reuters : Telecom Italia investor Fossati says TIM Brasil won't go cheap

(Reuters) - Telecom Italia investor Marco Fossati said any offer for TIM Brasil should value the Brazilian wireless operator at around 11 times core earnings, or twice its current market value of 10 billion euros ($13 billion) .

Consolidation in Brazil is heating up after Grupo Oi unveiled plans last week to take over TIM Brasil and Telefonica started exclusive talks to buy broadband operator GVT from France's Vivendi.


"If Brazilian operators want to reduce the number of players to three from four, bagging enormous synergies, it would be better if they presented an offer that values TIM Brasil at 11 times its EBITDA," Fossati told Reuters in a phone interview on Tuesday.

"Otherwise we will not take it into consideration," he said.

The Italian businessman, the second largest investor in the Italian group with a stake of just under 5 percent, said the exit of Telefonica from Telecom Italia was positive and he welcomed the possible entrance of Vivendi in the Italian incumbent's capital. (1 US dollar = 0.7621 euro)

WSJ : Anglo American CEO Says Open to Takeover Offers

Anglo American CEO Says Open to Takeover Offers
Mark Cutifani Aims to Boost Miner's Return on Capital Employed to At Least 15% in 2016

LONDON—The chief executive of Anglo American AAL.LN +1.61% PLC, one of the world's largest mining companies, said he won't pull up the drawbridge if a compelling takeover offer arrives.

"My job is to create value, however that may be shown," said Mark Cutifani, an industry veteran tasked 15 months ago with turning things around at Anglo after the departure of former chief executive Cynthia Carroll.

"Our job is to do a good job with the business, and at the end of the day, if somebody sees value, then there's a conversation to be had," said Mr. Cutifani.

"I'm not anti. I'm very open. I'm not scared by it," he said in an interview with The Wall Street Journal. But Mr. Cutifani, 56 years old, said his overriding ambition remained transforming Anglo into a top miner in its own right.

"That's not what we're setting this business up for," Mr. Cutifani said, referring to any future deal. In 2009, Anglo-Swiss mining firm Xstrata PLC made an approach that was rebuffed by Ms. Carroll. Since then, Xstrata has been absorbed by Glencore GLNCY +0.67% PLC.

Mr. Cutifani's key aim is to boost Anglo's return on capital employed to at least 15% in 2016. That measure slipped to 10% in the first half of 2014 from 11% a year earlier.

"It's an imperative that we have to get to. We've got to be doing better than that number," said Mr. Cutifani. Earlier this year, Anglo said it would sell some of its older, deep-level platinum shafts, a process Mr. Cutifani said would take at least another 18 months.

With assets in commodities ranging from iron ore to platinum and diamonds across several continents, Anglo is one of the world's most diversified mining companies. But bad bets—including one by Ms. Carroll on a Brazilian iron-ore mine that has run more than $6 billion over budget—have eaten into profits. Anglo's shares have fallen 55% since early 2011.

Investors have also fretted about Anglo's exposure to South Africa, where its subsidiary Anglo American Platinum Ltd. AMS.JO +1.18% —known as Amplats—has been hit by a five-month strike this year.

Mr. Cutifani has aimed to slash Anglo's costs and put several peripheral assets up for sale. The company's shares are up 17.5% this year, outperforming both of its bigger rivals, BHP Billiton Ltd. BHP.AU +0.54% and Rio Tinto RIO.LN +0.70% PLC.

Amid a global commodities downturn, Rio and BHP have also been selling assets, focusing investment on a smaller universe of commodities and steering away from a diversification model that until recently characterized many of the world's biggest miners. Mr. Cutifani, however, said he still believes in the diversified-mining model.

"We're less focused on driving into a favored commodity because in our view, there are so many unpredictable issues," he said.

Investors and analysts are closely tracking Mr. Cutifani's turnaround efforts.

