WSJ : Sony Loss Widens on PC Business Exit

Sony Loss Widens on PC Business Exit
Struggling Electronics Maker Now Expects $1.27 Billion Net Loss for Last Fiscal Year

A logo of Sony Corp is seen on its VAIO laptop at its showroom in Tokyo. Reuters
TOKYO—Sony Corp. said Thursday it expects a wider group net loss for the just ended fiscal year as the cost of disposing of its PC business weighed on the company as a whole.

The hard-hit Tokyo-based electronics maker now predicts a ¥130 billion ($1.27 billion) group net loss for the business year that ended in March compared with its earlier projection for a ¥110 billion loss.

Sony said it expects to book an additional ¥30 billion cost related to its PC businesses and a ¥25 billion write-off related to overseas disk manufacturing operations.

As part of its drastic restructuring measures Sony said in February it will sell its Vaio PC business to turnaround fund Japan Industrial Partners Inc. and split off its money-losing TV division into a separate subsidiary.

The moves underscore Sony's continuing struggle to turn around an electronics business that is bleeding cash. The Japanese company achieved global fame, and decades of profits, with innovative devices such as the Walkman portable music player and Trinitron TV. Electronics products remain at Sony's core, generating about 70% of its revenue.

Last month the company said that it will sell its entire stake in Square Enix Holdings Co., or 8.2% of the videogame maker's issued shares, for ¥15.3 billion.

Sony said Thursday that it will also release its earnings projections for the current fiscal year along with its results for last year on May 14.

>>> US After Hours

After Hours Summary: GDOT +12.3%, WTW +11.4%, UIHC +6.6%, YELP +5.1%, JDSU -6.6%, PEIX -4.2%, HOS -3.9% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: GDOT +12.3%, WTW +11.4%, UIHC +6.6%, YELP +5.1%, HOLX +4.8%, AXTI +4.2%, ISIL +3.7%, FLEX +3.5%, RKUS +2.7%, TSO +2.2%, MMLP +1.5%, EGN +1.5%, CGNX +0.9%, NGD +0.6%, MTGE +0.5%, LOPE +0.3%, MUR +0.3%, PPC +0.2%, TTEK +0.2%, CW +0.2%, ATML +0.1%, NEWP +0.1%

Companies trading higher in after hours in reaction to news: TMUS +7.9% (Bloomberg reporting that Sprint (S) plans to make a bid for the company), GTAT +4.3% (announced a series of strategic initiatives to leverage its advances in Hyperion lamina production technology), THRX +3.6% (announced positive results from a Phase 2 study of TD-9855 in patients With fibromyalgia; 5 mg dose did not meet statistical significance for the primary endpoint), FTEK +3.5% (acquired two air pollution control technology companies for total cash consideration of $7.25 and $1.0 mln; expected to be immediately accretive), ARO +3.4% (provided update to strategic initiatives; co has identified key initiatives it estimates will generate approximately $30-35 mln in annualized pre-tax savings; co also reaffirmed Q1 2014 outlook), SRPT +1.8% (Steven Cohen's Point72 Asset Management declares 5.2% passive stake in 13G filing)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: JDSU -6.6%, PEIX -4.2%, HOS -3.9%, UNTD -3.8%, ELX -3.5%, BYD -3.5%, CTHR -3.2%, STRM -3.2%, TEX -3%, ARAY -2.9%, MET -2.5%, QUIK -2.3%, WDC -2.1%, LOCK -2%, OILT -1%, CAVM -0.9%, LNC -0.8%, MIC -0.8%, SJW -0.7%, GLUU -0.5%, KRC -0.4%, ASH -0.3%, WLL -0.3%

Companies trading lower in after hours in reaction to news: STRM -3.2% (provided an update on the status of audit and timing of fiscal year end filings; co also provided a Q1 update), CLRO +2.1% (filed for a $75 mln mixed securities shelf offering and for 150K shares of common stock by a selling shareholder), RRC -1.1% (announced execution of an agreement to exchange producing properties and other assets with EQT), BLDP -0.8% (filed for $100 mln mixed securities shelf offering), FET -0.8% (priced offering of 10 mln shares by selling stockholders at $29 per share)

>>> GSK CEO downplays suggestion of 'white knight' bid for AstraZeneca

GSK CEO downplays suggestion of 'white knight' bid for AstraZeneca
GlaxoSmithKline (GSK) chief executive Andrew Witty has downplayed suggestions that the FTSE-100 pharmaceuticals group should make a “white knight” offer for AstraZeneca, The Guardian reported. The report cited Witty as saying yesterday (30 April) that GSK was concentrating on its asset swap deal with Switzerland-based rival Novartis.

