TheChek News Flow

Britain’s biggest wholesale market, New Covent Garden, is to be redeveloped to create thousands of homes in a £2bn project.

The fruit, vegetable and flower market in Vauxhall, south London, is part of the Nine Elms regeneration zone, where 18,000 homes are being built in the coming decade.

The 57-acre site opened in 1974, with traders moving from the historic Covent Garden area near the Strand in central London. It supplies 40 per cent of London restaurants’ and retail markets’ produce, and three-quarters of all fresh flowers in the capital pass through the market.

Wandsworth Council on Wednesday night granted permission for a consortium comprising St Modwen Properties, Vinci plc and the Covent Garden Market Authority to redevelop the plot, creating 3,000 homes and new market buildings, as well as offices, shops and restaurants.

Bill Oliver, St Modwen chief executive and the chairman of the joint venture company Vinci St Modwen, said the decision meant the scheme would “contribute to the long-term transformation of London’s newest residential and commercial quarter”.

The new market facilities would be “world class”, he promised. The developers will create 500,000 sq ft of space for the market’s 200 business tenants, which employ 2,500 people.

Pam Alexander, the Market Authority’s chairman, said that it would become “a key landmark at the heart of Nine Elms”.

“New Covent Garden Market is central to supplying London’s fresh produce” and the buildings would be “a new Food Quarter for London”, she said.

The plans include a public market to attract visitors. Development work will start early next year.

Also on Wednesday, Whitehall granted permission for work to start on the extension of the Northern Line to serve the Nine Elms area. Two new stations will be created at Nine Elms and Battersea.

The link will be partly funded through private finance contributions from local developers. One of the largest contributors will be Battersea Power Station, which is being regenerated to create a new town centre.

Rob Tincknell, chief executive of the Battersea Power Station Development Company, said: “Historically, the lack of transport connections to the site has been the biggest hurdle to overcome to ensure the successful restoration and redevelopment of the iconic power station and the surrounding area.”

US Market ended mix with with Dow & S&P down as Nasdaq & Russell slightly higher, Banks were underpressure on Forex Fine developments, Fossil & Macy's pushed the retail sector higher after better numbers...volume were in line with average with 700mil shares...VIX @ 13,02 +0,77%...US After Hours FUEL +16.1%, CYBR +14.4%, PLKI +2.6%, TWTR +1.5% (Raise Margins) XONE -8.5%, JCPcabinet has now been forced to deny early elections rumors twice in the scope of the past week. Separately, BOJ's Amamiya said the central bank's easing is an open-ended policy position targeting 2% inflation, and that the central bank is not concerned with the risk of hyper-inflation....As widely expected, BOK left rates on hold at 2.00% in a unanimous decision. Policy statement was largely neutral, noting exports continue favorable trend, economy would improve gradually, and negative output gap would narrow. Echoing some of the Korean govt officials, BOK acknowledged external threat of a weak Japanese yen potentially hurting domestic exporters, noting it was closely watching major countries' monetary policy along with the risks of the end of US easing and slowdown in the eurozone....Tech Sector pushed China mkt to open much lower (Tencent opened -3% on disaop numbers, rally all day - now +0.5%) ...Nikkei +1.14% Hang Seng +0.48% Shnaghai +0.03%-5.9%, NTAP-3.1%, CSCO -1.4% following earnings/guidance...WLT -3.5% (files $2.5b Mixed Sec. shelf)...Hasbro said to be in talks to buy Dreamworks (DWA US) -NYT (http://nyti.ms/1BdSVRs)...In Japan,

- China’s Zhu Says Divergent Global Monetary Policies Create Risks

- Brent Crude Falls Below $80 for First Time Since Sept. 2010

- China Oct. Industrial Output Rises 7.7%; Est. 8.0%

- Rio Tinto Urges G-20 to Focus on Infrastructure, Corruption

- ABG/P SM : Abengoa 9M Net Income Rises 37% to EU100M

- AB1 GY : Air Berlin 3Q Pretax Earnings EU50.4m vs EU102.2m

- ADEN VX : Adecco Starts New Shr Buyback Program Up to EU250m

- ADP FP : Aeroports de Paris Says Air France Strike Cut EU12m From Sales

- AGN NA : Aegon 3Q Net Income Misses on Charges, Americas Morbidity

- AH NA : Ahold 3Q Underlying Oper. Profit, U.S. ID Sales Beat Ests., CFO Sees Overall Sales Trends U.S. Improving in 4Q

- ALO FP : Alstom May Return EU3.5 Bln to EU4 Bln to Shareholders

- ATC NA : Altice has firepower to bump PT Portugal bid - Merger Market

- AR4 GY : Aurelius 9-Month Ebitda Rises to Record, Raises FY Forecast

- BMPS IM : Monte Paschi 3Q Net Loss EU796.7m; Est. EU461.7m Loss

- BMPS IM : Monte Paschi Received Binding Offers for Consum.It Unit: CFO

- BNP FP : BNP Paribas Fortis to Review Management Bonus Policy: Tijd Link

- CRG IM : Banca Carige may seek merger with BPM following capital increase - Milano Finanza daily edition

