The plight of builders in the slowing U.K. economy took center stage in Europe Wednesday as the market leader, Taylor Wimpey plc, warned it may breach agreements with its banks. The company failed to attract investors to an emergency £500 million ($997 million) share sale, which its banks had made a condition of easing existing loan terms. The group's market value is now less than a fifth of its £1.7 billion debt, and the announcement raised the prospect the group -- and potentially peers -- would collapse. On Wednesday, Taylor Wimpey's share price plunged by more than half, and peers, including Barratt Developments plc and Persimmon plc, fell in its wake.
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As private equity continues to struggle with banks that once lent freely, investors cheered the news that a consortium contemplating bidding for business publisher Informa plc had got as far as making a 506 pence per share, or £2.15 billion, indicative offer. The addition of Informa's debt would take the deal value to a hefty £3.39 billion -- quite a feat to pull off in the current markets -- and the stock remained well below the proposed offer.
Meanwhile, Big Pharma's march on U.S. biotechs continued as Bayer AG unveiled an agreement to buy the hemophilia treatment portfolio of Maxygen Inc. for up to $120 million. - Laura Board
