>>> AT&T Corp Looking to build out ulta-fast fiberoptic broadband network

AT&T Corp Looking to build out ulta-fast fiberoptic broadband network --> +ve for AlcatelLucent

- AT&T today announced a major initiative to expand its ultra-fast fiber network to up to 100 candidate cities and municipalities nationwide, including 21 new major metropolitan areas. The fiber network will deliver AT&T U-versewith GigaPower(SM) service, which can deliver broadband speeds up to 1 Gigabit per second and AT&T's most advanced TV services, to consumers and businesses. AT&T will work with local leaders in these markets to discuss ways to bring the service to their communities. Similar to previously announced metro area selections in Austin and Dallas and advanced discussions in Raleigh-Durham and Winston-Salem, communities that have suitable network facilities, and show the strongest investment cases based on anticipated demand and the most receptive policies will influence these future selections and coverage maps within selected areas. This initiative continues AT&T's ongoing commitment to economic development in these communities, bringing jobs, advanced technologies and infrastructure. 

- The list of 21 candidate metropolitan areas includes: Atlanta, Augusta, Charlotte, Chicago, Cleveland, Fort Worth, Fort Lauderdale, Greensboro, Houston, Jacksonville, Kansas City, Los Angeles, Miami, Nashville, Oakland, Orlando, San Antonio, San Diego, St. Louis, San Francisco, and San Jose. With previously announced markets, AT&T now has committed to or is exploring 25 metro areas for fiber deployment. 

- The planned expanded availability of U-verse with GigaPower is part of AT&T's Project Velocity IP (VIP) investment plan to expand and enhance its wireless and wireline IP broadband networks to support growing customer demand for high-speed Internet access, advanced TV services, and new mobile and cloud services. This expanded fiber build is not expected to impact AT&T's capital investment plans for 2014. And AT&T continues to expect that its wired IP broadband network will reach 57 million customer locations in its 22-state wireline footprint by the end of 2015.

>>> FT : AstraZeneca shares jump on Pfizer takeover approach reports

AstraZeneca shares jump on Pfizer takeover approach reports

Pascal Soriot, chief operating officer of Roche Pharma, speaks at a news conference in Basel, Switzerland, on Wednesday, February 3 2010©Bloomberg
US shares in AstraZeneca jumped on Monday after reports of a $100bn takeover approach by Pfizer that would have been the biggest pharmaceuticals deal in industry history if accepted.
Neither company would comment on the reports that the pair held informal talks several months ago but had since ended the discussions.

But one prominent sector analyst predicted Pfizer was likely to revive its interest in future, attracted by AstraZeneca’s promising pipeline of experimental cancer drugs and the potential for big cost savings between the companies.
Andrew Baum, analyst at Citigroup, said Pfizer’s reported interest “looks highly probable” and he expected the US company “to push aggressively ahead with a second approach”.
London’s stock market was closed for Easter on Monday but American Depositary Receipts in AstraZeneca were up 5.5 per cent in New York in morning trade after the reports from the Sunday Times and Bloomberg while Pfizer’s were up 5.5 per cent.
Any deal would herald the return of megamergers to the pharmaceuticals sector after a period when they had appeared to fall out of favour with companies and investors.
Pfizer has a history of big acquisitions, such as its $68bn takeover of Wyeth in 2009 and its $56bn deal with Pharmacia in 2002.
The company had recently appeared more focused on divesting non-core operations and restructuring but Ian Read, chief executive, said last year he would “never say never to a large acquisition that made sense”.

An acquisition of AstraZeneca would provide an outlet for the tens of billions of dollars in cash that Pfizer has accumulated overseas – avoiding the hefty tax bill that would be involved in repatriating it to the US.
However, the foreign acquisition of one of Britain’s biggest and most prized companies would be sure to rekindle debate over the openness of UK takeover rules and spark concern over jobs and investment in the life sciences sector.
Ann McKechin, a Labour MP on the parliamentary committee for business, innovation and skills, said: “Much depends on the detail of any deal but it is important that long-term strategic policy is uppermost rather than short-term gain for some groups of shareholders”.
AstraZeneca, led by Pascal Soriot, who took over as chief executive in 2012, has been struggling with declining sales and profits resulting from the loss of patent protection of several of its most lucrative drugs.
However, its shares have climbed more than 20 per cent in the past six months amid rising optimism over a range of treatments in development for cancer and autoimmune diseases, such as diabetes.
Mr Baum said acquisition of AstraZeneca would transform Pfizer’s “competitive presence along the critical axis of immuno-oncology [and] autoimmune disease”.

