TheChek News Flow

After Hours Summary: CALD +12.6%, ATEC +11.9%, MG +11.6%, AA +2.3%, LRN -14.3%, YUM -7.3%, KNX -5.8%, CAS -5.4%, EXFO -3.3% following earnings/guidance After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: - CALD +12.6%, - ATEC +11.9%, - MG +11.6%, - AA +2.3%

Companies trading higher in after hours in reaction to news: - BEN +2.3%(announced September 30, 2013 AUM of $844.7 bln vs $817.3 bln in prior month and $749.9 bln in prior year), - VVUS +1.2% (announced Qsymia shown to reduce progression to Type 2 diabetes in high-risk overweight or obese patients), - ACT +0.5% (confirmed that it has filed an Abbreviated New Drug Application with the FDA seeking approval to market Buprenorphine Hydrochloride and Naloxone Hydrochloride Sublingual Film), - CHK +0.3% (Reuters reporting that co has cut 1,200 jobs this year)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: - LRN -14.3%, - YUM -7.3%, - KNX -5.8%, - CAS -5.4%, - EXFO -3.3%

Companies trading lower in after hours in reaction to news: - LPTN -9.8% (provided update on plans for iSONEP option: Pfizer (PFE) seeking to divest option for a worldwide license to develop and commercialize iSONEP), - CYTR -6.2% (announced proposed public offering of common stock, size not disclosed), - HRB -4.4% (Republic Bancorp disclosed it is withdrawing application to merge with H&R Block), - DYAX -4.2% (announced proposed publiuc offering of common stock, size not disclosed), - TKMR -2.0% (announced the key programs and goals into 2014 for its RNAi therapeutic product pipeline; financial guidance remains the same)

Closing Summary It was day eight of the partial government shutdown and it was day two this week in which the major indices fell victim to broad-based selling interest. Once again, the budget/debt ceiling impasse in Washington was largely to blame. The Nasdaq Composite was the biggest loser today, sliding 2.0% on the back of pronounced weakness in many of the market's favorite momentum stocks. The cracks in leading names like LinkedIn (LNKD 222.59, -14.62), Priceline.com (PCLN 997.60, -44.08), Tesla (TSLA 174.70, -8.37) and Facebook (FB 47.14, -3.38) provided an added cue for buyers to stick mostly to the sidelines.

There were efforts during the day to forge a rebound effort, but they were all short-lived as another day of back-and-forth remarks between Republicans and Democrats that amounted to more of the same entrenched views on reaching a budget agreement and raising the debt limit provided little incentive to commit new money. Briefly, House Speaker Boehner said he would like the president to sit down and negotiate with the GOP before passing a continuing resolution and raising the debt limit while President Obama said he is open to negotiating after Congress passes a continuing resolution and raises the debt limit.

The major indices finished at their lows for the day as a final wave of selling interest in the last ten minutes completed today's damage. The utilities sector (+0.6%) was the only sector in the S&P 500 to finish in positive territory. It was only fitting perhaps that the low beta sector outperformed as high beta stocks got hit hard. Even so, there wasn't a full-on safety trade today. Longer-dated Treasuries and gold prices ended with modest losses while the US Dollar Index was little changed to the upside. In terms of the Treasury market, the real point of interest was at the front end of the curve. The 4-week bill surged nearly 14 basis points to 0.29% as traders remained leary of the paper with the October 17 debt limit deadline on the near horizon. The 4-week yield is at its highest level since October 2008.

Wal-Mart (WMT 72.89, +1.02), Procter & Gamble (PG 76.35, +0.70), and Coca-Cola (KO 37.28, +0.23) were the only Dow components to finish higher. That helped the Dow Jones Industrial Average show some relative strength versus its counterparts, most of which fell between 1.2% and 2.0%.

The continued weakness in the stock market and the continued impasse in Washington continued to benefit the CBOE Volatility Index (20.48, +1.07), which tacked on another 5.5% after gaining 16% on Monday.

Volume picked up on today's sell-off. 733 mln shares traded at the NYSE versus just 595 mln on Monday.

Alcoa 3Q Adj. EPS 11c, Est. 5c; Reaffirms Yr Aluminum View Alcoa 3Q rev. $5.77b, est. $5.63b * Still sees global aluminum demand growth 7%

Why Now Is Different From 2011

Unlike the last debt-ceiling crisis, policies and economies are more favorable -- so history may not repeat.

