18 November, 2009
UPDATE 1-Colgate stock up on Reckitt deal talk, company mum
* Colgate shares rise 3.7 pct on Reckitt deal talk
* Company declines to comment on market rumors
* Colgate says was contacted by the NYSE
CHICAGO, Nov 18 (Reuters) - Colgate-Palmolive Co (CL.N)
shares hit a new year high on Wednesday after a report
suggested that the toothpaste maker could be close to linking
up with Lysol maker Reckitt Benckiser Group Plc (RB.L).
The Telegraph reported online that Britain's Reckitt is
close to announcing a "multi-billion pound cross-border
transaction," but said it was unclear what company Reckitt was
targeting.
The report said that SSL International (SSL.L) has long
been seen as a target for Reckitt. It also said that
"well-placed sources" thought Colgate was the most obvious
candidate, but did not disclose those sources.
Shares of Colgate jumped as high as $87.39 before ending
the session up 3.7 percent at $85.87. Colgate issued a press
release to say it does not comment on unusual market activity.
It said the New York Stock Exchange had contacted the company
about its share move.
Officials at Reckitt could not be immediately reached for
comment.
"Colgate is a very attractive company given its Latin
American distribution but its similar size to Reckitt would
suggest a merger is more likely than an acquisition," said
Sanford Bernstein analyst Ali Dibadj, who follows Colgate.
Speculation of a deal with Reckitt fueled an all-out
feeding frenzy in its call options, according to Interactive
Brokers Group equity options analyst Caitlin Duffy.
About 63,000 Colgate call options changed hands, 21 times
their recent average daily turnover and more than double the
amount of its put options, according to option analytics firm
Trade Alert.
(Reporting by Jessica Wohl, additional reporting by Doris
Frankel in Chicago and Jessica Hall in Philadelphia, editing by
Matthew Lewis)
Source: http://www.reuters.com
UPDATE 1-Colgate stock up on Reckitt deal talk, company mum Added: (18.11.2009)
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