BL: U.S. Stock Futures Gain on Merger Speculation; Countrywide Rises
By Eric Martin
Aug. 21 (Bloomberg) -- U.S. stock-index futures rose on takeover speculation after the Wall Street Journal said Countrywide Financial Corp. may be a buyout target for investor Warren Buffett.
Countrywide, the largest U.S. mortgage lender whose shares have lost 30 percent this month amid a liquidity crisis, climbed in Europe. Bayer AG advanced on speculation Novartis AG is planning to make an offer for Germany's biggest drugmaker.
Standard & Poor's 500 Index futures expiring in September advanced 4.5 to 1,453.6 as of 7:45 a.m. in New York. Dow Jones Industrial Average futures added 29 to 13,178 and Nasdaq 100 Index futures increased 4.5 to 1,902.25.
Countrywide added $1.19, or 6 percent, to $21. The company could be bought by Buffett's Berkshire Hathaway Inc., which is sitting on almost $50 billion of cash and is seen as one of the few buyers in the market as the subprime and credit-market crises force asset sales, the Wall Street Journal said in its ``Heard on the Street'' column.
While Buffett isn't discussing potential transactions, it's safe to bet that struggling lenders and private-equity firms that fear planned purchases will be called off are looking to him, the newspaper said.
Texas utility TXU Corp., which is trying to persuade its shareholders to accept its sale to KKR & Co., is another potential target and would complement Berkshire's MidAmerican Energy Holdings, according to the Journal.
A TXU spokeswoman declined to comment and a Countrywide spokesman wrote in an e-mail that the company doesn't comment on takeover speculation, the newspaper added. Buffett wouldn't comment, the Journal said.
Bayer, LSI
Bayer American depositary receipts rose $3.17 to $77.05. ``The rumor Novartis might bid for Bayer is doing the rounds again,'' said Thomas Nagel, a trader at Equinet AG in Frankfurt.
LSI Corp. climbed 6 cents to $6.24 in Germany after Infineon Technologies AG, Europe's second-biggest maker of semiconductors, agreed to buy LSI's mobility products group for about $445 million.
To contact the reporters on this story: Marco Bertacche in Milan at at mbertacche@bloomberg.net ; Eric Martin in New York at emartin21@bloomberg.net .
Last Updated: August 21, 2007 07:46 EDT
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