* FTSEurofirst 300 index gains 0.6 percent
* Shire leads drugmakers on M&A news
* Kuehne & Nagel, Sports Direct advance
* Banco Espirito Santo falls for 6th session
By Atul Prakash
LONDON, July 14 European shares rose on Monday,
rallying from near two-month lows after their biggest weekly
loss in four months, with merger and acquisition activity in the
drugs sector and some positive company news improving sentiment.
London-listed drugmaker Shire rose 2.2 percent after
saying it was ready to recommend a new 31 billion pound ($53
billion) takeover offer from AbbVie, entering talks
after receiving a fifth bid from the U.S. firm.
Shire led the sector higher, with the STOXX Europe 600
Healthcare Index rising 0.9 percent to feature among the
top sectoral gainers in Europe and helping the broader market.
Shares in Shire touched an all-time high of 50.45 pounds.
"It's no secret U.S. companies have a lot of cash ... I
think there will be more of these kind of deals to come," said
Michael Hewson, chief market analyst at CMC Markets.
Chicago-based AbbVie, which wants to buy Shire to cut its
tax bill and diversify its product line-up, made the new offer
of 53.20 pounds per share on Sunday after a request from Shire
for an improvement on the previous approach. Reuters reported on
Saturday that Shire had asked AbbVie to sweeten its offer.
"AbbVie are coming in at a decent level. It's attractive to
Shire shareholders and I think they'll take it - AbbVie sounded
their key shareholders out and I think a fair level has been
reached," TJM Partners' head of trading Manoj Ladwa said.
The broader stock market was also helped by sharp gains
recorded by some individual companies. The FTSEurofirst 300
index of top European shares rose 0.6 percent to
1,360.28 points by 1055 GMT, having fallen 3 percent last week -
its biggest drop since March.
Kuehne & Nagel jumped 3.3 percent, the top gainer
on the FTSEurofirst 300 index, after saying its net profit rose
8.3 percent to 313 million Swiss francs ($351.49 million) in the
first half on revenues of 8.5 billion francs.
Sports Direct, up 4 percent, led retailers higher
after announcing its plans to launch in Australia and New
Zealand in partnership with MySale.
"Sports Direct has consistently outperformed competitors.
They made a lot of money last year," said Mike Jarman, chief
market strategist at H2O Markets. "(Sports Direct founder Mike
Ashley) realises that to continue to create shareholder revenue
(he) has to expand elsewhere."
Portugal's biggest listed bank Banco Espirito Santo
fell 8 percent, taking its losses since early July to nearly 50
percent. BES was at the centre of global market jitters last
week after the disclosure of financial irregularities at a web
of family-held holding companies behind the lender.
Credit Suisse remained underweight Portuguese equities
despite a broadly positive view of peripheral Europe, citing its
private sector debt levels, which are the highest of any
developed nation, poor economic momentum and risk of deflation.
Europe bourses in 2014: link.reuters.com/pap87v
Asset performance in 2014: link.reuters.com/gap87v
Today's European research round-up
(Additional reporting by Andrew Winterbottom in London and
Alistair Smout in Edinburgh; Editing by Catherine Evans)