TheChek News Flow

FT : Stress tests do little to restore faith in European banks

Stress tests do little to restore faith in European banks

Investors want simpler, clearer rules and tests

Regulatory authorities have a patchy record when it comes to being in tune with the markets. But the dissonance between those involved in Friday night’s stress tests on the European banking system and investors’ view of the banks is painful.

The London-based European Banking Authority, which is overseeing the tests, has said with admirable British understatement that the recovery of the EU’s banking system from the shock of 2008 has been slower than that of the US. It concedes, too, that the EU’s regulatory authorities have been less effective at recapitalising banks.

It claims, all the same, that progress has been made. EU stress tests, it contends, should no longer be about pushing fresh capital into the system, as they were in 2011, or conducting a root-and-branch assessment of asset quality, as in 2014. Now is more about “steady-state monitoring”.

That characterisation looks dangerously sanguine. European bank share prices have nudged lows last seen in 2011, when the eurozone debt crisis gripped the region. Investors clearly think this is nothing like a steady state.

True, banks’ capital buffers are more ample than they were five years ago. But a panel of respected academics concluded last week that EU banks need €900bn of fresh capital to convince investors they are robust. That dwarfs the €260bn which the EBA says has been pumped in since 2011.

Capital ratios are also about numerators — the quality of loans and other assets — as much as they are about those fattened denominators. As has been well documented, the Italian banking system is awash with non-performing loans — €360bn of them on a gross basis.

Sure enough, Monte dei Paschi di Siena, which on Friday launched an emergency fundraising, came bottom out of 51 banks tested. Other Italian, Irish and German banks were also among the weakest.

The stress tests have provided a welcome snapshot of how exposed banks are to various scenarios, ranging from a 25 per cent fall in equity markets to a 22 per cent decline in property prices. There is also a valid reflection of conduct risk, code for the vast fines that can erode capital buffers.

But this year’s stress tests, like prior exercises, are still flawed. Carried out over recent months, the tests failed to model for some obvious risks, Brexit and the mounting threat of negative interest rates, among them. Nor is there direct reference to the so-called Basel 4 proposals to further toughen capital demands. They have also excluded markets such as Greece and Portugal where banks are weak.

Worst of all is the atmosphere of obscurity. The structure of the tests is labyrinthine — four different, and sometimes bickering, arms of the EU are involved (the ECB, its SSM bank supervisory arm, the EBA and the European Systemic Risk Board).

In addition, the exercise this time carries no threshold for passing and failing. There will be suspicions that political sensitivities have been pandered to. But it may just as much be a result of chaotic policing: bank capital levels have become increasingly bespoke but stubborn delays among national regulators in requiring banks to publish their own individual numbers means there is no transparency about capital baselines. There is also little clarity about how and when undercapitalised banks will be strong-armed into raising fresh equity.

This probably adds up to yet another failed attempt to restore investor faith in Europe’s troubled banks. Without simpler, clearer rules and tests — and clear consequences for failure — there can be little hope of this changing.

WSJ : Sky, Discovery/Liberty Global, Others Circle Formula One

Sky, Discovery/Liberty Global, Others Circle Formula One

A winning bid could come in the next few weeks and value the racing series at $8 billion or more

The long-awaited sale of the Formula One may finally be nearing the finish line.

A number of bidders including British broadcaster Sky PLC are circling Formula One and a winner of the auction could emerge in the next few weeks, according to people familiar with the matter. A deal could value the racing series at around $8 billion or more.

Other possible buyers participating in the process include a team of Discovery Communications Inc. and John Malone’s Liberty Global PLC, the people said.

Should there be a deal, it isn’t clear how much of the famed motor-racing company would be sold.

Formula One holds the eponymous races in cities around the world, from Monte Carlo to Kuala Lumpur. The auto-racing franchise markets lucrative television rights and sponsorships for the popular races and negotiates contracts with venues and teams, among other functions. In 2006, private-equity firm CVC Capital Partners bought majority control of Formula One. It has since reduced its stake to around 35%.

CVC has flirted with the possibility of selling its stake for years but for various reasons hasn’t struck a deal.

One complication was a trial Formula One’s colorful founder Bernie Ecclestone faced in Germany related to charges of bribery and fraud. A court in 2014 dropped the case against Mr. Ecclestone, who is known as “Supremo” in Formula One circles, in return for a payment of $100 million.

Mr. Ecclestone is a former used-car salesman who built the race into a powerful marketing force in the late 1970s. The octogenarian remains chief executive of the company. Today, the stars in the sport include Lewis Hamilton and Sebastian Vettel.

Rights to show popular sporting events are considered increasingly valuable for channel distributors and advertisers amid a rise in ad-skipping technology and web-based entertainment.

