FT LEx : Unilever: marred mate

Unilever: marred mate
Anglo-Saxon capitalism, like Marmite, is not to everyone’s taste


Unilever is unfriending the UK. The Anglo-Dutch consumer products group is dropping the first third of its identifier by incorporating solely in Rotterdam. Its UK-listed shares are likely to fall out of FTSE Russell UK indices. Some UK-focused funds would then need to jettison them too.

The move, heralded in a prospectus on Tuesday, is unlikely to damage UK sales of Unilever products, such as Marmite. It has left a bitter taste in some British mouths, all the same. Critics who discern ulterior motives behind the simplification may be right. Unilever’s reasons for preferring the Netherlands do not all stack up.

The case for ditching dual nationality is robust enough. It reduces complexity and saves money. It makes Unilever stock a cleaner currency for dealmaking. Most border-straddling multinationals have already switched. RELX, the data group once known as Reed Elsevier, became unequivocally British on Monday, for example.

A streamlined future comes at the cost of short-term hassles. Unification may, for example, force Unilever to make a mandatory bid for an Indian subsidiary. This should not be a deal breaker, any more than complaints from UK-focused funds.

Investors should certainly question Unilever’s assertion that a more liquid stock pool is a factor in the favour of the Netherlands. Unilever NV has a market capitalisation of €71bn, compared with €57bn for Unilever Plc. But the Dutch business owns 55 per cent of group assets, so this is hardly surprising.

Moreover, Fidessa data shows the bulk of trading in Unilever shares is in London. Almost all Plc stock changes hands there. For Unilever NV, it is some 30 per cent.

Unilever disputes the claim it is turning fully Dutch to make takeovers harder. It has promised to eschew the poison pills Dutch regulation permits. This is beside the point. Chief executive Paul Polman appeared rattled by a tentative takeover approach from Kraft Heinz of the US last year. The communitarian Netherlands looks like a cosier berth for his socially conscious business than the profit-hungry UK. Anglo-Saxon capitalism, like Marmite, is not to everyone’s taste.

A revolt by niche UK funds is unlikely to derail the simplification. They might more usefully invest in RELX. Its shares have outperformed Unilever long term and its margins are a lot fatter.

9to5: Rumors: iPhone Xs Max is asymmetrical, heaviest at 7.3oz, Apple Watch goin

https://9to5mac.com/2018/09/11/rumor-iphone-xs-max-weight-apple-watch-64-bit/


Rumors: iPhone Xs Max is asymmetrical, heaviest at 7.3oz, Apple Watch going 64-bit

We’re just over 24 hours away from Apple’s iPhone Xs and Apple Watch Series 4 event, and we’re still hearing new details about what to expect from these devices. Apple’s event kicks off tomorrow at 10 am PT/1 pm ET, and this is the latest on the new iPhones and Apple Watch…

9to5Mac Happy Hour
The first tidbit is something we don’t put a whole lot of weight in as it comes from a single unconfirmed source that we believe has shared accurate information in the past, but it’s not a farfetched claim. That is the larger OLED iPhone which we expect to be called iPhone Xs Max will also be the heaviest model at 7.34 ounces.

If correct, that compares to the iPhone 8 Plus which weighs in at 7.13 ounces. The overall casings for both iPhones are expected to be about the same size, but the 0.20 ounce difference is likely do to with the use of stainless steel on the Xs Max versus aluminum on the 8 Plus for the enclosure band.

Gone are the days of obsessing over lighter and thinner — a trend that started reversing with iPhone 6s and each new Apple Watch — replaced with premium models with max weight, max screen size, and max price.

And despite the second year of iPhones priced at $999 and beyond, we now expect Apple to include the same slow 5W charging brick with USB-A in the box. After months of analysts expecting Apple to upgrade to a fast-charging solution that isn’t sold separately, Ming-Chi Kuo predicted otherwise yesterday and we’ve since heard the same thing.

Other tidbits floating around include expectations that the iPhone Xs Max with dual SIM will have four holes on one side of the Lightning port and seven holes on the other side — breaking from the current design of six holes on either side on the 5.8-inch model — although we don’t think that means the headphone jack is making its return. We’ll also likely see two more of those stunning space wallpapers (color matched for space gray and silver models) that we first saw in our gold iPhone Xs and iPhone Xs Max image.



