REuters - Sawiris says still interested in Telecom Italia


(Reuters) - Egyptian tycoon Naguib Sawiris would invest in Telecom Italia (TLIT.MI) as long as the company kept its stake in Brazilian mobile operator TIM Participacoes (TIMP3.SA), he said on Monday, as foreign bid interest picks up in the struggling operator.

"We have not lost interest," said Sawiris, who had a 3 billion euro ($3.8 billion) offer to buy a stake in Telecom Italia rejected in 2012.

"This company needs two things: one -- a capital increase and two -- a desire to expand or improve," Sawiris told Reuters by telephone, making clear he would not be interested if Telecom Italia sold its stake in TIM.

He said he would be prepared to take part in a capital increase but would not buy shares in the market.

Earlier this year, Sawiris said Telecom Italia needed 3 billion to 4 billion euros to reduce its debt and allow for possible investments. He declined on Monday to say how much he would be prepared to invest.

Telecom Italia has been forced to regroup after losing out to Telefonica (TEF.MC) in a $9 billion bidding battle for Vivendi's (VIV.PA) telecoms business in Brazil, GVT.

Burdened with more than 27 billion euros of net debt, in need of cash to carry out costly network upgrades and lacking a clear direction, Telecom Italia has again turned from hunter to potential prey, several investment bankers have told Reuters.

Last week, Bloomberg reported that U.S. businessman Sol Trujillo was seeking to raise as much as 7.5 billion euros to bid for a stake in Telecom Italia.

Reached by telephone by Reuters on Monday, Trujillo said: "I don't really comment on rumors." He declined to elaborate.

A changing shareholder structure at Telecom Italia is making it an easier target for potential bidders.

Telefonica, which is still Telecom Italia's largest indirect shareholder with a 14.8 percent interest, is selling out, with an 8.3 percent stake going to Vivendi as part-payment for GVT, and the balance covered by an exchangeable bond which Telefonica sold earlier this year.

In addition, a group of Italian financial institutions have also said they will sell their stake in Telecom Italia, which amounts to a combined 7.6 percent.

Sawiris, a former owner of Italian mobile operator Wind, said he was not in talks with Telecom Italia and would not make another approach unless he knew it was likely to be accepted.

"I made an offer one time. It was rejected. I don't want to go through that again," he said. "I've learned in my life it's better to know that you're welcome before you waste your time."

>>> What to look at today - 30th of Sept. 2014

US Market closed lower, but not on the low od the day, S&P closed above its 50d MA...few geopolitical news put pressure on the market (Hong Kong, Calaunia, Technology outperformed, Energy -0,4% widening its sept. loss to 6,5% and q3 declined to 8%, consumer discretionary sector (-0.6%) lagged amid weakness in carmakers after Ford(F 15.11, -1.22) said it projects a pre-tax loss of $250 million for its European unit in 2015. The stock plunged 7.5%, while peer General Motors (GM 32.22, -0.95) lost 2.9%. Homebuilders also lagged despite lower Treasury yields, TIBCO Software (TIBX 23.65, +4.14) surged 21.2% after agreeing to be acquired by Vista Equity Partners for $24.00 per share, representing a 26.3% premium to the closing price on September 23. Separately, Athlon Energy (ATHL 58.32, +11.59) spiked 24.8% in reaction to news that Encana (ECA 21.59, +0.46) will acquire all of the issued and outstanding shares of ATHL for $58.50/share. Lastly,DreamWorks Animation (DWA 28.18, +5.82) jumped 26.0% amid speculation the company could be acquired by Softbank...volume were below average @ 620mil shares...VIX @ 15,98 +7,61%...Hong Kong is once again leading regional indices to the downside with few signs that the standoff between Occupy Central and the authorities will abate, China HSBC final manufacturing PMI dominated a rather active for economic data session. The final print declined from the 50.5 Flash print to 50.2 but remained in expansion for the 4th consecutive month. HSBC noted "companies continued to cut their staffing levels in September at a modest pace", and chief economist said "the data in September suggest that manufacturing activity continues to expand at a slow pace," reiterating the need for "more accommodative monetary as well as fiscal policies."... Japan August figures were generally mixed, with strong employment data (rising cash earnings and falling unemployment) but bigger than expected declines in industrial output and household spending... Nikkei -0.95% ...Hang Seng -1.37%...Shanghai +0.17%

