1.4 billion compared to the €989 million and diluted earnings per share jumped to €3.13 from €2.27.

Merck said net sales in life science segment advanced 83.1% to €1.4 billion but net sales in healthcare business dropped 1.1% to €1.7 billion.

In the year, Merck lifted operating profit in the year estimate to between €4.45 billion and €4.60 billion compared to the earlier estimated range of €4.25 billion to €4.40 billion.

Vodafone Group Plc slipped 0.7% to 202.95 pence after the U.K.-based mobile services provider reported revenues in the first-half ending in September dropped 3.9% from a year ago to €27.1 billion.

Net loss in the period widened from a year ago to €5 billion compared to the €2.3 billion and diluted loss per share jumped to 18.38 cent from 9.43 cent.

Vodafone reported wider net loss after taking non-cash impairment of €5 billion or $5.38 billion in its Indian business as domestic competition heats and rates drop after the latest entry of Reliance Jio.

The mobile operator forecasted operating profit in the second-half to decline in the range of 3% to 6% or to between €15.7 billion and €16.1 billion compared to the previous estimate of €15.7 billion to €16.2 billion.