"Either the company outperforms under Mark Cutifani's leadership, and demonstrates the value of tons in the ground, or it fails to do so and is put out of its misery in fairly short order," said Paul Gait, an analyst at Sanford C. Bernstein.

>>> THOMA BRAVO : Confirms to be acquired for $2.5B (aggregate value $10.92/shr)

Confirms to be acquired for $2.5B (aggregate value $10.92/shr) 

- Thoma Bravo jointly announced that Compuware has entered into a definitive agreement to be acquired by leading private equity investment firm Thoma Bravo, LLC, in a transaction valued at approximately $2.5 billion.
- The transaction expected to close by early 2015
- Elliott Management, which owns approximately 9.5 percent of Compuwares common stock, has entered into an agreement with Thoma Bravo agreeing to vote its shares in favor of the transaction.
- Compuware has agreed to immediately discontinue its quarterly cash dividend.
- There is no financing condition associated with the proposed acquisition.- Thoma Bravo will pay a cash purchase price of $10.43 for each outstanding share of Compuware common stock, less the pro rata portion of the applicable corporate tax that will be owed in connection with the spin-off of Covisint, currently estimated at $0.18 per share based on the current market price of Covisint, for a net cash payment of approximately $10.25 per share.
- The parties have agreed that within 60 days following the date of the merger agreement, Compuware will effectuate the pro rata distribution to its shareholders of the remaining shares of Covisint owned by Compuware, resulting in a distribution of Covisint shares representing approximately $0.67 per share of Compuware common stock based on the closing price of Covisint on Friday, August 29. During the 60-day period, Compuware may seek a higher value alternative for its Covisint shares, in which case the proceeds, net of tax and certain charges, of such disposition will be paid to Compuware shareholders.

>>> Anglo American : CEO: Concerned about prices for iron ore, downturn for pric

CEO: Concerned about prices for iron ore, downturn for pricing could last longer than many expect 
- notes there is a lot of iron ore supply coming online and profits will be impacted


WSJ Article : Anglo American CEO Worried About Outlook for Iron-Ore Market
Fears That Global Supply Glut Won't Abate Any Time Soon

LONDON— Anglo American AAL.LN +1.67% PLC Chief Executive Officer Mark Cutifani said he's "worried" about the outlook for the iron-ore market amid a sharp fall in prices and signs that a global supply glut won't abate any time soon.

In an interview with The Wall Street Journal, Mr. Cutifani said Anglo would nonetheless press on with its much-delayed Minas-Rio iron-ore project in Brazil, which is expected to deliver its first ore later this year.

"There is a lot of [iron ore] supply coming on and it will impact profits—and so I'm concerned," said Mr. Cutifani.

While Anglo produces a range of commodities, from diamonds to copper, its iron ore and manganese division contributed more than 40% of its underlying earnings in the first half of 2014.

Iron-ore prices have slid 35% this year, to around $87 per ton, according to the Steel Index, as demand growth in key markets such as China has slowed and as major producers such as BHP Billiton BLT.LN +1.26% PLC and Rio Tinto RIO.LN +0.62% PLC have been producing at record output levels.

Mr. Cutifani said that if prices fell to around $80 per ton some producers would find it difficult to stay in the market. But he said it could take time before a full supply side response emerges.

"What I've found in this industry is that a lot of capacity can be really sticky," he said. "My concern is the downside [to prices will be] more and longer than you anticipate."

Mr. Cutifani warned that major producers' strategy of continuing to ramp up supply could backfire.

"In my view, they'll make a call that is right for their investors or they'll pay the price," he said.

Anglo would be unlikely to buy up distressed iron ore producers if prices fall further as the company won't allocate any more capital to the commodity, Mr. Cutifani said. But he said it would be "irresponsible" for Anglo not to proceed with its Minas-Rio project, which he said could deliver iron ore to Asia at a cost of $50-55 per ton. Anglo expects output from Minas-Rio to reach 26.5 million tons a year eventually.