Eur$ 1.2688 S&P +0.05% Eurostoxx +0.13% FTSE +0.02% Dax-0.06% SMI -0.03%

Macro
- Merkel Adviser Sees Low Rates for Prolonged Time: Handelsblatt
- Italy Govt Sees GDP -0.3% This Yr, Up 0.5% in 2015: Sole
- Japan Aug. Industrial Production Falls 1.5% M/m; Est. +0.2%

Keep an eye on :
- AUTO SECTOR : F -7,47% on investor day comments...watch European names...US Auto Sector (S5AUCO) -4,03%, testing Feb lows...50d MA crossing 200d MA...{S5AUCO Index GPC D<GO>}
- BANK SECTOR : S&P Lowers 88% of European Bank Hybrid Issue Ratings (Earlier)
- AIR FP : Airbus A350 to Get ESA Certification Today, Les Echos Says
- AKZA N: Akzo Will Close More Coatings Plants, Financieele Dagblad Says
- ALV GY : Pimco Total Return Cut From Gold by Morningstar on Gross Exit
- BON FP : Bonduelle Sees Another FY of Growth in Operating Profitability
- CBK GY : N.Y. Said to Target Some Commerzbank Employees: Hartford Courant
- CEZ PW : CEZ May Cut Staff by About 6% to Reduce Costs, CEO Tells Ihned
- CU FP : Bonomi Seeks Data from Club Med in Sign Bid is Active: Reuters {http://reut.rs/YKiN5m}
- GBF GY : Bilfinger Shrs Rise After Cevian Capital Raises Stake to 25.62%
- GLEN LN : Glencore Expects More Closures of Steelmaking Coal Mines to Come
- MOL AV : MOL Says Oil Shipments From Russia Are Secure: Reuters
- PRY IM : Prysmian CFO Sees No Addl. Costs on Western Link, Stable Div.
- SAN FP : Sanofi, Regeneron Say Dupilumab Met Endpoints in Phase 2a Study
- TIF US : Tiffany & Co: Lone Pine Capital discloses 5.3% passive stake
- TLSN SS : TeliaSonera Won’t Exit Eurasia Units, Svenska Dagbladet Reports
- VIV FP : Vivendi May Be Looking at Deal With Lions Gate: Reuters {http://reut.rs/1CBiWaD}
- ZALANDOIPO : Zalando Sets Issue Price at EU21.50/shr

>>> Brokers Upgrades & Downgrades - 30th of Sept 2014

>>> Up
*AFRICAN RAINBOW MINERALS RAISED TO OVERWEIGHT AT BARCLAYS
*ALSTRIA OFFICE RAISED TO BUY FROM HOLD AT BANKHAUS LAMPE
*ASSOCIATED BRITISH FOODS RAISED TO OUTPERFORM AT CREDIT SUISSE
*EXXARO RAISED TO EQUALWEIGHT VS UNDERWEIGHT AT BARCLAYS
*KUMBA IRON ORE RAISED TO OVERWEIGHT VS EQUALWEIGHT AT BARCLAYS
*LAGARDERE RAISED TO BUY VS NEUTRAL AT ODDO
*MTU AERO ENGINES RAISED TO BUY VS HOLD AT BERENBERG
*NEXANS RAISED TO NEUTRAL FROM UNDERPERFORM AT CREDIT SUISSE
*PGS RAISED TO NEUTRAL VS SELL AT UBS#
*SHELL RAISED TO OUTPERFORM VS MARKETPERFORM AT BERNSTEIN
*SMITHS GROUP RAISED TO OVERWEIGHT VS NEUTRAL AT JPMORGAN

>>> Down
*ARCELORMITTAL SOUTH AFRICA CUT TO UNDERWEIGHT AT BARCLAYS
*ASIA RESOURCE MINERALS CUT TO UNDERWEIGHT VS NEUTRAL: JPMORGAN
*FERREXPO CUT TO SELL VS NEUTRAL AT UBS

>>> PT Change


>>> Initiation
*ALPHA BANK RATED NEW NEUTRAL AT UBS, PT EU0.68
*EUROBANK RATED NEW SELL AT UBS, PT EU0.31
*LEONTEQ RATED NEW OUTPERFORM AT CREDIT SUISSE, PT CHF285
*ORLEN RATED NEW UNDERWEIGHT AT JPMORGAN
*PIRAEUS RATED NEW NEUTRAL AT UBS, PT EU1.45
*PKN ORLEN RATED NEW UNDERWEIGHT AT JPMORGAN

