(BFW) Croda Is M&A Candidate; Personal Care Issues Temporary: Goldman

Croda Is M&A Candidate; Personal Care Issues Temporary: Goldman
2014-08-27 07:00:08.837 GMT


By Chiara Remondini
Aug. 27 (Bloomberg) -- Croda hasn’t lost high-value, high-
margin mkt share in personal care as weak organic growth due to
soft personal care mkt rather than structural issues, Goldman
Sachs says in note dated yday.
* Goldman Sachs reiterates buy, unchanged PT at 2,750p
* Says co. is strategic asset, potential M&A candidate given
strong industry position, attractive valuation; may appeal
to chemical cos. seeking to move further downstream
* Brokerage sees catalyst at 3Q earnings on Nov. 6, says stock
may re-rate if results in line with guidance, any indication
of improvement in organic growth
* Highlights positive impact from product introductions, start
of manufacturing of generic Lovaza
* Sees scope to return cash to shareholders through buyback,
special div. on strong cash generation, potential absence of
pension top-ups, “lack of meaningful” M&A
* NOTE July 22: Croda said it will manufacture generic Lovaza
with partner
* NOTE July 22: Croda CEO said Personal Care slowdown
temporary
* NOTE: co. trades ex interim div today


For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>

To contact the reporter on this story:
Chiara Remondini in Milan at +39-02-8064-4241 or
cremondini@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net

>>> Brokers Upgrades & Downgrades

>>> Up
*ARCADIS RAISED TO BUY VS HOLD AT ING
*MAUREL ET PROM RAISED TO BUY VS SELL AT SOCGEN
*RWE RAISED TO HOLD AT DEUTSCHE BANK
*SODEXO RAISED TO OUTPERFORM VS NEUTRAL AT CREDIT SUISSE
*ZOOPLUS RAISED TO BUY VS SELL AT BERENBERG

>>> Down
*LEJU CUT TO NEUTRAL VS BUY AT GOLDMAN
*NOBEL BIOCARE CUT TO UNDERPERFORM AT JEFFERIES

>>> PT Changes


>>> Initiation
*CARILLION RESUMED EQUALWEIGHT AT MORGAN STANLEY, PT 370P
*EDENRED RATED NEW NEUTRAL AT CREDIT SUISSE, PT EU24
*INFINEON RATED NEW OUTPERFORM AT CREDIT SUISSE, PT EU10.10
*OPERA SOFTWARE RATED NEW BUY AT BERENBERG; PT NOK124
*ROYAL MAIL RATED NEW BUY AT SARASIN
*STMICRO RATED NEW UNDERPERFORM AT CREDIT SUISSE, PT EU4.8

>>> Call
>> Stock
*BRENNTAG REMOVED FROM UBS LEAST PREFERRED LIST
*ENEL ADDED TO UBS KEY CALL LIST
*HAYS REMOVED FROM UBS MOST PREFERRED LIST

>>> What to look at today - 27/08/2014

5US Market closed higher, S&P above the 2,000, Russel leaded the move (+0.9%) but volume continue to be light @500mil shares traded. Energy & Financials continue to OP, US names followed good perf from European peers...Industrials settled in the red (-0.3%), BBY -6.9% after Earnings, DSW +9.2% on Earnings, overall Retailers OP...no concrete news from Minsk but clearly some descalation of the situation...VIX @ 11.63 -0.6%...After Hours TUBE +32.3%, VIMC +7.1%, ARUN +3.3%, SWHC -11.8%, DAEG -10.1%, SLH -1.7%, TIVO -1.4% following earnings/guidance...TIF is reporting today before the open...Asian mkt was quite traded in line with US mkt...China Telecom reported better numbers, Haier reported better sales but stock is down on margin contraction...Nikkei +0.01% Hang Seng +0.09% Shanghai +0.30%

Eur$ 1.3159 S&P +0.04% SX5E -0.22% FTSE -0.15% DAX -0.09% SMI -0.14%

Macro
- EuroStoxx 600 changes : take effect on the 22nd of Sept.
In : ABG/P SM , BPOST BB, ERF FP, EUROB GA, GAM SM, ISS DC , MOR GY, OUT1V FH, PHMX LN
Out :CGG FP, EBRO SM, LMI LN, OTE1V FH, POLY LN, PTC PL , SOW GY, TOD IM, WIN GY,
- *ITALY TO REVISE DOWN GDP FORECAST, PADOAN TELLS CORRIERE