FT : 2014’s worst hedge fund performers so far

2014’s worst hedge fund performers so far

Sloane Robinson, Coupland Cardiff, Graham Capital and Discovery Capital Management were among the worst-performing hedge fund managers in the first quarter as managers with heavy exposure to Japan and quantitative investment specialists suffered.
The average hedge fund reported a gain of 1.1 per cent in the first quarter, according to HFR, the data provider, with alternative managers making their weakest opening to a year since the financial crisis.

With the Japanese stock market down 7.6 per cent in the first quarter, London-based hedge fund Sloane Robinson, a boutique founded in 1993 by Hugh Sloane and George Robinson, saw sharp losses.
Sloane’s $140m Global Japan fund and $570m Global International fund lost 17 per cent and 13.8 per cent respectively in the first three months, according to data from HSBC’s Alternative Investment Group. Coupland Cardiff, an Asia specialist, saw its $431m Asia absolute return fund lose 12 per cent over the same period.
A Sloane spokesperson said many investors have been left disappointed by the performance of the Japanese equity market. It had been handicapped by worries about the impact of tax increases on consumer spending and uncertainty over the Bank of Japan’s quantitative easing policy.
“It is unrealistic for investors to expect the major reforms being undertaken to be effective overnight and we do not expect Japan’s reflation agenda to be derailed,” said the spokesman.
Discovery Capital Management, founded in 1999 by Robert Citrone, who worked previously with the famed manager Julian Robertson, saw losses in its two main funds.
The $6bn Discovery Global Opportunities fund is down 8.4 per cent so far this year, while the $2.2bn Discovery Global Macro fund has lost 10.2 per cent.
Macro hedge fund managers that trade currencies, interest rates and stock indices based on changes in economic policy and quantitatively driven companies registered losses of 0.5 per cent and 1.8 per cent in the first quarter, according to HFR.

>>> FT : Carmakers lobby to delay EU efforts to upgrade emission testing

Carmakers lobby to delay EU efforts to upgrade emission testing

The European car industry is lobbying to delay the introduction of a tough new emissions testing regime designed to combat fears that carmakers are gaming the system to boost their efficiency ratings.
European cars are as much as 30 per cent less efficient than their manufacturers claim, according to the International Council on Clean Transportation, as carmakers take advantage of an archaic testing system that they want to keep in place for at least seven years.

The EU has said it wants to replace the 1970s test with a much more stringent regime by 2017. The new test would remove the loopholes that carmakers currently use to boost their efficiency ratings, including disconnecting the battery to stop it charging during the test, overinflating the tyres to reduce resistance and performing the test at optimum temperatures.
Documents seen by the Financial Times show that the European Automobile Manufacturers’ Association (ACEA), the industry’s lobby group, is pushing for a 2021 implementation date at the earliest. If the system is brought in before that, they say it would be impossible to meet existing 2020 targets for CO2 emissions. If no compromise is reached, carmakers could face fines of hundreds of millions of euros for failing to meet the targets.
Reducing carbon dioxide emissions is one of the most pressing concerns for carmakers, which are keen to position themselves as innovative and environmentally conscious, but need to spend billions of dollars every year to make engines more efficient or switch their models to electric motors.
Research by Exane BNP Paribas, suggests Europe’s carmakers will need to spend a combined €10bn on top of current budgets to meet legally binding emissions reduction targets if the new test is implemented.
The EU Parliament has said that it notes research showing that manufacturers have “exploited weaknesses in the current procedure, leading to official consumption and emission figures which are far from those achieved in everyday driving conditions.”
ACEA said in a statement that “all manufacturers test vehicles according to the laws in force.”
“Looking at the scale of the task required, ACEA believes 2017 is incredibly ambitious,” said Erik Jonnaert, the lobby group’s secretary-general. “The automobile industry continues to participate in an active and positive manner to the development, finalisation and implementation of the new test procedure, as it always does.”

(NY Post) How Aereo’s legal battle threatens $3.3B in retrans riches

There are a lot of reasons to care about the Supreme Court showdown over Aereo — 3.3 billion to be exact.
That’s how much the major broadcast networks pocket in so-called retransmission fees from charging cable and satellite companies to carry their local TV signals.
Aereo’s business model jeopardizes that growing cash pile, which is expected to hit $7.6 billion by 2019, according to SNL Kagan.
The startup, backed by Barry Diller’s IAC/InteractiveCorp, doesn’t pay for local broadcast signals and argues it shouldn’t have to pony up for what is currently free to the public.
Broadcasters fear that pay-TV providers will arrive at the same conclusion and come up with Aereo-like workarounds if they lose their case.
Of course, Aereo could simply pay broadcasters retrans fees to make the case go away, but Diller said that would render his business model moot.
“We could probably pay retransmission consent dollars if we could make a deal, we probably could, but the value proposition would go out of the game,” he told Bloomberg TV last week.
Retrans fees, which have been at the heart of blackout battles between broadcasters and cable companies in recent years, are relatively new but increasingly important.
They were born out of the recession and the brutal ad slump.

