>>> Lufthansa on radar of Abu Dhabi sovereign wealth fund

Lufthansa on radar of Abu Dhabi sovereign wealth fund - report (translated)

Lufthansa [LHA:GR], a German airline group, has attracted the interest of a sovereign wealth fund from Abu Dhabi, ARD reported. The German TV broadcaster quoted an unconfirmed report published by a local magazine, which - in turn - quoted unidentified sources close to the situation.
The report claimed that the unidentified sovereign wealth fund is interested in acquiring a “small stake” in Lufthansa. The rumour caused the airline’s share price to rise by up to 4%.
Lufthansa has a market cap of EUR 5.676bn

>>> Weekly Update

Weekly Market Update: Trump and Brexit Remain Center Stage

President Trump was sworn in today and gave a speech that promised more jobs for Americans, 4% growth, a boost to infrastructure spending, and putting 'America first' in energy and foreign policy. The stock markets received the speech cautiously, dropping modestly in the immediate aftermath of his inauguration remarks. Overall, the reflation trade stayed on track as US Treasuries sold off, although the dollar continued to lose some ground against major currencies. The 30-Year yield rose 17bps over the week to close today at 3.06%, while the dollar index was down 0.2% on the week. Over the four session period, the DJIA lost 0.3%, the S&P slipped 0.2%, and the Nasdaq fell 0.3%.

The ECB’s scheduled policy meeting on Thursday was uneventful, with nothing new coming from President Draghi's press conference. The central bank confirmed its asset buying program will be adjusted from €80 billion to €60 billion starting in April, and Draghi continued to insist this does not constitute “tapering.” He also made clear that the ECB will be watching core inflation closely, as higher energy prices are distorting long-term trends, but noted underlying inflation pressures remain “subdued.” No mention was made in the presentation as to which bonds would be cut back when the reduction in the program kicks in for April.

British PM May outlined UK intentions and desires for Brexit, mainly confirming previous statements that the UK would seek to leave the single market, take back immigration control, as well as legislative sovereignty at all levels. After a string of positive economic data, UK Retail Sales released Friday showed a much sharper slowdown than expected; m/m retail sales were down 2% compared to forecasts of -0.1%. Some analysts are saying this may be only the beginning of more severe fallout from the Brexit as the invocation of Article 50 looms in March.

On the corporate front, financial names began the holiday-shortened week hurt by lower bond yields and a disappointing investor reaction to Morgan Stanley, Comerica and Goldman earnings, despite generally solid quarters. Industrials showed some strength this week following news that CP's CEO may pursue an activist role with other railroads and after solid earnings from Union Pacific. IBM beat consensus estimates, and positive comments from analysts lifted shares into the weekend.


SUNDAY 1/15
(UK) PM May to deliver a speech on Tuesday, Jan 17th calling for 'clean and hard Brexit' - UK press
LUX.IT Said to have reached €50B merger agreement with Essilor; deal to be announced before the market opens today - FT

MONDAY 1/16
(US) IMF UPDATES ITS WORK ECONOMIC OUTLOOK (WEO): Maintains 2017 and 2018 global growth forecasts
RIO.AU Reports Q4 global iron ore production 73.6Mt v 72.7Mte; shipments 87.7Mt v 86.8Mte, +1% y/y

TUESDAY 1/17
RAI BAT to acquire remaining stake for ~$59.64/shr valued at $49.4B
(UK) DEC CPI M/M: 0.5% V 0.3%E; Y/Y: 1.6% V 1.4%E; CPI CORE Y/Y: 1.6% V 1.4%E (highest annual reading since July 2014)
(UK) DEC PPI INPUT M/M: 1.8% V 2.4%E; Y/Y: 15.8% V 15.5%E
(DE) GERMANY JAN ZEW CURRENT SITUATION SURVEY: 77.3 V 65.0E; EXPECTATIONS SURVEY: 16.6 V 18.4E
(UK) PM May: UK is leaving EU; will seek the best deal possible; not seeking partial or associate membership of EU (in-line with speculation); will be compromises in Brexit - Brexit
(SA) Saudi Min Energy Min al Falih: Oil market strength could end OPEC deal in 6 months; if OPEC does not extend cuts, that is a bullish sign for oil
(US) JAN EMPIRE MANUFACTURING: 6.5 V 8.5E
(CN) CHINA DEC PROPERTY PRICES M/M: RISE IN 46 OUT OF 70 CITIES VS 55 PRIOR; Y/Y: RISE IN 65 OUT OF 70 CITIES V 65 PRIOR

