>>> Generali suitor Intesa Sanpaolo not ruling out hostile bid for company; Axa

Generali suitor Intesa Sanpaolo not ruling out hostile bid for company; Axa likely buyer for Generali’s German business
25 JAN 2017
Italian bank Intesa Sanpaolo [BIT:ISP], is not ruling out submitting a hostile takeover offer for the Italian insurer Assicurazioni Generali [BIT:G], the Financial Times reported, citing a person close to Intesa.
The person said that Intesa CEO Carlo Messina was contemplating a bid for Generali in partnership with the French insurance group Axa [EPA:CS] and German financial services group Allianz [ETR:ALV].
Axa is the company most likely to acquire Generali’s German business, the report said, citing people briefed on the matter.The report also cited people within the insurance industry who said Allianz has been thought of as a possible acquirer of Generali's French operations for some time now.
In a separate development, the newspaper said Generali Deputy Chief Executive Alberto Minali is likely to tender his resignation at a board meeting in Milan on Wednesday, 25 January. The report cited two people with knowledge of the matter for the information.
The article went on to cite a person close to Generali who said Minali and Generali’s new CEO Philippe Donnet have in recent months been at odds over strategy.
Generali’s market capitalisation stood at EUR 24.05bn (USD 25.80bn) at the close of trading in Milan on Wednesday.
The report appeared on page 18 of the UK print edition of the Financial Times on Wednesday, 25 January.

>>> Pre-Market Indications

ML

GENERALI - Intesa said is examining possible industrial combination (16)....+4%
ANTOFAGASTA - Solid prodn with good cash cost delivery,16E EBITDA +26% (849)+3%
WH SMITH - 21wk group rev +2%. Profit expected to be slightly ahead (1517)+2-3%
MCCARTHY&STONE - Solid. YTD reservations 5% ahead due to strong ASPs (172)+2-3%
SANTANDER - NII beat driven by Spain & Brazil. Capital remains a concern (5)+2%
ORANGE BELGIUM - We UPGRADE to Neutral from Underperform, PO EUR23.4 (21).+1-2%
LIGHT NA - We initiate with a BUY, EUR30 PO. Inexpensive & proactive (23).+1-2%
MICHELIN - Strong Dec tyre data.Brazil +14% & China +5%, Europe inline (102)+1%
ABB - Spec solid order momentum in Grid cont with $200m UHVDC order (23.1)..+1%
BILLITON - Solid quarter. Stronger in iron ore and weaker in copper (1495)..+1%
PRYSMIAN - Bullish commentary from US peer Corning (GLW US +6% yday) (24.9).+1%
MINERS - Copper -0.28%, Iron Ore fut u/c with BHP OZ +3.2%, RIO OZ +3.8%..+0.5%
D.BANK - Spec is considering partial listing of its Asset Mgmt unit (18.4)+0.5%
BERKELEY GR - Company bought another £1.5m of its own shares yday (2822)....u/c
FRESNILLO - FY16 silver inline, gold prodn 8% beat.U/L commods weaker (1482)u/c
VODAFONE - We DOWNGRADE to Neutral, growth may stall in just 2 qtrs (197.5).-1%
CARREFOUR - Colony sold its entire state on Jan 20th; Le Figaro reports (23)-1%
INTESA - Confirms is examining possible industrial combination with G (2)...-1%
T.ITALIA - Infratel tender results released. Think mostly unsuccessful (82).-2%
NOVARTIS - Inline.Op profit outlook implies 3% d/g to 17e.$5b buyback (69)-1-2%

CS:

Antofagasta UNCH Q4 small beat vs CS est, cost guidance slightly worse
Barry Call M/P Q1 sales in line, guidance confirmed
BHP Billiton UNCH Copper prod weaker, Iron ore stronger, also a worker strike
Electrolux -0.5% December AHAM data showed shipments up 8.5% YoY
Generali +1-2% Intesa examining "industrial combination" with Generali
Intesa +1% Intesa examining "industrial combination" with Generali
Lonza +1% FY sales CHf4.13b, cons 4.03b, EPS 4% ahead
Logitech +5-10% Q3 revs 3% ahead, Non-GAAP EBIT 22% ahead, guidance raised
Miners UNCH Copper UNCH, Brent -0.65%, Iron Ore +0.25%, China +0.20%
Novartis -1% Q4 net inc 2.66 vs 2.71, Eps 1.12 vs cons 1.12, Buyback 5b
Prem Foods -1% CS DOWNGRADE to NEUTRAL (Sales growth challenging)
Restaurant Gp UNCH No's inline, performance to remain difficult in H117
Santander +2-3% Net EU1.6B vs est EU1.48B, CET1 better 10.55% vs 10.47%
Technip +1% CS INITIATE with OUTPERFORM (Recovering oil/gas cycle)
WH Smith +2-3% Last 21 weeks lfl sales +1%, travel performed well

