Updates from BSkyB, Carillion and United Utilities

BSkyB reaches deal with Murdoch for 'Sky Europe'

Updated: 

The FTSE 100 climbed 23 points on Thursday to 6,821.4. Reed Elsevier was the Board's biggest riser, up 4.37% to 980p while Concordia owner Carnival also climbed, up 2.34% to 2183p. However B&Q and Screwfix owner Kingfisher shares sank more than 8%, to 308.50p, on disappointing quarterly sales. easyJet shares were buffeted 4.99% to 1333p.

In the US, the Dow Jones finished flat, down 2.8 points to 17,083, despite considerable earnings news.

We start with news of a possible £3bn merger between Carillion and Balfour Beatty. Both boards says work is underway on a strategy and business plan for a combined operation, though a decision must be made by 21 August.

"In evaluating the merits of the merger," Carillion and Balfour said in a joint statement, "the two boards will, inter alia, wish to be satisfied that such a merger would lead to very significant value creation for the benefit of both sets of shareholders."

Balfour Beatty ex boss Andrew McNaughton left the business in the spring following a profit warning; the company has also been exposed to project difficulties at its engineering services arm.

Next BSkyB and an agreement with 21st Century Fox to acquire its 100% stake in Sky Italia and 57.4% interest in Sky Deutschland. The total sum for Sky Italia will be £2.45 billion with approximately £2.07 billion to be paid cash.

The acquisition of 21st Century Fox's shareholding in Sky Deutschland is £2.9 billion in cash, valuing Sky Deutschland at €6.75 a share. It's thought both deals could net Rupert Murdoch up to $10bn.

The deal should produce significant cost-cutting benefits for the shared businesses. Additionally, BSkyB claims adjusted revenue climbs 7% to £7.6 billion for the last 12 months; there is a 7% increase in full year dividend to 32.0 pence per share.

Finally, an interim from United Utilities. Revenue has increased, reflecting the regulated price rise for 2014/15 though partly offset by a previously announced discount of £20 million. The revenue increase is also offset by higher depreciation and other operating cost.

The group expects to deliver a good underlying financial performance for 2014/15. It claims it's ahead of schedule and remain confident of delivering our 2010-15 targets.

"We intend," says United, "to continue with our dividend policy of targeting 2% per annum growth above the rate of RPI inflation through to at least 2015, underpinned by a robust capital structure."

Carillion/Balfour Beatty
BSkyB
United Utilities

BSkyB Eyes Purchase of Sky Italy and Sky Germany from 21st Century Fox