>>> Halliburton beats by $0.01, beats on revs; guides Q2 EPS in-line

Halliburton beats by $0.01, beats on revs; guides Q2 EPS in-line 

Reports Q1 (Mar) earnings of $0.73 per share, excluding non-recurring items, $0.01 better than the Capital IQ Consensus Estimate of $0.72; revenues rose 5.4% year/year to $7.35 bln vs the $7.23 bln consensus.

Co issues in-line guidance for Q2, sees EPS +25% to ~$0.91 vs. $0.91 Capital IQ Consensus Estimate.

I am optimistic about our ability to grow our North America revenue and margins, and to realize industry-leading revenue and margin growth in our international business, resulting in solid EPS growth and significantly higher cash generation. We expect earnings per share to grow ~25% in the second quarter, with further increases to follow. We remain focused on generating superior financial performance and providing industry-leading shareholder returns, as evidenced by our $500 million share repurchase this quarter.

"Operating income of $970 million was 8% higher than adjusted operating income in the first quarter of 2013, and was the result of our double-digit growth in the Eastern Hemisphere. "In the Eastern Hemisphere, we continue to successfully execute our growth strategy. Relative to the first quarter of 2013, we grew revenue by 11% and operating income by 16%. We continue to forecast that full-year Eastern Hemisphere revenue growth will be in the low double digits, and average full year margins will be in the upper teens. "In the Middle East/Asia region, compared to the first quarter of the prior year, both revenue and operating income increased by 13%. Saudi Arabia led the improvement with growth across all product lines due to an increase in integrated project activity along with an overall higher rig count that is driving increased services. "In Europe/Africa/CIS, relative to the first quarter of 2013, we saw revenue and operating income increase 9% and 21%, respectively. The improvement was led by higher completion tools sales and cementing activity throughout the region, and increased drilling and open hole wireline activity in Angola. "In Latin America, revenue and operating income declined by 9% and 8%, respectively, compared to the same quarter last year, primarily due to a decline in drilling-related activity in Brazil and activity reductions in Mexico. For the full year, we expect Latin America revenue and operating income to be in line with 2013 levels. "In North America, revenue increased 5% and operating income was flat compared to the first quarter of 2013. Results were negatively impacted by lower pressure pumping pricing and transitory issues related to weather disruption and higher logistics costs. We are optimistic about the potential for increased activity levels in the second half of the year, and expect North America margins to expand over the remainder of 2014. Service intensity levels are expanding across the United States, where we continue to see a trend to longer laterals, increased stage density, and rising volumes per stage. We continue to expect North America margins to approach 20% before the end of the year.

(Cowen) Barrick (ABX)/Newmont (NEM): Sorting through the noise

Barrick (ABX)/Newmont (NEM): Sorting through the noise -- Cowen 

Cowen notes, according to various news sources, Barrick (ABX) and Newmont have recently been involved in merger talks, which broke down over the last few days. Neither co has released an official statement on the issue. A merger between ABX and NEM would create the next super senior and would allow Barrick - a co with high debt and little net growth in the foreseeable future - renewed strength for survival. While firm sees little shareholder benefit from a merger, it would instantly bulk up production and cash for the struggling senior (ABX).

(Betaville) Marlow cooks up massive drugs deal (Astrazeneca/Pfizer)

Marlow cooks up massive drugs deal
Huge hat tip to Ben Marlow, the M&A reporter over at The Sunday Times.

Ben - who is having an amazing story-breaking run at the moment - landed the scoop of the Easter weekend (and possibly the year) with his tale that US pharmaceutical giant Pfizer has been weighing a £60 billion takeover bid for London-listed Astra Zeneca.

Here is a link to Ben's original piece from yesterday: http://www.thesundaytimes.co.uk/sto/business/Companies/article1401626.ece

I understand from excellent sources his piece is broadly correct. Pfizer and Astra Zeneca held informal discussions about the US company buying the FTSE 100-listed business for about £50.00 a share, according to my sources familiar with the matter.

Although the informal talks never went anywhere and have been discontinued, Astra Zeneca has asked Morgan Stanley and Goldman Sachs to work as 'defence' advisers ahead of any fresh approach from Pfizer.

Pfizer, according to my sources, has been using JP Morgan on its potential bid for Astra Zeneca. This may surprise some sources as when the US company looked at buying Shire, another London-listed pharmaceutical company, back in 2008 Pfizer worked with Lazard.

Lazard, though, still may end up working on the AstraZeneca deal for Pfizer.