It is different this time. There may be no five words in the English language that have taught investors so many costly lessons. They are usually associated with pronouncements of a dawn of a New Era (in capitals for emphasis) where the constraints of the past have been thrown off by the wonders of this modern age.

Ultimately, eternal verities about value when it comes to investing are relearnt, and usually the hard way. Whether it was "Radio" (as RCA, the hot tech stock of the 1920s, was called) or dot-com stocks, the lessons of past manias were ignored. And accepting shibboleths, such as that prices of residential real estate never decline, can be equally dangerous to your wealth.

Yet there also is a simplistic notion that bad things will recur because, even if history doesn't repeat, it tends to rhyme. And so, the stock market slumped again Monday as the U.S. government shutdown extended into its seventh day and the D-Day when Uncle Sam runs up against his debt ceiling -- Oct. 17, according to the Treasury -- drew another day closer.

All of which conjured memories of 2011, when global markets shuddered and then plunged as the standoff between the White House and Congress threatened default by the Treasury on its obligations. That sorry episode resulted in Standard & Poor's stripping the U.S. of its triple-A rating.

But, as noted at the outset, there are differences now.

The U.S. economy was sputtering then. While it isn't exactly booming, it is at least making forward progress, however slowly.

And more importantly, monetary policy around the globe then ranged from neutral to restrictive. All of which helped to make the debacle of a couple of summers ago so severe. And those conditions are different now.

These key differences are detailed by Michael Darda, chief economist and market strategist of MKM Partners, who notes "several key forces that greatly exacerbated the market response to the 2011 debt-ceiling fiasco are not present today."

First, he points out the Federal Reserve's second round of quantitative easing, QE2, ended in July 2011, which made for an effective tightening of U.S. monetary policy in July of that year -- "just as the snafu in Washington D.C. was in full swing."

Monetary policy abroad also was restrictive. The European Central Bank "inexplicably and catastrophically tightened monetary policy in July and April when they should have been easing it, precipitating a double-dip recession and setting off a run on Spanish and Italian bond markets."

That came on top of a severe tightening by the Chinese central bank, Darda continues. The People's Bank of China "completed a two-year, 600 basis point [six percentage point] tightening cycle in the summer of 2011, with reserve requirement ratios [the percentage of cash banks have to hold against deposits] peaking at a record 21.5%, ending China's torrid upswing from the 2008 recession."

"In other words, a passive tightening by the Fed collided with a 1937-like policy error from the ECB and the 'stop' phase of a 'go-stop' monetary policy from from the PBoC. Global growth expectations came down with a thud," he writes. In 1937, the Fed tightened while Washington squeezed fiscal policy to create the second leg down of the Great Depression. There can be little doubt that blunder has greatly influenced the Bernanke Fed, especially while the sequester has squeezed on the fiscal side.

"It is impossible to know how the debt-ceiling imbroglio of 2011 would have played out in financial markets absent these other important anti-growth forces. Suffice it to say the decline in risk assets [such as stocks] would have likely been far smaller," Darda concludes.

At the same time, there are expectations that, in the event of a U.S. default, there would be a fast and furious flight to quality. As writes the RBC Capital Markets economics team headed by Tom Porcelli:

"There are too many people [who] believe if the unthinkable does happen, and we hit the debt ceiling, the Treasury market will rally massively. They base this view on the markets' reaction in 2011, but we do not think that is a clean benchmark.

"At that time, stress in Europe was soaring: from the beginning of July to Aug. 4, 2011, [credit-default swap spreads] in Spain went from 261 basis points to 431 basis points. [That means the cost to insure against the default in Spanish government debt rose to $431,000 from $261,000 for $10 million face amount.] Over that period, CDS in Italy went from 171 basis points to 390 basis points. We note that while [the Standard & Poor's 500 index] fell sharply in August 2011, it went from 1254 on the day the debt ceiling was raised to 1119 six days later."

Also noting the differences from 2011 to today, International Strategy & Investment says the Fed's continued QE--$85 billion a month and $255 billion over the next three months -- helps explain why the S&P 500 was flat last week and retained its 20% year-to-date gains. And that the economy now is doing better now than a couple of summers ago.

None of which minimizes the risk if Congress and the White House do a Thelma and Louise jump off the fiscal cliff. The only reason to expect they won't be that stupid is politicians' craven instinct for self-preservation.

Even so, the precedent of 2011 shows fundamentals outside of politics count. That's what's not different this time.