(CS) Intesa-SAnpaolo - Generali is an option: potential pros and cons

Generali is an option: potential pros and cons
■ Intesa considering a tie-up with Generali among the potential options:
ISP confirmed to explore potential external growth options, including a tie-up
with Generali (GASI). Press reports that ISP may consider a public exchange
offer on the GASI majority via shares swap.
■ Strategic rationale needs more clarity: GASI business mix is largely Life
(60%), potentially fitting with ISP business. With GASI, ISP could acquire
businesses in France, Germany, CEE, Asia and EMEA. According to the
press, ISP could sell part of the foreign business (France, Germany). We see
Banca Generali and the asset management business as the most valuable
piece for ISP from an industrial perspective, while the traditional insurance
has limited strategic rationale in our view, also in light of regulatory
headwinds in the future (Danish Compromise duration).
■ Financial rationale could make sense: A cash deal could be highly dilutive
CET1 wise (-250bp vs. -190bp preliminary estimated), while in case of a
shares swap it could be CET1 neutral in the base case scenario (assuming
the Danish Compromise application). In the blue sky scenario, we estimate
+180bp CET1 accretion. The minority contribution could increase the capital
accretion/reduce the dilution. Excluding France and Germany, ISP could
acquire up to ~€840m in earnings (28% of FY16E profit) before synergies.
■ Potential pros and cons: The potential deal could be positive in terms of: (i)
capital; and (ii) earnings accretion. Among negatives: (i) DPS17E dilution; (ii)
acquisition at a stretched valuation (GASI trading on ~1.9x PNAV17E); (iii)
execution risk; (iii) potential regulatory headwind on the uncertain future of
the Danish Compromise; (iv) unclear strategic rationale. Questions pose on
the use of potential capital accretion to clean up the loan book.

Le Figaro : Carrefour : Colony sort du capital


La sortie a été entamée en 2012, alors que le fonds d'investissement détenait 8% du capital.
Une page se tourne chez Carrefour. Dix ans après être entré, à la surprise générale, au capital du géant français de la distribution aux côtés de Groupe Arnault (holding du PDG de LVMH), le fonds d'investissement Colony Capital en sort par la petite porte. Il a cédé vendredi sa participation de 5,11 % dans le distributeur. Entamée en 2012, alors que Colony détenait 8 % du capital, la sortie a été achevée par l'intermédiaire d'une banque, qui a revendu progressivement les titres sur le marché. Après Edenred, c'est la seconde sortie de Colony d'un grand groupe français en une semaine.
Pendant des années, Colony Capital et Groupe Arnault (qui détient encore 8,95 % du capital) ont fait la pluie et le beau temps chez Carrefour, nommant les PDG et pesant sur leurs décisions stratégiques, de la scission de Dia (réussie) à celle de la branche immobilier (avortée) en passant par un projet de rapprochement avec la filiale brésilienne de Casino (raté).
Un nouveau cycle

Depuis l'arrivée de Georges Plassat à la tête du distributeur, début 2012, les grands actionnaires qui l'ont recruté pèsent moins sur la stratégie. Leur investissement ne leur a financièrement rien rapporté à ce stade.
Dans l'entourage de Colony Capital, on assure que le fonds est presque à l'équilibre sur cette opération, même si le cours de Carrefour est passé de 50 à 23 euros en dix ans. Colony s'est renforcé quand le cours a baissé et a bénéficié de la scission de Dia et des dividendes versés sur la décennie.
Resté trois à quatre ans de plus qu'à son habitude, Colony estimait qu'il étant temps de sortir, d'autant que l'arrivée prévue d'un nouveau PDG devra faire entrer Carrefour dans un nouveau cycle de quatre à cinq ans.
Après avoir redressé l'activité du distributeur et notamment de ses hypers français (mais pas son cours de Bourse), Georges Plassat vient en effet de lancer le processus de recrutement de son successeur. Ce projet fait l'objet de moult spéculations, parfois fantaisistes. Il n'y a désormais que trois grands actionnaires pour peser sur ce choix crucial: outre Groupe Arnault, il s'agit du Brésilien Abilio Diniz (8,05 %) et surtout de la famille propriétaire des Galeries Lafayette (11,51 %).