WEDNESDAY 1/18
ASML.NL Reports Q4 Net €524M v €416Me, Rev €1.91B v €1.77Be; Board to propose FY16 dividend at €1.20/shr from €1.05/shr in FY15
BRBY.UK Reports Q3 Retail rev £735M v £721Me; SSS +3% v +1.4%e
(UK) NOV AVERAGE WEEKLY EARNINGS 3M/Y: 2.8% V 2.6%E (highest since Sept 2015) ; WEEKLY EARNINGS (EX BONUS) 3M/Y: 2.7% V 2.6%E
(UK) NOV ILO UNEMPLOYMENT RATE 3M/3M: 4.8% V 4.8%E
(UK) DEC JOBLESS CLAIMS CHANGE: -10.1K V +5.0KE; CLAIMANT COUNT RATE: 2.3% V 2.3%E
(EU) EURO ZONE DEC CPI M/M: 0.5% V 0.5%E; Y/Y (FINAL): 1.1% V 1.1%E; CPI CORE Y/Y: 0.9% V 0.9%E
GS Reports Q4 $5.08 v $4.76e, R$8.17B v $7.43Be
C Reports Q4 $1.14 v $1.11e, R$17.0B v $17.0Be
(US) DEC CPI M/M: 0.3% V 0.3%E; CPI EX FOOD AND ENERGY M/M: 0.2% V 0.2%E; CPI INDEX NSA: 241.432 V 241.508E
(US) DEC INDUSTRIAL PRODUCTION M/M: 0.8% V 0.6%E; CAPACITY UTILIZATION: 75.5% V 75.4%E
(CA) BANK OF CANADA (BOC) LEFT INTEREST RATES UNCHANGED AT 0.50%; AS EXPECTED
(US) JAN NAHB HOUSING MARKET INDEX: 67 V 69E
(US) Association of American Railroads weekly rail traffic report for week ending Jan 14th: 516.2K carloads and intermodal units, +2% y/y
(US) Fed Chair Yellen: next rate hike will depend on economy over coming months
(US) NOV TOTAL NET TIC FLOWS: $23.7B V $18.8B PRIOR; NET LONG-TERM TIC FLOWS: $30.8B V $9.4B PRIOR
CP Reports Q4 C$3.04 v C$2.72 y/y, Rev C$1.64B v C$1.69B y/y; CEO Hunter Harrison to retire early to 'pursue opportunities involving other Class 1 Railroads'
(AU) AUSTRALIA DEC EMPLOYMENT CHANGE: +13.5K (3rd straight increase) V +10.0KE; UNEMPLOYMENT RATE: 5.8% (6-month high) V 5.7%E

THURSDAY 1/19
CA.FR Reports Q4 Rev €23.4B v €23.3Be
(MY) MALAYSIA CENTRAL BANK (BNM) LEAVES OVERNIGHT POLICY RATE (OPR) UNCHANGED AT 3.00%; AS EXPECTED
(EU) ECB LEAVES MAIN 7-DAY REFINANCING RATE UNCHANGED AT 0.00%; AS EXPECTED
*(US) INITIAL JOBLESS CLAIMS: 234K V 252KE; CONTINUING CLAIMS: 2.05M V 2.08ME
(US) DEC HOUSING STARTS: 1.226M V 1.188ME; BUILDING PERMITS: 1.210M V 1.225ME
(US) JAN PHILADELPHIA FED BUSINESS OUTLOOK: 23.6 V 15.3E
(EU) ECB's Draghi: Reiterates view that interest rates to stay low or lower for extended period - prepared remarks
(EU) ECB's Draghi: Have not discussed reducing stimulus at today's meeting (no tapering); inflation has to be sustained for the whole Euro Area - Q&A
(US) Atlanta Fed maintains Q4 GDP forecast at 2.8%, same as 1/13
*(US) DOE CRUDE: +2.3M V 0ME; GASOLINE: +6.0M V +1.5ME; DISTILLATE: -1.0M V 0ME
U.S. 5-YEAR TIPS BREAKEVEN RATE HITS 1.96 PCT, HIGHEST SINCE AUGUST 2014
(CL) CHILE CENTRAL BANK (BCCH) CUTS OVERNIGHT RATE TARGET BY 25BPS TO 3.25%; AS EXPECTED
IBM Reports Q4 $5.01 v $4.89e, R$21.8B v $21.6Be
(US) Fed Chair Yellen: sees inflation to rise to 2% over next couple of years; monetary policy stance remains modestly accommodative
(CN) CHINA DEC INDUSTRIAL PRODUCTION Y/Y: 6.0% (5-month low) V 6.1%E; 2016: 6.0% V 6.0%E
(CN) CHINA DEC RETAIL SALES Y/Y: 10.9% (1-year high) V 10.7%E; 2016: 10.4% V 10.4%E
(CN) CHINA DEC FIXED ASSETS EX RURAL YTD Y/Y: 8.1% (4-month low) V 8.3%E
(CN) CHINA Q4 GDP Q/Q: 1.7% V 1.7%E; Y/Y: 6.8% V 6.7%E (highest annual reading in 1-year)