Finally, there’s talk that the Apple Watch may be going 64-bit this year. iPhone, iPad, and Mac processors are all 64-bit. 32-bit software is no longer supported on iOS and going away on macOS next year, but the Apple Watch S3 processor remains 32-bit.

That may change tomorrow with a more capable S4 SiP (system in package). If true, Apple Watch Series 4 could see yet another performance boost, not just a beautiful face lift with the larger screen, slimmer bezels, and new watch faces.

At any rate, stay tuned to 9to5Mac for the latest breaking news and rumors going in to Apple’s big event tomorrow — and follow our live coverage of the iPhone Xs and Apple Watch Series 4 event as it unfolds.

Washington Post : Google’s location privacy practices are under investigation in

Google’s location privacy practices are under investigation in Arizona

Google's alleged practice of recording location data about Android device owners even when they believe they have opted out of such tracking has sparked an investigation in Arizona, where the state's attorney general could potentially levy a hefty fine against the search giant.

The probe, initiated by Republican Attorney General Mark Brnovich and confirmed by a person familiar with his thinking but not authorized to speak on the record, could put pressure on other states and the federal government to follow suit, consumer advocates say -- though Google previously insisted it did not deceive consumers about the way it collects and taps data on their whereabouts.

The attorney general signaled his interest in the matter in a public filing that indicated the office had retained an outside law firm to assist in an investigation. The document, dated August 21, said the hired lawyers would help probe an unnamed tech company and its "storage of consumer location data, tracking of consumer location, and other consumer tracking through . . . smartphone operating systems, even when consumers turn off 'location services' and take other steps to stop such tracking," according to the heavily redacted public notice.

The document was dated just over a week after an investigation from the Associated Press found that Google devices and services store time-stamped location data even for users who believed they had turned off that data collection. The AP verified its findings with the help of researchers from Princeton University.

Ryan Anderson, a spokesman for the Arizona attorney general, acknowledged that there have been “recent bombshell reports depicting how the tech industry handles consumer data and what companies are doing with that information,” including the AP story, which “highlighted Google’s apparent tracking of consumer movement even if you opt out of such services.”

He added that Arizona had "been thinking about investigating privacy concerns by tech companies for some time," including the tracking of consumer location and the gathering of consumer data. He said he couldn't confirm which company it was targeting in its investigation.

Google spokesman Aaron Stein said in a statement that location data “helps us provide useful services when people interact with our products, like locally relevant search results and traffic predictions,” nothing that it collects that information in many ways, including through Android devices as well as through search queries.

Previously, Google told the AP it provides “clear descriptions of these tools, and robust controls so people can turn them on or off, and delete their histories at any time.”

Under state law, Arizona can bring consumer-protection cases against businesses that deceive users about their practices. The state also can seek penalties of up to $10,000 per violation, meaning Google's location privacy practices could result in a sky-high fine for the company.

Arizona’s investigation of Google marks Brnovich’s latest attempt to push tech giants to improve their online privacy practices. This March, the attorney general publicly blasted Facebook for its entanglement with Cambridge Analytica, a political consultancy that improperly accessed personal data about 87 million of the site’s users. "Transparent disclosure of, and clear consent to, the collection and sharing of personal data should be the rule, rather than the exception,” Brnovich wrote in his letter to Facebook.

With Google, the new Arizona probe could embolden privacy hawks who would like to see federal regulators open their own investigation. The Federal Trade Commission penalized the company in 2011 for misleading consumers about its data-collection practices, and the agency has the authority to bring fines of its own if companies violate their settlements with the government.

"We fully support the efforts of the state Attorneys General to protect consumer privacy and pursue investigations,” said Marc Rotenberg, the leader of the Electronic Privacy Information Center, which asked the FTC to open a probe in August.

A spokesman for the FTC declined to comment.

Arizona's probe marks only the latest regulatory headache for the search giant. It already has to contend with an antitrust investigation in Missouri, where the state's Republican attorney general, Josh Hawley, sent Google his latest subpoena in July.

Other state attorneys general plan to convene later this month at an event convened by the Justice Department that will explore whether social media sites more broadly are “intentionally stifling the free exchange of ideas” online. Arizona, however, is among a large number of states that have not yet been invited to the gathering, a spokesman for Brnovich said Monday.

