>>> US Early premarket gappers

Early premarket gappers

Gapping up: EGHT +10.5%, SN +9.1%, SMTC +6.5%, YGE +6.1%, WSM +5.6%,MOV +5.2%, LINE +4.1%, GOGO +3.9%, AKBA +2.8%, JKS +2.3%, SOL +1.9%,RENN +1.6%, RIO +1.5%, CSIQ +1.4%, RDS.A +1.2%, RDS.A +1.2%, BHP +1.1%,LB +1%, GOLD +0.9%, SLV +0.9%, GOLD +0.9%, RH +0.8%, PLCE +0.7%, GLD+0.5%

Gapping down: BONT -8.6%, BBY -4.9%, SINA -4.7%, SHLD -4.2%, TRNO -4.1%,AEO -3.5%, SNPS -3.2%, CDW -2.7%, RLJ -2.4%, ANW -2.4%, PDCO -2.4%, AZN-1.2%, MNRO -1.2%, RAI -1.1%, JGW -1.1%, NTAP -1.1%, ATVI -0.9%

(Exane) Club Med : On tenderhooks

* Tender period closing on Friday – Outcome uncertain
Gaillon’s takeover bid at EUR17.5 (8% below current stock price) will expire on Friday and cannot
be sweetened by law. Gaillon Investment (which should gather around 38% of the capital with its
partners) could launch a totally new bid but we doubt it will (it could have sweetened it last week)
and we doubt there will be counterbids. Funds that have declared they will not tender (B&G,
Strategic, Moneta, Benetton) represent 22% of the capital, on top of which we think a further 10%
at least will not tender either. Either the bid is successful (and the stock price falls back towards
EUR17.5) or it fails to reach the 50% threshold (condition set for the success of the bid) by Friday
raising more doubts on the future of Club Med.

* Uncertain outlook if the bid fails
Were the bid to fail, management would be significantly destabilized. Development might suffer,
especially in China were Fosun to exit at some stage (even if its contribution has not been obvious
so far). Strategic Holdings may have a hidden plan in Italy/Spain for the group (together with the
Benetton family which used to be involved in the sector), visibility will remain quite poor and would
not offset a worse outlook in China. With summer bookings down heavily (-3%), and new troubles
(Thailand, possibly Egypt, Chinese boycott of Malaysia) we think consensus should revise down
quite sharply. We have lowered our estimates for Village operating income in 2014e to EUR51m
from EUR64m. We think the company is unlikely to hit its 10% EBITDA margin in the next two
years.

* SOTP lowered from EUR20 to EUR17
We have revised down our valuation to EUR17 from EUR20 to reflect our new forecasts. A bull
case would point to EUR22 under more flattering assumptions on asset management, but seems
unlikely on a two-year horizon. A scenario of a sale & leaseback of 40% of the assets portfolio
based on 2015e earnings gives a fair value of EUR17, and would value the group at 15.7x reported
EBIT 15e and 23x P/E 15e. The challenges facing the group (achieving profits in the low season,
raising prices in a deflationist sector, 45% clients from France/Belgium) are unchanged.

FT : UK Takeover Panel: code game

UK Takeover Panel: code game
M&A supervisor is secretive, anachronistic and effective

Bidder and target issue clarifications; opacity increases. This week’s statements from Pfizer and AstraZeneca should have damped expectations of a higher offer; they have had the opposite effect. The confusion raises familiar questions about the UK Takeover Panel.

Critics see the UK’s gentlemanly M&A supervisor as an anachronism, a self-regulatory body in an industry crowded with statutory bodies. A publicity-shy staff of mostly ex-bankers and secondees from investment banks dispense in-game advice. Their Bible is the Takeover Code, whose every rule appears to have Jesuitical exceptions.
Complexity was the root cause of the bewilderment sown by Pfizer and AstraZeneca, whose statements were probably prompted by the panel. On Sunday night, the US drugs group announced a “final proposal” to buy AstraZeneca at £55 per share. It was rejected as too low the next morning. Get-out clauses appeared to leave the door ajar for a higher “firm offer”.
Another wordy missive from Pfizer on Tuesday strengthened hopes that a loophole remained open. A blunt riposte from AstraZeneca quashed them. Many investors had believed what they wanted to: that a deal could be cut between £55 and the £59 mentioned by AstraZeneca. Instead, the code precludes – with caveats – a higher offer before the autumn.
Surely muddles are inevitable when clubbable City bankers supervise their peers? Wrong. UK takeovers tend to run smoothly. The code is complex but its principles are simple: fairness to investors and the keeping of promises. The panel saves businesses fortunes by preventing disputes ending in court, as they often do in the US.
But if the panel is going to use bid participants as mouthpieces, it must ensure their “clarifications” merit that name. Otherwise, it will have to intervene under full public scrutiny. And that would be most unBritish.

(BFW) Shell to Cancel Scrip Dividends From 2Q; Plans ‘A’ Shr Buyback...