FRIDAY 1/20
(UK) DEC RETAIL SALES (EX-AUTO/FUEL) M/M: -2.0% V -0.4%E; Y/Y: 4.9% V 7.5%E
(UK) DEC RETAIL SALES (INCLUDING AUTO/ FUEL) M/M: -1.9% V -0.1%E; Y/Y: 4.3% V 7.2%E
SLB Reports Q4 $0.27 v $0.27e, R$7.11B v $7.10Be
(US) President Trump administration updates WhiteHouse.gov website to highlight key issues and goals, starting with 'America First' foreign policy and energy policy

>>> US Close Dow +0.48% S&P+0.34% Nasdaq +0.28% Russell +0.45%

Closing Market Summary: Stock Market Closes Inauguration Day Higher

The rubber has finally met the road as Donald Trump became the 45th President of the United States on Friday. It will now be up to his administration to live up to the post-election hype that pushed the stock market up nearly 7.0% between the November 8th election and the S&P 500's record high on January 6th. So far so good, as the major averages finished with modest gains: S&P 500 (+0.3%), Nasdaq (+0.3%), Dow (+0.5%).

Much like the rest of the week, today's session was underpinned by a wait-and-see mentality as investors appeared to have already priced in Mr. Trump's pro-growth promises. The equity market opened the day immediately higher, but cut its gain in half during President Trump's inaugural address.

During the address, Mr. Trump struck a populist tone, reiterating his protectionist trade policy and promising to put American workers at the heart of every decision he makes. There wasn't really any new information in the President's address, just a fresh reminder of Mr. Trump's commitment to bring jobs back to America--a commitment that could hit manufacturers' bottom lines. The major averages responded by sliding from their highs, eventually ticking up in the final stretch of action.

Sector standings were consistent throughout the day, with telecom services (+0.9%) and materials (+0.9%) camping out at the top of the leaderboard, and health care (-0.3%) and industrials (unch) setting up shop at the bottom. Each of the remaining seven sectors closed in the green.

Energy (+0.5%) broke its two-session losing streak, piggybacking on crude oil's 2.1% advance. The commodity finished at $53.25/bbl, climbing for the second consecutive day as investors eyed this weekend's OPEC/non-OPEC compliance meeting, hoping for indications of a tightening market.

The financial sector (+0.5%) had a poor showing this week, despite ending Friday with an uptick. The space lost 1.6% for the week as better-than-expected quarterly earnings results from some of its top components were met with a sell-the-news response in the wake of the sector's huge 20.5% fourth quarter gain.

The top-weighted technology sector (+0.5%) also finished the day higher. Technology started the day on a positive note after both IBM (IBM 170.55, +3.74) and Skyworks Solutions (SWKS 88.67, +10.21) reported better-than-expected earnings, adding 2.2% and 13.0%, respectively. Skyworks Solutions' spike also had a ripple effect on other chipmakers, evidenced by the 1.3% increase in the PHLX Semiconductor Index.

In addition to IBM, three more Dow components reported before today's opening bell, including American Express (AXP 76.20, -0.49), General Electric (GE 30.53, -0.68), and Procter & Gamble (PG 87.45, +2.75). American Express and General Electric declined 0.6% and 2.1%, respectively after reporting disappointing results while Procter & Gamble jumped 3.3% on better than expected earnings-per-share and upbeat organic sales growth. 

