Smith & Nephew share price rises as Stryker CEO confirms interest
iNVEZZ.com, Thursday, May 29: Shares in Smith & Nephew (LON:SN) have added more than two percent in London this morning after the chief executive of US orthopaedic implant maker Stryker Corp (NYSE:SYK) confirmed to Fox Business that his company had been evaluating a bid for the FTSE 100 group.
**Smith & Nephew shares up again**
As of 09:34 BST, Smith & Nephew’s share price had added 2.70 percent to 1,020.31p. The company’s shares jumped more than ten percent in afternoon trading yesterday, buoyed by a report in the Financial Times that the Michigan-based company was preparing a bid for its UK rival.
Smith & Nephew’s share price, however, quickly gave up most of its gains after Stryker said in a statement to the London Stock Exchange that it did not intend to make an offer. (Smith & Nephew share price: Stryker denies bid speculation)
Stryker’s chief executive Kevin Lobo, however, told Fox Business that his company had been in the early stages of considering a transaction and that after the spike in Smith & Nephew’s share price, it was contacted by the UK Takeover Panel and under its rules had to make a statement about its intentions.
In yesterday’s statement Stryker noted that it reserved the right, under certain circumstances, to “participate in an offer or possible offer for Smith & Nephew and/or to take any other action”. Stryker, however, is now prevented from approaching Smith & Nephew for six months unless invited by the UK company.
“It’s one of those things where, unless you’re prepared to make a definitive announcement today, then I guess you have to back off,” Jeremy Feffer, an analyst at Cantor Fitzgerald LP, told Bloomberg in a phone interview. “It’s either, ‘Yes, we’re initiating a takeover process,’ or, ‘No, we’re not interested.’”
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Stryker’s interest in Smith & Nephew came on the heels of Pfizer Inc’s (NYSE:PFE) failed attempt to acquire AstraZeneca Plc (LON:AZN). The US pharma giant walked away empty-handed on Monday after its final offer, rejected by the Anglo-Swedish group’s board, expired under the UK Takeover Panel rules.
(Pfizer drops takeover bid for AstraZeneca)
**Analysts on Smith & Nephew**
As of May 23, the consensus forecast amongst 31 polled investment analysts covering Smith & Nephew for the Financial Times advises that the company will outperform the market.
Analyst Ratings Network reports that the UK artificial hips and knees maker currently has a consensus ‘hold’ rating and an average price target of 934.31p.
**As of 10:04 BST, buy Smith & Nephew shares at 1021.00p.**
**As of 10:04 BST, sell Smith & Nephew shares at 1020.00p.**