>>> Call
>> Stock
*ANGLO AMERICAN, FERREXPO ADDED TO UBS LEAST PREFERRED LIST

>>> US After Hours Summary: SNX +6.6%, CTAS +1.1%, SANW -4.3%, F -



From: LAURENT CHEKROUN () At: Sep 30 2014 06:34:22
Subject: Fwd: Briefing;>>> US After Hours Summary: SNX +6.6%, CTAS +1.1%, SANW -4.3%, F -1.0%
After Hours Summary: SNX +6.6%, CTAS +1.1%, SANW -4.3%, F -1.0% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: SNX +6.6%, CTAS +1.1%

Companies trading higher in after hours in reaction to news: CPRX +19.7% (announced positive top-line Phase 3 data from pivotal Firdapse clinical trial in patients with Lambert-Eaton Myasthenic Syndrome), BLDP +6.9% (received ElectraGen fuel cell system order for deployments in Digicel network), SNX +6.6% (initiated a quarterly cash dividend of $0.125 per share; co also reported earnings), SMPL +4.9% (to merge with HomeStreet (HMST); SMPL shareholders to receive one share of HomeStreet common stock for each share of Simplicity common stock), CTRP +2.3% (Priceline (PCLN) disclosed a 5.84% active stake in 13D filing)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: SANW -4.3%, F -1.0%

Companies trading lower in after hours in reaction to news: SVU -1.5% (announced the discovery of malware on some of its point of sale systems; protective technology believed to have limited the risk of data 

Reuters - Bonomi letter keeps French Club Med bid battle alive

(Reuters) - Italian tycoon Andrea Bonomi has written to directors of his bid target Club Mediterranee asking for updated financial information, a letter seen by Reuters shows, in a sign he still hopes to win control of the French holiday company.

The letter is dated Sept. 26, two weeks after Bonomi's bid was trumped by Gaillon Invest II, a takeover vehicle led by Chinese conglomerate Fosun and its controlling shareholder, the Chinese billionaire Guo Guangchang.

In the letter addressed to independent board members, Bonomi's Global Resorts asks whether Gaillon was provided with any additional or updated information to which Global Resorts did not have access.

Gaillon's 22-euro-a-share, 839 million euro ($1.06 billion) offer for the French vacation group made on Sept. 12 has been recommended by management and backed by Club Med's chairman, Henri Giscard d'Estaing, who will keep his job under the plan.

Global Resorts - whose 21 euro-a-share offer trumped a previous bid from the Gaillon team and would remove the existing management - has said it is considering its options.

Club Med said in a statement that "a strict compliance with equal treatment" between the bidders had always been ensured.

The letter from Global Resorts is addressed to Club Med headquarters in Paris, but is marked for the attention of a committee of independent directors, reminding the committee of its role ensuring "compliance with the principle of equality among bidders".

"In this respect we would like to know whether Gaillon Invest II, Fidelidade and/or the parties acting in concert with them have been given access to any additional or updated information other than those to which Global Resorts had access during its due diligence," it said.

Fidelidade is a Portuguese insurance company owned by Fosun.

The letter, also copied to markets regulator AMF, continued: "In any case, we would like to have the opportunity to review the information underlying the third-quarter results published by the company on Sept. 4."

Club Med shares have sat marginally above the offer price in the days since Gaillon's increased its offer. On Monday, the stock rose 0.4 percent to 22.49 euros.

Fwd: Briefing;>>> US After Hours Summary: SNX +6.6%, CTAS +1.1%, SANW -4.3%, F -1.0%

After Hours Summary: SNX +6.6%, CTAS +1.1%, SANW -4.3%, F -1.0% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: SNX +6.6%, CTAS +1.1%

Companies trading higher in after hours in reaction to news: CPRX +19.7% (announced positive top-line Phase 3 data from pivotal Firdapse clinical trial in patients with Lambert-Eaton Myasthenic Syndrome), BLDP +6.9% (received ElectraGen fuel cell system order for deployments in Digicel network), SNX +6.6% (initiated a quarterly cash dividend of $0.125 per share; co also reported earnings), SMPL +4.9% (to merge with HomeStreet (HMST); SMPL shareholders to receive one share of HomeStreet common stock for each share of Simplicity common stock), CTRP +2.3% (Priceline (PCLN) disclosed a 5.84% active stake in 13D filing)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: SANW -4.3%, F -1.0%

Companies trading lower in after hours in reaction to news: SVU -1.5% (announced the discovery of malware on some of its point of sale systems; protective technology believed to have limited the risk of data 

(BN) Yahoo Stands to Reap $11 Billion in Breakup (Correct): Real M&A


Yahoo Stands to Reap $11 Billion in Breakup (Correct): Real M&A
2014-09-30 02:22:07.301 GMT


(For a Real M&A column news alert: SALT REALMNA <GO>. Corrects
second paragraph to replace Softbank with Yahoo Japan.)