FT : Edouard Carmignac steps back from fund after 29 years

Edouard Carmignac, the founder of the eponymous fund management firm, is stepping back after three decades at the helm of one of the company’s oldest funds following lacklustre performance.

Paris-based Carmignac said on Tuesday that Mr Carmignac was stepping back from overseeing Carmignac Investissement, a €3.96bn fund investing in international equities that he has run since its inception in 1989. David Older, Carmignac’s head of equities, will take over the management of the fund.

Mr Older has also been named co-manager of the group’s largest fund, Carmignac Patrimoine, which invests in bonds, equities and currencies, and has €18.7bn under management. Mr Older will run it alongside Mr Carmignac and Rose Ouahba, head of fixed income. Mr Carmignac will remain as the group’s chief investment officer, focusing on overall asset allocation.

The changes follow a long period of underperformance at Carmignac.

Carmignac Investissement has underperformed its benchmark over one month, three months, one year, three years, five years and 10 years, and is in the bottom quartile of peer performance in each of these time periods, according to Carmignac’s website.

Meanwhile Carmignac Patrimoine has also underperformed its benchmark over one month, three months, one year, three years, five years and 10 years. The fund made its name during the financial crisis of 2008 when its performance was flat while its benchmark index lost 12 percentage points. Since then it has disappointed.

Mr Carmignac, 71, is one of the most high-profile names in the European fund management industry. He has cultivated a rock-and-roll image by entertaining clients, employees and friends in annual private concerts where the likes of the Rolling Stones and Eric Clapton have performed, and is a keen polo player. Mr Carmignac has amassed a vast collection of contemporary art and this summer opened a new foundation to display it on the island of Porquerolles off the coast of the South of France.

Mr Carmignac said in a statement on Tuesday:

I have at my disposal this wealth of talents to delve into, so as to focus my attention on forging deep-seated convictions on markets, essential to long term performance. This is in particular made possible because I have total confidence in fully extending to David Older the already large delegation in the management of our global equity portfolios that I had progressively granted him over the past few years.

>>> Weir stake may be up for grabs, activists circling?

Weir stake may be up for grabs, activists circling? - MergerMArket

Industrial engineer Weir Group [LON:WEIR] has looked like a natural activist target for some time.
A sizeable share price fall last week, coupled with an upcoming lock-up expiry (12 January 2019) on a chunky stake held by owners of a business acquired by Weir earlier this year, mean it’s a situation worth watching.
Shareholders of Esco, bought by Weir for USD 1.3bn in July, are locked up for 180 days from a 31 July completion date. They own around 16.8m shares in the business, worth about GBP 280m at market prices. On announcement of the acquisition of Esco in April, Weir said 50%-plus of that stake would be subject to the lock-up, indicating that around 6.5% of the business could be up for grabs.
As well as a potential share overhang due to the expiring lock-up, Weir’s share price is under pressure for other reasons.
Industrial markets are weakening after a strong run through 2017, according to JP Morgan’s Global Manufacturing PMI data. Profit warnings among some of Europe’s large industrial companies, including Osram Licht [ETR:OSR] and Continental [ETR:CON], as well as oilfield service giants Schlumberger [NYSE:SLB] and Halliburton [NYSE:HAL], provide evidence that demand may be starting to wane.
Weir itself issued an unscheduled trading update on 6 September, soon after a strong set of half-year numbers, saying equipment orders softened in late August. Its shares fell 6% on the news. Weir's market cap stands at GBP 4.7bn.
A sell-off at Weir, and the potential to pick up shares at a discount if former Esco investors sell, could whet the appetite of activists.
Weir trades at a discount to European peers Epiroc [STO:EPIA] and Metso [HEL:METSO] on trailing-12-month EV/EBIT and EV/EBITDA multiples, after including pro-forma revenues and profitability from Esco.
Metso, which has lower margins than Weir, trades at a slight EV/sales discount. The range of valuations on these two peers indicates an equity value for Weir of between GBP 13 and GBP 34 per share. Averages across a broader peer group, including Sandvik [STO:SAND], Komatsu [TYO:6301] and Caterpillar [NYSE:CAT], indicate an equity value of between GBP 15.41 and GBP 19.44 per share.
Weir’s share price at yesterday’s close was GBP 15.71.
Key risks at Weir include debt taken on to fund the acquisition of Esco: the engineer reported net debt/EBITDA on 30 June, excluding the rights issue to fund the deal, at 2.1x versus covenants at 3.5x.
Beyond valuation arguments, there are also elements of Weir’s corporate structure which could appeal to activists.
Weir’s management has already acted on perhaps its most obvious strategic move by kicking off a sale process for its Flow Control business.
A sale of the unit could bring in between GBP 500m and GBP 700m, the Flash previously calculated. EV/sales multiples on peers imply the unit should attract a valuation in this ball park. But it’s worth noting the unit does not generate a material amount of EBITDA and so buyers would need to be confident the business could be turned around.
Weir operates across two further business lines: Minerals and Oil & Gas. A sale or spin-off of the latter unit might help Weir take advantage of investor interest in the Minerals engineering sector.
Atlas Copco’s [STO:ATCOA] spin-off of Epiroc, which priced beyond the top end of comparative valuations, highlights investor appetite for high quality pure-play operators in this industry.
Activist interest in the sector from Cevian, which is invested in Metso, another key Minerals peer, means there are plenty of reasons to follow developments at Weir.

