* FTSE 100 edges up 0.1 percent
* Unilever slumps as Kraft withdraws offer
* RBS up on alternative plan to Williams & Glyn sale
* Hammerson gains after results
* Pearson hit by broker target price cut
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By Atul Prakash and Helen Reid
LONDON, Feb 20 Britain's top share index
steadied after hitting a new one-month high on Monday, with a
slump in Unilever after Kraft ditched its bid offset by
stronger firms like Royal Bank of Scotland and Rolls
Unilever shares tumbled nearly 7 percent and were on track
for their biggest one-day fall since 2008 after U.S. food giant
Kraft Heinz withdrew its proposal for a $143-billion
merger with its larger rival.
Kraft had made a surprise offer for Unilever to build a
global consumer goods behemoth that was flatly rejected on
Friday by Unilever, the maker of Lipton tea and Dove soap.
"What exactly happened in this whirlwind of a story is yet
to be fully revealed, but it looks like Unilever isn’t just
playing hard to get," said George Salmon, equity analyst at
"It was always going to be a difficult pitch to convince
shareholders to relinquish their grip on Unilever, given the
expectations for the company to keep churning out resilient
growth in the years to come."
Pearson also lost ground, with its shares falling
3.9 percent after Berenberg sharply cut its target price for the
stock to 400 pence from 500 pence, saying it did not see a
short-term fix for the company amid serious structural and
cyclical issues at the key higher education courseware division.
The blue-chip FTSE 100 index was flat in percentage terms at
7,299.86 points after climbing to an intra-day high of 7,329.56,
the highest level since the middle of January.
The broader index stayed steady despite sharp falls in
shares of companies like Unilever and Pearson as some other
firms made strong gains.
Royal Bank of Scotland shares rose 6 percent, the
top gainers in the FTSE 100 index, as the lender said late on
Friday that it had proposed abandoning the disposal of its
Williams & Glyn business after a seven-year struggle to sell the
unit to meet European Union state aid demands.
"On the face of it, removing this uncertainty would seem
like good news for RBS investors, reflecting the fact that
executing a disposal of Williams & Glyn was a key hurdle that
the group needed to overcome before it could recommence paying
dividends," Shore Capital analyst Gary Greenwood said.
Rolls Royce gained 6.3 percent after Goldman Sachs
added the stock to its "Conviction List" and upgraded its rating
on the aero-engine maker to "buy" from "neutral", saying that
its earnings performance was expected to improve.
Hammerson, which owns and manages shopping centres,
was among top gainers, up 4.3 percent after it posted an
increase in net asset value per share and said its premium
retail outlets continued to outperform.
Liberum analysts, who give Hammerson a 'hold' rating, said:
"Hammerson is the only European REIT to offer exposure to faster
growing premium outlets," adding that they remain cautious on
the sustainability of rental growth due to weaker consumer
British builder Bovis Homes slumped 10.2 percent,
the biggest faller in the FTSE 250, after the company
said profit would drop again this year as it builds fewer homes
and focuses on improving quality.
Small-cap support services and construction company
Interserve plummeted 32.1 percent, its worst daily loss
since 2002, after it doubled the charge for getting out of its
(Reporting by Atul Prakash; Editing by Janet Lawrence)