Keep an eye on :
- AENA Aeropuertos : Banks Value Spain's Aena at EU4b at Least, Cinco Dias Reports
- AGFB BB :Reports Q2 Adj EBIT €46M v €36M y/y, Rev €651M v €732M y/y, Revenues hurt by weakness in emerging markets, negative currency effects
- ASC LN : Takeover rumors - eBay mentionned as potential acquirer @£50/share
- CU FP : Fosun won't rule out Club Med return, Vice chairman said Fosun they haven't give up
- EDF FP : EDF Picks Cos to Build 3M Smart Meters: Echos (Correct)
- ENEA SS : Enea 2Q Net 416.1m Zloty; Analysts Est. 279m Zloty
- GOGL NO : Reports Q2 Net profit $1M v loss $5Me, EBITDA $23.2M v $12.9Me, Op Rev $72.8M v $74.5M y/y
- GSK LN : GSK Gets FDA Approval of Added Promacta Indication
- INH FP : Granted EU orphan drug status for IPH4102 for the treatment of cutaneous T-cell lymphoma
- MHG NO : Marine Harvest Posts 2Q Net Loss; Declares NK1/Share Dividend
- REP SM : Repsol Said Stalled in Talks to Buy Talisman Energy Assets: WSJ
- RNO FP : Renault Says Ruble Fall Prompts Car-Price Increases in Russia
- RUSAL (486 HK) : Rusal 2Q Adjusted Ebitda $220m; Est. $258.7m
- SAP GY : SAP, China Telecom Joint Venture Opens Shanghai Data Center
- STCBV FH : Stockmann: Sudden departure of CEO could mean accelerated strategic changes -Kauppalehti
- TEF SM : Telefonica Faceoff in Brazil Portends GVT Bidding War {NSN NAXQ3K6VDKHT <go>}
- TFI FP : TF1 Wants to Be Able to Buy Newspapers, Radio Stations: Echos
- TTI GY : Tom Tailor : There is speculation that Fosun could raise stake from 23%

FT : Nespresso smells opportunity in helping small coffee growers

The chief executive of Nespresso has high hopes for coffee from South Sudan, part of the area in east Africa from where the bean originates.
The farmers in the African nation are several years away from providing beans for the company’s coffee capsules. But after receiving the first export from the country, Jean-Marc Duvoisin wants consumers around the world to sample the brew from the “cradle of coffee”.

The head of the company – owned by Swiss food group Nestlé – will on Wednesday announce a SFr500m ($546m) six-year farmer welfare and environmental programme, which includes SFr15m of investment in South Sudan, Ethiopia and Kenya. The project will make contributions to a retirement fund for a coffee growing community in Colombia and provide funding to its aluminium capsule recycling programme.
It is part of a growing trend of large international agribusinesses and food companies that are increasing their involvement with smallholder growers. They regard these suppliers as important sources of commodities as well as potential customers.
Some 500m smallholder farmers – those who tend to work on farms of less than 10 hectares – produce about 70 per cent of the world’s food, and are a key source of commodities such as coffee and cocoa, the main ingredient for chocolate.
High quality coffee needs to be grown in high altitudes due to specific climate needs, making it uneconomical for the bigger landowners to cultivate.
With many of the world’s small growers concentrated in developing countries, where government support is often inadequate, an increasing number of multinational companies, many working with aid organisations and not-for-profit groups, are offering assistance to counter the effects of political risk, climate change and poverty.
Sir Gordon Conway, professor of international development at Imperial College, London, says there has been a realisation that unless these farmers feel they have a future in agriculture, the companies’ own strategies will be at risk.
“A lot of big businesses know that the risks of the food system are going to grow and grow,” he says. “They are finding a way forward and are having more involvement on the ground.”
In South Sudan, Nespresso is organising farmers from what was a pilot project into co-operatives, and is providing education and training with the assistance of not-for-profit group TechnoServe.
Supported by brand ambassador George Clooney, the programme envisages the farmers there will become part of Nespresso’s network of 60,000 smallholder suppliers around the world.
“Only 1-2 per cent of the world’s coffee meets the standards of the beans we need. We want to make sure that we get those supplies,” says Mr Duvoisin.
Other big coffee sellers such as Starbucks and Keurig Green Mountain are also providing assistance to growers, while large cocoa traders and chocolate companies this year agreed to collaborate on social welfare and farming aid initiatives for cocoa farmers in west Africa. In May, 12 companies, including Olam, Cargill, Mondelez, and Mars, announced they would align their individual social aid programmes and co-ordinate their efforts.
Meanwhile Sweden’s Hennes & Mauritz is investing in cotton farmers with Dutch NGO Solidaridad to ensure supplies of environmentally sound high quality cotton at a time when demand for food could lure growers away from cultivating the fibre.
Ray Jordan, chief executive of Self Help Africa, which helps farming communities negotiate with international businesses, says the companies’ willingness to engage with local farmers has grown over the past five years.
“Maybe before it was lip service about corporate social responsibility, but the reality is that the needs of the big international companies and small agricultural operations are converging.”
Adriana Mejia, European director of Colombia’s National Federation of Coffee Growers, says that businesses’ environmental and aid plans are under increasing scrutiny.
“You have the NGOs asking questions, and we, as a growers’ federation, also want to see impact,” she says. “If you’re saying you are transforming the lives of producers we want to see how that is being done.”
Some companies also regard the smallholder growers in developing countries as an important future customer base.
SABMiller, the brewer, for example, sees its production of cassava and sorghum beers for certain African markets as a way to boost smallholders as well as accessing new markets.
Mark Bowman, head of SABMiller’s African operations, says sourcing from smallholders leads to “local economic growth and empowerment, stability of supply and, ultimately, the ability to offer our beers to a wider low-income consumer base”.
For Nespresso, greater engagement with the growers can improve the relationship between the product and the customer, says Mr Duvoisin. By getting close to the farmers, Nespresso says it can relay to customers the conditions the beans were grown under, including the soil and the climate.
“The different stories we can tell of what is in their cup creates a strong link between the producer and the consumer,” says Mr Duvoisin.

