S&N shares up as it launches legal action

Source: Healthcare Digital

Date :08/08/2008 10:00:46

Smith & Nephew plc rose the most in eight months in London trading after the knee implant maker limited the financial effect of unacceptable sales practices at its orthopedics unit.

The company gained 29.5p, or 5.2 percent, to 597p after reiterating that the sales practices will reduce revenue by US$100 million, mostly this year.

The increase gives the company a market value of £5.3 billion.

Smith & Nephew began legal action against Plus Orthopedics, a private Swiss orthopedics company it bought for US$889 million (£455 million) last year.

Last May, Smith & Nephew said US$100 million would be wiped off full-year revenues because of what it claimed were “unacceptable” sales practices at Plus’s Greek operations.

That triggered a 13 percent drop in its share price and a five percent cut in forecast pre-tax profits for this year.