30th Mar 2016 10:11
LONDON (Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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US spices and flavourings group McCormick & Co made an increased bid for Premier Foods and called on the company to engage with it over the offer. McCormick offered 65.00 pence per share, up from 60p previously and valuing Premier Foods at GBP536.7 million. The stock closed Tuesday in London at 56.50p for a GBP476.0 million market capitalisation. The new offer comes after Premier Foods, the maker of Mr Kipling cakes and Bisto gravy, had rejected two previous bids from McCormick ahead of a key shareholder, Warburg Pincus, selling a 17% stake to Japanese noodle maker Nissin Foods Co instead. McCormick called on Premier Foods to engage with the offer, arguing it provides shareholders with the opportunity of a cash exit from their holdings at a full valuation of the company.
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BBA Aviation said it has agreed to sell six fixed-based operations for USD190.0 million under the regulatory remedies required to secure approval for the acquisition of Landmark Aviation. BBA has sold the businesses to KSL Capital Partners, which has partnered on the acquisition with Jeffrey Ross, the former president and chief executive of Ross Aviation. Ross will manage the assets following the deal closing. The sites sold are based in New York, Virginia, Arizona, Alaska and two in California. BBA struck a deal to buy Landmark, its US peer, in September for USD2.07 billion.
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Ceramic materials maker Morgan Advanced Materials said it has appointed Peter Turner as its chief financial officer, effective from April 11. Turner is the former finance director of engineer Smiths Group, having left that role in 2015. He takes over from Kevin Dangerfield, who left the company last week.
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Saga said it has signed a quota share agreement for motor policies underwritten by its AICL unit. Saga said the quota share deal with NewRe, a subsidiary of German reinsurer Munich Re, will cover 75% of the risk of motor policies underwritten by AICL since February 1. The initial agreement is for three years, with the option to extend for another three years. Saga said the deal will significantly reduce its underwriting risk and will lead to a phased withdrawal of capital from its underwriter.
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MARKETS
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UK indices were in the green, led by mining stocks, after dovish comments from US Federal Reserve Chair Janet Yellen late Tuesday. Commodity prices were higher due to weakness in the dollar. Wall Street was pointed to a higher open.
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FTSE 100: up 1.5% at 6,198.78
FTSE 250: up 1.2% at 16,960.28
AIM ALL-SHARE: up 0.2% at 709.46
GBP: up at USD1.4384 (USD1.4271)
EUR: up at USD1.1318 (USD1.1189)
GOLD: up at USD1,236.40 per ounce (USD1,225.74)
OIL (Brent): up at USD39.61 a barrel (USD38.84)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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England/Wales house prices grew at a slower pace in February, data from Land Registry showed. House prices increased 6.1% year-on-year in February, slower than January's 6.5% growth. Month-on-month, house prices fell 0.2%, reversing a 2% rise in January. The average house price was GBP 190,275.
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Eurozone economic sentiment fell to a 13-month low in March, survey results from the European Commission showed. The economic sentiment index came in at 103 versus 103.9 in February. This was the lowest reading since February 2015. The expected score was 103.8. The industrial confidence index slid less-than-expected to -4.2 from -4.1 a month ago. It was forecast to fall to -4.3.
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Fed Chair Yellen's speech to the Economic Club of New York was seen as dovish for US interest rates. Yellen said she considers it appropriate for the Fed to proceed cautiously in adjusting monetary policy given the risks to the economic outlook. The Fed chief said the caution is especially warranted because the central bank's ability to use conventional monetary policy to respond to economic disturbances is asymmetric with rates still at such low levels. "If economic conditions were to strengthen considerably more than currently expected, the FOMC could readily raise its target range for the federal funds rate to stabilize the economy," Yellen said. "By contrast, if the expansion was to falter or if inflation was to remain stubbornly low, the FOMC would be able to provide only a modest degree of additional stimulus by cutting the federal funds rate back to near zero." Yellen also repeatedly reiterated her stance that only gradual increases in interest rates are likely to be warranted in coming years. The speech largely offset recent speculation that the Fed will raise interest rates at its next meeting toward the end of April.
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President Dilma Rousseff's main coalition partner abandoned the government, bringing Brazil's political crisis to a boil and making her impeachment before a parliamentary committee all but certain, Brazilian media reported. The centrist Brazilian Party for Democratic Movement, which had governed with the ruling Workers' Party since 2003, quit the coalition just three minutes into a party meeting, saying it would withdraw its six remaining ministers from the government. The seventh, tourism minister Henrique Alves, resigned Monday.
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Egyptian authorities defended their security measures as the passengers from an EgyptAir jet returned home after being diverted to Cyprus by a hijacker wearing a dummy explosive belt. The Egyptian Interior Ministry issued video of the alleged hijacker, identified as Seif al-Din Mustafa, 57, passing through security checks at Alexandria's Borg al-Arab airport prior to boarding the Tuesday morning flight to Cairo. Mustafa and his carry-on baggage had both been subject to full security checks, but he later assembled the fake bomb from permitted personal belongings in the bag, the ministry said. Cypriot Foreign Minister Ioannis Kassoulidis earlier said the hijacker had connected several mobile phone covers with cables, which he passed off as an explosive belt.
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Industrial production in Japan fell a seasonally adjusted 6.2% on month in February, the Ministry of Economy, Trade and Industry said in a preliminary reading - marking the largest single-month decline in five years. The headline figure missed expectations for a decline of 5.9% following the 3.7% increase in January. On a yearly basis, industrial production fell 1.5% - beating forecasts for a decline of 1.7% following the 3.8% contraction in the previous month.
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Economic growth in Asia will slow down in the next two years amid a weak recovery in major industrial economies and lower prospects for China, the Asian Development Bank said. In its annual Asian Development Outlook report, the Manila-based bank said gross domestic product for the region was projected to expand by 5.7% in 2016 and 2017, down from 5.9% in 2015. "China's growth moderation and uneven global recovery are weighing down overall growth in Asia," said Shang-Jin Wei, ADB's chief economist. Growth in China will moderate to 6.5% in 2016 and 6.3% in 2017, down from 6.9% in 2015, the report said. India will remain one of the fastest-growing economies in the next two years, with its GDP projected to hit 7.4% in 2016 and further pick up to 7.8% in 2017.
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Ebola no longer constitutes a global health emergency, but a high level of vigilance must be maintained in West African countries to prevent and control new outbreaks, the World Health Organization said Tuesday in Geneva. The UN health agency had imposed its highest alert level in August 2014 as the virus ravaged in West Africa. The outbreak started in Guinea in late 2013 and spread mainly to neighbouring Liberia and Sierra Leone. More than 11,300 people have died in the outbreak.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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