By Tara Lachapelle
Sept. 30 (Bloomberg) -- Yahoo! Inc. shareholders are
inching closer to a potential $11 billion windfall.
Activist fund Starboard Value LP stepped up pressure on
Yahoo last week to break itself up, a move analysts say could
amount to an $11 billion market value gain. Starboard’s
proposals include Yahoo selling its valuable stakes in Alibaba
Group Holding Ltd. and Yahoo Japan Corp. and merging with
advertising rival AOL Inc. The ideas lay out a plan for
rewarding investors who are losing confidence in Chief Executive
Officer Marissa Mayer’s ability to create value with the
acquisitions she’s been making.
Yahoo, now worth less than those Asian stakes, has put $1.3
billion toward takeovers since 2012, around the same time Mayer
took the helm, according to Starboard. During that period,
earnings before interest, taxes, depreciation and amortization
dropped by almost half as revenue also slid. Investors are now
left holding a $40.52 stock that could be valued at more than
$50 in a breakup -- $51 if you ask Gabelli & Co. and up to $57
by Albert Fried & Co.’s estimates.
“This is a very classic sum-of-the-parts story: If you can
break up the company into its different parts, it would be worth
a lot more,” Brett Harriss, an analyst for Gabelli, said in a
phone interview. “The last thing shareholders want is the
management team going out and trying to be venture
capitalists.”
Alternatively, Yahoo may be a good acquisition for Alibaba
or SoftBank, Harriss said. A deal would enable Alibaba to buy
back its shares from Yahoo without a large tax leak. As SoftBank
searches for targets, buying Yahoo would increase its stakes in
Yahoo Japan and Alibaba.
Sarah Meron, a spokeswoman for Sunnyvale, California-based
Yahoo, declined to comment.

Starboard Record

In past investments such as Office Depot Inc. and TriQuint
Semiconductor Inc., Starboard’s exhaustive research and activism
have helped yield gains for shareholders.
The activist is now targeting a company whose business
investors assign no value. Yahoo shares are instead buoyed by
the stakes in Alibaba and Yahoo Japan, which add up to more than
Yahoo’s closing price yesterday of $40.52. Investors are
awaiting the potential payoff from selling those assets, rather
than expressing bullishness on Yahoo itself.
With the hype over Alibaba’s initial public offering dying
down, bears are beginning to pile in to Yahoo. Short interest is
up sixfold from the start of the year to 1.9 percent, the
highest since March 2012, four months before Mayer became CEO,
according to data compiled by Markit.
“Now that Alibaba’s IPO is in the rearview mirror, Yahoo’s
no longer benefiting from Alibaba’s ‘What if’ valuation
questions,” Youssef Squali, a New York-based analyst at Cantor
Fitzgerald LP, said in a note yesterday. “Marissa Mayer’s
honeymoon with investors is over.”

Looking for Cash

While Mayer has focused on making purchases to try to
position the Web portal for future growth, shareholders would
prefer to see the company’s cash returned to them, said Sameet
Sinha, a San Francisco-based analyst at B. Riley & Co.
“You have an activist investor saying ‘You have this cash
and we just want to make sure that you will utilize it
responsibly, versus the last couple of years where you’ve made a
lot of acquisitions that we haven’t seen bear any fruit,’”
Sinha said in a phone interview.
Yahoo’s trailing 12-month Ebitda was about $1.8 billion in
the period before Mayer took over and embarked upon a takeover
spree, according to data compiled by Bloomberg. It has since
fallen to $948 million. Revenue declined about 7 percent over
that same span.

