>>> Abertis/Atlantia: CNMV has until today to revoke authorisation given to Atla


Abertis/Atlantia: CNMV has until today to revoke authorisation given to Atlantia - report (translated)
08 JAN 2018

The Spanish market regulator CNMV has until today Monday (8 January) to reply to the request by the Ministries of Public Works and Energy to revoke the authorisation given to Atlantia’s [BIT:ATL] takeover offer for Abertis [BME:ABE], Expansion reported.

As previously reported, on 7 December 2017 the government of Spain’s Ministries of Public Works and Energy, Tourism and Digital Agenda issued requirements to the CNMV requesting the revocation or cancellation of the authorisation.

The requirements were based on the absence of an application by Atlantia for an authorisation from the ministries in relation to motorway concession in Spain controlled by Abertis and in relation to Abertis's interest in Hispasat. The Ministry of development is currently processing the application for authorisation submitted by last 21 December.

The Italian group's offer was approved by the CNMV Council on 9 October. The acceptance period has been interrupted pending the approval of the competing offer of Hochtief [FRA:HOT] , ACS’ [BME:ACS] German subsidiary, by the stock market supervisor.

FT : Quant hedge funds set to surpass $1tn management mark

Quant hedge funds set to surpass $1tn management mark
Growth propelled by interest in more systematic, computer-powered investment plans

The quantitative hedge fund industry is on the brink of surpassing $1tn of assets under management this year after breakneck growth from rising interest in more systematic, computer-powered investment strategies.

The amount of money managed by quant hedge funds tracked by HFR, a data provider, rose to more than $940bn by the end of October 2017 — nearly double their level in 2010 — and flows have continued to be strong in the fourth quarter, according to hedge fund executives.

An explosion of interest in automated, algorithmic investment approaches, ranging from the simple to high-octane strategies powered by artificial intelligence, has driven the surge. Even many traditional hedge funds are now hiring data scientists and programmers to reshape themselves into quants.

“Over the past decade the results of systematic quantitative investing have been undeniable,” said Philippe Jordan, president of CFM, a French quant hedge fund. “People have gone from being sceptical and uninterested to being artificial intelligence groupies.”

The growth of Two Sigma, one of the leaders of the quant hedge fund industry, is emblematic of the shift away from traditional hedge fund strategies. The New York-based firm’s assets have swelled from about $6bn in 2011 to more than $50bn in 2017, putting it roughly on par with the best-established quant powerhouses such as Renaissance Technologies and DE Shaw.

CFM’s assets under management nearly doubled last year to about $11bn, and the hedge fund has expanded its staff from about 160 at the start of last year to more than 200 today, according to Mr Jordan. He expects staffing to double over the next five years as more money pours into quantitative investing. Hedge fund executives say that the war for computer scientist talent has become intense.

Estimates for the size of the industry vary greatly because what constitutes a quant fund is debatable, especially now that many traditional hedge funds and even mutual fund groups are reinventing themselves as more computer-driven firms. However, Morgan Stanley’s analysts recently estimated that quant strategies — ranging from the newer breed of exchange traded funds to sophisticated hedge funds — have grown at 15 per cent annually over the past six years and control about $1.5tn.

But of this pile, they estimate that hedge funds only account for about $438bn, while quant mutual funds manage $712bn. Barclays analysts last summer estimated that quant hedge funds, or quant strategies within bigger hedge fund groups, managed about $500bn. Yet regardless of the overall size, analysts agree that it is the fastest-growing corner of the hedge fund industry.

That is worrying some fund managers, who fear that the money gushing into both simple and complex algorithmic trading strategies is making markets both more complex and fragile. The packaging of increasingly complex strategies into ETFs that are sold to retail investors is particularly alarming, according to analysts at 13D Research.

“When algorithms coexist in complex systems with the subjectivity and unpredictability of human behaviour, unforeseen and destabilising downsides result,” they wrote in a recent report. “They’re ignored, they intensify, until they become undeniable. We have little doubt the same will prove true for the algorithmic revolution in asset management.”

>>> LG just announced a 65-inch OLED TV that rolls up like a piece of paper

LG just announced a 65-inch OLED TV that rolls up like a piece of paper

Perhaps more than any other piece of consumer technology, TVs seem to be on a relentless march forward. Even as smartphones have begun to reach their limits of acceptable size and see diminishing returns as display resolutions push higher, TVs just keep getting bigger, sharper, and thinner. To drum up some hype for its CES showcase this year, LG just revealed a TV that pushes everything to the max, and it’s so thin that it can be rolled up like a poster.
The TV is just a concept, but it sure is wild. At 65 inches and a resolution of 4K, it’s of the ideal size and specs for many living rooms, but what LG really wants you to focus on is the fact that it’s basically a giant piece of electronic paper.

