Surprise statement comes after company refused to discuss bid speculation earlier in the week
Smith & Nephew has released a statement to the London Stock Exchange denying it is involved in any takeover or merger talks.
The announcement comes after a week of bid speculation about the medical device maker that has raised questions over when companies should be forced to reveal an approach to the market.
The statement reads: ‘Smith & Nephew notes the continued press speculation in relation to a possible merger or takeover involving the company.
‘Smith & Nephew has a long-standing policy of not commenting on press speculation, unless there is a regulatory obligation to do so. However, exceptionally, Smith & Nephew wishes to clarify that it is not engaged in any discussions which could lead to a merger or a takeover involving the company.’
Today’s statement follows a story in the Daily Telegraph claiming that Smith & Nephew is set to begin informal discussions with US rival Biomet about a possible merger. Smith & Nephew shares are up 3.5 percent today in London.
Smith & Nephew’s decision to make a statement signals a change of approach for the company, which has previously been reluctant to comment on bid speculation.
Earlier this week, Smith & Nephew refused to comment on a Sky News story, published last Saturday, which claimed it had been targeted by Johnson & Johnson with a £7 bn ($11 bn) bid late last year.
It remained silent despite the fact the company’s shares rose over 10 percent on the following Monday, leading to the concern a false market could emerge in Smith & Nephew's shares.
Under UK takeover rules, companies are required to make a statement confirming bid talks if, after an approach is made, there is an ‘untoward’ movement in the company’s share price.
