CSL Limited and Vifor Pharma Ltd today announced that they have entered into a definitive agreement for CSL to acquire Vifor Pharma for an aggregate equity value for Vifor Pharma of US$ 11.7 / CHF 10.9 billion. CSL has offered to acquire Vifor Pharma in an all-cash tender offer of US$179.25 (CHF 167) per share, payable in U.S. dollars. The offer assumes a dividend of CHF 2 expected to be declared at the AGM of 26 April, consistent with past practice. The tender offer represents an implied premium of approximately 61% to the unaffected closing price of Vifor Pharma on 1 December 2021 and a 47% premium to Vifor Pharma's unaffected 1-month VWAP as of 1 December 2021. Patinex AG, Vifor Pharma's largest shareholder holding 23.2% has agreed to tender its shares into the offer.

The Swiss stock market ended Monday's trading somewhat lighter. Profit-taking on the US stock markets slowed prices in the afternoon. The SMI lost 0.4 per cent to 12,551 points. Among the 20 SMI stocks, there were 15 price losers and five price winners. 33.06 (previously: 25) million shares were traded. A uniform trend could not be discerned on Monday. Defensive stocks such as Nestle (-0.3%) and Givaudan (-0.6%) were rather avoided despite the uncertainty before the central bank decisions. Pharmaceutical heavyweights Novartis (-0.2%) and Roche (-0.5%) were also not in demand. Investors also parted with Richemont (-1.7%). A positive analyst comment helped Logitech to a price gain of 1.6 per cent, with which the shares led the SMI. Deutsche Bank had started monitoring the share with a buy recommendation and a target price of 92 francs. SGS (+1.0%) was also in lively demand. UBS lost 0.4 per cent in line with the market. Credit Suisse, on the other hand, fell significantly by 1.8 per cent. Among the second-line stocks, Vifor jumped 18.4 per cent. The Australian CSL is interested in taking over the Swiss-based pharmaceutical company.

European equity markets retreated on Monday ahead of a series of central bank meetings this week, including those of the US Federal Reserve (Fed) and the European Central Bank (ECB). The announcement of the first death from the Omicron variant in the UK also weighed on the trend. The Stoxx Europe 600 index fell 0.4% to 473.5 points. In Paris, the CAC 40 and SBF 120 lost 0.7% and 0.8%, respectively. In Frankfurt, the DAX 40 remained stable while the FTSE 100 in London fell by 0.8%. Air France-KLM on Monday said that it has repaid 500 million euros ($565.9 million) of a EUR4 billion-euro French-state backed loan. The airline group said the decision was made following early signs of a recovery in air traffic around the world. It also negotiated changes in the redemption profile of the loan, which was initially due in a single repayment in May 2023. Air France-KLM will now pay EUR800 million in May 2023, and make a EUR1.35 billion payment in May 2024 and May 2025. Capita PLC said Monday that revenue in the 11 months to Nov. 30 rose and that it will launch another two disposal processes early in 2022. The London-listed professional-services provider said group revenue rose by 0.6% to 2.88 billion pounds ($3.82 billion), and that including the Secure Solutions and Services and Specialist Insurance disposals, it has achieved GBP620 million toward its target of GBP700 million by the first half of 2022.

Stocks fell ahead of a major decision by the Federal Reserve expected later this week on how aggressively to combat inflation. The S&P 500 fell 0.9%, pulling back after the benchmark gauge closed last week at its 67th record high of 2021. The Dow Jones Industrial Average slid 0.9%, as losses worsened in afternoon trading. The technology-heavy Nasdaq Composite Index declined 1.4%. The Fed is set to release its decision on Wednesday following the conclusion of a two-day policy meeting. The U.S. central bank is expected to move more quickly to wind down its bond-buying program and signal that it will raise interest rates next year to curb inflation. Data published Friday showed consumer prices increased in November at the fastest annual rate since 1982. Rising prices have rattled policy makers and hurt U.S. consumer confidence, putting pressure on the Fed to act. Pfizer Inc. agreed to acquire Arena Pharmaceuticals Inc. for $6.7 billion, bolstering the pharmaceutical giant’s pipeline of medicines for inflammatory bowel diseases. Pfizer will pay Arena shareholders $100 per share, double Arena’s share price of $49.94 through Friday’s close. The stock had fallen 35% so far this year before the Pfizer acquisition was announced. Pfizer will gain Arena’s lead drug, etrasimod, a pill in late-stage studies in ulcerative colitis; results are expected in the first quarter of next year, according to analysts. Data from a midstage study in Crohn’s disease are expected in the second quarter of 2022. The drug could have global ulcerative colitis sales of $900 million by 2026, BMO Capital Markets said in a note to clients. Delivery networks have mostly held up during the first major test of the peak shipping season, industry data show, as earlier shopping and increased in-store purchases have eased the usual late-year congestion.

The good mood at the start of the week on the stock exchanges in East Asia evaporated again on Tuesday. In this environment, investors are holding back on buying risk assets such as equities. In Tokyo, the Nikkei index is down 0.8 per cent to 28,409 points. There, shares of airlines and railway companies are sold because of the pandemic worries. In Seoul, there is a similarly sharp drop. In Hong Kong, the HSI loses even more, 1.3 per cent, also after the first case of infection with the Omicron variant was discovered in China.

The bond market has taken the pullback in Fed asset buying with relative calm so far and yields haven't shown a huge reaction.

BoA raises Watches of Switzerland to Buy (Neutral) – Target 2,000 (1,410) p
CS raises Unicredit target to EUR 15.10 (13.80) – Outperform
CS lowers Novartis target to CHF 85 (90) – Neutral

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