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If you’re seeing the TV when it’s deployed, you might not realize exactly what you’re looking at. It’s big and pretty, but what’s with the giant, blocky base, right? That long, narrow box is actually the TV’s “home,” and when it’s not in use it can be rolled back into that base unit and hidden from view.
But why would you want a big, rollable TV? LG does its best to make a case for it in its press release, suggesting that it’s a great space saver and a boon for its portability. For those of us who keep our TVs mounted to a wall or situated on a stand for the entirety of their lives, that’s not exactly a huge selling point, but that’s not to say the technology won’t be useful in the future. The classic sci-fi prop of an “electronic newspaper” which stays constantly updated but can be folded up like paper might not be too far off.

>>> Novartis could sell Sandoz assets valued between USD 2bn - USD 3bn


Novartis could sell Sandoz assets valued between USD 2bn - USD 3bn - report (translated)
08 JAN 2018

Novartis [VTX:NOVN], the Swiss pharmaceutical group, could sell parts of its US Sandoz business, Basler Zeitung reported. The Swiss daily said a Bloomberg article cited insiders who said Novartis is expanding its plan to sell US generic assets and could sell parts of its Sandoz business valued at USD 2bn to USD 3bn.

In December 2017, Novartis said it is planning the sale or discontinuation of certain non-core products, the report noted.

Pharma groups and private equity firms have already expressed an interest in Novartis' dermatology business, the report stated.

A Novartis spokesperson said the group continually examines the portfolio.

FT : China shadow bank clampdown eyes $2tn of entrusted loans

China shadow bank clampdown eyes $2tn of entrusted loans
Beijing seeks to shut down a giant market of unregulated lending

China’s banking regulator has put new curbs on the country’s Rmb13.8tn ($2.13tn) entrusted lending business, a sign that the crackdown on shadow banking launched by Beijing in 2017 will extend into the new year.

Rules issued at the weekend by the China Banking Regulatory Commission bar banks from arranging entrusted loans or providing guarantees on them. They also stop the loans from being used to buy equities, bonds or derivatives by the company borrowing.

Entrusted loans are loans made from one company to another in what has come to resemble banking activity but without the same level of risk controls that licensed lenders exercise when making credit decisions.

The rules, which reduce banks to intermediaries in the entrusted lending business, are part of an effort from China’s regulators to stem risk in the country’s financial sector, much of which was leveraged off banks’ balance sheets, and out of clear view.

“In many areas of shadow banking, I think this kind of regulation will become tighter and tighter,” said Xia Le, chief economist for Asia at BBVA. “This is going to put pressure on banks because shadow banking has already become an important source of income for them” as they earn fees guaranteeing and arranging the transactions.

Banks that guarantee such loans do not disclose that liability on their balance sheet, and it is not constrained by loan-to-deposit rules or capital adequacy measures. The upshot is that this vast volume of loans is unregulated.


Shadow banking continued to grow in the first half of 2017. Shadow banking assets hit Rmb64.7tn at the end of June, about 27 per cent of total banking assets but just a 0.5 per cent increase from the end of 2016, according to data from Moody’s.

Entrusted loans rose faster during that period, at about 4.5 per cent, to Rmb13.8tn. However, growth in that business, considered a core element of shadow banking, has slowed over the past few years. During 2016, entrusted loans rose 21 per cent from the year before.

Companies engaged in entrusted lending often lend out excess cash but many also borrow from banks and then re-lend at much higher rates to other companies, often to ones that could not get approval for bank loans in the first place.

Banks have grabbed part of the business by acting as arrangers for the loans, said Mr Xia, but many do not play a role in monitoring the activity. “They get the fees but don’t do much else,” he said.

Several large state-owned steel and coal companies, such as Baosteel and coal miner China Shenhua, have in the past pushed into the entrusted lending business.

Starting in early 2017, the CBRC and China’s central bank launched a series of measures that have taken aim at various channels used to structure off-balance-sheet lending.

In November, the People’s Bank of China published rules aimed at the country’s $15tn asset management market that prohibited asset managers from promising investors a guaranteed rate of return, while also requiring them to set aside 10 per cent of the management fees they collect for provisioning purposes. In September, money market funds came under regulatory attack.