U.S. Treasuries finished their trading day mixed with the the 2-yr note higher while longer-dated issues ticked lower. The yield curve steepened with the 2-yr yield closing three basis points lower at 1.19% and the 30-yr yield finishing one basis point higher at 3.06%. The benchmark 10-yr yield closed unchanged at 2.47%.

Looking ahead, investors will not receive any economic data on Monday, but they will see a slew of earnings reports. Most notably, McDonald's (MCD 122.26, +0.08) and Halliburton (HAL 56.45, +1.11) will report before the open, while Yahoo! (YHOO 42.05, -0.04) will report after the close.

  • Russell 2000 -0.4% YTD
  • Dow Jones Industrial Average +0.3% YTD
  • S&P 500 +1.5% YTD
  • Nasdaq Composite +3.2% YTD

WSJ : Apple Sues Qualcomm Over Licensing Practices


Apple Sues Qualcomm Over Licensing Practices

Apple Inc. is suing Qualcomm Inc., alleging the smartphone-chip supplier demanded onerous terms for its technology and that it sought to punish Apple for cooperating in a Korean regulatory probe into Qualcomm’s licensing practices.

The suit, which Apple said it filed Friday in federal district court in the Southern District of California, claims that Qualcomm leveraged its position as a manufacturer of a critical chip used in cellphones to seek “onerous, unreasonable and costly” terms for patents and blocked Apple’s ability to choose another supplier for chipsets.

The complaint seeks $1 billion in rebate payments that Apple says Qualcomm has withheld as retribution for Apple’s participation in an investigation by South Korea’s antitrust regulator. The Korean agency last month announced a roughly $853 million fine on Qualcomm for alleged anticompetitive patent licensing practices—a decision Qualcomm also vowed to fight.

Qualcomm Says FTC Is Investigating It (Nov. 5, 2014)
Apple’s suit comes three days after the U.S. Federal Trade Commission sued Qualcomm alleging it engaged in unlawful tactics to maintain a monopoly on a type of chip used in cellphones.

That suit highlighted Qualcomm’s dealings with Apple.

Qualcomm said earlier this week that it will fight the FTC’s suit, which it says is based on inaccurate information and was rushed out ahead of the change in presidential administrations. Qualcomm said it has never withheld or threatened to withhold its chips to gain unfair licensing terms.

According to the Apple complaint, Qualcomm’s terms required Apple to pay a percentage of the average selling price of an iPhone to use Qualcomm patents and to exclusively use Qualcomm chips in iPhones from at least 2011 to 2016. Apple received what it called quarterly rebates from Qualcomm under terms of the agreement, but Qualcomm began withholding those last year after Apple met with Korean regulators, the suit says.

The suit says that Qualcomm told Apple the iPhone maker had forfeited the nearly $1 billion in rebates by responding to the Korea Fair Trade Commission. The suit also says that Qualcomm “then attempted to extort Apple into changing its responses and providing false information to the KFTC in exchange for Qualcomm’s release of those payments.”

In a statement, Apple said, “We are extremely disappointed in the way Qualcomm is conducting its business with us and unfortunately after years of disagreement over what constitutes a fair and reasonable royalty we have no choice left but to turn to the courts.”

>>> E.ON set to maintain structure as nuclear liability payment nears – bankers

E.ON set to maintain structure as nuclear liability payment nears – bankers

  • Rationale of grids spin-off questioned
  • Uniper shares may be used to fund nuclear liability shortfall
  • Urenco sale remains challenging

E..ON [ETR:EOAN] is likely to keep its remaining major businesses following the spin-off of its conventional power generation and trading activities into Uniper [ETR:UN01], said several sector bankers and a minority shareholder.

Last September’s major reorganisation prompted speculation that the German group may be broken up further. Activist investor Knight Vinke wants to see the power distribution or grids business spun off as it believes E.ON should be a pure-play regulated network group. The other divisions are customer solutions and renewables.

But utility bankers and a minority shareholder questioned the logic for such a move. A spin-off of the grids business would “undermine the whole equity story” of E.ON, said one banker. Another added that the group needs the cash flow from the division, which contributed 60% of EBIT in 2015.

