TheChek News Flow

iPhone 8 Will Include 'Revolutionary' Front Camera With 3D Sensing Abilities

The three modules include an existing front camera module of current iPhones, an infrared transmitting module, and an infrared receiving module. Using these advancements, the camera will be able to find the location and depth of objects placed in front of it, with potential applications including facial and iris recognition.

The camera will function by merging the depth information captured by the IR transmitting and receiving modules with the traditional 2D images captured by the front camera. This not only could be used for the iPhone 8's long-rumored iris recognition feature, but even in some gaming applications -- and future AR/VR experiences -- where users could place their own 3D-scanned face in the game using a quick selfie.

Today's news of an overhaul to the front-facing camera of the iPhone 8 follows speculation surrounding the potential of Apple dropping Touch ID and instead focusing on either 3D facial recognition or iris scanning as the device's main security feature. JPMorgan analyst Rod Hall has stated that facial recognition could be a more secure alternative, and help increase Apple Pay adoption with retailers and financial institutions.

According to Kuo, this three-module front-facing camera system "will bring an innovative user experience" to the OLED iPhone 8, but for now it'll be reserved as exclusive to that model. "Future iPhones may come with a similar system for the rear camera," the analyst noted.

Last week, during which the S&P 500 climbed to another new high, BofAML clients were net sellers of US equities for the first time since the week prior to the US election in early November. Net sales of $2.1bn were the largest since June, with net sales of single stocks eclipsing small net purchases of ETFs. Sales were broad-based across size segments and client types, and this was the first week of selling by private clients since January. Buybacks by corporate clients slowed to a six-week low, and year-to-date are tracking the lowest of any comparable period since 2013. As our Chart of the Week below shows, buybacks on a trailing 12-month basis have been slowing since early 2016. Corporates may be pulling back on buybacks given elevated market valuations and a near-record-low proportion of investors wanting companies to return excess cash to shareholders (based on the latest Global Fund Manager Survey).

Clients continued to buy ETFs last week, though purchases of ETFs were their smallest since the week prior to the election. And after the previous week’s buying of cyclical stocks and selling of defensive stocks, clients sold stocks across all sectors except Materials last week. Consumer Discretionary, Industrials and Staples stocks saw the largest net sales; sales of Discretionary stocks were the sixth-largest in our data history following record sales of this sector two weeks ago. Utilities currently has the longest selling streak, with outflows for the last four weeks, while only Materials has seen two weeks of inflows. Based on less-volatile four-week average flows, Health Care has seen net sales since last March, while Financials and Tech have the longest buying streaks (since early Jan 2017).

• Mixed sector flows across client groups: Real Estate was the only sector which saw net sales by hedge funds, institutional clients and private clients alike last week. No sector saw net buying by all three. 

• Pension fund clients were net sellers of US stocks following two weeks of net buying. They sold ETFs along with single stocks in seven of the eleven sectors last week, led by Financials and Utilities. This group sold large caps but bought small and mid caps last week. See Pension fund flows for details.

Moelis founder pulls off a big coup with his firm’s role on flotation of oil producer

Ken Moelis has built his three-decade long dealmaking career on winning big business outside of the New York bubble, notably by helping casino tycoon Steve Wynn revive the Las Vegas Strip.

But with Moelis & Co having secured the role of lead independent adviser on the planned initial public offering of Saudi Aramco, the veteran banker’s status on Wall Street is set to be elevated to a whole new level.

“If he pulls this one off we’ll be renaming him Ken of Arabia,” says a senior executive at a rival New York investment bank. “It won’t be easy dealing with a client that is not your traditional [US] chief executive, [but] then again Ken is used to dealing with eccentric tycoons.”

The race to become lead adviser to what is expected to be the world’s largest IPO — Saudi officials hope it could value the state-owned company at $2tn — was a tough one. And as a relatively new investment bank, Moelis & Co was not the obvious frontrunner.

For months Saudi Aramco has invited banks to its headquarters in Dhahran to pitch for advisory and underwriter roles on the IPO, in which the world’s largest oil producer could sell a 5 per cent stake to investors.

