Nexans: a buyer, SG doesn't believe in General Cable.

(CercleFinance.com) - Société Générale (SG) has confirmed its buy rating on the share of the French cable manufacturer Nexans.


SG analysts have distinguished the group for its fundamental qualities more than for its potential interest in the US group General Cable, a scenario they deem lacks credibility. SG maintains its 12-month target price for the share at 61 euros, with the share still one of SG's favourite "smidcaps".

At the end of last week, news agencies reported that three major European names in the sector, Prysmian, NKT and Nexans, have made offers to take over their US competitor General Cable (GC).

SG believes that it would not be in Nexans' interest to take over all of GC, although this seems to be the option considered by the US group. In addition, the value of General Cable (market capitalisation of approximately 1 billion dollars and slightly more in net debt) seems to exceed Nexans' financial firepower, which SG estimates at one billion euros.


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