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What to watch: Takeover talk boosts BT, stocks rally, and Pearson taps ex-Disney exec as CEO

Oscar Williams-Grut and Edmund Heaphy
·3-min read
Embargoed to 0001 Friday November 08 EDITORIAL USE ONLY File photo dated 17/10/19 of the BT logo. The telecoms giant is to offer home visits by technology experts as part of a new phone and internet plan.
BT's logo projected on stage in 2019. Photo: PA

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:

Takeover talk boosts BT

Shares in BT (BT-A.L) shot to the top of the FTSE 100 on Monday after speculation in the weekend press that the telecoms group could be a takeover target.

Sky News reported that BT has hired Goldman Sachs to preemptively prepare a defence strategy for a possible hostile takeover bid. It comes after BT has suffered a recent share price slide that has left it significant undervalued.

BT made no statement to the market on Monday morning and a spokesperson declined to comment when approached by Sky News.

“There is no formal offer, but shares could jump further if one emerges,” said Neil Wilson, chief market analyst at Markets.com. “Deutsche Telekom, which owns 12% in BT, is seen as a likely candidate.”

Shares rallied over 6%, making BT the biggest riser on the FTSE 100.

Stocks rally

BT’s share price bounce came amid a wider rally for stocks.

European stocks rallied strongly at the open on Monday after the US Food and Drug Administration (FDA) issued an emergency use authorisation on Sunday, approving the use of blood plasma from patients who have recovered from COVID-19 to treat the novel coronavirus.

US president Donald Trump said in a press conference the treatment had reduced mortality by 35% in a study of patients by the Mayo Clinic. He called the approval a “very historic breakthrough” and said the public would be hearing about vaccine developments “very soon.”

The FTSE 100 (^FTSE) and the DAX (^GDAXI) rose 1.4% in early trade, while the CAC 40 (^FCHI) rose 1.6%, the IBEX 35 (^IBEX) climbed 1.1%, and the FTSE MIB (FTSEMIB.MI) was up 1.2%.

Equities had risen across Asia overnight. The Nikkei (^N225) rose 0.2% in Tokyo, the Hong Kong Hang Seng (^HSI) added 1.5%, the Shanghai Composite (000001.SS) climbed 0.1%, and the Shenzen Component (399001.SZ) rose 1.4%. In Australia, the ASX 200 (^AXJO) rose 0.3%.

US futures were pointing higher, with the S&P 500 once again projected to reach a fresh all-time high. S&P 500 futures (ES=F) were up 0.5% to 3,411.75, building on the record close reached on Friday. Dow Jones futures (YM=F) and Nasdaq futures (NQ=F) were up 0.6%.

Pearson taps Disney exec as new CEO

Textbook publisher Pearson (PSON.L) said on Monday that it had appointed former Disney (DIS) executive Andy Bird as its new chief executive to drive its shift toward digital publishing.

Bird, who left Disney in 2018 after 14 years at the company, helped the entertainment giant overhaul the digital strategy of its international arm, including by transforming its route-to-market and product portfolio, Pearson said.

“Andy brings a wealth of international consumer experience, as well as significant expertise in building brands, transformational change and driving digital innovation,” said Sidney Taurel, the chair of Pearson.

“He is an inspirational and dynamic leader with an excellent track record of growth,” he said.

Shares rose 0.3%.

Frasers Group buys gym chain

Billionaire Mike Ashley’s Frasers Group (FRAS.L) said on Monday that it had acquired the fitness clubs business of DW Sports Fitness out of administration for £37m ($48m).

The gym and sports retailer, which was founded by former Wigan Athletic owner Dave Whelan, collapsed into administration earlier this month, putting around 1,700 jobs at risk across the UK.

Frasers Group, which owns Sports Direct and the Everlast brand of gyms, said the move would save “a number of jobs” at DW Sports Fitness.

Frasers will stump up at least £37m in the deal, but could end up paying almost £44m to the administrators of the company if certain conditions are met.

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