According to two people with knowledge of the situation, Evercore and Rothschild appeared to be the top contenders for the advisory role, given their experience working on large IPOs of state-controlled assets.

However, Moelis ended up winning the race as its founder convinced executives at Saudi Aramco about his boutique firm’s ability to navigate what is likely to be a complex flotation.

“What do they [Moelis] know about oil and gas privatisations? . . . Ken Moelis is a fantastic pitcher for business,” says a rival banker close to the process. “There’s probably no one better anywhere. But Moelis’s equity people have never done anything like this before.”

As the lead adviser, Moelis will oversee underwriters and other preparations for the IPO, including helping make decisions such as where Saudi Aramco will list.

While the shares will be quoted on Riyadh’s Tadawul, Saudi officials are weighing the prospect of multiple overseas listings: including London, New York, Hong Kong and Tokyo.

New York is likely to be contentious given US legislation that allows families of victims of the 9/11 terror attacks to sue Saudi Arabia.

But the selection of New York-based Moelis as lead adviser may suggest a US listing could be back in favour.

JPMorgan, which has been Saudi Aramco’s commercial banker for years, is in pole position to be one of the main underwriters, according to several people following the process.

JPMorgan and Michael Klein, a former star Citigroup banker, have been working with Saudi officials on a broad range of matters related to the IPO and are expected to continue doing so.

For Mohammed bin Salman, the hard-charging deputy crown prince of Saudi Arabia, the flotation is the centrepiece of his ambitious plan to modernise and revive the waning Saudi economy through a privatisation programme.

Any proceeds from the offering would be ploughed into non-oil investments as the country seeks to diversify its economy away from oil.

Saudi Aramco, Moelis, JPMorgan and Rothschild declined to comment. Evercore did not immediately respond to a request for comment.

Prince Mohammed has asked those working on the IPO to speed up the process as he seeks a flotation as early as possible in 2018, says one person familiar with negotiations with advisers.

Mr Moelis is now gearing up to get that accomplished. For his firm, which was only founded in 2007, landing the Saudi Aramco IPO vindicates a strategy that has focused on dealmaking the old-fashioned way — based on a partnership business model.

By spreading the firm’s franchise across a global network, with experienced bankers in regions where few other boutique firms have a presence, Moelis has gained an edge to rapidly grow its business focused on mergers and acquisitions, restructuring and IPOs.

In the Middle East, Moelis built a sizeable team that has worked closely with large companies including Dubai World and Abraaj, an influential private equity fund in the United Arab Emirates. This team liaises with specialists in London, New York and Houston, where Moelis recently made several big hires.

In 2014 Moelis recruited Eric Cantor, the former Republican majority leader in the US House of Representatives, in what many on Wall Street saw as a shrewd move to increase the bank’s clout in Washington and overseas.

Mr Moelis, a Republican who was among the first on Wall Street to say that Donald Trump’s presidential campaign could succeed, said at the time that hiring Mr Cantor would expand its ability to help clients better navigate complex situations around the world.

Nikkei -0.01% Hang Seng +0.84% CSI +0.09% Shanghai +0.11%

Eur$ 1.0523 CNH 6.8667 CNY 6.8811 JPY 113.53 GBP 1.2488 CHF 1.0110 RUB 57.4250 WTI$ 54.51 +0.33%

S&P +0.08% EuroStoxx +0.18% Dax +0.24% FTSE +0.04% SMI -0.07%

Macro :

- Fillon Jumps in French Poll as Macron Pays for Campaign Gaffe

- Fed’s Mester Says Comfortable With Interest Rates Going Higher

- U.K.’s May Faces Brexit Clash After Bill Clears First Lords Test

- Goldman Says Commodities Need Proof of Real Demand to Rally More

Keep an eye on :

- ABBN VX : ABB nominates Cevian managing partner Lars Förberg for election to the board

- AC FP : Accor Says Former French President Sarkozy to Join Board

- AC FP : Accorhotels 2016 Net Income EU265m; Est. EU317m

- AIR FP : Airbus Takes EU2.2b Charge for A400M Program

- AAPL US : IPhone 8 May Include 3D-Sensing Front Camera: MacRumors --> STM

- ARAMCO IPO : Saudi Aramco Said to Weigh Offering Citizens Discounted Shares

- ARMAMCO IPO : Aramco Picks JPMorgan, HSBC, MS as Lead Underwriters: CNBC/DJ

- ATO FP : Atos Posts 2016 Net EU620M, Beating Estimates

- BAYN GY : Bayer 4th-Qtr Ebitda EU2.17 Bln vs. EU2.07 Bln Est.