TechCrunch : Why the $3.7 billion AppDynamics acquisition happened right before

Why the $3.7 billion AppDynamics acquisition happened right before IPO

Applications management company AppDynamics was just wrapping up the final touches on its initial public offering when they learned that Cisco was interested in discussing a potential deal, after preliminary talks were abandoned in November. The discussion picked up again last week, and the IPO was slated to price tomorrow.

Although many companies seek acquisition offers in the months leading up to an IPO, also known as a “dual-track process,” that wasn’t what happened with this one. Investment banking firm Qatalyst, decided to play matchmaker and floated the idea to Cisco, a source with knowledge of the deal tells TechCrunch.

Fast forward to today, where the company announced a $3.7 billion deal. We’re told things were just decided on Saturday, and they had about 48 hours to complete the paperwork. (This is fast…very fast).

The IPO would have valued AppDynamics at around $2 billion, or close to the $1.9 billion the company was valued at its last private round. While it’s possible the stock would have risen, AppDynamics leaders liked the bird in hand.

Competitor New Relic went public a little over two years ago and is still trading near where it was at on its first day.

With clients like IBM and Salesforce, Cisco saw opportunity to grow its enterprise IT business. Cisco has been known to make billion-dollar purchases, such as when it acquired Jasper Technologies last year.

This would have been the first tech IPO of the year. AppDynamics was expected to kick off a spate of tech IPOs for 2017, a contrast from last year’s dry spell. Its management had been talking publicly about its IPO plans since for several years.

AppDynamics has raised more than $300 million in funding over the past eight years and its largest shareholders are Greylock Partners and Lightspeed Venture Partners, which each owned 20.8 percent of the company.

>>> What to look at today - 25th of January 2017

Dow +0.57% S&P +0.66% Nasdaq +0.86% Russell +1.59%
US Market Closed Higher mostly driven by Treasury move. investors traded Treasuries for stocks, but they were more specifically after growth-sensitive equities as all six cyclical sectors outpaced the broader market. Materials led all sectors with a 2.5% gain. telecom services (-2.7%) finished the day at the bottom of the leaderboard following the disappointing earnings report from Verizon. Health care (-0.7%) also finished in the red, while consumer staples bucked the trend, advancing 0.8%. US After Hours STX +11%, CREE +3%, AA +2.5% following earnings/guidance, BOBE +17% on plans to sell restaurant unit/focus on BEF Foods. Asian indices mostly firmer, tracking the gains in US markets; Gaming and tech firms outperformed in Hong Kong, while Australia was bolstered by mining names. FX majors have been range-bound with the exception of AUD and JPY. Japan Dec trade surplus was at a 6-month high as exports rose for the first time in 15 months; Overall, lower oil prices have also helped Japan register its first suprlus in 2016 in 6 years. Shipments to Asia and China were up over 12%, while those to Europe fell about 4%.

Nikkei +1.43% Hang Seng +0.29% CSI +0.27% Shanghai +0.15%

Eur$ 1.0724 CNH 6.8329 CNY 6.8797 JPY 113.70 GBP 1.2510 CHF 1.0019 RUB$59.18 WTI$53.07 -0.10%

S&P +0.13% EuroStoxx +0.55% Dax +0.52% FTSE +0.25% SMI +0.39%

Macro :
- U.K ‘Going Rogue’ on Taxes Would Hinder Trade Deal: Dijsselbloem
- Germany Plans to Raise Auto Tax Revenue: Handelsblatt
- JPMorgan Overweights Brazil, Reversing Tactical Move in November
- Carlyle, Blackstone Said to Look to Luxembourg for EU Access: FT
- UBP CEO Says Bank Won’t Quit London Because of Brexit: Le Temps
- European Doubts Over U.S. Stocks, Growth Worst in 20 Years: BMO

