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Thomson-CSF surges
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February 2, 2000: 10:58 a.m. ET
French defense group posts upbeat sales report; stock gains on Raytheon hint
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LONDON (CNNfn) - French defense electronics group Thomson-CSF posted stronger-than-expected sales Wednesday and hinted at closer ties with U.S. giant Raytheon, sparking a surge in its stock.
The company said revenue climbed 11.7 percent last year to 6.9 billion euros ($6.7 billion), suggesting that business improved in the last three months of 1999 after a weak third quarter.
However, it was remarks by chairman Denis Ranque of a "privileged relationship" with Raytheon (RTH.B: Research, Estimates), the number three U.S. defense-equipment company, which sent the shares soaring. The stock was suspended twice having climbed 17.5 percent to 44.65 euros.
Thomson-CSF (PHO) shares have climbed more than 50 percent since November, after underperforming the market earlier in the year.
The $2.2 billion acquisition of Britain's Racal Electronics last month has helped reduce Thomson's exposure to the defense business, which now accounts for 50 percent of sales.
"We always presume that the perception of Thomson-CSF will move from that of a pure aerospace stock to a technology stock," Crédit Lyonnais analyst Philippe Gossard said in a note to clients.
Thomson produces a range of military and civil products including radar for combat aircraft and commercial air traffic control systems for. Its order book stood at an all-time high of 15.4 billion euros at the end of last year. 
-- from staff and wire reports
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Thomson-CSF
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