Witty previously said that companies can be left with unwanted assets after “mega deals,” the item noted.

Separately, the Financial Times reported that some of AstraZeneca’s biggest shareholders are willing to sell if the price is right. Some large shareholders indicated that they would back a deal if listed New York City-based rival Pfizer increased its GBP 60bn (EUR 73bn) takeover bid.

A top 10 shareholder quoted in the Financial Times report said they are not “protectionist,” and that price and commercial logic would be the criteria on which a deal is judged.

One top 10 shareholder quoted in the report said Pfizer’s proposal could yield “huge synergies,” but added that an improved offer would be welcome.

The Financial Times report also quoted AstraZeneca chairman Leif Johansson as saying that he remains opposed to Pfizer’s informal GBP 46.61 per share bid. Johansson said the offer significantly undervalues AstraZeneca, and questioned whether big mergers have been useful in marketing new drugs. The chairman added that AstraZeneca has sufficient scale to create value independently.

Separately, The Times reported that UK politicians said they plan to scrutinize the proposed deal closely. The report quoted a member of a parliamentary select committee, Ann McKechin, who said the size of the proposed deal means that the effects on employees and the UK’s wider interests must be considered alongside the interests of shareholders.

AstraZeneca’s share price closed 31.5p up at 4664p in London yesterday, giving the company a market capitalisation of GBP 58.85bn.


Source The Guardian, Financial Times, The Times

>>> Clariant closes sale of Leather Services business

Clariant closes sale of Leather Services business
Clariant, a world leader in specialty chemicals, today announced the closing of the sale of its Leather Services business to Stahl Holdings B.V. as of April 30, 2014.

Stahl, majority owned by Wendel Group, is a Dutch company providing high-quality chemicals, dyes and coatings for leather and other applications. The combination of both businesses has created a global leader in leather chemicals with a higher growth profile than the standalone entities and with significant synergy potential.

As announced on October 30, 2013, Clariant has received a cash consideration and a 23% stake in Stahl for the sale of its Leather Services business. The minority shareholding will allow Clariant to participate in the upside potential of the enlarged Stahl. Wendel remains the principal shareholder of Stahl with approximately 70% of Stahl's capital.

The closing of the Leather Services transaction marks the last major step in the repositioning of Clariant's portfolio. The company has already divested the Business Units Textile Chemicals, Paper Specialties and the Business Line Emulsions on September 30, 2013, as well as the Detergents & Intermediates business on January 6, 2014.


Source Company Press Release*

FT : AstraZeneca’s Johansson hits at Pfizer ‘big is better’ bid

AstraZeneca’s Johansson hits at Pfizer ‘big is better’ bid

AstraZeneca warned that “bigger is not always better” as it launched its defence against Pfizer’s £60bn approach, but some of the UK pharmaceutical company’s biggest shareholders signalled they would be open to a takeover at the right price.
Leif Johansson, AstraZeneca chairman, on Wednesday highlighted the mixed record of big mergers in the pharmaceuticals industry as he urged investors to keep faith with the company’s drive to revive growth by developing new drugs on its own.
However, several big shareholders said they would support a deal if Pfizer raised its offer, and that they would not be influenced by political concerns over what would be the biggest foreign takeover in UK history.
Meanwhile, Downing Street has appointed two of the most powerful officials in Whitehall – Sir Jeremy Heywood, cabinet secretary, and John Kingman, a top Treasury mandarin – to lead government talks with Pfizer over its plans for one of Britain’s biggest and most strategically important companies.
AstraZeneca has so far refused to enter negotiations with Pfizer over an informal £46.61-per-share offer that it said “significantly undervalued” the company. Mr Johansson told the Financial Times that he saw no reason to change that stance in the absence of a higher bid.
Rejecting Pfizer’s argument that the UK company would benefit from bigger scale, he said: “Big is not necessarily best in pharma.
“It is highly questionable whether big consolidations have led to greater success in getting new medicines to market,” he added. “AstraZeneca is big enough to create good value for shareholders and other stakeholders by itself.”
Ian Read, Pfizer chairman and chief executive, on Wednesday made his case to large AstraZeneca shareholders during a second day of meetings in London aimed at winning support from the City and the UK government.
One top 20 investor said: “We are impressed that Pfizer has made an effort to come and see us. That shows how serious they are. They have listened to us and been impressive.”
A top 10 shareholder said the proposed deal could be “a great fit”.
“There are huge synergies here . . . [but] we would like a better offer than what Pfizer has so far offered,” the investor added.
Other shareholders said the City would not be influenced by concerns over what a deal would mean for jobs and investment in UK life sciences. AstraZeneca employs about 7,000 people in the country and accounts for more than 2 per cent of exported goods.
A top 10 investor said: “We are not particularly protectionist, like the French, and are much more open. Commercial logic and price determines whether we back a deal or not.