- RF FP : Eurazeo 3Q Revenue Rose 4.3% to EU1.19B

- FGR FP : Eiffage Cuts Rev. Forecast, Expects Slight Decline

- FER SM : Morgan Stanley Selling 3.11% Stake in Ferrovial

- GTO NA : Gemalto Buys Marquis ID Systems; Terms Not Disclosed

- GSZ FP : GDF Suez 9-Month Ebitda EU8.9b vs Est. EU9b; Confirms Targets

- ILD FP : 3Q Rev. E1,06bln vs E1,05bln, 9,58mln sub. at Seot 30 vs 9,10m at june 30

- INGA NA : ING Group: ING to sell 34.5 million shares in Voya Financial ( Reducing stake from 32,5% to 19%)

- SDF GY : K+S 3Q Ebit I Beats Ests.; Raises 2014 Rev., Ebit I Forecasts

- LNZ AV : Lenzing 9M Sales, Profit Fall on Global Fiber-Production Surplus

- MLP GY : MLP 9M Sales Rise 2%; EPS Down 22%; Confirms 2014 Ebit Outlook

- MRK GY : Merck KGaA 3Q Adj. Ebitda Beats; Raises 2014 Sales Forecast

- MRL SM : Merlin Properties 3Q Net EU29M

- MOBB BB : Mobistar Says Telenet Lost Court Bid to Block Cable Regulation

- RWE GY : RWE 9-Month Recurrent Net Income EU763m, Est. EU779m

- SAL IM : Salini Impregilo 9M Rev. EU3.09b Vs EU2.89b Y/Y

- SBMO NA : SBM 9-Month Directional Rev. $2.52b; Stable Vs Yr Earlier

- SRP LN : Carlyle Said Interested in Serco’s Non-Core Businesses: Sky

- SW FP : Sodexo FY Net Beats Ests., Rev. In Line, Div. Beats

- SOLB BB : Solvay Says Brazil Rejects Braskem Buy of Co.’s Indpua Stake

- SOLB BB : Solvay 3Q Adj. Ebitda EU458m vs Est. EU448m as Rev. Beats Ests.

- SONI PL : Sonae Industria 3Q Loss Narrows to EU10m vs EU16m

- SZG GY : Salzgitter Narrows 3Q Net Loss, Cuts 2014 Sales Forecast

- SAZ GY : Stada 9-Mo. Sales In Line; Keeps 2014 Forecast for Slight Growth

- SY1 GY : Symrise 3Q Sales Sales In Line; Confirms 2014, 2020 Targets

- TLX GY : Talanx 3Q Net EU149m vs EU118m, Confirms 2014 Profit Target

- TEF SM : Chedraui to Offer Mobile Services on Telefonica’s Network (Mexico)

- TFI FP : TF1 Is Selling Off Rights to 29 Rugby World Cup Matches: Figaro

- TOD IM : Tod’s 3Q Ebitda Misses Ests., Rev. In Line

*AVEVA RAISED TO OVERWEIGHT FROM EQUAL WEIGHT AT BARCLAYS

>> Stock

*PHILIPS ADDED TO MORGAN STANLEY EUROPE BEST IDEAS LIST (note attached)

*UBS Preferred in Europe; Citi, JPM, BofAML in U.S.: MS Says

Story

Banca Carige, the listed Italian lender, could seek a merger with peer Banca Popolare di Milano (BPM) after it completes its capital increase of EUR 500m-EUR 650m, Italian-language daily Milano Finanza reported.

The unsourced article said a merger between the two banks could be opened by Andrea Bonomi, the head of private equity firm Investindustrial, subscribing to a significant part of the Carige capital increase. The report noted Bonomi was recently chairman of BPM.

The most likely scenario would involve BPM taking a stake in Carige through a reserved capital increase in the second half of 2015, the item noted.

The Bank of Italy is likely to look favourably at the operation, and with its support plus the fact that Carige would be recapitalised could prove to be factors in favour of BPM agreeing to a merger. BPM and Carige do not have significant geographical overlap, which would make the merger easier, the article added.

Source Milano Finanza daily edition

Shrek could soon share a home with the Transformers and little ponies like Flutteryshy and Twilight Sparkle if their corporate parents are able to seal a deal.

The toymaker Hasbro is in advanced talks to buy DreamWorks Animation, potentially gaining a new big-screen outlet for its wares, people briefed on the matter said on Wednesday.

Should a deal be reached — and these people cautioned that talks were continuing and might still fall apart — it would mark a new chapter for DreamWorks Animation. It would also come more than a month after the studio held talks with another prospective buyer, the Japanese telecommunications company SoftBank.

Under the current terms of the proposed deal, Hasbro would pay a mix of cash and stock, though an exact price has not yet been determined, one of the people said. Jeffrey Katzenberg, the chief executive of DreamWorks Animation, is seeking more than $30 a share, a significant premium over his company’s current stock price.

