Eurofirst adds 2 percent on week

| October 13, 2006 | 0 Comments

In a week that saw focus on two long-term stories of merger attempts, the FTSE Eurofirst 300 added 0.3 percent on Friday to close at 1,440.78 for a total gain of 2 percent over the week.

Both Banca Intesa and Sanpaolo IMI saw gains after both companies’ boards of directors approved the merger on Thursday. Sanpaolo gained 1 percent during the week to €17.14, while Intesa added 3.6 percent to €5.46. But France’s Credit Agricole, which said on Wednesday that it supports the Intesa/Sanpaolo deal, dropped 4.6 percent to €34. The gains for Intesa and Sanpaolo came despite a downgrade for both banks Italian banks from Credit Suisse.

In another merger saga, MAN upped its bid for Scania during the week. Both Scania and shareholder Investor rejected the offer. It appeared that Volkswagen, however, which has been blocking the deal in favor of a three-way merger between itself, Scania and MAN, has changed its mind and will support the MAN/Scania merger. Scania’s A shares added 3.3 percent to SKr490 over the week. MAN was up 3.6 percent to €70.26.

In the telecommunications sector, Ericsson B shares were 6 percent higher during the week to SKr27.35 after its joint venture to manufacture cell phones with Sony posted a profit margin of 14.8 percent.

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