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Market Update

Santander to Raise €7 B and Acquire Popular, Bayer Reduces Stake in Covestro

Author: Sarla Buch
Last Update: 12:48 PM ET June 07 2017

4:00 PM Frankfurt – Banco Santander plans to acquire Banco Popular Español and raise €7 billion to clean up the balance sheet. Bayer reduced its stake in its subsidiary Covestro. EQT acquired 85.2% stake in DGC One. RPC Group profit surged on recent two acquisitions. WPP revenues soared 16%.

In London trading, FTSE 100 index slid 4.18 to 7,511.04 and in Frankfurt the DAX index dropped 113.23 or 0.9% to 12,709.29.

In Paris, CAC 40 index slumped 36.53 or 0.7% to 5,271.08.

Banco Santander, S.A fell 1.2% to €5.73 after Spain-based financial services provider said that it plans to acquire 100% stake in the domestic struggling rival Banco Popular Español, S.A. for a nominal €1 after the European authorities deemed the lender insolvent.

As a part of the transaction, Banco Santander also plans a €7 billion rights issue and finance a cleanup of Banco Popular’s balance sheet.

Covestro AG declined 4% to €63.37 after Germany-based drug-maker Bayer AG reduced its stake in its high-tech polymers and chemicals producer maker subsidiary to 44.8% from 53.3% and sold 17.25 million Covestro shares at a price of €62.25 for €1.07 billion.

The institutional tranche of 8.5% worth about €530 million is based on yesterday’s closing price of €66.03.

EQT AB, Sweden-based private equity firm today said it had acquired 85.2% stake in the domestic telecom services provider DGC One Holding AB and also made recommended mandatory all-the-shares cash offer to shareholders at a price of 250 kronor per share or 2.3 billion kronor or $265 million.

DGC One AB stock surged 59.5% to 250.50 Swedish kronor.

RPC Group Plc slumped 9.3% to 771 pence after the U.K.-based plastic packaging products maker reported revenues in the year ending in March surged 67% from a year ago to £2.7 billion.

Net profit soared 140% to £132 million from £54.9 million in a year ago period and diluted earnings per share jumped to 36.8 pence from 18 pence.

The company reported higher revenues on “excellent performance” in recent two acquisitions of France-based bottle-top maker GCS and the U.K.-based British Polythene Industries.

WPP Plc dropped 2.5% to 1678 pence after the U.K.-based advertising, marketing and communication services provider reported revenue in the first four months soared 15.9% at £4.846 billion.

As of April 2017, net debt increased to £344 million from the same period a year ago.

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