Tax Savings

Analysts have described many ways Yahoo can reward
investors, though most say that a tax-efficient method for
exiting the Asian stakes takes priority.
Yahoo retained a 16.3 percent interest in Alibaba after the
Chinese e-commerce company’s IPO earlier this month. Selling its
remaining shares would create a large tax bill, which could be
avoided if Alibaba took over Yahoo, shareholder Ironfire Capital
LLC has suggested.
Yahoo is also the second-largest owner of Yahoo Japan
behind SoftBank, which means SoftBank could use an acquisition
as a way to gain more control of the Japanese business. SoftBank
has had internal conversations about buying Yahoo, according to
a person familiar with the matter, who asked not to be
identified discussing private information.
Mitsuhiro Kurano, a Tokyo-based spokesman for SoftBank,
declined to comment.

Free Business

The sum of Yahoo’s parts equates to about $51 a share, with
about $7.50 from the Yahoo Japan stake, $34 for its interest in
Alibaba and $9 a share of cash, according to Gabelli’s Harriss.
That means any acquirer would be getting Yahoo’s core business
for free.
“Even if Yahoo’s U.S. business went to zero tomorrow, it
would still be a fantastic deal for SoftBank or Alibaba,”
Harriss said. “And it would be a win for shareholders if they
went out and sold themselves.”
Starboard is proposing that AOL, which has reinvented
itself as a competitor in the digital-advertising industry,
merge with Yahoo to save as much as $1 billion of expenses. Not
only would there be cost-cutting opportunities, it may even
boost revenue, according to Brian Wieser, a New York-based
analyst at Pivotal Research Group LLC.
“Being a larger player means you are in a far better
position to get a larger share of your customers’ wallets,”
Wieser said in a phone interview. “It also means you have a
larger customer base over which to amortize expenses and capital
investment that you might not otherwise undertake. For example,
investing in higher-quality video content.”

Asset Swap

B. Riley’s Sinha says there’s a way for Yahoo to both merge
with AOL and sell its Alibaba stake without the tax penalty:
SoftBank could first buy AOL, then exchange it with Yahoo for
the Alibaba shares.
He also estimates Yahoo could add about $15 to its stock
price by raising money domestically and then giving it to
shareholders, rather than paying them with the repatriated
proceeds from the Asian assets. Apple Inc. made a similar move
last year by borrowing funds to repurchase stock instead of
using its overseas cash hoard, which would have been taxed.
The issue for Mayer with keeping Yahoo’s proceeds
internationally is that it reduces her flexibility for making
further acquisitions, Sinha said.
“Management always wants to do the right thing probably,
it’s just that they also have other motivations,” he said. “So
it can be good to have an activist there.”

For Related News and Information:
Yahoo’s Mayer Under Scrutiny as Starboard Pushes to Unlock Value
NSN NCJ7WR6KLVRB <GO>
AOL Reincarnated as Digital Ad Powerhouse Entices Yahoo Activist
NSN NCJ18D6TTDS0 <GO>
Yahoo Valued at Less Than Asian Assets After Alibaba’s IPO
NSN NC6RK56TTDS0<GO>
Alibaba Ambitions Signal Deals for Snapchat to Akamai: Real M&A
NSN NBPDKS6VDKHU <GO>
SoftBank Ending T-Mobile Deal Opens Door to Dish, Line: Real M&A
NSN NAPV9M6TTDSJ <GO>
Real M&A columns: NI REALMNA <GO>
Top deal stories: DTOP <GO>

--With assistance from Brian Womack in San Francisco, Alex
Sherman in New York and Takashi Amano in Tokyo.

To contact the reporter on this story:
Tara Lachapelle in New York at +1-212-617-8911 or
tlachapelle@bloomberg.net
To contact the editors responsible for this story:
Beth Williams at +1-212-617-2307 or
bewilliams@bloomberg.net
Whitney Kisling

>>> Asian Update

Asian Market Update: China HSBC manufacturing PMI still in expansion but softer than expected; Hong Kong's Leung warns standoff may last