Keep an eye on :
- BARN SW : Barry Callebaut Sales Beat Estimates; Sees Volume Accelerating
- BLT LN : BHP Reaffirms Iron Output Forecast; 2Q Production Tops Estimate
- CA FP : Colony Capital Sells Its Stake of 5.11% in Carrefour: Figaro
- DBK GY : Deutsche Bank Said May Register Asset Mgmt Unit: Reuters
- EDPR PL : EDP Renovaveis Electricity Generation Rose 14% in 2016
- FINGB SS : Fingerprint Card’s Former CEO Released From Custody, Direkt Says
- G IM : Consob Said to Convene Intesa, Generali, UniCredit on M&A Rumors
- G IM : Intesa Examining Possible Industrial Combination With Generali
- G IM : Axa Boss reiterated, no interest in Generali - Cash.ch
- GLEN LN : Glencore Said Eyeing Brazil Sugar, Ethanol Mill Takeovers: Rtrs
- ISP IM : Intesa Examining Possible Industrial Combination With Generali
- LATOB SS : Latour CEO Says Company Has ~SEK4b for Acquisitions, DI Reports
- LOGN SW : Logitech 3Q Sales Beats Highest Est.
- LONN VX : Lonza 2016 Eps Beats Estimates; M/T Targets Announcemnt Mid-Year
- MAN GY : MAN’s Drees Sees Stable Commercial Vehicle Business: Boersen-Z.
- MB IM : Mediobanca Rises to 1-Yr High Amid Generali-Intesa Takeover Talk
- NOVN VX : Novartis Says 2017 FY Sales to Be Broadly in Line with Prior Yr
- NOVN VX : Novartis Mulls Spinoff, IPO as Options for Alcon Eye-Care Unit
- SGO FP : Saint-Gobain to Build New Gypsum Plant in Vietnam
- SKY LN : EU Probing Need for Restrictions in Pay TV Contracts: Vestager
- SAN SM : Banco Santander Reasserts Commitments for 2017, 2018
- SAND SS : Sandvik Hires JPMorgan for Sale of Process Systems, DI Reports
- SSE LN : SSE Plans GBP6b Investment; ‘Significant’ Portion in Scotland
- VED LN : Vedanta to Buy Back ~$796m of 2018 and 2019 Notes After Tenders
- VOD LN : Vodafone Wins Ruling for Retrial in Duct-Fee Case: Dt. Telekom
- VOW3 GY : Volkswagen Will Enter Guilty Plea Feb. 24, Detroit Judge Says

>>> Europe : brokers Upgrades & Downgrades - 25th of January 201

>>> Up
*ABB Raised to Outperform at RBC, PT CHF25
*ASHMORE Raised to Buy at UBS
*Axel Springer Raised to Equal-Weight at Barclays, PT EU48.50
*BGEO Group Raised to Buy at Peel Hunt
*BT Raised to Neutral at Macquarie, PT 270p
*Edenred Raised to Hold at Berenberg, PT EU19
*EDF Raised to Hold at HSBC, PT EU9
*Entra Raised to Buy at Goldman
*ICADE Raised to Buy at Goldman
*International Paper Raised to Outperform at BMO, PT $62
*Land Securities Raised to Buy at Goldman
*Legrand Raised to Sector Perform at RBC, PT EU55
*Mediaset Espana Raised to Equal-Weight at Barclays, PT EU11.25
*Metropole Television Raised to Overweight at Barclays
*New Wave Group Raised to Buy at Nordea Securities, PT SEK60
*Pfeiffer Vacuum Raised to Hold at Deutsche Bank, PT EU96.20
*ProSieben Raised to Overweight at Barclays, PT EU45
*Raiffeisen Raised to Buy at UBS, PT EU22
*Reckitt Benckiser Raised to Buy at Berenberg, PT 7900p
*RTL Raised to Equal-Weight at Barclays, PT EU75
*Schneider Raised to Outperform at RBC, PT EU75
*SKF Raised to Sector Perform at RBC, PT SEK170
*Spirax Raised to Outperform at RBC, PT 4800p
*SSE Raised to Buy at HSBC, PT GBP17.40
*Swatch Raised to Buy at Deutsche Bank, PT CHF415
*Telenor Raised to Hold at Berenberg
*Zurich Ins. Raised to Outperform at Exane, PT CHF318

