(ZH) 'Hedge Fund Hotel' Arconic Crashes 25% As Sale Plan Abandoned

'Hedge Fund Hotel' Arconic Crashes 25% As Sale Plan Abandoned

Widely-held by hedge funds (e.g. Elliott Mgmnt with 52mm shares), aerospace company Arconic has decided to no longer pursue a potential sale of the company. The shares are down over 25% pre-market...
What changed in 4 days?
Jan.18: Arconic Hopes to Finalize Sale to Apollo This Weekend: NY Post
  • Apollo Global Management is nearing a deal to buy aluminum giant Arconic in a deal valued at roughly $22 a share, or $10.6 billion, The Post has learned.
Jan 22: Arconic no longer pursuing sale of company
  • we did not receive a proposal for a full-company transaction that we believe would be in the best interests of Arconic’s shareholders
As a reminder, a UK-based unit of Arconic sold construction panels that were blamed for the quick spread of a 2017 fire at Grenfell Tower in London that killed 72 people.
And as the crowd rushes for the exit, the door gets narrower and narrower...crashing the stock to a new record low.
Full Statement:
Arconic Inc. (NYSE: ARNC) today announced that its Board of Directors has determined to no longer pursue a potential sale of the company as part of its strategy and portfolio review.
John C. Plant, Chairman of Arconic, said, “Together with management, we have been conducting a rigorous and comprehensive strategy and portfolio review over the past year and as part of that process considered a sale of the company, among other matters. However, we did not receive a proposal for a full-company transaction that we believe would be in the best interests of Arconic’s shareholders and other stakeholders.”
“We will continue with the previously announced sale process for our Building and Construction Systems business. More broadly, we remain strongly focused on creating value for Arconic shareholders, through continued operational improvements and through other potential initiatives which we have identified in our strategic review.”
"Ouch" for many...

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance:

  • UBS -5%, SWK -3.1%, BG -1.5%, JNJ -1.4%, HAL -0.8%, ATI -0.7%

Select financial related names showing weakness:

  • RBS -3.6%, DB -3.4%, CS -1.5%, MS -1.1%, BAC -1%, GS -0.9%

Select Chinese stocks trading lower:

  • WB -3%, BIDU -1.8%, BZUN -1.5%, JD -1.5%, MOMO -1.5%, BABA -1.4%

Select metals related names showing early weakness:

  • FCX -3.3%, BHP -2.5% (production results) BBL -2.4%, RIO -1.9%

Other news:

  • SDLP -15.3% (cuts quarterly distribution to $0.01/unit from $0.10/unit)
  • TI -8.5% (Italy regulators have rejected plan for Telecom Italia (TI) to separate networks)
  • PDD -5.1% (following discount voucher hack)
  • SSW -4.4% (files for 52,810,939 Class A common share offering by selling security-holders)
  • ALXN -3.7% (EU patent office revokes Soloris formulation patent)
  • STNE -2.2% (releases Q4 Operational Metrics)
  • PAAS -2% (reports FY18 silver production slightly below guidance)
  • ABBV -1.7% (announces update on Phase 3 RESOLVE trial of ibrutinib (IMBRUVICA) in metastatic pancreatic cancer; study did not meet primary endpoint)
  • GWPH -1.7% (files mixed securities shelf offering)
  • MA -1.4% (fined EUR 570 mln by the EU for obstructing merchants' access to cross-border card payment services)
  • PCG -1.1% (cont volatility)

Analyst comments:

  • GPS -4.4% (downgraded to Sell from Neutral at Goldman)
  • MO -2.3% (downgraded to Underweight from Equal-Weight at Morgan Stanley)
  • REVG -2.3% (downgraded to Neutral from Outperform at Credit Suisse)
  • FTNT -1.7% (downgraded to Market Perform at BMO Capital Mkts)
  • TIF -1.7% (downgraded to Neutral from Buy at Goldman)
  • X -1.6% (downgraded to Hold from Buy at Jefferies)
  • FHN -1% (downgraded to Underperform from Neutral at BofA/Merrill)
  • PVH -0.8% (downgraded to Market Perform from Outperform at Cowen)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance:

  • EDU +3.8%, LOGI +2.6%, ONB +1.2%, STLD +1%

Other news:

  • MDWD +26.7% (announces that it has met its primary and all secondary endpoints in its pivotal U.S. Phase 3 clinical study)
  • TGTX +19% (granted Breakthrough Therapy Designation for umbralisib from the FDA)
  • SRNE +13% (announces interim results in osteoarthritis knee pain Phase 1b trial)
  • NOG +4.6% (provides Q4 business update)
  • EYPT +4.4% (entered into $20 mln At Market Issuance Sales Agreement)
  • CYTK +4.2% (announces receipt of FDA feedback regarding reldesemtiv in patients with SMA -- six minute walk test acceptable as primary efficacy endpoint for potential registration program)
  • EXK +2.6% (provides FY18 mineral reserve and resource estimates)
  • TLRY +2% (will acquire all of the issued and outstanding securities of Natura Naturals Holdings for CAD 35 mln in cash and stoc)
  • NNBR +1.7% (Legion partners discloses increased holding -- with 6.35% active stake)
  • GOLD +1.6% (reports preliminary Q4 production results)
  • TSLA +1.1% (modestly rebounding)
  • LIN +0.8% (authorized a share repurchase program for up to $6.0 billion of its ordinary shares)

