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By Swissquote Analysts
Published on 16.08.2021
Morning news

Faurecia to launch a takeover bid for German automotive supplier Hella

Topic of the day

The lighting and electronics specialist Hella and the French automotive supplier Faurecia have signed an agreement on the merger of the two companies. Under the terms of the agreement, Faurecia will acquire the 60 percent share package held by Hella pool shareholders at a price of 60 euros per share. Faurecia will acquire the 60 percent stake via a cash payment of 3.4 billion euros and the issue of up to 13,571,428 new Faurecia shares. The transaction values Hella at approximately 6.7 billion euros. Faurecia has also announced a voluntary public tender offer to acquire the remaining Hella shares at an offer price of 60 euros. The gross offer price - including the expected dividend of 0.96 euros - per Hella share is 60.96 euros. This corresponds to a premium of 33 percent on the last unaffected share price of 45.80 euros and of 24 percent on the last unaffected 3-month average price of 49.10 euros. Completion of the transaction is subject to regulatory approvals and is expected in early 2022, Hella said. Hella and Faurecia will become the world's seventh-largest automotive supplier through the combination of their activities. This will open up significant potential for further profitable growth, Hella added.

Swiss stocks

The record chase on the Swiss stock exchange continued at the end of the week. The SMI marked a new all-time high for the fifth day in a row - this now stands at 12,479 points. The SMI gained 0.3 percent to 12,464 points, around 2% over last week. Among the 20 SMI stocks, there were twelve winners and seven losers, one share closed unchanged. A total of 18.89 (previously: 22.8) million shares were traded. The list of winners was headed by Nestle, which advanced by 0.8 percent. Insurers Swiss Life, Swiss Re and Zurich Insurance also showed gains of up to 0.8 percent. Following better-than-expected results the previous day, Zurich Insurance shares benefited from various positive analyst comments. Roche and Novartis each gained 0.3 percent.

International markets


European stocks edged into positive territory Friday, with the Stoxx Europe 600 up 0.2% and at its highest level in a year. It was supported by gains in the utilities and energy sectors and as investors shrugged off fresh concerns about coronavirus variants in Asia. Renewable-energy stocks were among the biggest pan-European risers while semiconductor manufacturers dropped. In Paris, the CAC 40 and the SBF 120 each gained 0.2% on Friday. The DAX 30 in Frankfurt rose 0.3%, while the FTSE 100 in London gained 0.4%. Adidas shares were 2.4% higher after the German sportswear giant agreed to sell Reebok to Authentic Brands Group. Bryan Garnier said a EUR2.1 billion valuation for Reebok is a good deal for Adidas, given the U.S. brand's narrower margins. Analyst Cedric Rossi said the price tag implies an enterprise value of 1.2 times estimated sales this year and while the brand has been recovering well from the pandemic, this nevertheless looks a decent price from Adidas's perspective, given Reebok books lower gross margins than the parent group, and is only slightly profitable in terms of its operating margin, he said. Shares in Ipsen fell 9% after the French pharmaceutical company said it would withdraw its new drug application for palovarotene with the Food and Drug Administration. The company plans to resubmit the application once additional data analyses are completed. The move "comes as a surprise," said Jefferies. "This setback is unlikely to improve current sentiment, with the overhang from uncertain timing and impact of Somatuline generic competition likely to persist. “ Palovarotene is a potential treatment for people living with ultra-rare genetic disorder fibrodysplasia ossificans progressiva.

United States

The S&P 500 drifted to a fresh high as investors drew confidence from a blockbuster round of earnings. The broad stock-market gauge added 7.17 points, or 0.2%, to 4468.00 on Friday, clinching its 48th record close of 2021. The Dow Jones Industrial Average added 15.53 points, or less than 0.1%, to 35515.38. The tech-heavy Nasdaq Composite edged higher 6.64 points, or less than 0.1%, to 14822.90. Companies including Walt Disney and Tyson Foods posted a big jump in profits this week, and around 86% of S&P 500 constituents that have filed quarterly reports have beaten analysts’ expectations. Disney shares jumped $1.79, or 1%, to $181.08, after the company posted $918 million in profit for its fiscal third quarter compared with a loss of $4.72 billion in the same period last year. And a volatile stretch for vaccine-makers continued. Moderna shares slipped $1.64, or 0.4%, to $389.78. Pfizer edged up around $1.24, or 2.6%, to $48.48 after the Food and Drug Administration authorized booster shots for certain people with weakened immune systems. Airbnb (+0.5%) reported strongly improved second-quarter results on Thursday, posting higher revenues than before the start of the pandemic. Boeing's Starliner space capsule (-1.5%), whose liftoff to the International Space Station had to be canceled last week because of problems detected in the propulsion system, will have to return to the factory for repairs, the company announced Friday. The British specialist in therapeutic inhalers Vectura announced on Thursday evening that its managers intended to unanimously recommend to shareholders the takeover bid of 165 pence per share presented by the American cigarette maker Philip Morris (+1.6%).


Downward trends on the stock indices in East Asia predominate at the start of the week. Tokyo displays a discount of 1.8 percent to 27,475 points. Positive exception is Shanghai, where the market barometer increases by 0.4 percent. After the presentation of business figures, Nippon Express slumps by 13.3 percent, while Fujifilm rises strongly by 8.0 percent. Citizen Watch gains 9.4 percent on the back of strong results. In Hong Kong, according to participants, concerns about the Corona pandemic, and especially about possible further regulatory intervention by Beijing, continue to put the brakes on. The fact that the forecast for GDP growth in 2021 was increased on Friday from 3.5 to 6.5 lost significance.


The yield on 10-year U.S. Treasury notes slipped Friday but notched its second week of gains, settling at 1.293%. The Treasury market has swung lately as investors have grappled with risks like the Delta variant and concerns about global growth. On Friday, fresh data showed that consumer sentiment in the U.S. declined in early August.


Baader lowers Zooplus to Sell (Buy) - Target EUR 390 (320)
LBBW raises KSB target to EUR 397 (317) - Hold
Independent Research lowers Henkel target to EUR 93 (97) - Hold

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