>>> Europe Flash: Weir stake may be up for grabs, activists circling?

Europe Flash: Weir stake may be up for grabs, activists circling? - MergerMArket

Industrial engineer Weir Group [LON:WEIR] has looked like a natural activist target for some time.
A sizeable share price fall last week, coupled with an upcoming lock-up expiry (12 January 2019) on a chunky stake held by owners of a business acquired by Weir earlier this year, mean it’s a situation worth watching.
Shareholders of Esco, bought by Weir for USD 1.3bn in July, are locked up for 180 days from a 31 July completion date. They own around 16.8m shares in the business, worth about GBP 280m at market prices. On announcement of the acquisition of Esco in April, Weir said 50%-plus of that stake would be subject to the lock-up, indicating that around 6.5% of the business could be up for grabs.
As well as a potential share overhang due to the expiring lock-up, Weir’s share price is under pressure for other reasons.
Industrial markets are weakening after a strong run through 2017, according to JP Morgan’s Global Manufacturing PMI data. Profit warnings among some of Europe’s large industrial companies, including Osram Licht [ETR:OSR] and Continental [ETR:CON], as well as oilfield service giants Schlumberger [NYSE:SLB] and Halliburton [NYSE:HAL], provide evidence that demand may be starting to wane.
Weir itself issued an unscheduled trading update on 6 September, soon after a strong set of half-year numbers, saying equipment orders softened in late August. Its shares fell 6% on the news. Weir's market cap stands at GBP 4.7bn.
A sell-off at Weir, and the potential to pick up shares at a discount if former Esco investors sell, could whet the appetite of activists.
Weir trades at a discount to European peers Epiroc [STO:EPIA] and Metso [HEL:METSO] on trailing-12-month EV/EBIT and EV/EBITDA multiples, after including pro-forma revenues and profitability from Esco.
Metso, which has lower margins than Weir, trades at a slight EV/sales discount. The range of valuations on these two peers indicates an equity value for Weir of between GBP 13 and GBP 34 per share. Averages across a broader peer group, including Sandvik [STO:SAND], Komatsu [TYO:6301] and Caterpillar [NYSE:CAT], indicate an equity value of between GBP 15.41 and GBP 19.44 per share.
Weir’s share price at yesterday’s close was GBP 15.71.
Key risks at Weir include debt taken on to fund the acquisition of Esco: the engineer reported net debt/EBITDA on 30 June, excluding the rights issue to fund the deal, at 2.1x versus covenants at 3.5x.
Beyond valuation arguments, there are also elements of Weir’s corporate structure which could appeal to activists.
Weir’s management has already acted on perhaps its most obvious strategic move by kicking off a sale process for its Flow Control business.
A sale of the unit could bring in between GBP 500m and GBP 700m, the Flash previously calculated. EV/sales multiples on peers imply the unit should attract a valuation in this ball park. But it’s worth noting the unit does not generate a material amount of EBITDA and so buyers would need to be confident the business could be turned around.
Weir operates across two further business lines: Minerals and Oil & Gas. A sale or spin-off of the latter unit might help Weir take advantage of investor interest in the Minerals engineering sector.
Atlas Copco’s [STO:ATCOA] spin-off of Epiroc, which priced beyond the top end of comparative valuations, highlights investor appetite for high quality pure-play operators in this industry.
Activist interest in the sector from Cevian, which is invested in Metso, another key Minerals peer, means there are plenty of reasons to follow developments at Weir.