Shares in DreamWorks Animation closed on Wednesday at $22.37, giving the studio a market value of about $1.9 billion. Hasbro’s stock closed on Wednesday at $57.47 a share, giving it a market value of about $7.2 billion.

Mr. Katzenberg, the Hollywood mogul who runs DreamWorks Animation, is expected to stay with the company, the person added.

In courting the Hollywood studio, Hasbro believes that it can find a new market for its stable of toys, which includes Transformers, G.I. Joe and My Little Pony. The company, the second-biggest toymaker in the United States behind its rival Mattel, has reported robust sales in recent years. Last month, it reported sales of $1.47 billion in its third quarter, up 7 percent from the same period of a year earlier.

Hasbro’s chief executive, Brian Goldner, has long sought to take advantage of the company’s properties to transform it into a global entertainment titan, notably by forming its own studio in 2009 to develop and produce television shows and movies.

One model might be the Lego Group, a privately held Danish company. Lego started with its trademark plastic toy bricks and transformed itself into a broader entertainment company by creating Lego video games and building seven Legoland theme parks. Its most recent effort was a collaboration with Warner Bros., “The Lego Movie,” which took in $468.1 million worldwide. Three sequels are on the way.

Some of Hasbro’s own efforts have met with success. The four live-action “Transformers” movies, made together with Paramount Pictures, have produced nearly $3.8 billion in ticket sales. And Universal recently hit pay dirt with “Ouija,” a horror film based on the classic Hasbro board game. The film cost $5 million to make and has so far taken in $57.9 million.

But Hasbro’s four-year joint venture with Discovery Communications to establish a children’s cable channel, the Hub Network, ended in October when Discovery bought a controlling stake and rebranded the channel Discovery Family.

Hasbro has also suffered a few movie flops, notably “Battleship,” in 2012.

In buying DreamWorks Animation, Hasbro, which is based in Pawtucket, R.I., would be teaming up with Hollywood’s smallest film studio. DreamWorks Animation produces only a handful of movies a year but has been responsible for blockbusters like the “Shrek” and “Kung Fu Panda” franchises. The company was spun off in 2004 from DreamWorks Studios, which is privately owned.

The studio has fallen on harder times in the past couple of years, with films like “Turbo” and “Rise of the Guardians” falling well short of expectations. Even its most recent hit, “How to Train Your Dragon 2,” suffered from lower domestic ticket sales than its predecessor. Source material that is already familiar to children — like Hasbro toys — would give the studio a leg up when it comes to generating interest in a related movie.

DreamWorks Animation’s recent run of misfortune helped contribute to two consecutive quarterly losses, including a $15.4 million loss in the quarter ended June 30. But in the most recent quarter, the company reported net income of $11.9 million, a 17 percent increase compared with results in the same period of a year earlier. From its high in early 2010, the studio’s stock price has fallen 49 percent. Yet analysts have said that DreamWorks Animation still has a trove of lucrative content in its library. And the company has been making forays into television production and an array of other business initiatives, from an entertainment center in Shanghai to indoor mini-theme parks in Russia.

The studio also owns AwesomenessTV, a YouTube channel aimed at teenage girls.

News of the talks between Hasbro and DreamWorks Animation was reported earlier by Deadline.com, a trade publication.

CSR reported better than expected Q3 results with revenues/EBIT of $212m/$41.1m

ahead of UBSe of $210m/$35.1m and consensus of $217m/$39.6m. Underlying core

gross margins rose to 61.3% from 59.2% in Q2 and is the equal highest ever seen

from the company (equal with Q3 '13). Within the quarter, Voice & Music was the key

outperformer, growing 41% y-o-y and benefiting from strength in underlying handset

demand and also structural growth in speaker bars and connected audio solutions.

Disappointingly however, automotive declined further in Q3 (-19% y-o-y vs -18% in

Q2) as despite seeing growth in factory-fit solutions (which is now the majority of

revenue), competitive pressure in after-market solutions in China along with continued

declines in PND solutions, more than offset this.

In Q3, CSR also announced that it had signed a further 20 licences for its aptX audio

codec, taking the total number to nearly 300. CSR has a strong breadth of customers

now for aptX and we believe is helping to strengthen the company's position in the

emerging wireless home entertainment market. In Bluetooth Smart, it remains a small

proportion of overall revenue but CSR highlights it has seen a number of Tier 1 wins

and that revenue approximately doubled y-o-y in Q3.

CSR's management is highlighting that its expectations remain unchanged for Q4. We

have left our revenue forecasts broadly unchanged (c1%, although higher Voice &

Music offsetting lower Auto), but increase our gross margins leading to 8%/5%/4%

increases to our '14E/'15E/'16E EPS forecasts.

Our 900p valuation for CSR is based on the recommended offer price for the shares

from Qualcomm. The court and general meetings to approve the transaction are

scheduled for the 4th December 2014 with the acquisition targeted to be effective by

the end of summer 2015.

We add Philips. Since our September 26 upgrade, the shares have sold off after Q3 disappointments. In his report today, Ben Uglow reiterates that the spin-off of Lighting can crystallise the value of HealthTech.

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