>>> Japan govt sees Toshiba's sale of chip unit stake to Apple better than to Ho

Japan govt sees Toshiba's sale of chip unit stake to Apple better than to Hon Hai - report (translated)

The Japanese government regards the potential sale of Toshiba Corp.'s [TYO:6502] stake in a to-be-formed memory-chip subsidiary to Apple Inc. [NASDAQ:AAPL] a better deal than the sale to Hon Hai Precision Industry Co., Ltd. [TPE:2317], Gendai Business reported.

The preference to Apple over Hon Hai is because of concerns over possible leakage of Japan's flash memory-chip production technology to China, the Japanese news website report said, quoting an unidentified executive of the Ministry of Economy, Trade and Industry.

Toshiba should survive as an elevator manufacturer, and that is the only option left avaiable at this point, the industry ministry executive was quoted in the report.

>>> Deutsche Bank Right Issue : 687.5mil shares @ €11.65

*** Deutsche Bank (DBK GY): Announces €8bn Rights Issue to strengthen its capital ratio


• To issue 687.5m new shrs at €11.65 each (30% discount to TERP) vs outstanding 1379.27m shares
• Timetable: prospectus published Mar 20; Trading Mar 21- Apr 6
• No language related to Unsubscribed rights
• Note: In 2014 Deutsche executed similar capital increase with take up of 99.1% where remaining new shares that were not subscribed were sold on the market.

https://www.db.com/newsroom_news/2017/medien/deutsche-bank-refines-strategy-and-announces-capital-increase-en-11483.htm

>>> What to look at today - 6th of March 2017

Asia indices are mixed to positive, all in spite of Fed Chair Yellen virtually confirming intentions to raise rates this month in her speech on Friday and US/European futures coming under pressure on more political polarization in Washington and geopolitical concerns on Korean peninsula (North Korea missiles tries). Nikkei225 is underperforming as JPY reversed 4 consecutive declines on Friday with a modest rally, while Australia is among the gainers as miners rally after recent slump. In FX, USD/JPY and NZD/USD are among the bigger movers, falling 40pips and 30pips to 113.70 and 0.7005 session lows. China kicked off its National People’s Congress (NPC) with 2017 GDP target of "around 6.5% or higher if possible" vs 6.5-7.0% in 2016, also lowering 2017 M2 money supply to 12% from 13% and Retail sales to 10% from 11. PBoC pledged to pursue prudent, neutral monetary policy in 2017, while Fin Min expressed concerns over imbalances between revenue and spending as well as local govt debt risks. In other notable developments, Defense Ministry's 2017 growth was set at 7%, down from 7.6% last year and the lowest in a decade. Expressing continued commitment to reducing pollution, regulators also announced cuts in steel capacity by another 50M tons and coal output by over 150M tons.

Nikkei -0.46% Hang Seng +0.27% CSI +0.39% Shanghai +0.36%

Eur$ 1.0595 CNH 6.8948 CNY 6.8975 JPY 113.81 GBP 1.2280 CHF 1.0093 RUB 58.3310 WTI $52.92 -0.77%

S&P -0.34% EuroStoxx -0.26% Dax -0.24% SMI +0.02% FTSE -0.11%

Macro :
- U.S. to Impose Duties on Stainless Steel Sheet From China
- China Ready to Meet Challenges From Trump White House, Fu Says
- EPA expected to reopen vehicle emissions decision: source - http://reut.rs/2mQ10aM (Reuters)
- Germany, France, Italy Spar Over EU Defense Fund: Handelsblatt
- SNB Posts CHF24.5b Profit for 2016 Allowing CHF1.7b Payout