- BBVA SM : BBVA Agrees to Acquire 9.95% Stake in Garanti for EU859m

- BMY US : Icahn Takes Stake in Bristol-Myers; Sees as Possible Target: DJ

- CBK GY : Commerzbank Strategy Faces ‘High’ Execution Risk: Fitch Ratings

- DB1 GY : LSE, Deutsche Boerse Said to Plan Further Antitrust Concessions

- DENERG DC : Maersk, Dong Still in Oil Unit Merger Talks, Borsen Says

- DTE GY : Germany Still Considering Sale of Telekom, Post: Handelsblatt (14.47%(fed. rep) + 17,51% (Gov) stake)

- DPB GY : Germany Still Considering Sale of Telekom, Post: Handelsblatt (20.46%)

- DWNI GY : Deutsche Wohnen Primary Shares Offered in Placement: Terms

- DWNI GY : Deutsche Wohnen Convertibles Issued With 0.325% Coupon

- EDP PL : EDP May Sell Naturgas Network, Continue as Supplier: Economista

- FRE GY : Fresenius SE Sees 2017 Sales Up 15-17%; 2016 Misses Expectations

- KYG ID : Kerry Group stresses no plan to sell consumer foods arm; could spend EUR 1bn on 2017 acquisitions

- LSE LN : LSE-Deutsche Boerse Deal Not in National Interest: U.K. Lawmaker

- MDLZ US : Mondelez: Some of Our Brands Are Candidates to Be Sold Off

- MMT FP : M6 Metropole Television FY Net Jumps 33%; Revenue Climbs 2.3%, M6 Extends De Tavernost Mandate to 2020, Les Echos Says

- NXI FP : Nexity FY Net Income Rises 16%; Sees Profit Growth in 2017, 2018

- NYR BB : Nyrstar Adj. Ebitda of EU193m Meets Ests., Net Debt Above Ests.

- PKD US : Parker Drilling offering 12m common shares, $50m convertible preferred stock via Barclays.

- UG FP : Peugeot Family Said to Support Opel Deal: Les Echos

- SCR FP : Scor Considers Share Buybacks; Profit Beats Estimates

- SDRL NO : Seadrill To Review Rate and Cross Currency Hedge Accounting9

- STM FP : IPhone 8 May Include 3D-Sensing Front Camera: MacRumors

- TEF SM : Telefonica, KKR Plan Future IPO for Telxius, Expansion Reports

- O2D GY : Telefonica Deutschland 4Q Sales Broadly In Line With Estimates

- UNA NA : Kraft Heinz may buy Unilever's food division - Het Financieele Dagblad

- WIE AV : Wienerberger 2016 Ebitda EU404.3M; Est. EU397M

- WHM LN : William Hill Said Set to Promote Philip Bowcock to CEO, FT Says

22 FEB 2017

Kraft Heinz may buy Unilever's food division, according to a report by Dutch daily Het Financieele Dagblad that cited discussions with several industry analysts.

The report said that turnover in Unilever's food division is lagging behind other parts of the conglomerate and only brings in a quarter of Unilever's turnover. The food division brought in turnover of EUR 6.3bn out of a total of EUR 26.3bn in 1H16.

The report says a takeover of the food division might be leverage for acquiring the entire company.

Unilever's growth is mostly in domestic and personal care products and the company could gain in value if it chooses to move further into that business sector, the report said.

Unilever last weekend rejected a EUR 134bn takeover offer from Kraft Heinz.