Hints and tips:
...● Merrill Lynch upgraded Intermediate Capital to “buy” from “neutral”....
...“Tesco has many ways to free up cash to invest in the UK proposition,” said Merrill Lynch. “A prolonged price war therefore looks likely to us.”...
...RSA Insurance advanced by 1 per cent to 127¾p as analysts at Cazenove played down the claimant risk from benign lung scarring caused by asbestos, a condition known as pleural plaques....
...It suffered a series of setbacks, the most serious of which was when asbestos was discovered in the fabric of the hall during the refurbishment....
...“We estimate a net present value for this asset of $400m, meaning that any purchase price in excess of this is destructive,” said a Merrill Lynch note on the deal....
...Higher default assumptions, asbestos reserving and other unrealised losses pushed net tangible asset value well below forecasts....
...Merrill Lynch upgraded six European banks, raising Commerzbank from “neutral” to “buy” and Credit Suisse from “underperform” to “neutral”....
...“And the capital markets were closed to us because of the asbestos liability,” he adds. It all became too much for the industrial company to bear....
...The US group originally filed for bankruptcy in 2005 after facing more than $1bn in asbestos and environmental claims....
...The unwelcome parallel is with companies lumbered with asbestos liabilities....
...But some analysts thought a battle unlikely as Heidelberg was the only logical trade buyer for Hanson and the only one prepared to take on its asbestos liabilities....
...On the downside, ITV drifted 0.9 per cent to 113p after Merrill Lynch slapped a “sell” rating and 105p fair value target on the broadcaster....
...Then, 10 minutes into its presentation to analysts, an evacuation was ordered because of a suspicious package in a bus parked next door to the Merrill Lynch conference suite....
...But we quantified the company’s asbestos liability and thought the market was pricing this too negatively....
...David Nisbett, research analyst at Merrill Lynch, said in a note that the results contained, “a lot of good news, showing that RSA is performing well, its self help measures are now boosting profits.”...
...Merrill Lynch said it believed the move was good news as the bank’s modernisers tightened their grip....
...The view was echoed on Wall Street, where Merrill Lynch also predicted movement on medical malpractice costs and environmental regulation....
...The stock was boosted by a revival of bid speculation and a more hopeful view of its problems with US asbestos liabilities....
...Cookson, the industrial materials group, climbed 3.8 per cent to 34¼p amid heavy volume of 47m as Merrill Lynch upgraded the stock to “buy” from “neutral” following a period of share price underperformance...
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