Keep an eye on :
- ADN LN : Aberdeen Asset, Standard Life Said to Mull GBP11b Merger: Sky
- AIB ID : Ireland Said to Sell 25% AIB Stake in IPO Within Weeks: Times
- AGS BB : Ageas Keen to Increase Holding in IDBI Federal Life to 49%: PTI
- AA US : Alcoa Upgraded at Goldman; Should See 12% FCF Yield Through ’18
- AZA IM : Alitalia Plan May Include 2,000 Job Cuts: Il Sole 24 Ore, Needs Capital, Funding of About EU1.3b: Messaggero
- AR4 GY : Aurelius 2016 Revenue Rises to EU2.9B, Proposes DIV of EU2/Share
- BAS GY : BASF Plans to Invest 3b Euros in Asia-Pacific 2017-2021: BS
- BT/A LN : Du Plessis Said Frontrunner for BT Chairman Role: Sunday Times
- BC IM : Cucinelli Looks to E-Commerce to Boost Growth: Il Sole
- DASNKE DC : Danske to Focus Asset Management Expansion in Nordics, Germany
- DB1 GY : Deutche Boerse Board Says Kengeter Is Right Man as CEO: FAZ
- DBK GY : Deutsche Bank Extends Declines; Confirms Potential Capital Boost
- DBK GY : Deutsche Bank Supervisory Board Said to Meet Sunday: Reuters
- ERICB SS : Ericsson CFO Says Earnings, Cash Flow a Priority This Year: BZ
- XOM US : Exxon Mobil Seeks License for $5b Guyana Crude Project: El Mundo
- GFK GY : KKR Takeover Offer for GfK Exceeds Minimum Acceptance Threshold
- ISP IM : Intesa CEO Says Le Pen Victory Could Be Damaging: Corriere
- LOOMB SS : Loomis Sees Market Potential for 200k Safepoints in Europe: DI
- MBTN SW : Meyer Burger CEO Braendle Hopes to Cut Costs Further: FuW
- NOVN VX : Novartis Study Shows Efficacy of Sandoz Biosimilar Adalimumab
- NOVOB DC : Novo Nordisk Sues to Block Teva Copy of Diabetes Drug Victoza
- OMV AV : Austria’s OMV to Buy Uniper Gas Field Stake for $1.85b
- OMV AV : OMV Reaches Agreement for Sale OMV Petrol Ofisi to Vitol Group
- P US : Pandora shares surge amid speculation about a sale - NYT
- UG FP : PSA Sets Monday Press Conference With GM: PSA Spokesman
- POP SM : Saracho Sees Merger as Best Option for Popular: Expansion
- PFD LN : Premier Foods major shareholder Nissin urged to sell or launch takeover
- PMO LN : Premier Oil approaches Halliburton and Schlumberger for funding - FT
- RYA LN : Ryanair Says Its Canceled 45 Flights on Monday To/From France
- SAN FP : Sanofi, Regeneron Report Positive Results From Dermatitis Drug
- SBRY LN : Sainsbury’s to Cut 400 Jobs in Shake-Up of Operations: Guardian
- SIG US : Signet Drops; Earlier NYT Story Discussed Company Accounting
- SNAP US : MSCI to Reassess Snap Inclusion in USA Index at May Review
- TMG NA : De Mol Raises TMG Cash Offer to EU6.50 P/S Amid Takeover Battle
- TWX US : Sprint Wins $139.8 Million Verdict Against Time Warner Cable
- UBER IPO : Uber Said to Have Used Greyball Tool to Deceive Authorities: NYT
- UN01 GY : Uniper sells 25% stake in Yuzhno-Russkoye field for EUR 1.749 billion

>>> Europe : Brokers Upgrades & DOwngrades - 6th of March 2017

>>> Up
*Aberdeen Raised to Hold at Jefferies, PT 287p
*Alcoa Raised to Buy at Goldman, PT $52
*Archer Raised to Buy at ABG Sundal, PT NOK17
*Bekaert Raised to Buy at ING
*EasyJet Raised to Buy at Kepler Cheuvreux, PT 1106p
*Kone Raised to Buy at DNB Markets, PT EU47
*St James's Place Raised to Buy at Citi
*Telenet Raised to Buy at Citi

>>> Down
*Acacia Mining Cut to Hold at Jefferies, PT 475p
*Albioma Cut to Hold at HSBC, PT EU18.50
*DIA Cut to Equal-Weight at Morgan Stanley, PT EU5.50
*Go-Ahead Cut to Hold at Liberum
*J D Wetherspoon Cut to Reduce at Peel Hunt
*Mondi Cut to Neutral at Credit Suisse
*Skandiabanken Cut to Hold at Arctic Securities, PT NOK80
*Steinhoff Cut to Neutral at Goldman, PT EU5
*Swiss Life Cut to Hold at Kepler Cheuvreux, PT CHF335
*Tesmec Cut to Neutral at MedioBanca, PT EU0.60

>>> Initiation
*Lamprell Rated New Outperform at Renaissance Capital, PT 210p

>>> Call

>>> Uniper sells 25% stake in Yuzhno-Russkoye field for EUR 1.749 billion

Uniper sells 25% stake in Yuzhno-Russkoye field for EUR 1.749 billion


Uniper Exploration & Production has signed an agreement with Austrian oil and gas company OMV Exploration & Production GmbH (OMV) for the sale of its interest in the Russian gas field Yuzhno-Russkoye.

The purchase price for Uniper’s participation amounts to EUR 1,749 million (USD 1,850 million) plus cash on balance sheet per 31 December 2016. Uniper holds an interest of approx. 25% in Yuzhno-Russkoye via participations in OJSC Severneftegazprom and JSC Gazprom YRGM Development.

OMV will acquire 100% of Uniper’s interest in both companies. Yuzhno-Russkoye is one of the giant Russian gas fields in Western Siberia operated by a joint venture with Russian Gazprom and German Wintershall. The field was commissioned in 2007 and is on plateau production of 25 bcm/a since 2009.