WSJ : Mobile-Payments Startup Square Discusses Possible Sale

Mobile-Payments Startup Square Discusses Possible Sale
Company Faces Wider Loss, Less Cash; Google Considered Potential Acquisition


With losses widening and cash shrinking, representatives of mobile-payments startup Square Inc. have discussed a possible sale to several deeper-pocketed rivals, according to people familiar with the matter.
Google Inc. discussed a possible acquisition of Square earlier this year, according to three people familiar with the matter. Those talks followed a meeting in 2012 between top Google and Square executives to discuss a possible takeover, according to two people familiar with the matter. It isn't clear whether the talks are continuing.
Square also had informal discussions about a deal with Apple Inc. and eBay Inc.'s PayPal in the past, according to people familiar with those situations. Those conversations never developed into serious talks.
Square recorded a loss of roughly $100 million in 2013, broader than its loss in 2012, according to two people familiar with the matter.
The five-year-old company paid out roughly $110 million more in cash last year than it took in, according to two people familiar with the matter. Over the past three years, the startup has consumed more than half of the roughly $340 million it has raised from at least four rounds of equity financing since 2009, two people familiar with the company's performance said.
A spokesman for Square said, "We are not, nor have we ever been in acquisition talks with Google."
He added, "While we appreciate that Square may be an attractive target for some companies, we have never seriously considered selling to anyone or been in any talks to do so."
A spokesman for Paypal said, "We did not have acquisition talks with Square."
Square would likely fetch billions of dollars in a sale.
Co-founder and Chief Executive Jack Dorsey is a well-known Silicon Valley entrepreneur with a flair for design. Mr. Dorsey also was a co-founder of Twitter Inc., which conducted an initial public offering of stock in November.
Over the years, the rising profiles of its brand and of Mr. Dorsey have helped Square raise money at larger valuations. Square insiders sold shares earlier this year on the secondary market at a price that valued the company at roughly $5.2 billion, according to people familiar with the offering.
Square's square-shaped credit-card readers are used by nearly one million merchants, who attach them to their smartphones or tablets, allowing them to accept credit or debit-card payments anywhere. Last year, the startup processed more than $20 billion in transactions, yielding revenue of about $550 million, according to three people familiar with the company's performance.
But Square's business yields razor-thin profit margins, if any. Square typically charges merchants 2.75% to swipe credit cards through its reader, according to the company's website. About four-fifths of that money is spent on fees to payment networks like Visa and MasterCard, other financial intermediaries and fraud costs.
During the first quarter of 2014, a Square executive told a potential acquirer that the company had nine months before it would hit a predetermined "cushion" of funds set aside as a last resort, according to a person with direct knowledge of the conversation. The figure was separately confirmed by someone close to Square.
This month, Square secured a credit facility of more than $100 million from a group of five banks led by Goldman Sachs Group Inc., giving the company more financial flexibility, two people said at the time.
Square's financial performance might be narrowing the company's options. Last year, it explored an IPO with banks including Goldman Sachs and Morgan Stanley. Those discussions were at least temporarily suspended, two people said.
"Square looks a lot like a company in transition," said Rick Oglesby, of consulting firm Double Diamond Payments Research. "It had very strong success in penetrating the micro-merchant market, but that market isn't a terribly profitable one, so Square needs to go up market to find the real money."
A partnership with Starbucks Corp., announced in late 2012, introduced Square to millions of coffee drinkers and gave the startup billions of dollars in new transactions. But Square's fee on Starbucks transactions amounted to just over 2% in 2013, according to two people familiar with the company's financial statements. That left Square with a loss of at least $20 million from the Starbucks deal last year, according to these people. Starbucks declined to comment.
Square's gross margin, the portion of revenue remaining after paying processors and covering other costs like fraud, fell to 21% in 2013, from 27% in 2012, according to a copy of Square's results viewed by The Wall Street Journal.
Square has been adding services that could eventually be more profitable than its main payments business. In the past 12 months it began Square Cash, which helps people send money to friends via email, and Square Market, a digital marketplace for small businesses. It also offers Square Stand to help stores track customer data and is testing a lending program for merchants who have difficulty getting a bank loan.
"We don't see ourselves building a payments company," Mr. Dorsey told Bloomberg TV last fall. "We see ourselves building a commerce company."
Talks between Google and Square resumed during recent months, three people familiar with the matter said, but it isn't clear whether either side is still pursuing a deal. Technology website The Information reported earlier this month that Google recently considered a purchase of Square, but said the companies aren't currently discussing a deal.
Mr. Oglesby, the consultant, said it is "not at all surprising that Google and Square have been discussing combining forces," because their payment businesses are complementary.
Google Wallet, the Internet company's payments business, has signed up a lot of consumers through its Google Play app store, but has few brick-and-mortar merchants, Mr. Oglesby said. Square, meanwhile, has merchants but has fewer customers enrolled in its digital wallet virtual-payment account, he added.