Analyst comments:

  • UAA +4.4% (added to Conviction Buy List at Goldman)
  • DRNA +2.1% (upgraded to Buy at Chardan Capital Markets)
  • PANW +1.8% (upgraded to Buy from Neutral at UBS; upgraded to Outperformat BMO Capital Markets)
  • CARS +0.9% (upgraded to Buy from Neutral at BTIG Research)
  • NKE +0.9% (upgraded to Outperform from Market Perform at Cowen)

(CNBC) Facebook is the most ‘vulnerable’ big tech firm facing disruption, top VC

Facebook is the most ‘vulnerable’ big tech firm facing disruption, top VC says - https://cnb.cx/2CFUCM2

* Facebook is the most vulnerable big technology firm when it comes to facing disruption, Rebeca Hwang, co-founder and managing director of Rivet Ventures, told CNBC at Davos.

* Hwang also said large technology firms could be challenged by start-ups.

* Phil Chen, managing director at venture firm Presence Capital and decentralized chief officer at HTC, said blockchain technology could take some power away from big tech firms.


Facebook is the most vulnerable large technology company when it comes to facing disruption, a prominent venture capitalist told CNBC on Tuesday, amid ongoing concerns around privacy.

The social media giant had a very rough 2018. It kicked off after revelations that the data of 87 million Facebook users had been harvested by a political consultancy that ended up working with U.S. President Donald Trump. The year saw further issues including Russian-backed attempts to influence American elections, the resignation of the Instagram founders, and news that 50 million Facebook accounts were compromised in a cyber attack.

Rebeca Hwang, co-founder and managing director of Rivet Ventures, said that the backlash from users towards social media firms has left Facebook is a tough place.

“I do think Facebook is in a very vulnerable place right now. Both seen from the perspective of the consumer reaction … but also form the perspective of the deal flow that I see and the types of companies that are trying to become the disruptors of a Facebook,” Hwang said during a CNBC-hosted panel at the Davos Sanctuary.

“In my opinion they have to take very strong actions to maintain their position.”

Facebook was not immediately available for comment when contacted by CNBC.

Part of the discussion on the panel focused on the power of the world’s largest technology firms and whether they are too powerful to face disruption. Hwang said that the heightened sensitivity among consumers towards data privacy could provide an opportunity for start-ups.

“I think the ones that have become dominant, especially with younger generations, it’s also very challenging having that status. And so I don’t necessarily see a future where all of these giants will continue dominating forever. I think there will be disruptors in some of these areas by new players,” Hwang told CNBC.

Blockchain disruption?

Phil Chen, managing director at venture firm Presence Capital and decentralized chief officer at HTC, said blockchain technology could take some power away from big tech firms.

Blockchain is the technology that underpins the cryptocurrency bitcoin. It is a public ledger of transactions in bitcoin that is decentralized, meaning it is not owned by any one person. Instead, it is maintained by many participants.

Currently, Chen argues that companies like Facebook hold data on users in a central database which is owned by the company.

But blockchain technology could decentralize databases, allowing users to own their own data, and taking the power away from large firms.

“That’s the hope, that’s the thesis. At the end of the day today, the big corporates they have big central servers that hold everybody’s data. I think what bitcoin and blockchain really allows … is empowering people to own their own keys,” Chen told CNBC.

A key is a unique cryptographic address that allows someone to own their own cryptocurrency. Chen argues that this unique key could allow users to own their own data.

“Once you start owning your own keys, which is the means in which you own the cryptocurrency, then you start owning your identity, then you start owning your data, and that needs the whole crowd and the people to participate,” Chen said.

>>> US Early premarket gappers

Early premarket gappers

Gapping up:

  • MDWD +29.2%, AABA +4.2%, EDU +3.6%, FENG +3.6%, URI +3%, UAA +2.5%, MTL +2.1%, LOGI +2.1%, PANW +1.8%, GOLD +1.6%, RDUS +1.5%, TSLA +1.5%, MUX +1.2%, TAL +1.2%, GFI +0.8%, LIN +0.8%, NKE +0.6%

Gapping down:

  • TI -8.5%, UBS -4.5%, DB -3.7%, RBS -3.4%, WB -3.2%, BBL -2.7%, FCX -2.5%, BZUN -2.4%, MO -2.3%, RIO -2.2%, X -2%, PCG -1.8%, BHP -1.8%, RDS.A -1.7%, AG -1.7%, MA -1.7%, BIDU -1.6%, AMD -1.5%, JD -1.5%, CS -1.5%, BP -1.5%, MOMO -1.4%, MS -1.4%, BABA -1.3%, PAAS -1.3%, STM -1.3%, BA -1.2%, MU -1.2%, CAT -1.2%, ADBE -1.1%, NVDA -1%, GS -1%, AMZN -0.9%, MSFT -0.9%, FB -0.9%, NFLX -0.8%, BAC -0.8%, AAPL -0.7%