Another major UK firm is in the takeover spotlight after a report said Smith Nephew had rejected an approach from US rival Johnson Johnson.
The leading maker of hip and knee replacements is said to have turned down an indicative offer worth £7 billion several weeks ago, although Sky News added the American firm was still considering whether to return with a higher offer.
The speculation raises the possibility of another major British company going to an overseas rival after last year’s sale of Cadbury to US firm Kraft Foods.
Hull-based Smith Nephew, which is listed in the FTSE 100 Index, has not made any comment on a wave of recent bid speculation.
Its shares spiked in early December amid takeover rumours but fell back on Friday after US peer Biomet – seen as another potential suitor – reported slower sales growth.
Johnson Johnson has a medical devices division and owns a number of well-known UK household brands, including Listerine, Sudafed and Benecol.
Its approach for Smith Nephew valued the UK firm at 750p a share but this was rejected on the grounds it substantially undervalued the firm, Sky said. Smith also specialises in wound-care products such as dressings and gels.
It is thought that if Johnson Johnson returned with a higher offer, then the likes of Biomet and rivals such as Stryker and Zimmer may also be interested.
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