"That rocket has been launched a few years back," Mr. Cutifani said of the project, which Anglo bought in 2008 for $5.5 billion. It is now expected to require total investment of $8.8 billion, against an initial estimate of $2.5 billion.

FT : Iran’s hardliners ready to exploit corruption trial

For more than three decades, the family of Akbar Hashemi Rafsanjani, Iran’s former conservative president, has been seen by the Iranian public as a symbol of the Islamic regime’s corruption, allegedly with a hand in many projects, both big and small.
But the closed-door trial of one of Mr Rafsanjani’s sons, Mehdi Hashemi, on unspecified corruption and security charges is less to do with the current regime’s fight against corruption than with a growing power struggle as hardliners battle to reinstate their parliamentary majority in 2016 elections, ahead of a presidential poll the following year.

Even though the vote is still 18 months away in February 2016, hardliners – mainly based in the judiciary, the parliament, the state-run radio and television and the elite Revolutionary Guards – are already closing ranks against the centrist government of Hassan Rouhani.
“Iran’s politics are getting very complicated,” said one reform-minded analyst. “Hardliners, who know they have little public support, still think they can accuse their rivals of links to Mr Rafsanjani and prove they are corrupt.”
The tactic was successfully employed by former president Mahmoud Ahmadi-Nejad, who used his election campaigns to question Mr Rafsanjani’s economic record and accuse his family of massive fraud – building Mr Ahmadi-Nejad a reputation as a champion in the fight against corruption.
But the latest charges relating to the Rafsanjani family come after disclosures that the biggest corruption in Iranian history took place on Mr Ahmadi-Nejad’s watch, when in one case $2.8bn of oil revenues disappeared and in another an embezzlement of the same amount occurred in the banking sector. Many similar examples of corruption are thought to exist.
According to unconfirmed reports, Mr Hashemi is accused of receiving millions of dollars in commissions in oil contracts with western companies. While analysts do not rule out the possibility, they say these figures are considered tiny compared with the scale of the figures revealed in the corruption cases under the previous government.
“Rafsanjani and his family were not clean, but you cannot in any way compare that level of corruption with the current one started under the previous [Ahmadi-Nejad] government,” said one economist.

Mr Rafsanjani – whose alliance with Mohammad Khatami, a former reformist president, was crucial in mobilising public support for Mr Rouhani in last year’s election – has shown no sign of retreat.
He has recently become more outspoken and published a transcript of private meetings that took place six years ago during which he warned that the radical policies of Mr Ahmadi-Nejad were inflicting economic and political damage on the country.
“Rafsanjani is not going to be intimidated by the imprisonment of his children even though he knows Mehdi will get a heavy sentence,” said another reform-minded analyst. “He will continue to fight and influence Rouhani because he wants to save the Islamic regime and not to let radical forces destroy it.”
Mr Rouhani has also stood up to his opponents. When his minister of higher education was impeached two weeks ago, he promised to continue his university reforms – students are one of his main support bases – no matter how many more ministers were removed.
In recent weeks, Mr Rouhani’s government has accused the state broadcaster of refusing to cover its achievements, particularly the reduction of the inflation rate from about 40 per cent to 25.3 per cent over the past year, which has been widely praised by Iranian economists.
Akbar Torkan, a senior adviser to Iran’s president, said hardliners were instead trying to show the government was inefficient.