>>> Down
*Alfa Laval Cut to Underperform at RBC, PT SEK135
*Aryzta Cut to Neutral at Goldman
*Aryzta Cut to Hold at Baader-Helvea, PT CHF32.50
*Aryzta Cut to Neutral at UBS, PT CHF33
*Attendo Cut to Hold at Nordea Securities, PT SEK84
*Axa Cut to Neutral at Exane, PT EU24
*BT Cut to Hold at Berenberg, PT 400p
*Citycon Cut to Sell at Goldman
*Elior Group Cut to Hold at Berenberg, PT EU21
*Eurocommercial Properties Cut to Sell at Goldman
*Geberit Cut to Sector Perform at RBC, PT CHF440
*Grand City Properties Cut to Neutral at Goldman, PT EU18.90
*Hamburger Hafen Cut to Sell at Citi, PT EU17.50
*Intu Cut to Sell at Goldman
*Inmarsat Cut to Sector Perform at RBC, PT 775p
*IMI Raised to Sector Perform at RBC, PT 1050p
*Lagardere Cut to Underweight at Barclays
*Legal & General Cut to Market Perform at Bernstein, PT $17
*Mercialys Cut to Sell at Goldman
*Metro Cut to Neutral at Macquarie, PT EU34
*Premier Foods Cut to Neutral at Credit Suisse, PT 40p
*Publicis Cut to Equal-Weight at Barclays, PT EU70
*Snam Cut to Hold at HSBC, PT EU4.10
*Vivendi Cut to Underweight at Barclays, PT EU17.50
*Wereldhave Cut to Sell at Goldman
*Yoox Net-a-Porter Cut to Underperform at Exane, PT EU20

>>> PT Change

>>> Initiation
*Abcam Rated New Hold at Peel Hunt, PT 750p
*BTG Rated New Hold at Peel Hunt, PT 630p
*Hikma Rated New Buy at Peel Hunt, PT 2340p
*IWG PLC RATED NEW BUY AT PEEL HUNT
*Soco International Rated New Buy at Peel Hunt, PT 180p
*TechnipFMC Rated New Outperform at Credit Suisse, PT EU40
*UDG Rated New Add at Peel Hunt, PT 730p
*WEIR GROUP ASSUMED AT SECTOR PERFORM AT RBC; PT 2,200P

>>> Call
>> Stock
*KLEPIERRE REMOVED FROM CONVICTION LIST, REMAINS BUY: GOLDMAN

Cash.ch : Axa boss reiterated his dislike of major acquisitions - no interest in

Axa boss reiterated his dislike of major acquisitions - no interest in Generali
The French insurer Axa has no interest in a big takeover. A possible purchase of the Italian rival Generali, for which a long time and in recent days again increased takeover speculation, Axa boss Thomas Buberl again gave a clear cancellation.
01/25/2017 07:44
If someone wants to play the consolidator in the industry and clean up the market, he can do that, he said on Tuesday evening at an event of the "Süddeutsche Zeitung" in Bergisch Gladbach. "Our strategy is not that." He had already said last autumn that the purchase of a big rival like the Generali or Zurich for the Axa "no sense at all".
A large acquisition would not be well received on the financial market either. A leading insurance analyst had called him in connection with the new rumors of a generali takeover and said in English: "Thomas, if you do, you will be crucified." But he would not be crucified, said Buberl.
The German manager, who came to the top of the French insurer last year, sees the future of the industry increasingly on the brink of traditional business, such as advising customers on the prevention of risks. A generali takeover by the Axa had been speculated again and again last summer - until Buberl had denied the whole thing.
Nevertheless, market speculations have always been speculating that Axa could be a prospective buyer - especially as the new Generali boss Philippe Donnet comes from the French. Last but not least, a different constellation developed.
On Tuesday evening, Italian bank Intesa Sanpaolo confirmed that she was thinking about joining Generali. The speculations were recently boiled up by a report from the Italian daily La Repubblica. The price of the Generali shares then rose by more than ten percent to the highest level since the beginning of 2016. The insurer is thus worth about 24 billion euros on the stock market.
According to Intesa's management, the company continues to examine every opportunity to improve the competitive situation of its own company. Options include a combination with Generali. This possibility, like other alternatives, is currently under investigation by the bank management.
At the weekend, the newspaper "La Stampa" had already reported that Intesa wants with the support of the German insurer Allianz in the larger style at Generali einsteigen./stw/zb/fbr