>>> Europe : Brokers Upgrades & Downgrades - 21st of September 2

>>> Up
* EDF Upgraded to Neutral at Exane
* Enel Upgraded to Outperform at Exane
* Hermes PT Raised at RBC on Higher Margin, Lower Tax Assumptions
* Maersk Upgraded to Buy at HSBC; PT 11,100 Kroner

>>> Down
* Danske Bank Downgraded to Neutral at BofAML
* Endesa Downgraded to Neutral at Exane
* Tom Tailor Downgraded to Hold at Commerzbank; PT 4.50 Euros
* Verbund Downgraded to Underperform at Exane

>>> Initiation
* Deutz Rated New Buy at Baader Helvea; PT 8.50 Euros
* Paragon Rated New Sector Perform at RBC; PT 5 Pounds
* Siemens Healthineers Reinstated Neutral at Oddo BHF; PT 39 Euros

>>> Call
*

>>> US After Hours Summary: SCS +16%, PIR -17%, UNFI -11%, MU -8% foll


After Hours Summary: SCS +16%, PIR -17%, UNFI -11%, MU -8% following earnings/guidance, most semi/chip names are pulling back

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: SCS +16.4%

Companies trading higher in after hours in reaction to news: NBEV +8.3% (continued strength after closing up 80% on the day), ADVM +5.2% / KALV +2.8% / CARA +1.3% (initiated with Overweight at Cantor Fitzgerald), HLIT +2.9% (initiated with Buy at Loop Capital), ADT +2.6% (continued strength), ACAD +2% (confirms FDA issues statement reaffirming the positive benefit-risk profile of NUPLAZID for patients with Parksinon's disease psychosis), SONO +1.3% (after initially seeing continued weakness on Amazon product news, shares are higher on CNBC mention it could be M&A target), TXN +1% (raises quarterly dividend to $0.77/share from $0.62/share; authorizes repurchase of additional $12 bln of common stock), MRK +0.5% (receives positive CHMP opinion for DELSTRIGO and PIFELTRO in the EU for the treatment of HIV-1 infection), RDS.A +0.3% (ticking higher; Royal Dutch Shell may sell Gulf of Mexico assets to Focus Oil, according to Bloomberg sources)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: PIR -17.1% (provides prelim Q2 guidance), UNFI -10.8%, MU -7.8%

Companies trading lower in after hours in reaction to news: MDXG -8.1% (determined previously announced separations of four senior executives will be treated as terminations 'for cause'), WMC -4.5% (announces public offering of 6.5 mln shares of common stock), TLRY -3% (ongoing volatility), SJT -1.7% (late volatility follows release of Hilcorp's revised 2018 capital expenditures plan; now estimates Q4 CapEx of $662k), VRTV -1.6% (proposed underwritten secondary offering of 1.5 mln shares of common stock by selling stockholders)

Semi/chip names are lower following Micron (MU) guidance sell-off: WDC -1.8%, AMAT -1%, LRCX -0.8%, INTC -0.6%, AMD -0.4%, CY -0.3%, etf - SMH -0.2%

>>> US Close Dow +0,95% S&P +0,78% Nasdaq +0,98% Russell +1,01%

Closing Market Summary: S&P, Dow Climb to New Records

Wall Street soared on Thursday, with the Dow Jones Industrial Average adding 1.0% and finishing at a new all-time high for the first time since January 26. With trade war fears still lingering and no fundamental catalyst to drive the market higher, stocks relied on momentum and the fear of missing out to log Thursday's gains.

As for the other major averages, the S&P 500 also closed at a new record, finishing with a gain of 0.8%; the tech-heavy Nasdaq Composite advanced 1.0% to finish about 1.0% off its August 29 record; and the small-cap Russell 2000 climbed 1.0%, coming within 1.2% of its all-time high.

The top-weighted information technology sector rebounded on Thursday after a slow start to the week, finishing atop the sector standings with a gain of 1.2%. However, within the space, software company Red Hat (RHT 133.81, -9.35) tumbled 6.5% after disappointing Q3 guidance overshadowed above-consensus earnings.

In total, 10 of 11 sectors finished in the green. After tech, the materials (+1.1%), consumer staples (+1.2%), and health care (+0.9%) sectors were the next-best performers. The influential financial sector (+0.8%) was also strong, even though yields fell from multi-month highs. The benchmark 10-yr yield, for instance, slipped one basis point to 3.08% after hitting a four-month high on Wednesday.

Conversely, the oil-sensitive energy sector finished with a loss of 0.1%. A decline in the price of crude oil weighed on energy shares after President Trump criticized OPEC on Thursday morning, saying the "OPEC monopoly must get [oil] prices down now!" WTI crude futures lost 0.6%, closing at $70.26/bbl.