PRN 05/22 06:00 ROYAL DUTCH SHELL PLC: Shell announces cancellation Scrip Dividend from Q2 2014
 BN 05/22 06:00 *SHELL SHELL REPORTS CANCELLATION SCRIP DIV FROM 2Q '14
Shell to Cancel Scrip Dividends From 2Q; Plans ‘A’ Shr Buyback
2014-05-22 06:07:32.896 GMT


By James Ludden
     May 22 (Bloomberg) -- 2Q interim div. and thereafter to be
in cash only.
  * Will allow for more efficient buyback program
  * Buybacks to offset prior dilution from scrip divs. by
    end-2015
  * Plans to be able to buy back “A” shrs again
  * 12-month div. yield 4.73%: Bloomberg data

Link to Statement:{NSN N5YOOF3MMTC5 <GO>}
Link to Company News:{RDSA LN <Equity> CN <GO>}

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

To contact the editor responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net

>>> Kensington to receive joint bid from TPG and Blackstone; Lonestar also biddi

Kensington to receive joint bid from TPG and Blackstone; Lonestar also bidding 

TPG and Blackstone Group will submit a joint bid for the UK-based mortgage lender Kensington, according to a Sky News report. It is understood that the two private equity firms will submit a joint offer before a bid deadline later this month, the item said, without citing a source for the claim.

The California-based property investment group Lonestar, is also said to be bidding for Kensington, the article added. At least two other bidders are also said to be interested, the item said.

Investec, a listed Anglo-South African financial services company, owns Kensington. Investec paid GBP 283m (EUR 283m) for Kensington in 2007, the item noted.

Other reports have said the banks Goldman Sachs, Metro Bank and Virgin Money are among the bidders for Kensington, the report continued. However, it is understood that at least a couple of those companies are now out of the bidding, the item added.

Fenchurch Advisory is handling the Kensington auction, the article noted.

TPG and Blackstone refused to comment on Wednesday, 21 May, the report said.


Source Sky News

(BFW) SABMiller FY Ebita $6.45b; Est. $6.44b...

SEN 05/22 06:00 SABMILLER PLC - Preliminary (unaudited) results for the twelve months to 31 March 2014.
 BN 05/22 06:03 *SABMILLER SEES REV GROWTH DRIVEN BY SELECTIVE PRICE INCREASES
 BN 05/22 06:03 *SABMILLER SEES OPS IMPACTED BY CURRENCY MOVEMENTS
 BN 05/22 06:02 *SABMILLER SEES TRADING CONDITIONS `BROADLY' UNCHANGED
 BN 05/22 06:00 *SABMILLER DELIVERS STRONG MARGIN EXPANSION
SABMiller FY Ebita $6.45b; Est. $6.44b
2014-05-22 06:04:05.653 GMT


By Heather Burke
     May 22 (Bloomberg) -- FY organic Ebita up 7%, est. up 6%.
  * Final div. 80c, BDVD forecast 82c
  * Sees trading conditions “broadly” unchanged
  * Sees ops impacted by FX movements

Link to Statement:{NSN N5YOON3HBS3K <GO>}

Link to Company News:{SAB LN <Equity> CN <GO>}

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

To contact the editor responsible for this story:
Heather Burke at +44-20-7673-2044 or
hburke2@bloomberg.net

>>> Indesit controlling shareholder will examine binding offers on 15 June

Indesit controlling shareholder will examine binding offers on 15 June 

Finelco, the holding company of the Merloni family that controls the listed Italian white goods group Indesit, will examine binding offers for a strategic stake in the company on 15 June, the Italian language daily Il Sole 24 Ore reported. The unsourced report noted that Finelco is looking to close a sale by 15 July.

The item noted that Turkish white goods maker Arcelik, German industrial group Bosch, and the US-listed, Michigan-based Whirlpool are presently believed to be in the bidding. The report said that Whirlpool is believed to be the frontrunner.

The item added that some market rumours claim that Chinese group Haier and South Korean group LG could also be among the bidders.

Indesit has a market cap of EUR 1.06bn.


Source Il Sole 24 Ore

>>> Repsol shareholder Pemex could sell shares during summer, autumn

Repsol shareholder Pemex could sell shares during summer, autumn 

Repsol shareholder Pemex, the Mexican group, has several financial mechanisms to sell shares in the Spanish oil company that could be executed during the summer and autumn, Expansion reported, citing financial sources.

Pemex holds 9.3% of Repsol, and for the past few years, it has covered its stake in equity swaps and other financial derivatives and exchange systems. Although Pemex maintains voting and economic rights in Repsol, it no longer holds the stock, according to the Spanish-language report.

These financial mechanisms, renewed each year, come up for renewal between August and October, the report said citing several Pemex reports to US regulator SEC, the last of which was filed last week.

As of 31 December 2013, Pemex held 67.96m Repsol shares through three equity swaps that expire this year. Pemex also holds another 53.7m shares of Repsol covered by different derivatives, the last of which ends in August, Expansion said.

One of Pemex's advisers on its Repsol stake is Credit Agricole, the report added.


Source Expansion