>>> ASOS said to be eyed by Amazon and eBay; investor Bestseller rumoured to hav

ASOS said to be eyed by Amazon and eBay; investor Bestseller rumoured to have been approached

The share price of ASOS, the online fashion retailer, leapt 7.6% yesterday amid rumours of an approximately GBP 50 (USD 83)-per-share takeover bid, The Daily Mail reported. The market report said dealer chatter suggested Bestseller, a family owned Denmark-based clothing company, had been contacted by a North American group regarding the potential sale of its 27.4% stake.

The e-commerce giants Amazon, based in Seattle, Washington, and San Jose, California-headquartered eBay are thought to be interested in ASOS, the report said, noting that both are keen to expand their clothing offerings. A Daily Express market report which also named the two US prospective bidders said Bestseller might be interested in making an offer itself.

The Mail item reported that Nick Robertson, chief executive and founder of ASOS, is believed to be engaged in divorce proceedings with his estranged wife Janine and may be tempted to listen to highly priced bid offers, the report said. It stated that he is believed to have a fortune worth more than GBP 440m and owns 9.3% of ASOS.

A Times market report mentioned rumours that Robertson could be close to disposing of part, if not all, of his holding.

ASOS shares ended the day’s trading at 2348p yesterday, 26 August, the report said, noting that the share price hit a 7195p high five months ago. The company has a GBP 1.96bn market cap.




Source Daily Mail, Daily Express, The Times

>>> EuroStoxx 600 changes

*PORTUGAL TELECOM, SOFTWARE AG TO BE DELETED FROM STOXX 600
*WINCOR NIXDORF, TOD’S TO BE DELETED FROM STOXX 600
*POLYMETAL INTL, LONMIN, CGG, EBRO FOODS TO LEAVE STOXX 600
*EUROFINS SCIENTIFIC, GAMESA, BPOST TO JOIN STOXX 600
*EUROBANK ERGASIAS, ISS, ABENGOA TO JOIN STOXX EUROPE 600 INDEX

(MergerMarket) Fosun won't rule out Club Med return, to retain its stake

Fosun won't rule out Club Med return, to retain its stake - executives
 
Fosun International Limited, will keep a close watch on France's Club Mediterranee [EPA CU], and does not rule out the possibility of coming back to the fray, Vice Chairman Liang Xinjun said.

"The withdrawal of our first tender offer to take over Club Med doesn't mean we have given up on Club Med," Chairman Guo Guangchang added. Fosun will also retain its stake in Club Med, he said, even as reports state that Ardian, its French partner for its failed bid, will accept rival bidder Andrea Bonomi's takeover offer.

Fosun and Ardian announced last 14 August that they have withdrawn their USD 746m offer for Club Med, after French regulators allowed the USD 1bn rival bid. Fosun and Ardian each have 9% in Club Med. 

Given its relationship with Club Med and the resort chain's robust growth in China, Fosun is confident that Club Med could develop even further under the umbrella of Fosun Group, Liang said. 