E.ON is unlikely to pursue further major corporate action while constrained by its nuclear liabilities, noted the first banker. E.ON, alongside RWE [ETR:RWE], needs to pay a hefty sum to a government fund, to which it will transfer the liability for interim and final storage of nuclear waste.

E.ON said in November that it would need to pay EUR 9.8bn, and had recorded provisions of EUR 7.8bn.

Any shortfall in the payment to the government fund could be made by selling a financial instrument – such as an exchangeable bond – using E.ON’s 47% holding in Uniper, suggested the shareholder. E.ON is reportedly looking to start reducing its holding from 2018. At current market prices, E.ON's stake in Uniper is worth EUR 2.35bn.

A rights issue is another option, the shareholder added. E.ON has permissions to increase its share capital by up to 10% without seeking further shareholder approval .
Knight Vinke believes any shortfall could be covered by noncore asset sales, according to a letter to shareholders.

Separately, E.ON and other German utilities are seeking compensation from the government for the early shutdown of their nuclear reactors. An abrupt volte-face in Germany’s energy policy following the 2011 Fukushima disaster in Japan, led to the phasing out of nuclear power.

A takeover of E.ON, hostile or friendly, was dismissed by two bankers who highlighted the almost insurmountable political and legal hurdles of acquiring an integrated German utility. A recent news report suggested that the company was speaking to advisers to defend itself against a hostile takeover.

The appointment of M&A or defence advisers is likely to be part of a normal mandate process undertaken by large companies every year or so, the third and fourth bankers said.

While the sources downplayed any major corporate action, most agreed that smaller asset sales are likely. In one of its biggest recent asset sales, E.ON divested it’s Norwegian E&P business for USD 1.6bn in 2015. Other E&P have been transferred to Uniper.

One option is the sale of its 50% share of Turkish electricity group Enerjisa, said the second banker, who noted that E.ON had appointed advisers to explore the sale several years ago. E.ON has electricity businesses across Europe, in the Czech Republic, Hungary, Italy, Romania, Slovakia and the UK.

The Essen-headquartered group has been looking to sell its holding in Urenco for some time, but this looks unlikely any time soon. E.ON and RWE jointly own a third of the uranium enrichment group, with the remainder owned by the Dutch and British governments. A sale or partial listing of Urenco has been mooted for years but is proving extremely complicated to execute due to the political nature of any deal, and issues surrounding non-proliferation.

A spokesperson for E.ON declined to comment.

FT : The dilemma for under-fire executives at VW and Rolls

The dilemma for under-fire executives at VW and Rolls
Would you rather people thought you were out of touch or risk prosecution as a criminal mastermind?

Here is the dilemma: would you rather people thought you were out of touch and incompetent or risk prosecution as a criminal mastermind?

Two high-profile corporate bosses found themselves in that position this week. When Rolls-Royce agreed to pay more than £671m in penalties and admitted to 20 years of bribery and corruption, the UK judge presiding over the case made clear he believed top management was involved.

Sir Brian Leveson wrote that the investigation had revealed “most serious breaches of the criminal law . . . some of which implicated senior management and, on the face of it, controlling minds of the company”. He also wrote that the company “under different leadership” knew about the allegations of corruption as early as 2010 and decided not to notify authorities.

That line about “different leadership” casts the spotlight on the team headed by Sir John Rose, who was chief executive from 1996 to 2011. UK and US authorities have praised the company for its co-operation since 2012.

Opposition politicians from Britain’s Labour party are already calling for Sir John to lose his knighthood, and the UK Serious Fraud Office has said it is investigating individuals. So far, Sir John has remained silent and did not respond to a request for comment.

Across the channel, former Volkswagen chief executive Martin Winterkorn faced stern questioning this week from the German parliament about his role in the emissions scandal that has already cost the carmaker more than $21bn in penalties and payments to car buyers and dealers.

The company admitted last week that it had started designing special software to cheat on emissions tests as early as 2006, and US prosecutors alleged in court documents that “executive management” had been briefed on the cheating in July 2015.

But Mr Winterkorn, a VW insider who was promoted to chief executive in 2007, insisted to German MPs that he first learnt of the so-called “defeat devices” in September 2015.

