Smith & Nephew surges as rumours resurface about Stryker takeover bid

Shares in Smith & Nephew surged in London on Wednesday on the back of rumours that US surgical implants group Stryker Corp could return to the table to launch a takeover offer within weeks.

Stryker’s chief executive had said back in May that the company had been evaluating a bid for its UK rival that never emerged.

Now, with the six-month standstill period having ended during which Stryker was not allowed to make a bid, the company is said to be planning a renewed approach.

According to Bloomberg, which cited “people with knowledge of the matter”, Stryker is looking to make a bid at a premium of around 30% to S&N’s current share price.

The London-listed stock, which closed at 1,089p per share on Tuesday, had a market capitalisation of around £9.7bn after a 26% jump year-to-date.

The shares advanced nearly 9% to 1,183p in early deals on Wednesday, valuing the company at around £10.6bn.

Bloomberg’s sources said that Michigan-based Stryker is not planning a controversial tax-inversion deal because of the limited tax benefits and political risk associated with a potential takeover.

Speculation about a soon-to-be-announced proposal resurfaced last month on reports that Stryker was weighing up the financing of a possible deal and looking at potential anti-trust obstacles.