Klaus Schäfer, CEO of Uniper SE: "The sale of the Yuzhno-Russkoye stake will enable us to effectively achieve our deleveraging target well ahead of schedule. At the same time the disposal does not impact our strategy, as the E&P business was no longer at the core of our future development. We have valued the joint ownership with Gazprom and Wintershall over more than seven years as an excellent and trustful partnership, and at the same time we are convinced that the sale of our stake to an experienced E&P company like OMV will allow for a smooth transition. Even after the sale of Yuzhno-Russkoye we will remain active in the Russian energy market where we generate roughly 5% of Russian electricity production through our majority stake in one of Russia’s largest private generators, Unipro. And our historic partnership with Gazprom will not be affected as we jointly continue to secure gas supplies to Europe for the next decades."

The consummation of the transaction is subject to the required regulatory approvals of the competent Russian authorities as well as co-shareholder consent.

The transaction is anticipated to close by year end and will be retroactively effective as of January 1, 2017.

>>> Toshiba chip unit bidder Western Digital expected to use refusal right to bl

Toshiba chip unit bidder Western Digital expected to use refusal right to block investment from Micron, SK Hynix - report 

Western Digital Corp [NASDAQ: WDC], one of the bidders for Toshiba Corp's [TYO: 6502] memory-chip subsidiary, is likely to say no to investments from rivals Micron Technology Inc [NASDAQ: MU] or SK Hynix Inc [KRX: 000660] in the new unit, the Diamond Weekly reported.

If Toshiba chooses these companies as buyers of stakes in the to-be-formed chip subsidiary, Western Digital is expected to exercise the first right of refusal, which it holds through an alliance accord with Toshiba on flash memory chip production, the Japanese weekly magazine reported, citing an unidentified official from the US company.

The unit is to be formed on 1 April via a spin-off of Toshiba's flash memory-chip business.

Between 2002 and 2016, Western Digital had spent a total of JPY 1.2tn (USD 10.52bn) on the flash memory chip-making factory in Yokkaichi, Mie Prefecture, jointly operated by the two companies, according to the report.

The Yokkaichi plant operations will be problematic if a rival to Western Digital joins, the report said, citing the source.

Meanwhile, Toshiba is reluctant to sell the chip unit stake to Western Digital, partly because the US chip maker is a direct competitor, and also because it may take longer than expected time to gain regulatory approvals, the magazine report said, citing an unidentified Toshiba executive.

Other bidders Apple Inc [NASDAQ: AAPL] and Hon Hai Precision Industry Co Ltd [TPE: 2317] do not appear seriously ready to make a huge investments in the memory-chip business, the Toshiba executive was quoted as saying in the report.

That automatically leaves investment funds as the only potential acquirers left, the report added, citing the executive.

>>> De Mol Raises TMG Cash Offer to EU6.50 P/S Amid Takeover Battle

De Mol Raises TMG Cash Offer to EU6.50 P/S Amid Takeover Battle
John de Mol’s Talpa raises intended bid on all outstanding TMG shares to EU6.50 in cash from previous EU6.35 bid, Talpa says in statement late Sunday.
  • Bid represents a premium of 8.3% to Mediahuis, VP Exploitatie’s recommended March 5 offer, co. says
  • Talpa will announce its position, further steps in short term, it says
  • NOTE: Mediahuis, VP Exploitatie, TMG agree on cash offer for TMG Shrs
  • NOTE: The supervisory board of TMG suspended both members of management board, TMG said Sunday
  • NOTE: March 1, Talpa proposed takeover offer of EU6.35/share ($6.74)

>>> PSA to Buy GM’s European Operations in Deal Valued at EU2.2b

PSA to Buy GM’s European Operations in Deal Valued at EU2.2b
Owner of Peugeot and Citroen car brands agrees to buy GM’s Opel/Vauxhall subsidiary valued at EU1.3b, and GM Financial’s European operations valued at EU0.9b, PSA and GM say in statement.
  • PSA to acquire GM Financial business in joint-venture with BNP Paribas
  • PSA sees annual synergies of EU1.7b by 2026, “significant part” to be reached by 2020
    • Opel-Vauxhall to reach recurring operating margin of 2% by 2020 and 6% by 2026, to generate positive operational free cash flow by 2020
  • Deal allows GM to lower cash balance requirement under its capital allocation framework by $2b, plans to use that to accelerate share purchases
    • GM to buy warrants to buy shares in PSA
    • GM will take a primarily non-cash special charge of $4.0b-$4.5b
  • Deal expected to close before year-end
    • Makes PSA second-biggest European carmaker with 17% market share
  • Opel-Vauxhall had revenue of EU17.7b in 2016