>>> Abertis buyers Atlantia, ACS step up process with US expansion in mind - rep

Abertis buyers Atlantia, ACS step up process with US expansion in mind - report (translated)
11 SEP 2018
Atlantia's [BIT:ATL] has renewed its commitment to the structure of the acquisition of its Spanish rival Abertis [ABE:SM] and the distribution of the agreed capital, Cinco Dias reported citing unspecified reliable sources.
Atlantia and its partner ACS [BME: ACS] are speeding up the takeover of Abertis with the aim of getting it ready to expand to the US, according to the report.
Atlantia and ACS are completing the corporate vehicle that will hold 100% of Abertis' capital and will be divided into 50% plus one share for the Italian group, 20% for ACS’ German unit Hochtief [ETR: HOT] and 30% minus one share for ACS. The partners hope to close the process between September and October, the Spanish-language paper said.
With this scheme, Atlantia will consolidate the debt of the Spanish motorways’ concessions group, Cinco Dias noted.

Atlantia will then appoint a new financial director and possibly a head of business development, taking up the key management positions, together with the CEO of Abertis, José Aljaro, and the chairman Marcelino Fernández Verdes, who in turn is the CEO of ACS and chief executive of Hochtief.

Atlantia is yet to know the penalties the Italian government will impose after the sinking of the Morandi viaduct in the city of Genoa, the report noted. Despite the fact that some of its assets may be nationalised, its bet on Abertis remains intact, according to the report. Last Wednesday 5 September, Gilberto Benetton, chairman of Edizione (Atlantia’s main shareholder with a 30.2% stake), confirmed in an interview that the schedule for Abertis remained unchanged.

>>> US Gapping down


Gapping down
In reaction to disappointing earnings/guidance:

  • FRAN -27.8%, SONO -16.7%, LMNR -16.5%, MTRX -15.5%

M&A news:

  • YUMC -12.3% (Hillhouse Capital consortium said to be abandoning efforts to acquire Yum China, according to Bloomberg)
  • SD -9.1% (completes strategic review process; to move forward with development and growth plan)

Other news:

  • USAT -18.6% (to delay FY18 Form 10-K filing -- Audit Committee in process of conducting internal investigation of current and prior period matters)
  • PACB -6.6% (proposed public offering of common stock; offering size not disclosed)
  • NNBR -5.5% (announces public offering of 12.5 mln shares of common stock)
  • ECYT -4.7% (Endocyte proposes $175.0 mln public offering of common stock and files for mixed securities shelf offering)
  • PSX -2.5% (Berkshire Hathaway [BRK.A / BRK.B] lowers passive stake)
  • NXPI -2% (initiates dividend program with initial interim dividend for Q4 of $0.25 per ordinary share that will be paid on Oct 5 to shareholders of record as of Sept 25)
  • PODD -1% (promotes Shacey Petrovic to CEO; Patrick Sullivan will retire as Chairman and CEO at the end of 2018; reaffirms guidance provided August 2)
  • AABA -0.9% (Altaba to sell all of the shares of Yahoo Japan that it currently holds to certain managers at a price of JAP 354 per share)

Analyst comments:

  • MNK -4.7% (downgraded to Sell from Neutral at Goldman)
  • CNX -2.1% (downgraded to Sell from Neutral at Goldman`)
  • TSLA -1.9% (downgraded to Neutral from Buy at Nomura)
  • WING -1.9% (downgraded to Neutral from Buy at Goldman)
  • WDC -1.6% (downgraded to Sector Perform from Outperform at RBC Capital Mkts)
  • CBS -1.3% (downgraded to Neutral from Buy at UBS)
  • JCI -1.3% (downgraded to Neutral from Buy at UBS)