In corporate news, Amazon (AMZN 1944.30, +17.88) introduced 15 Alexa-enabled products at an event in Seattle, including a microwave, as the company looks to strengthen its position in the voice assistant space. Shares of Amazon finished the day higher by 0.9%.

On the currency front, the U.S. Dollar Index fell for the fourth day in a row, tumbling 0.7% to 93.46; that marks its lowest level since early June.

Reviewing Thursday's economic data, which included Existing Home Sales for August, the weekly Initial Claims report, the Philadelphia Fed Index for September, and the Conference Board's Leading Economic Index for August:

  • Existing home sales stayed at an annualized rate of 5.34 million units (consensus 5.37 million) in August. The July reading was left unrevised at 5.34 million.
    • The key takeaway from the report is that inventory is stabilizing, implying that there could be some moderation in the pace of price increases that could help drive increased buying interest (and perhaps added listing interest).
  • The latest weekly initial jobless claims count totaled 201,000, while the consensus expected a reading of 209,000. Today's tally was below the unrevised prior week count of 204,000. As for continuing claims, they declined to 1.645 million from a revised count of 1.700 million (from 1.696 million).
    • The key takeaway from the report is that it reflects a reluctance on the part of employers to reduce staff, which goes hand-in-hand with a strong economy and tight labor market.
  • The Philadelphia Fed Survey for September rose to 22.9 (consensus 15.3) from an unrevised 11.9 in August.
    • A number above zero is indicative of growth, so the key takeaway from the report is that it reflects the idea that manufacturing activity in the Philadelphia Fed region accelerated in September.
  • The Conference Board's Leading Economic Index increased 0.4% in August ( consensus +0.5%), and the July reading was revised to +0.7% from +0.6%.
    • The key takeaway from the report is that strength among the leading indicators remained widespread, which points to a sustained pace of economic expansion.

Investors will not receive any notable economic data on Friday.

  • Nasdaq Composite +16.3% YTD
  • Russell 2000 +12.0% YTD
  • S&P 500 +9.6% YTD
  • Dow Jones Industrial Average +7.8% YTD

>>> CECONOMY agrees to sell 9% Metro stake to EP Global

CECONOMY agrees to sell 9% Metro stake to EP Global
20 SEP 2018
CECONOMY AG (ETR: CEC) has signed a binding agreement to sell its approximately 9% stake in METRO AG (ETR: B4B).
  • Structured sale of approx. nine per cent of METRO stake agreed and is expected to be fully completed within nine months
  • CFO Mark Frese: “With the sale of our approx. nine per cent METRO shares, we achieve the capital structure we desired at the time of the demerger.”
The agreement with EP Global Commerce II GmbH (“EP Global”), indirectly owned by Daniel Kretínský and Patrik Tkáč, Czech and Slovak entrepreneurs, respectively, as the purchaser provides that EP Global will in a first step acquire an approximately 3.6 per cent stake in METRO from CECONOMY. In a second step, the parties agreed on put/call options regarding the transfer of the remaining approximately 5.4 per cent, which are expected to be exercised within nine months. The parties agreed not to disclose the purchase price. The consummation of the transaction is subject to the approval by the Federal Cartel Office.With the consummation of this transaction, we achieve the capital structure we desired at the time of the demerger. We strengthen our balance sheet through the inflow of liquid funds and eliminate the financial risks from this equity stake. This transaction is good news for CECONOMY and our shareholders,” says Mark Frese, CFO of CECONOMY.
After the demerger into two independent companies, a wholesale and food specialist (METRO) and a consumer electronics focused company (CECONOMY), CECONOMY had received a stake of around ten per cent in the new METRO as a financial resource and capital backing. CECONOMY directly holds an approx. one per cent stake in METRO, whereas the approx. nine per cent stake is held through MWFS Zwischenholding GmbH & Co. KG (“MWFS KG”). The agreement with EP Global concerns the approx. nine per cent stake in METRO, which is indirectly held via MWFS KG. CECONOMY always stated that the company considers its METRO stake as “non-strategic”. After completion of the transaction, CECONOMY will continue to hold a stake of approx. one per cent in METRO. This remaining stake will be held at least until 30 September 2023, for tax reasons.
goetzpartners Corporate Finance is advising the bidder.

>>> AT&T : Has learned that an unsolicited "mini-tender" offer has been made by

Has learned that an unsolicited "mini-tender" offer has been made by Ponos Industries LLC ("Ponos") to purchase up to 14,000,000 shares of AT&T common stock at $36.00 per share

While this price is above the current market price of AT&T common stock, the offer is conditioned upon the closing price of AT&T's shares exceeding the $36.00 offer price, as noted below. The offer is dated September 10, 2018, and indicates that it will expire at 5:00 p.m., New York City time, on October 12, 2018, unless extended at the sole discretion of Ponos.

