Brussels shares close lower; Delhaize leads the fallers UPDATE

Brussels shares close lower; Delhaize leads the fallers UPDATE

	Published : Mon, 15 Oct 2007 17:12 By : Agencies Print this Story

BRUSSELS (Thomson Financial) - Shares were lower at the close, with supermarket group Delhaize leading the fallers.

The Bel 20 closed 30.08 points or 0.66 pct lower at 4,501.98.

Delhaize dropped 1.70 eur or 2.44 pct to 67.87.

Heavyweight financials Dexia and Fortis pulled the blue-chip index lower, losing 0.42 eur or 1.81 pct to 22.80 and 0.38 eur or 1.62 pct to 23.11 respectively.

KBC reinitiated its coverage of Fortis with a 'buy' rating and 28 eur target price following the group's 13.4 bln eur rights issue to fund its share of the consortium buy of ABN Amro.

Coverage had been suspended as KBC was involved in the rights issue. Analyst Dirk Peeters said in a note to clients that whilst, at first glance, Fortis appears to be priced in line with its peers, distortion of EPS through divestment gains and its share of gains from the sale of ABN Amro's businesses mean it is trading at a discount.

Peer KBC dropped 1.53 eur or 1.53 pct to 98.30.

Imaging and software company Agfa-Gevaert fell 0.26 eur or 1.86 pct to 13.72.

Telecoms were also lower at the close, with Belgacom dropping 0.51 eur or 1.52 pct to 32.99 and mobile operator Mobistar down 0.84 eur or 1.34 pct at 61.93.

Brewer Inbev was 0.83 eur or 1.26 pct lower at 65.12 and chemicals and pharmaceuticals group Solvay dropped 1.01 eur or 0.96 pct to 103.83.

Earlier today, the group said it signed a sale and purchase agreement with Sweden's Perstorp Group to divest its Caprolactones unit for 200 mln eur.

In positive territory, utility Suez gained 0.44 eur or 1.04 pct to 42.95 after Gaz de France CEO Jean-Francois Cirelli said he aims for his company's merger with Suez to conclude 'as close as possible to the start of 2008'.

He said the merger will generate 1 bln eur of operational synergies per year.

EBITDA is seen rising to 17 bln eur by 2010, and capital expenditure should total 10 bln eur per year.

Oddo analysts upped their target price to 48 eur from 45 for Suez, saying 'even if there's nothing fundamentally new in today's announcement, we think it's high time to bet on this project.'

Steel cord manufacturer Bekaert was up 0.85 eur or 0.85 pct at 101.18 after it abandoned its takeover talks with Russia's Uralkord on Friday.

Petercam analysts reiterated 'buy', saying the news has no impact on their investment case, whilst KBC reiterated its 'accumulate' stance.

Specialy materials group Umicore was up 5.30 eur or 3.01 pct at 181.55.

The initial public offering of shares in Nyrstar, the zinc-smelting joint venture started by Umicore and Australian peer Zinifex, will be priced at 18-23 eur per share, the companies said.

Chief executive of Nyrstar Paul Fowler said the group will be have ry active' in looking at the zinc market for consolidation opportunities following the launch of its listing in Brussels.

Outside the Bel 20, Innogenetics was 0.22 eur 3.41 pct lower at 6.23 as the market reacted negatively to news chief executive Frank Morich has stepped down, analysts said.

Earlier, the biotech company said Christiaan De Wilde, who has been chief financial officer since last year, will replace Morich, who is leaving 'to pursue other interests'.

KBC Securities slashed its rating on the group to are duce' from 'accumulate' and reduced its target price on the stock to 6.00 eur from 8.50.

'This is for us a very negative signal,' analyst Christophe Vanvaeck said in a note to clients. 'A CEO that leaves a company in difficult times isn't good for investor confidence.'

Kinepolis was 0.67 or 1.45 pct lower at 45.50 following the release of third quarter ticket sales figures on Friday after the market close which were slightly below expectations.

Petercam preliminarily reduced its target price to 55 eur from 57.50, but maintained its 'add' rating.

antonia.vandevelde@thomson.com

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