US-based Stryker set to pounce on Smith&Nephew

Stryker may be set to pounce on rival Smith&Nephew according to a person with knowledge of the situation, Street Insider reported.

Although rumours about just such a transaction had been percolating through markets for a long time, they had not lost their power to influence the share price of both companies.

During the company´s third quarter earnings conference call on 10 December, chief Kevin Lobo said M&A continued to be the firm´s number-one priority when deploying its cash, although the timing was difficult to predict.

"Valuations is one factor; it's not always the only factor. We also have issues sometimes around quality, of remediation that's required. Sometimes it's cultural fit, so there's always a range of issues that we go through when we're looking at a target, and as we get under the covers and do due diligence, then we sort of figure out whether we really want to move forward or not,” Lobo said.

As of 16:04 stock in London-listed orthopaedics equipment manufacturer Smith&Nephew were rising by 5.27% to reach 1,179p while those of its New York-listed rival Stryker were down 0.53% to $92.20.