(Alliance News) - Stock prices in London are seen opening in the red on Monday amid fear about the quickening spread of the deadly coronavirus in China.
In early company news, Anglo-Swedish drugmaker AstraZeneca agreed to sell the rights to its hypertension portfolio, as it also acquired a Crohn's disease treatment. Guarantor loans provider Amigo Holdings launched a strategic review and said it was exploring the possibility of a sale. Hazard detection company Halma made two acquisitions.
AstraZeneca said it has agreed to sell the commercial rights for its hypertension medicines portfolio to Atnahs Pharma for USD350 million. The agreement excludes rights in the US and India, which were previously divested, and in Japan, where they will be retained by AstraZeneca.
Meanwhile, AbbVie said it will sell both a Crohn's disease drug and a medical nutrition business as part of its Allergan merger.
AbbVie is selling Zenpep, which offers gastrointestinal medication, to Swiss nutrition firm Nestle for an undisclosed sum. Nestle said the purchase from AbbVie is aimed at expanding its medical nutrition business. Zenpep delivered net sales of USD237 million in 2018, Nestle noted.
Chicago-based AbbVie, which is currently in the process of buying Dublin-based pharmaceutical firm Allergan, also is selling the rights to brazikumab to AstraZeneca.
Brazikumab is in development for the treatment of Crohn's disease and ulcerative colitis, both gastrointestinal conditions. AbbVie did not disclose any financial details for this sale.
Halma said it acquired Florida-based synthetic bone graft products maker NovaBone Products for USD97 million in cash. In addition, Halma said it acquired a 70% stake in Australia-based fire protection software provider FireMate Software for AUD18.2 million.
Amigo Holdings has launched a strategic review and formal sale process in a bid to "maximise value for its shareholders". This may result in a sale of the company.
Amigo said shareholder Richmond Group is willing to sell its 60% stake. The company said it is considering the potential sale of the company as a whole, the sale of parts of the group, the sale of the UK business, and a potential de-listing of the company's shares.
Amigo added that loan book growth and impairments for the nine months to December 31 were in line with guidance.
Automotive fluid maker TI Fluid Systems said annual results for 2019 are expected to be in line with management expectations.
TI Fluid said it expects to report revenue of approximately EUR3.40 billion for 2019. The company reported revenue of EUR3.47 billion in 2018.
"We remain confident in the group's ability to outperform global light vehicle production on a constant currency basis, maintain high margins, and generate strong cash flow. We will provide our 2020 outlook with our full year 2019 results," the company said.
The toll from China's viral epidemic spiked on Monday to 80 dead with hundreds of new infections despite unprecedented quarantines and travel lockdowns, as foreign governments scrambled to help their trapped citizens.
Cases have been reported as far afield as France, the US and Canada, with various countries in Asia also detecting cases. Those infected had previously been in China.
The new additions to China's death toll came entirely from the epicentre province of Hubei, which on Monday reported 24 fresh fatalities. Most fatalities and overall cases have been in Hubei, and the government says the deaths have largely been elderly or people already weakened by pre-existing health conditions.
But China's National Health Commission said on Monday in addition to 2,744 confirmed infections nationwide - an increase of 769 - there were nearly 6,000 suspected cases and more than 30,000 people under medical observation.
Further, the national government decided it will extend the Lunar New Year holiday and related school closures beyond the original Thursday end-date to "reduce population flows," state media reported. The holiday was extended to Sunday, February 2.
IG futures indicate the FTSE 100 index is to open 85.38 points lower at 7,500.60. London's blue-chip index closed up 78.31 points, or 1.0%, at 7,585.98 on Monday.
CMC Markets analyst David Madden said: "Before the coronavirus situation broke out, stock markets in Europe as well as the US were in a strong position. In mid-January the FTSE hit its highest level since the summer, the DAX registered a record-high during the health crisis, and the major US indices set a series of record highs.
"Some traders were questioning the lofty valuations of stocks, so now the fear surrounding the health crisis has acted as an excuse to take money off the table. Last night it was announced there were five confirmed cases of coronavirus in the US, so sentiment is likely to remain sour."
The Japanese Nikkei 225 index closed down 2.0%. Financial markets in China and Hong Kong were closed for the Lunar New Year holiday.
The pound was quoted at USD1.3065 early Monday, flat from USD1.3068 at the London equities close Friday.
The euro was quoted at USD1.1027 early Monday, flat from USD1.1025 late Friday. Against the yen, the dollar was trading at JPY109.05, lower than JPY109.36 late Friday.
Oil was quoted at USD59.36 early Monday, sharply lower than USD60.72 late Friday, amid concern the health crisis in China will curtail economic activity and therefore energy demand.
Gold was quoted at USD1,579.42 early Monday, up from USD1,571.18 late Friday, amid the risk-off investment atmosphere.
The economic events calendar on Monday has UK mortgage approvals figures at 0930 GMT.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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Astrazeneca (AZN)
Halma (HLMA)
TI Fluid Systems (TIFS)
Amigo (AMGO)