McKesson + Celesio a Win-Win Deal

The drug wholesaler is up on reports that it will buy Celesio for $5 billion. However, McKesson looks cheap even without it.

McKesson is going shopping in Europe.

Citing "people familiar with the matter," The Wall Street Journal reported Tuesday that drug wholesale giant McKesson (ticker: MCK) is in "advanced negotiations" with the majority shareholder of Celesio to buy the German rival for more than $5.08 billion.

The news is not a complete surprise. Reports have circulated since July of talks between McKesson and Celesio. If McKesson decides to proceed, it could announce a bid as early as this month, according to the Journal.

The potential boon to McKesson's bottom line cheered investors, who sent shares 4% higher to $135. The stock reached an all-time high of $138.43 this morning.

A deal is not a foregone conclusion. Talks could fall apart at any time as the two sides haggle over price and financing. But even then, McKesson remains an industry powerhouse with an enviable balance sheet and robust profit growth.

"McKesson is an emerging player in the global pharmaceutical supply chain," says Russ Muken, an analyst with ISI Group. "But even without Celesio, it's a fundamentally strong story."

With revenue of $122 billion, McKesson is one of the three largest drug wholesalers in the U.S., competing with Cardinal Health (CAH) and AmerisourceBergen (ABC).

It's a changing industry. Last year, retail pharmacy giant Walgreen (WAG) snapped up a 45% stake in U.K. drug wholesaler Alliance Boots for $6.7 billion, and followed this year with an alliance with AmerisourceBergen (see Barron's Take, "Walgreen Rolling in the Green," Sept. 5).

Under pressure to form alliances of their own, McKesson, Cardinal Health and CVS Caremark (CVS) have all reportedly been in talks to buy a stake in Celesio, one of Europe's three largest drug wholesalers.

An acquisition makes sense for both McKesson and Celesio, says ISI's Muken.

McKesson has been searching for assets in Europe since the financial crisis. Celesio, meanwhile, has been undergoing a restructuring, hurt by an ongoing price war among German drug distributors.

In July, Celesio CEO Markus Pinger was ousted after a falling-out with parent company Franz Haniel & Cie. And in August the company cut its full-year forecasts.

But with Alliance Boots already tied up with Walgreen, Celesio is one of the few remaining options for rivals looking to expand into Europe's development markets.

Celesio operates 2,200 pharmacies across Europe. But its wholesale business, which operates in 16 markets in Europe and Brazil, generates 85% of revenue, which totaled $29 billion last year.

Celesio's new CEO, Marion Helmes, told a German newspaper Tuesday that the company is not in a rush to form an alliance. Still, she agreed a deal would "generate opportunities."

For McKesson, an alliance with Celesio creates enormous scale and boosts its purchasing power, particularly when negotiating with generic-drug makers.

Without the acquisition, McKesson is expected to earn $8.32 a share during the current fiscal year ending March 2014, a 31% year-over-year jump. The following year, profits are expected to climb 12% to $9.35 a share.

ISI's Muken sees Celesio adding $1.50 a share to McKesson's fiscal 2015 earnings.

Of course, acquisitions can prove troublesome. Drug pricing in Europe has been under pressure due to austerity measures. And the U.S. market is undergoing enormous changes due to expansive reform.

As ISI's Muken puts it, "Nothing is settled until they sign on the dotted line." And if that never happens, McKesson looks likely to do just fine on its own.

Parties Diverge in Bid to Break Fiscal Deadlock

House Republicans Urge Budget Talks; Senate Democrats Plan Debt-Limit Vote

WASHINGTON—The House and Senate headed down separate tracks Tuesday in their efforts to break the stalemate that has led to a week-old partial government shutdown.

House Republicans, stepping up calls for face-to-face negotiations, planned to pass legislation that would set a framework for wide-ranging budget talks. Senate Democrats were planning a vote this week to extend the country's borrowing authority through 2014, after next year's midterm elections.

The efforts lacked a key component for ending the budget stalemate: endorsement from the other side.

President Barack Obama dismissed the latest overtures from House Republicans earlier Tuesday. The White House said the president told House Speaker John Boehner (R., Ohio) in a morning phone call he remained willing to engage in broad talks on federal spending "after the threat of a government shutdown and default have been removed."

Mr. Obama, in remarks from the White House Tuesday afternoon, said failure to raise the U.S. borrowing limit would have catastrophic consequences for the economy.