Mr Winterkorn has already lost his job: he resigned five days after the scandal broke. But he too faces legal risks. German prosecutors are investigating whether VW executives including him failed to tell investors about the affair quickly enough. US prosecutors have already indicted six lower-level executives on conspiracy, fraud and environmental charges and have said they are still investigating. Mr Winterkorn’s attorneys did not respond to requests for comment.

While they were still at work, both Sir John and Mr Winterkorn received accolades for their leadership and credit for rising sales and share prices. Now, they face pressure to explain why they should not be held accountable for the bad things that happened on their watch as well.

They are not the first chief executives to face this issue. Back in 2005, Bernard Ebbers went on trial for his role in the $11bn accounting fraud that brought down WorldCom, the telecom company he had built. On the stand, Mr Ebbers claimed he had repeatedly failed to to read the first page of monthly reports that showed expenses fluctuating by as much as $900m in a single month. Prosecutors countered that he was so hands-on that he cancelled the office coffee service when he thought employees were using too many beans. The jury voted to convict and Mr Ebbers was sentenced to 25 years in prison.

NY Post : Military refused Trump’s bid to parade missile launche

Military refused Trump’s bid to parade missile launchers at inauguration


The US military shot down President-elect Donald Trump inauguration team’s bid to have tanks and missile launchers rolling down his parade route Friday, according to a report.

“They were legit thinking Red Square/North Korea-style parade,” an inauguration team source told The Huffington Post, referring to grandiose military parades in Moscow and Pyongyang that are often considered displays of bellicosity.

Trump has made showing off US military might part of his platform.

The military “may come marching down Pennsylvania Avenue,” Trump told the Washington Post this week. “That military may be flying over New York City and Washington, DC, for parades. I mean, we’re going to be showing our military.”

Several sources involved in his inaugural preparations told HuffPost that Trump wanted to ensure that his first day as commander-in-chief was marked by an unusual display of military hardware.

But military officials balked because of the optics of having tanks and missile launchers rumbling down Pennsylvania Avenue – and because the tanks, which often weigh over 100,000 pounds, would destroy the roads, the source said.

“I could absolutely see structural support being a reason [not to use tanks],” a Department of Defense official said. “DC is built on a swamp to begin with.”

Defense Department spokeswoman Valerie Henderson referring questions about the request to the Trump transition team.

Trump adviser Boris Epshteyn told the site that the inaugural committee worked closely with the military “to render appropriate honors” for Trump’s swearing-in.

But he directed questions about “specific aspects” of the military’s role back to the Defense Department.

Although Trump’s ideas for the ground displays didn’t fly, the Pentagon was on board with plans for five military flyovers ― one for each branch of the armed services, spokesman Maj. Jamie Davis told HuffPost.

The Air Force plans to fly four fighter jets: an F-35, an F-16, an F-22 and an F-15E. The Navy will fly four F/A-18 combat jets. The Army will fly four UH-60 Black Hawk helicopters. The Marines will fly four V-22 Ospreys. And the Coast Guard is looking at flying four MH-65 rescue helicopters, Davis said.

Stephen Kerrigan, who held top positions in President Obama’s first and second inaugural committees, said he was “shocked” to hear about the flyovers.

“It seems unnecessary and the optics don’t seem appropriate. … It’s very Red Square,” he told HuffPost.

Washington airspace is highly restricted and in the days after 9/11, planes flying over the city terrified people, Kerrigan said.

“If there are fighter jets flying over Washington, people are going to assume something bad is happening,” he said.

President Obama did not use any military aircraft at either of his inaugurations, the Defense Department official said.

There also were no flyovers at President George W. Bush’s 2005 inauguration, but he did have a flyover during his 2001 opening ceremony two days before the inauguration.

President Reagan had considered including flyovers in his second inauguration in 1985, but one never materialized, the official said. Before that, the last president to include military flyovers during an inauguration was President Truman in 1949.

La Tribune : Safran-Zodiac : ce qui peut faire capoter le deal

Safran-Zodiac : ce qui peut faire capoter le deal



Avec deux offres distinctes pour les actionnaires de Zodiac, une OPA suivie d'une fusion, la structure de l'opération proposée pour la reprise de Zodiac par Safran fait courir le risque que le seuil de réussite de l'OPA soit atteint. Or, dans la mesure où les actionnaires de référence de Zodiac ne veulent pas vendre leurs titres et conserver leur droit de votes doubles chez Safran, le schéma de l'opération est le seul possible pour réussir ce deal.

