Porsche, Qatar Deal; Hochtief Spinoff

Mayank Mehta
14 Aug, 2009
New York City

Porsche agreed to sell 10% stake to Qatar and the sovereign fund will also acquire options in Volkswagen AG. Volkswagen plunged 15% after it agreed to acquire Porsche. Hochtief AG gained after it plans to spin off its portfolio holdings in airports and toll roads.

[R]7:00PM Frankfurt, Paris; 1:00 PM New York – European stocks fell after consumer confidence declined in the U.S. Porsche agreed to sell 10% stake to Qatar and the sovereign fund will also acquire options in Volkswagen AG. Volkswagen plunged 15% after it agreed to acquire Porsche. Hochtief AG gained after it plans to spin off its portfolio holdings in airports and toll roads.[/R]

In London FTSE 100 Index closed lower 41.49 or 0.87% to 4,713.97, in Paris CAC 40 Index decreased 29.12 or 0.83% to close at 3,495.27 and in Frankfurt DAX index lower 92.00 or 1.70% to close at 5,309.11. In Zurich trading SMI decreased 1.42 or 0.02% to close at 5,985.30.

Gainers & Losers

Air France-KLM, the largest European airline lost 2.3% to €10.12 and Virgin Air sought partnership with Lufthansa.

CGG Veritas the seismic surveyor advanced 1.6% to €14.44.

CS Communication & Systemes SA the computer-services company that makes air- and traffic-control systems lost 3.1% to €9.24.

France Telecom S.A the European telecommunications industry retreated 0.9% to €17.50.

Hochtief AG advanced 6.1% to €47.06 after the German construction company confirmed its annual forecast. The order backlog grew by a further 4% to record €33.11 billion.

The company also plans to spin-off its concession unit that holds stakes in airports in six cities including Athens and Sydney and seven toll roads, 89 schools, a military base and two geothermal energy projects. In all the company values the holdings at €1.54 billion.

IVG Immobilien AG declined 0.1% to €5.94 after the real estate company said first-half sales fell 19.5% to €250.8 million from €311.4 million a year ago. Net loss in the first-half was €116.1 million or €0.89 per diluted share compared to net profit of €26.4 million or €0.24 per share a year ago.

LVMH Moet Hennessy Louis Vuitton SA the luxury goods company added 6.5% to €67.66.

The Swatch Group Ltd the watchmaker said first-half sales fell 17% to €2.35 billion. Net profit in the first-half fell 28% to €299 million compared to net profit of €416 million a year ago.

Safran SA the Europe’s aircraft-engine maker increased 1.9% to €12.12.

ThyssenKrupp AG added 4.1% to €23.63 after the steelmaker said third quarter sales fell 34.5% to €9.3 billion from €14.2 billion a year ago. Net loss in the quarter was €639 million or €1.38 per diluted share compared to net profit of €613 million or €1.21 per share a year ago.

Total SA the Europe’s oil refiner increased 1.5% to €38.92.

Volkswagen AG dropped €35 or 15.6% to €218.00 after the Europe’s carmaker supervisory board on Thursday approved the merger of Porsche with VW by the end of 2011.

Separately, Porsche SE surged 8.7% to €48.50 after fund controlled by Qatar agreed to acquire 10% stake in the company and almost all of the options in Volkswagen AG. Qatar will also participate in a bank loan syndicate with €265 million. The stake sale will provide Porsche €1 billion to support its option collateral.

DAX Index Movers

Volkswagen AG led the decliners in the DAX index of 15.79% followed by losses in Salzgitter AG of 4.04%, in BASF SE of 2.82%, in Commerzbank AG of 2.40%, in K+S AG of 2.29%.

Hannover Re AG led gainers in the DAX index with a rise of 3.38% followed by increase in Thyssenkrupp AG of 2.85%, in E.ON AG of 0.91% in MAN SE of 0.31%, in Adidas AG of 0.13%.

CAC-40 Index Movers

Renault SA led the decliners in the CAC-40 index of 5.17% followed by losses in PSA Peugeot Citroen SA of 3.66%, in Air France-KLM of 3.64%, in Air Liquide SA of 2.98%, in GDF Suez SA of 2.78%.

Unibail-Rodamco SA gainers in the CAC-40 index with a rise of 3.35% followed by gains in LVMH Moet Hennessy Louis Vuitton of 3.34%, in Bouygues SA of 1.83%, in Michelin SCA of 0.80%, in PPR SA of 0.11%.

FTSE 100 Index Movers

Of the stocks in the FTSE 100 index, 33 increased, 65 declined and 4 were unchanged.

Eurasian Natural Resources Corporation Plc decliners in the FTSE 100 index with a loss of 5.57% followed by losses in Old Mutual Plc of 3.62%, in Xstrata Plc of 3.09%, in HSBC Holdings Plc of 2.84%, in Petrofac Plc of 2.64%.

The British Land Company Plc led gainers in the FTSE 100 index with a rise of 3.93% followed by increase in British Airways Plc of 2.75%, in Tullow Oil Plc of 2.49%, in London Stock Exchange Group Plc of 2.26%, in The Sage Group Plc of 1.92%.