So far, the budget standoff has taken a limited toll on financial markets, but there were signs of fresh wariness Tuesday. Short-term U.S. debt prices tumbled amid rising investor concern about the prospect of a government-debt default, sending the yield on one-month U.S. Treasury bills to their highest level since the financial crisis. Stock prices also continued to sag, with the Dow Jones Industrial Average down about a hundred points in afternoon trading.

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Top Bankers Warn on U.S. Debt Proposal Debt Limit Taking Center Stage in Impasse Government Shutdown Starts to Crimp Trade Mr. Boehner, under pressure to keep together a divided Republican caucus in the House, turned to calls for negotiations after pressing GOP priorities in numerous bills on government funding in recent weeks, both before and after the shutdown. House Republicans planned to vote on legislation later Tuesday ensuring some federal workers get paid Friday, in the Republicans' latest bid to engage Senate Democrats in broader budget talks.

"It's time for us to sit down and resolve our differences," Mr. Boehner said. "Are we going to sit down and have a conversation or aren't we?"

Senate Majority Leader Harry Reid (D., Nev.), speaking on the Senate floor Tuesday, maintained Democrats were ready to negotiate over government spending as long as Republicans first agreed to reopen the government and increase the nation's borrowing limit. "Everyone has my commitment: open the government, raise the debt ceiling and we'll talk about anything you want to talk about," Mr. Reid said.

To provide a formal vehicle for budget negotiations, House Republicans have proposed a bipartisan, congressional working group to discuss fiscal issues, including government funding and the debt limit. They planned to attach the plan to the "essential worker" pay legislation.

Some House Democrats recoiled at the prospect of budget negotiations along the lines of the so-called supercommittee formed in the 2011 debt-ceiling negotiations.

"Not again," said Rep. Xavier Becerra (D., Calif.), one of the 12 members of that group. "It was just punting." He said what emerged from that group's failure to reach a deal to reduce the deficit was the sequester, the across-the-board spending cuts that kicked in last spring. "There is no reason we can't get our work done now."

House Minority Whip Steny Hoyer (D., Md.), however, said the measure to set up a new committee was a step forward but complained it lacked balance because there was no discussion of tax revenues.

"A suggestion that we sit down and talk is progress," Mr. Hoyer said. But he said that the plan "is not a consideration of all options available to America."

At the morning press briefing, Mr. Boehner refused to respond to questions about whether he would support a short-term debt-limit increase to keep the government solvent while talks were under way. But Rep. Tom Cole (R., Okla.), a close Boehner associate, said Republicans might be willing to pass a debt-ceiling extension in order to start broader talks over reducing the deficit. "If the president is willing to talk, I suspect we could deal with these problems," Mr. Cole said.

In the Senate, Democrats prepared for votes later this week to extend the nation's borrowing authority through 2014, in a fresh sign the focus of the budget impasse is shifting toward preventing a U.S. debt default.

Democrats are still weighing their opening bid, but the most likely scenario is to advance a debt-limit bill free of extraneous policy amendments, as Mr. Obama has demanded. House Republicans say they won't pass any such debt-limit extension unless it is accompanied by deficit-reduction measures or other priorities.

The Treasury says the debt ceiling must be raised this month or it won't be able to pay all the country's bills. With that prospect approaching, the standoff over increasing the borrowing limit has merged with a related impasse over terms for funding the government so that it can fully reopen.

Treasury Secretary Jacob Lew is making a trip to Capitol Hill on Thursday to answer questions about the debt ceiling in front of the Senate Finance Committee, giving Republicans a chance to press him for potential areas of compromise.

Senate Democrats would need 60 votes to advance any debt-ceiling plan if Republicans decide to filibuster. Democratic aides expressed confidence that all 54 Democrats and allied senators would support the bill being considered, but one aide said it might be hard to persuade Republicans to cross party lines until the prospect of the U.S. reneging on some of its obligations is closer.

Sen. John McCain (R., Ariz.) said he was on the fence about the proposal and wanted to see what else Democrats were offering. "The markets will not stand for default," Mr. McCain said. "I want it done."

Link : http://reut.rs/GJKmUg / {http://reut.rs/GJKmUg}

BG nears partner deal on Brazil Barreirinhas basin

LONDON, Oct 8 (Reuters) - BG Group Plc is close to a deal or deals that would reduce its 100 percent holdings in a group of six exploration licence blocks off Brazil's coast, the company said on Tuesday, a signal it aims to push ahead promptly with drilling there.

