Transatlantic deals were in the spotlight last week, with UK predators having a better time of it than American ones.
As expected US group Pfizer raised its offer for AstraZeneca to £55 but saw its offer immediately rejected. Despite a number of AstraZeneca shareholders calling for the board to open talks with Pfizer, the deal looks dead in the water ahead of Monday's deadline.
AstraZeneca ended the week at £43.28, up 53p on the day.
But London Stock Exchange announced it was in exclusive talks to buy US asset management business Russell Investments from Northwestern Mutual Life Insurance for around $3bn. Its shares added 43p to £18.52 helped by Goldman Sachs moving its recommendation from sell to neutral. Goldman said:
The last five years have seen determined efforts by LSE to diversify its business model away from cash equity trading. By acquiring control of the FTSE business, LSE increased its exposure to the rapidly growing index construction space. Through its acquisition of LCH.Clearnet, LSE also significantly increased its exposure to post-trade business lines. As a result, cash equity trading only accounts for 11% of LSE's revenue currently, which is one-third of the level five years ago.
LSE has announced that it is in exclusive discussions concerning a potential acquisition of the Frank Russell Company. If completed, LSE would further the process of diversification away from cash equities and towards less transaction-driven business lines... If completed, this deal would increase the group's exposure to the global indices business, which is currently seeing strong growth as a result of the increased use of exchange traded fund vehicles, particularly in the US where in our view LSE's existing FTSE business is underexposed currently.
Still with UK companies targeting US businesses, aerospace and defence company Cobham agreed to pay $1.46bn for US communications equipment maker Aeroflex. Cobham slipped 0.2p to 308.5p.
Overall the FTSE 100 finished at 6815.75 on Friday, down 4.81 points on the day and 40 points on the week. Mixed manufacturing surveys during the week showed strong performances from the US, China and Germany, but France once again disappointed, showing the divergence within the eurozone as voters went to the polls. Growing tensions around the world - from a coup in Thailand to the continuing violence in Ukraine - continued to unsettle investors, and there were also some disappointing company updates.
Vodafone and Marks & Spencer both reported results on Tuesday and a subsequent slump in their shares left the FTSE 100 nursing its biggest daily fall for five weeks.
Marks reported its third year of falling profits, and chief executive Marc Bolland missed a sales target set two years ago. Yesterday there were reports that international director Jan Heere was set to leave the company. Clive Black at Shore Capital said:
We would deem such a departure as a loss for M&S as Mr Heere brought considerable authority and capability to the business and whilst his time has been confronted by challenges in the Czech Republic, Greece and Ireland, he has undoubtedly contributed to sound strategic thinking and the creation of a robust framework for M&S to move forward in international markets. Accordingly, we await confirmation from M&S as to what's what but a departure of Mr Heere is not seen by us as helpful to Mr Bolland's strategic plans. Following this week's mellow preliminary results for M&S, Shore Capital has a hold stance on the group's shares.
Marks slipped 4.6p on Friday to 443.2p while Vodafone recovered 2.05p to 206.2p.
Tullow Oil slid 10.5p to 841p after its Shimela-1 well in Ethiopia found only water bearing reservoirs and traces of thermogenic gas.
Sports Direct International added 5p to 774p as Exane BNP Paribas began coverage of Mike Ashley's retail group with an outperform rating and a £10 price target. But Burberry dipped 26p to £15.03 as the same bank cut its price target from £16.90 to £15.61 in the wake of the luxury goods group's results on Wednesday.
Two new listings had differing fortunes. Saga, the over 50s insurer and travel specialist, was unchanged from its 185p float price but on AIM, Shoe Zone rose 9p to 169p.
Elsewhere Go-Ahead accelerated 174p to £21.13 as its 65% owned subsidiary Govia won the London Thameslink rail franchise from incumbent FirstGroup, up 1.7p at 136.5p.
Finally blur, the operator of an online marketplace for companies to buy and sell services from advertising to legal help, slumped 18% to 85p. The company, which issued two profit warnings in the space of a month, reported a $6.37m full year loss, up from $1.81m and unveiled a placing and open offer at 75p a share to raise $22m. In March the shares stood at 524p.
Blur is now looking for a finance director and non-executive chairman, and analyst Tintin Stormont at the company's broker N+1 Singer said:
We continue to believe the group has built an exciting platform that has the potential to disrupt the significant global market for business services. It is now crucial it navigates these growing pains through robust execution aided by a strengthened team and improved systems and controls.