--> AT&T wishes to inform its shareholders that it recommends rejection of this unsolicited offer and that AT&T is in no way associated with Ponos.

>>> Tikehau Capital in talks to buy Sodify for EUR 220m

Tikehau Capital in talks to buy Sodify for EUR 220m

Tikehau Capital [EPA:TKO], the llisted French alternative asset management and investment group, accelerated its development in real estate by entering exclusive negotiations with a view to acquiring Sofidy, a major player in real estate asset management in France.
This proposed acquisition would allow Tikehau Capital not only to become one of the leading independent French players in real estate asset management, but also to increase its assets under management by over 30% (On the basis of total amount of assets under management of EUR 14.8bn as at end June 2018 for Tikehau Capital), enabling it to achieve its target of EUR 20bn in assets under management by the end of 2018 initially announced for 2020.
A significant opportunity to strengthen its presence in the promising real estate asset management market and thus balance the Group's business mix.
This acquisition project is fully aligned with Tikehau Capital's strategy to broaden its fund offering in order to balance its business mix. It enables the Group to reach out to new investor categories and extend its know-how in the field of real estate investment solutions thanks to the strong complementarities between the two companies.
Established in 1987 by Christian Flamarion, Sofidy is a leading asset manager in the real estate management sector in France and Europe, involved in the creation and development of investment and savings products particularly focused on retail and office real estate.
A leading independent player in the SCPI (real estate investment trust) market with EUR 4.8bn under management, Sofidy manages a portfolio of over 4,100 real estate assets on behalf of over 45,000 individual investors and a large number of institutional investors.
This planned tie-up flows from the operational complementarity between the two groups, supported by common values of independence and excellence, which will allow their different know-how and expertise to be given free rein.
This complementarity is demonstrated firstly in the client base profile: institutional investors on the one hand and private investors on the other. The complementarity is also clear in terms of product range: on the one hand Real Estate Collective Investment Schemes (OPCI) for professional investors; and Real Estate Investment Companies (SCPI), real estate UCITS and OPCI for private investors, on the other.
For Mathieu Chabran, co-founder of Tikehau Capital: "Tikehau Capital is pleased to be able to seize the unique opportunity of acquiring Sofidy. We have high ambitions to grow in the real estate sector, and we are delighted to not only broaden our expertise in this area, but above all to welcome Sofidy and its teams alongside us."
For Jean-Marc Peter, CEO of Sofidy: "We are moving closer to a Group with strong growth, and with which we have numerous shared values, foremost among them being independence and performance at the service of our investors. We are convinced that this proposed operation will strengthen Sofidy over the long term and will benefit all our clients and partners."
By consolidating EUR 4.8bn (As at 30 June 2018) in additional real estate assets under management, the proposed acquisition of Sofidy will enable Tikehau Capital to almost triple its assets under management in this sector (which amounted to EUR 2.6bn at the end of June 2018).
In addition to the strong operational complementarities, this acquisition will immediately generate growth and profitability for Tikehau Capital. With net revenue corresponding on average to around 100 basis points of assets under management, and an operating margin of around 40% of net revenues in 2017, the acquisition of Sofidy will have an immediate positive impact on the average fee rate and operating margin of Tikehau Capital's asset management activities.
Following this envisaged operation, Tikehau Capital should hold over 90% of Sofidy's capital. The valuation for 100% of the shares in Sofidy amounts to EUR 220m, corresponding to an estimated enterprise value of c. EUR 120m (or below 7x EBITDA), plus c. EUR 100m in available cash and financial assets. The transaction will mostly consist in a sale in cash and -- for a marginal portion -- in a remunerated contribution in new Tikehau Capital shares. Tikehau Capital will finance the operation from its own resources and will communicate at a later date on the definitive terms of the operation.
The operation is subject to an information-consultation with the unique staff representative body of Sofidy.
The signature of an exclusive agreement has been authorised by the Supervisory Board of the Company as regulated agreements. For the purpose of this operation, the Supervisory Board designated an ad hoc committee composed of independent members. Its assignment is to supervise the works of an independent expert (Finexsi) and to submit a fairness opinion on the terms of the acquisition. M. Antoine Flamarion will abstain from taking any measure related to this operation for the account of Tikehau Capital.
Tikehau Capital is advised by Rothschild & Cie.
Once signed, the completion of the operation will be subject to approval from the French Financial Markets Authority (Autorite des marches financiers) as well as the competent competition authorities. Its completion is planned for Q4 2018.
After the definitive completion of the Sofidy acquisition, Tikehau Capital intends to launch a takeover bid for the acquisition of the shares in Selectirente. The offer price is under discussion and will be subject to a fairness opinion from an independent expert. The terms and conditions of the offer will be communicated to the market once they have been set.