***Economic Data***
- (CN) CHINA SEPT FINAL HSBC MANUFACTURING PMI: 50.2 V 50.5E (4th straight expansion)
- (JP) JAPAN AUG JOBLESS RATE: 3.5% (3-month low) V 3.8%E
- (JP) JAPAN AUG LABOR CASH EARNINGS Y/Y: 1.4% V 0.9%E (6th consecutive increase)
- (JP) JAPAN AUG RETAIL SALES M/M: 1.9% (2nd consecutive rise) V 0.5%E; RETAIL TRADE Y/Y: 1.2% (5-month high) V 0.1%E
- (JP) JAPAN AUG PRELIM INDUSTRIAL PRODUCTION M/M: -1.5% (1st decline in 2 months) V +0.2%E; Y/Y: -2.9% V -1.1%E
- (JP) JAPAN AUG OVERALL HOUSEHOLD SPENDING Y/Y: -4.7% V -3.6%E (5th straight decline)
- (AU) AUSTRALIA AUG PRIVATE SECTOR CREDIT M/M: 0.4% V 0.5%E; Y/Y: 5.1% V 5.2%E
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 113.7 v 112.9 prior
- (NZ) NEW ZEALAND SEPT ANZ ACTIVITY OUTLOOK: 37.0 V 36.6 PRIOR; ANZ BUSINESS CONFIDENCE: 13.4 (2-yr low) V 24.4 PRIOR
- (NZ) NEW ZEALAND AUG BUILDING PERMITS M/M: 0.0% V 0.0%E
- (KR) SOUTH KOREA AUG INDUSTRIAL PRODUCTION M/M: -3.8% V +0.1%E; Y/Y: -2.8% V +2.0%E
- (KR) SOUTH KOREA OCT BUSINESS SURVEY MANUFACTURING: 78 (3-month high) V 74 PRIOR; BUSINESS SURVEY NON-MANUFACTURING: 74 V 72 PRIOR
- (UK) UK SEPT GFK CONSUMER CONFIDENCE: -1 V 0E

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 -1.3%, S&P/ASX +0.1%, Kospi -0.7%, Shanghai Composite +0.1%, Hang Seng -1.4%, Dec S&P500 flat at 1,969

***Commodities/Fixed Income/Currencies***
- Dec gold -0.2% at $1,217/oz, Nov crude oil -0.3% at $94.32/brl, Dec copper +0.3% at $3.05/lb
- (CN) PBoC to drain CNY20B in 14-day repos (19th consecutive drain); Drains net CNY5B this week v drained CNY11B in prior week (2nd consecutive week of drain)
- JGB: (JP) Japan MoF sells ¥2.50T in 0.1% 2-yr notes, Avg Yield: 0.074% v 0.067% prior; bid to cover: 6.44x v 5.88x prior
- (PE) Peru Central Bank cuts reserve requirement in Soles to 10.5% from 11%, effective on Oct 1st
- USD/CNY: (CN) PBoC sets yuan mid point at 6.1525 v 6.1539 prior setting (1st firmer setting in 4 sessions)

***Market Focal Points/Key Themes***
- Hong Kong is once again leading regional indices to the downside with few signs that the standoff between Occupy Central and the authorities will abate. Ahead of the start of China's National Day holidays, Shanghai Composite and the Hang Seng are both down by over 1%. HK chief Leung warned local businesses that protests may last for a long time, but also noted there is no need to ask for deployment of the PLA (China People's Liberation Army), expressing confidence in local authorities. Leaders with the Occupy Central movement are not deterred despite nearly 100 arrests and over 50 injured, calling for Leung's resignation and vowing to continue marches.

- China HSBC final manufacturing PMI dominated a rather active for economic data session. The final print declined from the 50.5 Flash print to 50.2 but remained in expansion for the 4th consecutive month. HSBC noted "companies continued to cut their staffing levels in September at a modest pace", and chief economist said "the data in September suggest that manufacturing activity continues to expand at a slow pace," reiterating the need for "more accommodative monetary as well as fiscal policies."

- Japan August figures were generally mixed, with strong employment data (rising cash earnings and falling unemployment) but bigger than expected declines in industrial output and household spending. Japan Fin Min Aso cheered the improving employment and also acknowledged the run of poor weather will likely weigh on July-Sept quarter.

- USD staged a bearish reversal across the board, initially trading higher before turning down across the board. USD/JPY tested below 109.20 (-30pips from the highs), while AUD/USD and NZD/USD rose 0.4% about $0.8760 and $0.7820 respectively.