Although government opponents are unable to block Mr Rouhani over the nuclear talks with the US, UK, France, China, Russia and Germany, thanks to the strong support he receives from the supreme leader Ayatollah Ali Khamenei, they are hoping the negotiations will fail, making him vulnerable to charges of ‘inefficiency’, if not treason.
“Whenever there is any new round of talks, some say they are shaking [with fear],” Mr Rouhani said of his political adversaries recently: “OK, go to hell! . . . I cannot do anything [for you].”
Meanwhile, analysts say hardliners also worry that Mr Rouhani may meet US President Barack Obama on the sidelines of the UN General Assembly this month even though Iran’s president denied such a meeting was being planned. If a meeting took place, it would be the first time the two countries’ presidents have met since the 1979 Islamic revolution.
It is not clear whether the arrest in July of Jason Rezaian – an Iranian-American journalist writing for the Washington Post – is related to back-channel efforts to prevent any such encounter between the two presidents.
Some analysts expect the suppression of pro-reform forces to intensify and say it is highly likely that Mehdi Hashemi will be sentenced to at least a couple of years in jail, which then can be exploited by hardliners against moderate forces in the next elections.
Mr Hashemi and other Rafsanjani family members deny all allegations of corruption. Mr Rafsanjani’s daughter, Fatemeh Hashemi, who is also charged with security offences, accused hardliners of “taking the son for the father”.
“Those who were themselves involved in corruption accuse our family of corruption to mobilise the public opinion against Mr Rafsanjani and to decrease his influence in politics,” Ms Hashemi said, speaking to the Financial Times. “Today, people see that the Hashemis have not been involved in any wrongdoing and see that the judiciary does not deal with those who were involved in corruption. The image of Hashemi family has improved a lot.”

>>> Darden Restaurants guides Q1 EPS just above consensus; reaffirms FY15 guidan

Darden Restaurants guides Q1 EPS just above consensus; reaffirms FY15 guidance; new Board of Directors will have four Starboard members, four incumbents and four new independent/unaffiliated members

Co issues upside guidance for Q1 (Aug), sees EPS of $0.31-0.33, excluding non-recurring items, vs. $0.30 Capital IQ Consensus Estimate. The Company reported that it anticipates U.S. same-restaurant sales for the first quarter to be approximately +2.8% for LongHorn Steakhouse, -1.3% for Olive Garden and +2.1% for its Specialty Restaurant Group. The Specialty Restaurant Group's results reflect preliminary U.S. same-restaurant sales of approximately +3.9% for The Capital Grille, +2.5% for Eddie V's, +2.3% for Yard House, +1.1% for Bahama Breeze and -0.3% for Seasons 52.

Co reaffirms guidance for FY15 (May), sees EPS of $2.22-2.30, excluding non-recurring items, vs. $2.23 Capital IQ Consensus. These expectations reflect the Company's projection that U.S. same-restaurant sales growth for fiscal 2015 for Olive Garden, LongHorn Steakhouse and the Specialty Restaurant Group will be flat to +1%, +1% to +2% and ~ +2%, respectively.

Co also announced a new slate of nominees for election to the Company's Board of Directors at the 2014 Annual Meeting of Shareholders, which is scheduled for October 10, 2014. The new slate reflects the Board's commitment to serving the best interest of all Darden shareholders. Darden's slate and proposed board structure would provide for four new independent nominees unaffiliated with the Company or Starboard, four returning independent director nominees, and four seats to be filled by candidates proposed by Starboard Value L.P. and its affiliates.

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance
: CONN -25.5%, VIVO -0.6%.

Select pharma/biotechl related names showing weakness: AMPE -5.1% (announces update on the phase III, multicenter, double-blind STEP study of Ampion for osteoarthritis of the knee), GSK -1.6%, AZN -1.1%.

Select metals/mining stocks trading lower: GFI -2.5%, PAAS -2.4%, NEM -2.1%, GG -2%, GDX -1.8%, SLV -1.7%, GOLD -1.7%, GLD -1.6%, SLW -1.4%, .

Other news: EXEL -52.4% (announces results from the COMET-1 Phase 3 pivotal trial of Cabozantinib in men with metastatic castration-resistant prostate cancer), RIBT -17.4% (disclosed its Irgovel plant experienced a structural breakdown; co withdraws prior guidance), TWGP -11.9% (received a letter from the SEC stating that the SEC is conducting an investigation and attaching a subpoena for various documents), PT -2.7% (still checking), LXRX -1.3% (files for $150 mln mixed securities shelf offering), PXLW -1.2% (files $50 mln common stock shelf offering), HSBC -0.9% (stake sold by Fund Manager Neil Woodford, according to reports), CREE -0.7% (LED demand fell in Q3 QoQ, according to reports (not stock specific)).