The assets are in Brazil's Barreirinhas Basin, a prospect it calls a "frontier position" and says may contain more than 1 billion barrels of oil equivalent.

BG won the assets as part of a licensing round in May, Brazil's first in five years and one which raised a record $1.4 billion.

Unusually for offshore Brazil, where state-controlled Petrobras dominates operatorship of fields, the British oil and gas group is the operator of all 10 it bought into. It sees the Barreirinhas as its 2013 contribution to a company target of one new basin entry per year to keep its project pipeline filled.

It holds 50 percent of four Barreirinhas blocks in partnership with Petrobras and Galp Energia of Portugal, and 100 percent of a further six blocks in which it wants to bring in a partner or partners.

Selling stakes in acreage to other companies at an early stage is called a farm-down and is common practice in the oil industry to spread risk and exploration and development cost.

"So at the moment we are 100 percent, and I know that we are involved in one thing at the moment to change that," said Malcolm Brown, BG's executive vice president for exploration. "It's active portfolio management at the exploration phase".

Brown was speaking to reporters with help from slides presented to investors in September. The Barreirinhas assets were identified at the time as farm-down or equity swap opportunities.

Brown did not name the likely partner or partners, but interest in offshore Brazil assets has been strong for years thanks to huge discoveries in the Santos basin to the south of the Barreirinhas.

These have put Petrobras, and BG, a partner with the state giant in some Santos basin blocks, at the top of a value creation league table for the period 2002-2011 published by Wood Mackenzie.

"It's an attractive part of Brazil... and everybody wants to explore Brazil," said analyst Oswald Clint of Bernstein, who said the news confirms the emphasis on strength in exploration that BG wanted to make when it appointed Brown to the board in January this year reporting directly to new chief executive Chris Finlayson.

"They only got these things back in May, so they're obviously moving quickly to right-size that acreage," Clint said. Smaller explorer Chariot Oil and Gas also has Barreirinhas blocks.

A more recent offshore Brazil bidding round did not attract much interest from oil majors, with BG among those that abstained.

However, Brown said he had taken a number of phone calls expressing interest in partnership after winning the blocks in May, and cited the complexities of the bidding process as one reason why interest can sometimes look low.

Brown also said the company was "coming to a conclusion" on the site selection stage for a gas liquefaction plant on the coast of Tanzania.

He would not be drawn on the likely date at which it might receive a Final Investment Decision (FID) - slated in presentations as near the end of 2016.

FID for the project would likely be made in conjunction with fellow Tanzania explorers Exxon Mobil and Norway's Statoil, he said.

Soaring US drone market comes under fire

Manufacturers of unmanned aircraft have seen the value of their market soar to more than $5bn in just a few years as the Pentagon and the CIA have increasingly relied on drones in the mountains of Afghanistan and Pakistan and in the deserts of Yemen. But what was seen recently as an even bigger commercial prize, using drones for anything from helping police in the US find lost children to delivering tacos, is now under threat even as the domestic market is on the brink of taking off. The drone industry is facing a backlash in scores of US states over privacy worries. With demand from the US military potentially reaching a plateau, drone manufacturers are gearing up to sell to domestic customers when commercial airspace opens up in 2015. It is a market which executives hope will be worth tens of billions of dollars. According to the Teal Group, an aerospace and defence consultancy, the global market for drones – or unmanned aerial vehicles (UAVs), as the industry calls them – is likely to double over the next decade from $5.2bn to $11.6bn by 2023. Congress decided last year that drones should be integrated into US commercial airspace from 2015, opening up a vast potential market for the industry, even though many of the rules surrounding domestic use have still to be established. Proponents say drones could play a vital role in public services, including monitoring hurricanes, and have the potential to transform a number of industries, including cargo delivery and agriculture. More than 20 states are vying to host one of the planned six test sites for the domestic use of drones, believing the industry could be an important source of new, well-paid jobs. However, the political revolt against government surveillance that the Edward Snowden leaks have helped to spur has exacerbated already strong fears about the risks to privacy from extensive use of drones in US airspace. Dozens of states have proposed bills to limit the use of drones – restrictions that some industry executives believe could stifle the potential domestic commercial market at birth. More legislative efforts are expected in the coming months as anxieties grow. "These [privacy] issues are all coming to a head right now and unfortunately they are all being directly tied to UAVs," said Michael Toscano, president of the Association for Unmanned Vehicles Systems, the trade group for the drone industry. Jay Stanley, an expert on privacy and technology at the American Civil Liberties Union, said the political battle lines over drones were the same as over the NSA. "If common sense privacy protections are put in place, then we will see lots of cool new uses for this technology." Alan Frazier, deputy sheriff of Grand Forks county in North Dakota and one of the pioneers of using drones in law enforcement, said some of the proposals from state legislatures were equivalent to introducing wiretapping laws even before telephones were used. "They could have a chilling effect on the development of this technology," he said. "If we do not get the public to agree to its use, we could fail before we even get out of the gate." Greg McNeal, a law professor at Pepperdine University, who believes the industry is "in denial" about the likely impact of privacy concerns on sales in the domestic market, said: "Drones have tapped into a vein of paranoia that the general public has about robotics." "Some of these bills could kill off the potential use of drones," he said.