Et si le rachat de Zodiac Aerospace par Safran échouait ? Si cet ambitieux rapprochement industriel censé donner naissance à un poids lourd de l'aéronautique mondiale, tombait à l'eau ? Plusieurs observateurs se posent la question. Car la structure de l'opération fait courir un risque. Et plus précisément, le choix de proposer deux types d'offres aux actionnaires de Zodiac avec deux étapes complètement liée puisque la réussite de la première conditionne l'ensemble de l'opération.

Deux offres, deux timing
En effet, celle-ci prévoit dans un premier temps une offre publique d'achat (OPA) de Safran sur Zodiac, à 29,47 euros par action Zodiac dont le seuil de réussite est fixé à 50% du capital de Zodiac, puis, dans un second temps (et à condition que l'OPA ait été réussie) une fusion pour les actionnaires de Zodiac qui n'ont pas participé à l'OPA, qui transformera les actions Zodiac en actions Safran, selon des parités d'échanges « cohérentes » avec le prix de l'OPA.
Autrement dit, Safran propose deux offres différentes pour les actionnaires de Zodiac, l'une en cash (l'OPA), l'autre en échange d'action (la fusion), sachant que la première doit réussir pour déclencher la seconde. Si un nombre important d'actionnaires de Zodiac ne souscrit pas à l'offre, le deal capote.

Certains actionnaires de Zodiac sont réticents
Or, selon certains analystes, plusieurs investisseurs n'étaient pas très chauds à céder leurs titres au prix de 29,47 euros et réclamaient soit une revalorisation du prix proposé par Safran pour l'OPA, soit un autre type d'opération, comme une offre publique d'échanges (OPE) afin de convertir leurs actions en actions Safran. Certains actionnaires de Zodiac qui ont acheté au-dessus des 29, 47 euros proposés dans l'OPA de Safran, sont en effet réticents à céder leurs titres.

Les demandes des actionnaires de référence de Zodiac
Problème : la structure imposée par Safran est la seule possible.

« Oui il y a un risque, mais il n'y a pas d'autres solutions pour faire réussir ce deal », explique un proche du dossier. Car les actionnaires de référence de Zodiac que sont les familles fondatrices de l'entreprise (Domange, Maréchal, Desages, Schelder..), et les actionnaires institutionnels (FFP et le fonds stratégique de Participations) ne veulent pas vendre leurs parts, mais préfèrent au contraire échanger leurs titres Zodiac par des actions Safran, en conservant leurs droits de votes doubles une fois que Zodiac sera absorbé par Safran. Ils ne participeront donc pas à l'OPA. Vu leur poids (32% du capital et 45% des droits de vote de Zodiac), il était impossible en effet de concevoir une OPA quand 45% des voix martèlent qu'ils ne veulent pas vendre. Une offre publique d'échange (OPE) sur l'ensemble des titres de Zodiac n'était pas non plus envisageable car elle ne leur permettait pas de conserver leur droit de votes doubles dans Safran.


«La fusion est le seul moyen de conserver leurs droits de vote double», explique un connaisseur du dossier. «Juridiquement, c'est le seul moyen de maintenir la personne morale de Zodiac dans une entité plus large », ajoute un autre.
Le système imaginé apparaît par conséquent comme le seul possible pour réussir ce deal. Pour autant, il y a une contrainte assortie à cette fusion. Les actionnaires de référence de Zodiac ne pourront pas vendre leurs titres pendant deux ans.

"La balle dans le camp des autres actionnaires de Zodiac"
Résultat, l'opération est suspendue à l'attitude des autres actionnaires de Zodiac. Avec le risque donc qu'ils ne souscrivent pas l'OPA (en espérant que d'autres le feront) et qu'ils participent à l'opération de fusion, jugée plus attractive. Si un trop grand nombre d'entre eux raisonnent ainsi, le seuil des 50% de participants à l'OPA pourrait ne pas être atteint.

«S'ils veulent vraiment des actions Safran, rien ne les empêche de céder leur titres au moment de l'OPA et de racheter derrière des actions Safran », font remarquer deux proches du dossier.

