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Market Update

Akzo Rejects Revised PPG Offer, Kingfisher Net Surges

Author: Sarla Buch
Last Update: 11:30 AM ET March 22 2017

4:00 PM Frankfurt – Akzo Nobel rejected second unsolicited proposal of €22 billion from PPG. Gemalto lowered revenues forecast. Kingfisher profit surged but remained cautious on the outlook for France. STADA said guidance for 2017 remains unchanged. Softcat profit soared as the company expanded its customer base.

In London trading, FTSE 100 index declined 62.18 or 0.8% to 7,316.47 and in Frankfurt the DAX index decreased 52.33 or 0.4% to 11,909.73.

In Paris, CAC 40 index slipped 13.63 or 0.3% to 4,988.80.

Akzo Nobel N.V slipped 2.5% to €74.98 after the Netherlands-based paints and coatings maker rejected revised takeover proposal from the U.S.-based rival PPG Industries Inc for about €22.37 billion or $24.19 billion.

The paint maker rejected the second “unsolicited, non-binding and conditional proposal” dated March 20 from PPG Industries Inc.

Revised proposal offer of €88.72 consisting €56.22 in cash and 0.331 PPG shares.

""This proposal significantly fails to recognize the value of Akzo Nobel,"" and ""The issue is we have a number of stakeholders. It''s also not in the interests of shareholders,"" said chief executive officer and chairman Ton Buechner.

Gemalto NV dropped 2.4% to €16.21 after the Netherlands-based digital security services provider lowered revenue forecast in the first-quarter to between 7% and 9% on lower than expected payment business revenue in the United States.

In fiscal 2017, Gemalto said revenues in payment business is estimated to be about €100 million lower than its initial expectation.

Kingfisher Plc declined 5.7% to 325.90 pence after the U.K.-based home improvement products reported revenues in the year ending in January jumped 7.7% from a year ago to £11.2 billion.

Net profit in the year surged 48.1% from a year ago to £610 million from £412 million and diluted earnings per share increased to 27 pence from 17.8 pence.

Pretax profit in B&Q and Screwfix store chains in the U.K. jumped to £759 million from £512 million a year earlier.

""Looking forward, the EU referendum created uncertainty for the U.K. economic outlook and we remain cautious on the outlook for France, especially in light of the forthcoming presidential elections,"" said chief executive officer Veronique Laury said.

STADA Arzneimittel AG gained 0.8% to €54.48 after the Germany-based healthcare products maker rescheduled analyst conference on March 29 after process of reassessment of full year.

However, the executive board does not expect any material changes in the full year financial statements of 2016 and guidance for 2017 remains unchanged.

Softcat Plc jumped 5.5% to 366.50 pence after the U.K.-based IT infrastructure solutions provider said revenues in the first-half ending in January increased 28.9% from a year ago to £378.5 million.

Net profit in the year soared 40.3% from a year ago to £16.7 million from £11.9 million and diluted earnings per share advanced to 8.5 pence from 6.1 pence.

However, the company remains debt free with a cash balance of £46.6 million and customer count in the period jumped 8.7% from 6.7% in the same period a year ago, the fastest growth rate of customer since 2014.

Shoe Zone Plc rose 0.2% to 177.80 pence after Sky News reported that the U.K.-based footwear retailer is one of the final bidders to buy a privately held rival Brantano.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc