*SWATCH CEO SAYS SOME CHINESE CONSUMERS ARE BUYING 'LIKE HELL'
*SWATCH CEO HAYEK SAY 'HILARIOUS' WHAT CO. SOLD IN CHINA IN JAN.
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Drillisch, Freenet May Buy German Mobile Assets: Bankhaus Lampe 2014-02-05 09:47:41.542 GMT
By Sam Chambers Feb. 5 (Bloomberg) -- German regulators are likely to tie the approval of the E-Plus/O2 Deutschland merger to the sale of 3m-6m of its mobile customers, Bankhaus Lampe says. * Says there are 9 mobile communications assets, at a total value of ~EU368m, that would interest Drillisch and Freenet if available for sale * Says Freenet could currently finance acquisitions of up to EU313m and Drillisch EU231m * Expects United Internet to continue its strategy of generating organic growth in mobile * Bankhaus Lampe downgrades Freenet to hold following strong run in the shrs; increases PT by 4% to EU24 (9% upside) * Reiterates Drillisch at buy and increases PT by 4% to EU26 (15% upside) * NOTE: In Dec., Drillisch sold EU100m convertible bonds and Freenet obtained EU300m credit line * NOTE: EC has set a May 14 deadline to rule on proposed merger of E-Plus/O2 Deutschland
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--Editor: James Ludden
To contact the reporter on this story: Sam Chambers in London at +44-20-7673-2021 or schambers7@bloomberg.net
To contact the editor responsible for this story: James Ludden at +44-20-7673-2645 or jludden@bloomberg.net
Link to Google Transaltionc : {http://bit.ly/1g0OHOy}
Link to Original article in France : {http://bit.ly/1dpMOrl}
EXCLUSIVE. Google straightened one billion euros by the IRS!
Fiscal control of giant reached a record! And help reduce (slightly) the budget deficit of France in 2014.
The tax dispute between the French State and Google concludes with a record recovery of one billion euros, has-been learned from a government source and a parliamentary source. The joint Point.fr Bercy relies tax secrecy and wished neither confirm nor deny that sum. Point is yet able to say that the Directorate General of Taxation has not skimped to claim his due. To the delight of Bernard Cazeneuve , the Minister for the Budget, which is expected to raise two billion additional euros in 2014 through hunting fraudsters. However, between the time when the Treasury is claiming payment of one billion euros to Google and the actual payment, it may take a while ...
The dispute between Google and the Treasury goes back several years. June 30, 2011, a raid on the headquarters of Google France has allowed the National Directorate of tax and customs investigations take many documents (invoices, emails, contracts ...) to defeat the optimization strategy tax introduced by the U.S. giant through its various subsidiaries, including via the Ireland .
Google has always maintained that it was in compliance with national legislation. The Mountain View company declares, in France, a low turnover (less than 150 million euros) stating bill sponsored links its search engine for Ireland. This allowed Google to set only very small slate tax: EUR 5.5 million in 2011.
According to Google, this is the set of global Internet players operating in France who could pay hundreds of millions of euros in Bercy. For other litigation undertake effect Amazon, Facebook, Apple ..
Google Gives Schmidt $100 Million in Stock
Internet Company Says Executive Chairman's Restricted Shares Will Vest over Four Years
Google has awarded $100 million in restricted stock to Executive Chairman and former CEO Eric Schmidt, as well as a cash bonus of $6 million tied to the search giant's 2013 performance.
In a regulatory filing with the Securities and Exchange Commission, Google disclosed it awarded Mr. Schmidt a $6 million annual cash bonus, to be paid later this month, "in recognition of his contributions to Google's performance in fiscal year 2013."
The restricted stock, meanwhile, will be granted on Wednesday and will vest over a four-year period beginning in May 2015.
Mr. Schmidt's compensation totaled $7.6 million in 2012, a figure that included a $6 million bonus and a base salary of nearly $1.3 million. The bonus payments Mr. Schmidt has received the last two years are the most he can achieve under Google's cash incentives targets.
Still, the 2012 pay was far less than what Mr. Schmidt received in total compensation in 2011, when he was granted $100 million in equity after he assumed the chairman role.
Mr. Schmidt first joined Google in 2001 and served as CEO for about a decade. He stepped down from the CEO role in April 2011, when Google co-founder Larry Pageshifted to that role to take charge of Google's day-to-day operations.
Google continues to post strong revenue growth, beating back concerns that the shift in Internet usage to mobile devices from desktop computers would harm its lucrative search business.
The company's shares have risen about 61% since the beginning of 2013, a gain that demonstrates investors are sanguine about the shift to mobile, despite the fact that Google's link-based ads don't always translate well from desktop computers to smaller smartphone screens.
Analysts, polled by Thomson Reuters, expect Google's strong growth to continue this year. The top and bottom line are both projected to rise by 18%.
Sony is closing in on a sale of Vaio to a local private equity fund after several strategic buyers balked at taking on the personal computer business, according a person familiar with the process.
The Japanese electronics group has been battling to turn round its computing and TV businesses, which have been weighing on its profits, and has been reassessing its strategy for the PC business - including whether to keep it at all.
A sale to Japan Industrial Partners – a private equity venture backed by Bain Capital and Mizuho Securities – is likely to mean the survival of Vaio computers and laptops in Japan but the end of its ambitions overseas, according to the person.
Sony said at the weekend that it was addressing various options for the PC business as it denied reports that it was in talks to create a joint venture with Lenovo of China.
“We helped several strategic buyers look at the business, but none decided to pursue an offer,” said one banker.
The Nikkei in Japan reported on Wednesday that Sony and JIP were in talks over a sale of Vaio to a new company created and owned by JIP, in which Sony may take a small stake. The unit could fetch between Y40bn and Y50bn – or up to $460m, the Nikkei reported.
PC sales have been hurt globally by the growth in tablet devices. Worldwide shipments have fallen by 13.5 per cent over the past two years, according to Gartner, the research group.
Sony’s global market share has never been strong, but its own global sales have dropped by more than 27 per cent over the past two years, to just 6m machines, while its market share has fallen from a peak of 2.3 per cent to 1.9 per cent, according to Gartner.
Moody’s, the credit ratings agency, cut Sony to junk rating status late last month saying that its profitability would be “weak and volatile” until the turnround of its TV and PC businesses translated into better earnings.
Analysts expect the company to make a loss of Y30bn or more for 2013 when it reports earnings on Thursday.
Sony side-stepped a denial of a sale to JIP. “Sony has made no announcement in this regard. As Sony has announced previously, Sony continues to address various options for the PC business, but Sony has no further comments.”
JIP declined to comment.
Sony shares rose 4.6 per cent to Y1,600 as investors took heart from the prospect of a disposal of the ailing business.
* Q4 earnings seasons kick off – don't hold your breath
After the PE re-rated by 50% (since mid-12) investors await a rebound in European earnings. The season has kicked off and peaks on 24th February. Q3 saw the weakest Revenues since 2009, but EPS was a bit better. We expect Q4 to be even worse. While only one-sixth of our population has reported (too small to extrapolate) a net 14% have missed on Revenue (again!) and a meagre 3% of companies beat on EPS - the weakest since the Eurozone fell back into Recession mid-2011.
* 4 head-aches: AQR, overall kitchen sinking, a strong Euro & low inflation
4 fears: 1) Banks take large provisions to cover loan, litigation and regulatory risk ahead of the AQR review of 31 Dec balance sheets; 2) as Europe closes off its 3rd year of double digit EPS disappointment non-financials are tempted to clean-up house too ahead of the long-awaited 2014 recovery; 3) EURO DRAG is the biggest in a decade; and 4) Producer price inflation is the worst in 12 years (other than 09) and consumer price inflation struggles to remain at 1%. Not great for nominal profit growth.
* Keep calm and look through Q4 – outlook is key
European earnings are depressed versus history & the US so we see limited downside (barring a full blown EM balance of payments crisis). Why? The disconnect between the PMI / IFO current conditions 'and' earnings is verging on bizarre; the operating leverage expected in 2014 is akin to 2003/04 when profits exploded; and net debt keeps falling further. As we flush out the bad news we open the door to an even better 2014. Watch out for: badly needed revenue growth, a better domestic backdrop (vs EM); FX pain; any sign of bank optimism/lending, increasing capex and M&A (animal spirits).
* Stocks: Beats & Misses and currency checklists (most exposed to EM)
Our analysts see potential for positive surprises for stocks including: BASF, ITV and IAG and negative surprises: Air Liquide and Renault. See pages 14, 17 and 23 onwards.
Sacyr Vallehermoso Says Panama Canal authority breaks off talks over canal extension - press
- Note Feb 4th: SYV.ES: Panama Canal Authority and GUPC consortium said to be close to an accord on funding for the third set of locks - financial press
As EM adjustment pressures policy rates, EM domestic demand is more at risk
* Pressure on policy rates, dom demand
Turkey’s large emergency rate hikes highlight the ability of asset markets to influence action. The adjustment focus appears to be moving from FX to policy rates, which have a more direct effect on domestic demand in EMs with a C/A deficit, and put domestic cyclicals and financials more at risk, in our view. We continue to prefer DM-facing exporters, and North Asia. MX and RU may face currency volatility because of portfolio flows, but we feel this may create an attractive entry point.
* Weak bond inflows, more rate pressure
We feel that the ongoing tapering process will reduce the appetite for EM assets, particularly bond flows, which have offset rising EM C/A deficits since 2009. US data suggest the appetite inflected around the May ‘taper tantrum’; the large exposure of EM bond funds to C/A deficit countries doesn’t help investor appetite.
* FX exposure remains high in places
Foreign ownership of local currency bonds and cross-border bank loans implies that significant FX exposure remains in certain EMs. We compare these exposures to FX reserves, and highlight the relative risks in SA, TK, MX, and ID.
* SA back to U/W, with TK, ID and BR
A move to higher rates should accelerate the C/A adjustment but will come by broadly impacting domestic demand, especially in countries like South Africa and Turkey, where domestic demand and financial sectors are large and have high valuations. We swap Thailand (to Underweight) and Malaysia (to Market weight).
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BN 02/05 06:30 *POLTRONA FRAU: HAWORTH TO BUY 58.6% OF SHARE CAPITAL AT EU2.96 BN 02/05 06:29 *POLTRONA FRAU CONTRACT TO BUY 58.6% OF SHR CAPITAL BY HAWORTH
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Haworth to Buy 58.6% of Poltona Frau at EU2.96-Shr 2014-02-05 07:36:56.912 GMT
By James Ludden Feb. 5 (Bloomberg) -- Public tender offer to follow at same price. * Charme Investments (51.3%), Moschini (7.3%) agree to sell stakes * 31% premium to 100-DMA, 19% premium to close yday * Completion expected by end April * Deal values Poltona Frau at EU415m based on shrs outstanding of 140.3m: Bloomberg data
Link to Statement:{NSN N0IFBU3PR6RL <GO>} Link to Company News:{7343122Z US <Equity> CN <GO>} Link to Company News:{PFG IM <Equity> CN <GO>}
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Haven appeal of Swiss franc will fade
The Swiss franc and US Treasury bonds are the final remaining haven assets with international appeal. In contrast, German bunds are denominated in euros, the Bank of Japan’s massive quantitative easing is weakening the yen, and gold has lost its lustre as inflation has stayed low among developed economies.
Switzerland’s currency has been in demand this year as emerging markets have fallen around the world. But in spite of its haven status, investors should be sellers of the franc as the currency is set to weaken in 2014.
First, the Swiss National Bank is highly unlikely to abandon its cap on the exchange rate and start raising interest rates when other central banks begin tightening monetary policy over the next few quarters. The SNB claims the ceiling on the franc is needed for the foreseeable future given Switzerland’s near zero inflation rate.
Policy makers believe an increase in interest rates would endanger the limit on the currency and risk tipping the economy into deflation. The SNB is therefore likely to be one of the last central banks to start normalising monetary policy over the next few years.
Second, the large scale deleveraging that Swiss banks have undertaken since the credit crunch began, primarily through selling foreign assets and returning capital back into francs, appears to have finished. From 2007 to 2012, Switzerland experienced more than CHF200bn of inflows as local banks cut loans abroad.
That counts as extreme repatriation in an economy with a current GDP of CHF600bn. But in the first three quarters of last year, Swiss banks reversed course and increased their net lending abroad. This puts the balance of payments on track in 2013 to record annual outflows from domestic banks for the first time in a decade.
Third, the unwillingness of Swiss portfolio managers to purchase foreign assets since the eurozone crisis began in 2010 may also finally be coming to an end.
When the region’s debt crisis erupted, investors favoured the franc as a haven substitute for the old deutschemark. Even as eurozone equity and debt markets started to recover last year, Swiss asset managers were reluctant to reduce the high levels of ‘home bias’ in their portfolios in case the debt crisis flared up again.
That helped to underpin the strong value of the franc against the euro and dollar. But as foreign asset markets have continued to benefit from rising global growth, domestic portfolio investors are also now beginning to reduce their overweight positions in Swiss francs.
Admittedly, the currency is likely to remain supported by Switzerland’s large current account surplus this year. For the first three quarters of 2013 alone, the current account’s positive balance exceeded CHF60bn. For the year as a whole, it is likely to be well over 10 per cent of GDP. That provides substantial support and underpins the franc’s status as a haven asset.
But balance of payments accounting also overstates the significance of Switzerland’s current account surplus in relation to the franc. Trade in goods only makes a modest contribution to the surplus.
In contrast, investment income from Switzerland’s large net foreign assets, financial sector earnings and revenue from merchanting have all increased sharply over the past decade. But these flows may not necessarily be converted into francs. As SNB President Thomas Jordan said in a speech last year, “merchanting refers to trade, denominated primarily in US dollars, that does not cross the domestic border”.
The franc is also likely to remain supported by fears that the eurozone will edge towards deflation, prompting the European Central Bank to ease monetary policy further. In particular, if the ECB was to set its deposit rate below zero or engage in large-scale asset purchases as other central banks have since the financial crisis, the franc would benefit from haven-seeking inflows, resulting in the SNB selling domestic currency to enforce the CHF1.20 cap against the euro.
The risk of further ECB easing this year cannot be discounted given eurozone headline inflation was only 0.7 per cent in January. But the franc would be at risk if the SNB matches any move by the ECB to pursue negative interest rates.
Furthermore, the broader picture of recovery in the US, UK, Japan and Germany, less risk in peripheral eurozone markets, and the SNB’s commitment to maintain the cap on the franc and to be slow in raising interest rates, suggest risk-averse investors should favour the US dollar and Treasury bonds rather than the franc when seeking to hedge portfolios.
The dollar should benefit this year from the Fed tapering its asset purchases while US Treasuries will be in demand if emerging market turbulence intensifies.