This is even more the case now than it was 20 years or more ago as the world has become a smaller place in a business sense. The FTSE is made up of global companies.”
Mr Read met George Osborne, chancellor, Jeremy Hunt, health secretary, and David Willetts, universities and science minister, in three separate meetings on Tuesday night. He also had a conference call on Wednesday with Vince Cable, business secretary, on the way back to the airport after his 48-hour trip
One minister familiar with the talks said: “This is the difference between shareholders and government. Shareholders may not care [about national interest] but public policy and government matters, and we are custodians of the wider view. Pfizer are engaging with us because they value life sciences.”
GlaxoSmithKline on Wednesday indicated it would not be tempted to mount a “white knight” bid to combine the UK’s two biggest drugmakers. Sir Andrew Witty, chief executive, reiterated his longstanding scepticism about the merits of big pharma mergers, highlighting the risk of disruption to research and development.

WSJ : Rolls Royce Warns of Lower Profit at Marine Unit on Production Problems

Rolls Royce Warns of Lower Profit at Marine Unit on Production Problems
Profit And Sales At Unit Will Be Down 10% This Year, Company Says

Rolls-Royce Holdings PLC Thursday cut the outlook for its marine unit due to production problems that will lead to a one-time charge of about £30 million pounds ($50.5 million) and hit profitability.

Marine profit and sales this year will be down 10%, the London-based company said in a statement. Rolls-Royce had previously said profit in the sector would see modest growth on a reduction in revenue.

Rolls-Royce didn't provide further details on the "product quality issue" that triggered the adjustment.

The company also said currency effects from the strong U.K. pound will represent a £40 million hit on profit and £300 million on sales at current exchange rates. The impact comes from repatriating sales in other currencies to the U.K.

At group level the company maintained its outlook for no growth this year with cash-flow on a par with 2013 levels. Growth should resume next year, the company said.

Rolls-Royce said April 29 it was in talks with Siemens AG over the sale of its commercial energy production assets. Talks that involve the gas turbine and compressor activities haven't concluded, it said.

The British manufacturer also this month agreed to pay €2.43 billion ($3.36 billion) to Daimler AG for the German car maker's remaining 50% stake in diesel engine maker Tognum AG, now called Rolls-Royce Power Systems. The transaction should close in the next five months pending regulatory approval.

WSJ : SpaceX Wins Injunction Against Rocket Rival Working With the Russians

SpaceX Wins Injunction Against Rocket Rival Working With the Russians
Elon Musk Company Wants the U.S. Air Force to Open Satellite Launches to Competition.

A Boeing and Lockheed Martin joint venture working for the government was barred by a U.S. court on Wednesday from dealing with a Russian supplier of rocket engines used to shoot air-force satellites into space.

Elon Musk's Space Exploration Technologies Corp., or SpaceX, won a temporary injunction against the U.S. government and its contractors Boeing and Lockheed operating as United Launch Alliance.

The air force and United Launch Alliance is prohibited "from making any purchases from or payment of money to NPO Energomash", Federal Claims Court Judge Susan Braden said late Wednesday in a temporary injunction.

United Launch Alliance, the air force and NPO Energomash weren't immediately available for comment.

SpaceX is challenging United Launch Alliance's near monopoly on military- and intelligence-satellite launches. It wants the Pentagon to open them to competition.

It drew attention to its rival's use of the RD-180 rockets made by Russia's state-controlled NPO Energomash OAO. U.S. defense officials and lawmakers are uneasy about the air force's reliance on Russian engines in the wake of the Ukraine crisis.

The engines are supplied by RD Amross, a joint venture between the Russian company and a unit of United Technologies.

The air force has looked into alternative rocket engines including building them in the U.S. under license or fast-tracking a new domestic design.