Analyst comments: OSIS -3.1% (downgraded to Perform from Outperform at Oppenheimer), FNSR -2.5% (downgraded to Hold from Buy at Jefferies), EMES -1.7% (downgraded to Neutral at Robert W. Baird on valuation), FCX -0.5% (downgraded to Equal-Weight from Overweight).

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance
: DGLY +15.5%, FORM +2.4%, KFX +1.1%, (also announces acquisition of Softpro GmbH) ZNH +1%, GZT +0.7%.

M&A news: CPWR +15% (WSJ reporting that company is in sale discussions), FLWS +12.6% (signs definitive agreement to acquire Harry & David Holdings for $142.5 mln in cash), TMUS +2.8% (Illiad (ILIAY) in discussions with buyout firms regarding TMUS bid, according to reports), DG +1.7% (to raise bid for FDO for $80/share), TSL +1.4% (acquires Majority Stake in Yunnan Metallurgical New Energy), ARCP +0.8% (confirms Cole Corporate Income Trust entered into merger agreement relating to the sale of CCIT to Select Income REIT (SIR)), FDO +0.6% (Dollar General (DG) confirms enhanced proposal to acquire Family Dollar).

Select pharma/biotech related names showing strength: ELOS +10.5% (still checking), ZGNX +5.9% (reports that Zohydro ER demonstrates sustained 12-hour pain relief), ARNA +3.9% (still checking), NVS +3.5% (new heart failure medicine LCZ696 cut cardiovascular deaths by 20% vs. ACE-inhibitor in landmark PARADIGM-HF trial, early results of upcoming presentations).

Other news: HGSH +43.2% (signed its second shanty area rebuilding project agreement with a budgeted investment over $750 mln), ASTI +21.2% (announces new common stock investment of $8.0 mln led by largest shareholder), SYNA +4.7% (positive Barron's mention), USG +3.5% (positive Barron's mention), ISNS +2.4% (in sympathy with DGLY), NXPI +2.2% (reports that Apple (AAPL) may partner with Visa (V) and Mastercard (MA) for payment applications), DTV +1.9% (still checking), OWW +1.8% (reaches an agreement with American Airlines (AAL) to continue to offer American Airlines and US Airways (LCC) flights on all of its sites), BLDP +1.8% (appoints Randy MacEwen as President and Chief Executive Officer, effective October 6, 2014), PBA +1.2% (to acquire the Vantage pipeline system and Mistral Midstream's interest in the Saskatchewan Ethane Extraction Plant), NBG +0.9% (still checking), YHOO +0.8% (Alibaba.com to begin roadshow next week, according to reports).

Analyst comments: SPLS +4.9% (upgraded to Outperform from Neutral at Credit Suisse), SD +3.4% (upgraded to Buy at Stifel), CENX +3% (upgraded to Overweight from Equal-Weight at Morgan Stanley), GRPN +2.9% (upgraded to Sector Perform at RBC Capital Mkts), STO +2.9% (upgraded to Buy from Hold at Deutsche Bank), TSLA +2.9% (upgraded to Buy from Hold at Stifel), DSKY+2.6% (initiated with a Overweight at Piper Jaffray), ACHN +2.6% (tgt raised to $15 from $11 at UBS), TS +2.4% (upgraded to Neutral from Sell), RCAP +1.9% (upgraded to Buy from Neutral at Citigroup), ZU +1.5% (upgraded to Buy from Fair Value at CRT Capital), ANET +1.3% (initiated with a Buy at Sun Trust Rbsn Humphrey), COG +1% (upgraded to Buy at Stifel), AAPL +0.8% (target raised to $120 from $105 at Piper Jaffray)