***Equities***
US markets:
- CPRX: Announces positive top-line phase III data from pivotal Firdapse trial in patients with Lambert-Eaton Myasthenic Syndrome (LEMS); +16.4% afterhours
- SNX: Reports Q3 $1.59 v $1.48e, R$3.54B v $3.38Be; +8.5% afterhours
- CTAS: Reports Q1 $0.78 adj v $0.76e, R$1.10B v $1.10Be; +1.1% afterhours
- FDX: Approves new stock repurchase program of up to 15M shares (approx 5.3% of shares outstanding) - AGM; +0.2% afterhours
- F: Guides FY14 pretax profit ~$6B; guides initial FY15 pretax profit $8.5-9.5B - investor day; -0.9% afterhours
- DWA: Deal talks between DreamWorks, Softbank said to have cooled - financial press; -7.4% afterhours

- AAPL: China regulators said to approve introduction of iPhone 6 - financial press
- GM: CEO: To reveal long-term business plan on Wednesday; details to include firmer financial guidance, will run past 2020 - financial press

Notable movers by sector:
- Consumer staples: Nissin Food 2897.JP +2.0% (to increase price of noodle products)
- Financials: Sumitomo Corp 8053.JP -12.5% (cuts FY14/15 guidance; to close JV coal operations); Noble Group NOBL.SG -6.8% (CIC to cut stake); Dah Sing Banking Group 2356.HK -3.8%, Bank of China Hong Kong 2388.HK -1.8%, HSBC 0005.HK -1.0% (HKMA reports several Hong Kong banks remained shut)
- Consumer discretionary: Lawson 2651.JP +0.9% (to acquire Seijo Ishii supermarket chain); Recall Holdings Ltd REC.AU +9.5% (reports of possible offer from Iron Mountain); Chow Tai Fook 1929.HK -0.6%, Li & Fung Ltd 494.HK -0.8%, Cheung Kong Holdings 1.HK -2.9%, Esprit Holdings 330.HK -1.3% (Hong Kong protest impacting local retailers)
- Industrials: Hyundai Motors 005380.KR +0.3%, Kia Motors 000270.KR +0.9% (tentative agreement with union)

WSJ : SoftBank, DreamWorks Animation Talks Cool

SoftBank, DreamWorks Animation Talks Cool
Two Sides Still Could Renew Talks or Agree on a Content Partnership


SoftBank Corp.'s discussions to acquire DreamWorks Animation SKG Inc. have cooled, according to people familiar with the matter, less than two days after word first emerged of the talks.
It wasn't immediately clear what had happened between Saturday, when the talks were under way, and Monday. It remained possible that negotiations could restart, two of the people said. The two sides could ultimately strike a deal other than an outright takeover, one of the people said, for instance some kind of content partnership.


DreamWorks shares spiked on the initial report, rising 26% Monday to close at $28.18 on the Nasdaq Stock Market. However, following news of the talks cooling, DreamWorks shares fell 9% from the Monday close in after-hours trading.
The talks had come about two months after Tokyo-based SoftBank, which owns Sprint Corp., abandoned a bid for T-Mobile US Inc.
Headed by veteran Hollywood executive Jeffrey Katzenberg, DreamWorks has released animated hits like "Shrek" and "Madagascar," though recent releases like "Rise of the Guardians" and "Turbo" have disappointed at the box office, depressing its stock price.
The prospect of a takeover gave DreamWorks its most significant share boost since its stock fell after disappointing second-quarter results in July. The Glendale, Calif., company reported a second-quarter loss of $15.4 million on revenue of $122.3 million.
Eric Wold, a stock analyst at B. Riley, said SoftBank could be attracted to DreamWorks because of a "beaten-down valuation that still has a valuable content library and character franchise," adding that the telecommunications company could be looking for ways to get content from DreamWorks's youth-oriented YouTube company, AwesomenessTV, to its Sprint consumers.
AwesomenessTV, purchased by DreamWorks for an initial $33 million in May 2013, is one of several recent acquisitions at DreamWorks as part of an effort to diversify the studio's business into online content, consumer products and television. The animation company releases two to three films a year, an arrangement that requires the public company to release a steady stream of hits to keep the stock price afloat.

(Makor) Special Situations: Brewers (2). Long SABMiller / Short AB-Inbev stub

Special Situations: Brewing deals (2)

Now is better than 2 weeks ago

SAB LN: GBP 34.22; HEIA NA: Eur 58.44; CARLB DC: DKK 522; ABEV: US$ 6.57; BUD: US$110.69

September 30, 2014

Last Sept 16, while the market was speculating on a takeover of SABMiller by AB-Inbev, we concluded that an acquisition was unlikely at the then price for SABMiller, up the preceding day more than 10%. Since then, SABMiller stock price heavily corrected and has been the worst performing major brewer in Europe (next table):