The article below is, (imho) another sign of economic life in Colombia. More positioning by international companies. A sign of faith in the future, I'd say. Specifically that a French company thought it important to get a foot hold in the Colombian and hence South American market, via the trade blocks.
Moulinex <MOUP.PA> rises after Brazil acquisition
PARIS, April 7 (Reuters) - Shares in French appliance manufacturer Moulinex <MOUP.PA> rose sharply on Tuesday in a slumping stock market after the company announced plans on Monday to acquire an appliance firm in Brazil.
The stock finished up 3.35 percent at 166.40 francs.
Traders said the stock was also underpinned as several analysts have set price targets of around 200 francs.
Moulinex <MOUP.PA> announced on Monday that it planned to acquire control of Mallory SA by subscribing to a capital increase at the Brazilian firm to the tune of around $30 million, which would leave it with 80 percent of Mallory.
It said the deal would help it increase its penetration of Latin American markets, where its domestic rival SEB <SEBF.PA> is active.
SEB announced on Friday that it had signed an agreement to buy Colombia's leading appliance maker, Volmo, to complement its recent acquisition of Brazilian appliance company Arno.
"Seeing Moulinex switch from a defensive strategy of restructurings to a more offensive strategy is a good sign," said Loic Pelichet, an analyst at HSBC James Capel.
"It shows that their restructurings are proceeding smoothly, that they're holding to their objectives and can shift now to the attack," he said. His target price for the stock is between 200 and 220 francs by the end of the year.
"This is a stock that's done nothing since the start of the year, which isn't normal given the reductions in the company's costs. This deal in Brazil has rekindled interest in the stock," said CDC Bourse analyst Christiane Morino.
At one point on Tuesday, the stock was ahead as much as 6.2 percent before a huge wave of profit-taking took the market lower. Volume in the stock was heavy, with two blocks of 100,000 and 200,000 shares traded during the day.
Another analyst, who asked to remain anonymous, said the acquisition would be good for Moulinex, giving it a foothold in the Mercosur trade region in the southern part of South America. Moulinex is already present in the free trade zone formed by the North American Free Trade Agreement.
The analyst has a price target of 200 francs, and expects the improvement in the group's performance to be confirmed when it publishes its 1997/98 sales soon. Moulinex expects to publish its annual sales toward the end of the month.
12:58 04-07-98 |