«La balle est dans le camp des actionnaires de Zodiac. S'ils font capoter le deal, ils risquent de se tirer une balle dans le pied », explique l'un d'eux, estimant que le cours de Zodiac repartirait à la baisse et devrait attendre plusieurs années avant d'atteindre les 29,47 euros par action proposé par Safran.
Ce qui représente une prime de 26,4% par rapport au cours de Bourse du 18 janvier (plus de 23 euros), la veille de l'annonce des négociations exclusives entre Safran et Zodiac. Pour rappel, l'action Zodiac, qui culminait à plus de 35 euros en mars 2015, a plongé lorsque les déboires industriels ont été dévoilés au grand jour pour atteindre 14 euros en février 2016, avant de remonter au-dessus de 20 euros avec les premiers effets des mesures de redressement. Dans son histoire, le cours de Zodiac n'a dépassé le seuil de 30 euros que pendant 5 mois.

Les conséquences d'un échec seront lourdes pour Zodiac
Les conséquences d'un échec ou pas du deal ne sont en effet pas les mêmes pour les deux industriels. Contrairement à Safran, il est vital pour Zodiac. Sa direction a en effet reconnu ce jeudi lors de la présentation du rapprochement, qu'il ne pouvait plus rester seul.
« Ce marché est rude, très compétitif, très très exigeant sur les délais, la qualité, l'innovation et les prix. La crise de croissance que nous avons vécue depuis 18 mois nous l'a bien confirmé ! Nous, actionnaires de référence et managers de Zodiac, avons donc pensé que le temps était venu de s'adosser à un groupe puissant, solide, riche en ressources humaines, technologiques et financières tous égards , le choix de Safran s'imposait », a déclaré, Didier Domange, le président du conseil de surveillance de Zodiac Aerospace.

L'heure de vérité est prévue cet été puisque l'OPA devrait être lancée en août. Pour cela, il faut au préalable recevoir un avis des représentants du personnel et le feu des autorités de la concurrence. Celui-ci est attendu d'ici à l'été. Vu qu'il n'y a que très peu de recoupements d'activité entre les deux industriels, le dossier devrait en effet aller assez vite.

FT : Close Brothers resilient despite Brexit uncertainty

Close Brothers resilient despite Brexit uncertainty
UK merchant bank says loan book grew by 9.3% in 2016

Close Brothers Group, the UK merchant bank, posted a 2.3 per cent rise in its loan book in the five months to December 2016, in an indication of the recent resilience of the wealth management sector.

For the whole of 2016, the bank reported that its loan book had grown by 9.3 per cent to £6.6bn.

The merchant bank is one of several midsized financial services companies to report growth despite the continuing uncertainty in the markets following the UK’s decision to leave the EU in last year’s referendum. 

In its third-quarter results for 2016, wealth manager St James’s Place reported that new investment was 21 per cent higher, at £2.8bn, over three months to September. David Bellamy, chief executive, said at the time that despite the backdrop of political uncertainty, it was “very much business as usual”.

In November, Arbuthnot Banking Group paid a further special dividend of £3 per share on the back of half-year profits of £225m — up from £12.7m over the same period in 2015. Profits were boosted by the sale of its Everyday Loans division and a reduction in ABG’s holding in Secure Trust Bank.

And in September, private banks Lombard Odier and Kleinwort Benson — now Kleinwort Hambros — announced further job hires in London despite market quivers over Brexit.

The wealth management sector is in the throes of a wave of consolidation. In December, Duncan Lawrie was broken up and sold to Brewin Dolphin and Arbuthnot Latham, with Brewin paying £28m for the private bank’s asset management business and Arbuthnot scooping up the £44.9m loan book for £42.7m.

Also last year, Liechtenstein’s LGT Group took a majority stake in London-based boutique, Vestra Wealth, and Société Générale moved to buy City stalwart Kleinwort Benson.

Close ascribed its five-month performance to “good growth particularly in the premium finance and property businesses”. 

Its share price nudged higher, gaining almost 0.5 per cent in early trading on Friday.

However, analysts remain cautious about the sector’s prospects. Shore Capital has upgraded its full-year adjusted earnings per share estimate for Close Brothers by 3 per cent, but analyst Gary Greenwood said he would leave subsequent years “broadly unchanged”.

“We think the drivers of the upgrade may not be sustainable,” he wrote in an analyst’s note.