TheChek News Flow

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Macro :

- Bordeaux 2016 Wine Starts to Price Above 2015, Liv-ex Data Show

- China in Talks With U.S., France for More Air Rights: CAAC

- Greece Cuts 2017 Growth Forecast to 1.8% From 2.7%: Reuters

- N.Korea Missile Closer to Russia Than Japan: White House

Keep an eye :

- AIR FP : Lion Air Says Its 1st Boeing 737 Max Delivery Delayed by 4 Days

- ABE SM : Atlantia May Bid for Abertis on Monday: Messaggero, public offer will be 70% cash and 30% shares and is likely to be priced at EUR 16- EUR 17 a share. (Il Sole 24)

- AKZA NA : Dutch Investor Group VEB Opposes PPG Making Hostile Bid for Akzo

- BARC LN : Barclays rumored to be mulling sale of 16% stake in African unit - Reuters

- BLT LN : BHP Plans to Drop Billiton from Name, Launches TV Ad Campaign

- BPM PL : Banco BPM May Consider Paying Dividend in 2017: Sole

- DBK GY : Deutsche Bank to Start Asset Management IPO Talks in Sept.: FAS

- DYS LN : Vacuum Tycoon Dyson Close to London Property Deal, S. Times Says

- DWNI GY : Deutsche Wohnen Would Evaluate Bid From Rival, CFO Tells FT

- ENEL IM : Enel looking for opportunities in electricity transmission assets in South America - CFO

- GSK LN : GlaxoSmithKline preps shareholders for buyout of 36.5% Novartis stake in GSK Consumer Healthcare

- SDF GY : K+S Is in Talks With Possible New Major Shareholder: FAS

- NOVN VX : Novartis Treatment Granted Orphan Drug Status by FDA

- PAXN SW : Holders of More Than 10% of Pax May Reject Baloise Offer: FuW

- PAH3 GY : Porsche North America Recalls 51,497 Macan S, Macan Turbo SUVs

- RNO FP : Renault Halts Production at Some Sites to Halt Virus Spread

- SAF FP : GE Sees No Change to Engine Output Plans After 737 Grounding

- SKY LN : Fox Said Willing to Make Concessions to Win Approval for Sky Bid

- UBSG VX : UBS, U.K. Revenue Office in GBP100m Tax Dispute: Mail on Sunday

- VOW3 GY : Volkswagen Recalls 240,487 Audi Q5, Q7 SUVs on Fuel Pump Parts

Analysts say Apple’s Corning investment signals future AR glasses & wireless charging tech

As noted by CNBC, a pair of analysts on Friday expressed that there’s much more to this investment than just display glass. For instance, Oppenheimer analyst Andrew Uerkwitz, who regularly covers Corning, explained that the move away from metal to glass is a must for wireless charging technologies.

Of course, it’s essentially common knowledge at this point that the iPhone 8 will switch to a glass design, but Uerkwitz believes that the Corning investment paves the way for wireless charging:

“Metal can interfere with wireless charging technology,” he told CNBC. “That means you need glass on the back of the phone, but glass that won’t break. Or you need to use ceramics. Corning has a long history of investing in both glass and ceramics.”

Furthermore, Patrick Moorhead of Moor Insights explains that the investment in Corning by Apple is more of a partnership. Moorhead explains that Apple and Corning can work together to create glass that “properly magnifies” the 180-degree augmented reality experience. It’s been reported multiple times in the past that Apple is working on a pair of augmented realty glasses, thus needing a supplier for the glass for this initiative.

“You need specialized glass in the headset, glass that properly magnifies the 180-degree experience of AR. Also, that glass has to be really light. Corning could develop that for Apple.”

Moorhead also notes that with the investment, Apple would be in a position to obtain exclusive rights to the augmented reality-focused glass from Corning.

When announcing the Corning investment, Apple explained that the $200 million would go to “support Corning’s R&D, capital equipment needs, and state-of-the-art glass processing.” Apple and Corning have been partners for 10 years and as Apple looks to grow United States manufacturing, the investment makes sense. But as always, maybe there’s more to the story than what Apple initially led on.

Deutsche Wohnen would not block a bid from its rival, Vonovia, if the price was “adequate”, according to the new chief financial officer of Germany’s second largest listed landlord.

Deutsche Wohnen last year fended off a hostile bid from its larger rival after a bitter struggle, which one person involved described the “most hostile deal in Germany since the Mannesmann-Vodafone takeover battle”.

The takeover would have capped two years of rapid consolidation in German real estate by creating a residential landlord controlling around half a million properties across the country, but was comfortably rejected by Deutsche Wohnen shareholders.

Philip Grosse, a former Credit Suisse banker who became CFO of Deutsche Wohnen last year, said he was sceptical of the merits of further consolidation. But he said that remaining independent was not an “end in itself” and that the company’s management would not stand in the way of an “adequate offer”, were one to materialise.

“If our shareholders were to be made a sensible offer, which was appropriate . . . and which sufficiently reflected the potential of Deutsche Wohnen, you would have a devil of a job to work against it. At the end of the day . . . we are the representatives of the investors, and have to act on their behalf to manage the company. And that of course includes evaluating a potential bid,” he said in an interview with the Financial Times.

Vonovia said: “A deal with Deutsche Wohnen was a topic in 2015 and 2016. This year building new properties is on the agenda.”

Mr Grosse declined to say what an “adequate offer” would be, but said that Deutsche Wohnen had attempted to give investors an idea of what its potential was in a presentation published alongside its third-quarter results.

On this basis, he said, “a value of considerably above €40 [per share]” could be justified. “Of course that is still a long way off. That means the true value lies somewhere between our current valuation and this long-term potential,” he added.

Deutsche Wohnen’s shares closed at €34.05 on Friday, some way above the €25.86 per share implied by Vonovia’s cash-and-stock bid in October 2015, which valued Deutsche Wohnen’s equity at €9.92bn.

Still, Mr Grosse said that he saw little justification for further big transactions in the German real estate sector. “[In residential real estate] the topic of scale is a topic of concentration. If you have concentrated portfolios, then you can run them efficiently. But scale is not an end in itself,” he said.

“If you look at the companies that have critical mass, then in my opinion it is very hard to argue that there are economies of scale and cost synergies, because they just aren’t there. And I think that is one reason why [Vonovia’s bid] failed, because many investors agreed. In that context, I would put a question mark next to the point of further consolidation.”

For the rest of the year, Mr Grosse said his priority was to focus on “internal growth”. The company will invest in both its existing portfolio of properties, as well as in building new properties on land it already owns.