Rue21/Apax deal likely to close by Oct. 19 at latest, dealReporter said, citing person with knowledge of matter. • RUE CFO will write a letter certifying. co is solvent • RUE declined comment to dR; Apax didn’t return calls seeking comment • RUE up as much as 3.1%; RUE/Apax spread 90c vs $2.03 yday • NOTE: Oct. 4, NYPost said RUE CFO expected “within days” to sign solvency certificate • NOTE: Earlier, Bloomberg said RUE bank lenders face $100m loss

---- Original Message From: LAURENT CHEKROUN (MAKOR SECURITIES LLP) At: 10/08 09:00:00 {http://bit.ly/17iupdb} Google Translation {http://bit.ly/1b63CF4} Original in german

German Telekom flirting heavily with orange

AT & T ante Portas, Telefónica and Vodafone on a shopping spree - to defend their supremacy in Europe, Telekom remains only the merger with the French.

For their summit, the chiefs of the largest European telecom companies have found a classy frame. In the restored ballroom of the Grand Hotel Steigenberger, one of the most distinguished addresses in the Brussels City, occur today 8 October, the CEOs of German Telekom , Telefonica and Orange (formerly France Telecom) together on stage before the members of the Association of European telecom provider (ethno). Officially, it seems the agenda before, want the designated telecom CEO Timothy Höttges debate the EU Reform recently submitted plans for a single European telecoms market, César Alierta of Telefónica and Orange Stéphane Richard Handler.

However, the official agenda on Tuesday interested only in passing. In truth, it comes to the restructuring of European corporate landscape in the industry. Because a prominent guest which gives a special flavor Elefantentreffen: Randall Stephenson, chairman of the powerful U.S. giant AT & T has announced his coming. "Live on Stage" will for the first time publicly declare before this distinguished audience why a leap across the Atlantic is suddenly at the top of its agenda and the strategic expansion goals he takes on targeted Stephenson. The performance is more than a courtesy visit. Specifically examined AT & T in Europe after takeover candidates. In the Madrid headquarters of Telefónica emissaries of Stephenson are already knocked out first and have informal discussions. The British mobile phone giant Vodafone , it peddle with the events on the market trusted investment banker, fits in the search grid of AT & T. Stephenson plans big in Europe. The Americans, with about 135 billion euros, almost three times as high as rated on the stock exchange, the German Telekom want a Big Deal lift and ascend with a blow to one of the largest telecom provider in Europe.The speculation inspire even the stock prices: almost all telecom stocks moved sharply in recent weeks. The telecom shares managed after years of infirmity even made ​​about the magical ten-euro mark. It is about the supremacy in Europe. From the fragmented market with more than 100 predominantly nationally active in mobile and fixed network operators, a single European market with three or four strong players to be within a few years. Only then, the EU Commissioner Neelie Kroes is convinced that Europe can the large backlog at super fast internet and mobile networks catch up and create a counterweight to the dominance of American and Asian corporations.

Otherwise there is a sellout. Portugal Telecom slipped in the past week, even at the Brazilian Oi. Eat or be eaten - with the largest European telecom providers, the message has arrived from Brussels. "Everyone is currently talking to anyone," says a London-based investment banker who does not want to be named. "How jugglers keep all of their options in the air in order to pick out the most balls at the right moment can." As one can ascend to the strong counterpart of the giants in the U.S. and in Asia, is heavily discussed in the corporate headquarters. Whether Vodafone, German Telekom, Telefonica and Orange - all four major European provider launched in recent weeks, a "strategic review" of all its activities in Europe. In other words: Exact analyzes how to set up the future, where can be improved by an acquisition, the market position and the countries from which one withdraws better.