Bonomi's Investindustrial has offered EUR 21 (USD 28.14) a share for all the shares of Club Med, while Fosun and Ardian, through their joint venture Gaillon Invest, had offered EUR 17.50 euros each.

Fosun and Ardian did not rule out "exploring any potential options which would serve Fosun's and Club Med's best interests," Fosun said in a filing to the Hong Kong Stock Exchange on 14 August.

by Ling Ya

>>> Asian Update

Asian Market Update: Fonterra reaches partnership in China; Putin, Poroshenko commit to political process


***Economic Data***
- (AU) AUSTRALIA Q2 CONSTRUCTION WORK DONE Q/Q: -1.2% V -0.5%E (largest decline in 5 quarters)
- (NZ) NEW ZEALAND JULY FOOD PRICES M/M: -0.7% V +1.4% PRIOR (first decline in 4 months)
- (KR) SOUTH KOREA AUG CONSUMER CONFIDENCE: 107 V 105 PRIOR

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 -0.1%, S&P/ASX +0.2%, Kospi +0.4%, Shanghai Composite flat, Hang Seng flat, Sept S&P500 flat at 1,999

***Commodities/Fixed Income/Currencies***
- Dec gold flat at $1,284, Oct crude oil flat at $93.89/brl, Sept Copper flat at $3.18/lb
- (US) API PETROLEUM INVENTORIES: CRUDE: -1.3M v -1Me, GASOLINE: -3.2M v -1Me, DISTILLATE: +2.4M v -0.5Me
- (JP) BOJ offers to buy ¥400B in 5-10yr JGB, ¥100B in 10-25yr JGB and ¥30B in JGB with maturity over 25-yr
- (AU) Australia MoF (AOFM) sells A$600M in 3.25% 2029 Bonds; avg yield: 3.7184%; bid-to-cover: 3.46x

***Market Focal Points/Key Themes***
- NZD has clawed back some of the recent losses, rising about 30pips above $0.8360 after dairy cooperative Fonterra launched a partnership with the leading Chinese infant food manufacturer Beingmate. Fonterra also affirmed its FY14/15 payout of NZ$6/kg after the announcement, just as expectations were starting to build that it may have to lower the payout forecast once again. Separately, New Zealand July food prices fell m/m for the first time in 4 months.

- In China, local press speculated the top four banks have accelerated their lending in the past week relative to a rather subdued loans volume in the first half of the month. Recall this follows a very disappointing new yuan loans report for July. Banks were said to be increasingly concerned with rising NPL levels. Among notable earnings, China Telecom posted an over 10% increase in net profit as the growth in 3G subscribers accelerated. Earlier, Haier Electronics reported a 10% topline growth but shares fell 2% due to a 70bp gross margin contraction.

- After initial speculation that bilateral Putin-Poroshenko talks in Minsk could fall apart, the two leaders finally held a brief round of talks. Both spoke in favor of promoting peace in the East. Putin added the recently detained Russian soldiers were actually only patrolling the border, while Poroshenko promised to work on an urgent ceasefire plan.

***Equities***
US markets:
- TUBE: Reports Q2 $0.01 adj v -$0.15e, R$28.7M v $24.0Me (2 est); +33.4% afterhours
- ARUN: Reports Q4 $0.24 v $0.23e, R$203M v $195Me; cutting workforce by 4% (66 employees) as part of cost optimization plan; +4.2% afterhours
- ADI: Reports Q3 $0.63 v $0.63e, R$722.4M v $716Me; -0.4% afterhours
- TIVO: Reports Q2 $0.08 v $0.07e, R$111M v $106Me; Approves $350M buyback program (22% of market cap); -1.8% afterhours
- SWHC: Reports Q1 $0.26 v $0.25e, R$131.9M v $134Me; cuts FY15 guidance on high inventories; -11.2% afterhours

Notable movers by sector:
- Consumer Discretionary: Guangzhou Automobile Group 2238.HK -3.5% (H1 results)
- Financials: Haitong Securities 6837.HK +0.8% (H1 results); New China Life 1336.HK +1.4% (H1 results); Steadfast Group SDF.AU +11.9% (FY14 results)
- Materials: St Barbara SBM.AU +2.5% (FY14 results)
- Industrials: Hafei Aviation Industry 600038.CN +2.7% (H1 results); United Co. RUSAL 486.HK -1.0% (Q2 results); Worley Parsons WOR.AU +3.4% (FY14 results); Austal ASB.AU +9.1% (FY14 results); Boral BLD.AU +4.5% (FY14 results)