European stocks climbed for the first time in three days as takeover speculation buoyed shares of European Aeronautic Defence & Space Co., DaimlerChrysler AG and J Sainsbury Plc.
EADS, owner of Airbus SAS, and British supermarket chain Sainsbury rose after Qatar's $40 billion investment fund said it may buy stakes in the companies. DaimlerChrysler advanced to the highest since 2001 as the London-based Times said JPMorgan will send out details about the potential sale of the Chrysler unit.
``Mergers and acquisitions are the true support for stocks,'' said Roland Lescure, who oversees $99 billion in assets as chief investment officer of Groupama Asset Management in Paris. ``Companies have a lot of cash and there is significant competitive pressure. M&A is a way to improve profitability.''
The Dow Jones Stoxx 600 Index rose 0.4 percent to 382.24 as of 11:54 a.m. in London, the highest since November 2000. The Stoxx 50 climbed 0.4 percent, and the Euro Stoxx 50, a measure for the 13 nations sharing the euro, added 0.6 percent.
Markets are closed today in the U.S. for a holiday. Asian stocks advanced to a record, led by retailers and steelmakers in Japan, on speculation takeovers will increase in both industries.
The Stoxx 600 has gained every week except one in 2007 as investors bet companies will continue to seek acquisitions to boost earnings. Announced takeover deals involving a European company jumped in 2006 to a record $1.48 trillion, according to data compiled by Bloomberg.
So far this year, M&A transactions in Europe worth $164 billion have been announced. Deals worth $242 billion were announced in the same period last year.
Qatar Interest
National benchmarks gained in all of the 17 western European markets that were open. France's CAC 40 rose 0.6 percent. The U.K. FTSE added 0.5 percent, as did Germany's DAX.
EADS advanced 2.3 percent to 25.7 euros. Qatar's investment fund may buy as much as 10 percent of Europe's largest aerospace company to diversify the emirate's holdings, the fund's chief executive said.
The state-owned Qatar Investment Authority had talks with EADS, the parent of Airbus SAS, because the company is ``under pressure'' and its shares may be undervalued after falling by a fifth over the last year, said Sheikh Hamad bin Jasim bin Jaber al-Thani, the authority's chief executive officer.
The stock has fallen 20 percent over the last 12 months on concern that the superjumbo A380 program will be delayed.
The authority also is seeking a ``strategic'' stake in Sainsbury and is studying how much of the U.K.'s third-largest supermarket company to buy, the chief executive said. Sainsbury shares rose 1.5 percent to 511.75 pence.
Offer Rejected
DaimlerChrysler climbed 3.6 percent to 56.07 euros. JPMorgan will send out details regarding the potential sale of Chrysler unit to possible bidders within days, the Times said, without saying how it obtained the information.
DaimlerChrysler last week said it is considering ``all options'' for the money-losing U.S. subsidiary. Automakers today rose the most among the 18 industry groups in the Stoxx 600.
``In the short term, it's going to be extremely difficult to make money in the U.S. market,'' said Philippe Gijsels, senior equity strategist at Fortis Bank SA's private investment unit in Brussels, which manages $62 billion. ``If Daimler can get out of there,'' it's beneficial.
Converium Holding AG surged 11 percent to 20.9 Swiss francs after the Swiss reinsurer rejected an unsolicited bid from Scor SA, the largest French reinsurer, valuing it at 3.08 billion francs ($2.5 billion).
Scor over the weekend offered to pay 21 Swiss francs a share for Converium, the Zug, Switzerland-based reinsurer said. Scor slid 6.4 percent to 19.76 euros.
Anglo Platinum
Enterprise Plc jumped 8.5 percent to 576 pence after the Daily Telegraph said the U.K. provider of support services to utilities had agreed to a 486 million-pound ($949 million) takeover by private-equity firm 3i Group Plc. Calls to Enterprise spokesman Nick Oborne and 3i spokeswoman Ingrid Tighe weren't immediately returned today.
Shares of Anglo Platinum Ltd., the world's largest platinum producer, jumped in Johannesburg on speculation that Anglo American Plc will bid for the quarter of the company that it doesn't already own. Anglo American, the world's second-biggest mining company by sales, increased 2.6 percent to 2,604 pence.
``The market is talking about Anglo American taking out minorities,'' said Greg Potter, a trader at Nedcor Securities based in Johannesburg.
Fiona Wrench, a spokeswoman for Anglo American in Johannesburg, didn't immediately return a call to her office.
Carrefour Gains
Carrefour SA, Europe's biggest retailer, jumped 3.3 percent to 49.62 euros. The company's main shareholder, the Halley family, offered its 13 percent stake to investors in London and Paris, La Tribune reported without saying where it got the information.
Areva SA, the world's biggest maker of nuclear power plants, gained 0.8 percent to 729.75 euros. The company agreed to buy Italian company Passoni & Villa to become the No. 3 maker of high-voltage bushings. Bushings are insulated components that connect power transformer winding leads to high-voltage transmission lines.
Fonciere Des Regions, France's fourth-biggest real estate investment trust, made an all-share bid for Beni Stabili SpA that values Italy's second-largest real-estate company at about 2.6 billion euros $3.4 billion). The stocks didn't trade.
Groupe Danone SA added 1.8 percent to 125.95 euros. Franck Riboud, the chief executive officer, said he's confident about the company's 2007 growth targets, Investir reported, citing an interview with the head of the world's biggest yogurt maker.
Novartis Drops
Novartis AG tumbled 1.6 percent to 73.4 francs after an analyst said the experimental diabetes drug Galvus may be delayed by U.S. regulators until the company can provide more information on safety. A Food and Drug Administration decision that was expected by late February may be delayed by months, Timothy Anderson of Prudential Equity Group LLC, said in a Feb. 16 note.
Barry Callebaut AG, the world's biggest bulk-chocolate maker, surged 7.3 percent to a record 924 francs after UBS AG raised its price estimate based on the potential benefits of an outsourcing plan agreed last week with Nestle SA.
source:www.bloomberg.com
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