Sky has a vast pay-TV business, with more than 20 million customers in Italy, Germany, Austria, the U.K. and Ireland. It is a big investor in television content too, with a programming budget of more than £4.6 billion ($6.1 billion), according to the company’s website. Its market value currently stands at nearly £16 billion.

21st Century Fox Inc., which holds a 39% stake in Sky, shares common ownership with News Corp, the owner of The Wall Street Journal.

Discovery, whose properties include Discovery Channel, TLC and Animal Planet, has been trying to build its sports-content holdings abroad, buying control of European sports entertainment group Eurosport International in 2014.

Liberty Global is a global media and content-distribution giant. It has struck a number of content deals in recent years, including one for the U.K.’s All3Media, together with Discovery.

Mr. Malone, Liberty Global’s chairman, has a big stake in Discovery Communications.

WSJ : Most European Banks Survive Stress Test

Most European Banks Survive Stress Test

Results show how much capital banks would have left after a severe downturn

European regulators gave most banks a clean bill of health in “stress tests” despite the Continent’s sluggish growth and low interest rates, saying only a clutch of lenders would struggle to ride out a hypothetical severe economic downturn.

The European Banking Authority released results Friday of its latest stress test showing how much capital, or cushion against losses, banks would have left on their balance sheets in an adverse economic scenario. The tests come after European banks climbed out of the 2010 eurozone crisis but have continued to grapple with low profits, bad loans and, sometimes, management problems and turnover, all of which have translated into struggling stock prices.

Struggling Italian lender Banca Monte dei Paschi di Siena SpA was at the bottom of the pack of 51 banks assessed, underscoring investor sentiment that the bank is a worrisome vulnerability in the country’s system and needs to raise substantial funds.

Other major banks that suffered sizable hits to their capital buffers included UniCredit SpA, Barclays PLC and Deutsche Bank AG.

Hours before the results were made public, the board of Monte dei Paschi unveiled a plan to unload nonperforming loans and raise up to €5 billion ($5.54 billion) in capital. Because the Siena-based bank was expected to be the worst performer in the test, its management was eager to come up with a plan to head off a crisis of confidence following release of the results.

The bank said the tests didn’t take into consideration its new plan to raise capital and unload sour loans.

The European Central Bank said the exam used a less severe scenario than the toughest one used in stress tests for U.S. banks in June, in which 31 out of 33 U.S. lenders, including big firms such as Bank of America Corp. and Citigroup Inc., passed. In addition, the European Union tests didn’t include struggling Greek and Portuguese banks this year, which could help account for the relatively rosy results despite Europe’s woes. Such lenders are being privately tested by regulators, and the results won’t be made public.

In addition, the banking authority’s toughest economic scenario didn’t factor in negative interest rates or the effects of a U.K. pullout from the EU. Regulators said the scenarios tested were gloomier than most of the predicted impact from the Brexit vote.

Unlike in previous European stress tests, regulators didn’t include a pass or fail result for each bank related to a specific capital amount. Instead, the EBA has left it up to investors and regulators to interpret the results.

Broadly, investors were looking for banks to maintain at least a 5.5% ratio of top-quality capital in the test scenario, analysts said.

Of the “systemically important” European banks, Italy’s UniCredit fared the worst, with a ratio of 7.1%. U.K. bank Barclays had a capital ratio of 7.3%.

Deutsche Bank had a 7.8% capital level, better than some analysts had expected. Investors had been concerned that the German lender could face an ill-timed capital crunch. The results show that Germany’s largest lender by assets must continue to cut costs and reduce risky assets to boost its buffer against losses.

Deutsche Bank Chief Executive John Cryan said the test showed the bank is “well equipped for tough times” and on track to reach capital goals in its turnaround plan.

UniCredit said it would take the results into consideration as it develops its new strategic plan.

Some analysts said they had expected Barclays to meet a higher capital ratio threshold of 7.5%.

Such an expectation potentially raises pressure on the bank to bolster its balance sheet. It said was focused on a separate Bank of England stress test expected later this year.

Swiss banks UBS Group AG and Credit Suisse Group AG aren’t part of the eurozone and weren’t included in the stress tests.

Generally, the test was a glimmer of good news for U.K. banks, whose share prices have been depressed following the country’s vote to exit the EU in late June.

“The results demonstrate that the extensive banking reforms since the financial crisis are working,” said Anthony Browne, chief executive of the BBA British banking group.

Monte dei Paschi’s capital buffer, which was calculated before the bank unveiled its overhaul plan on Friday, was totally wiped out by the test scenario. Its poor results underscore the importance of carrying out its new plan, which includes unloading €9.2 billion in net nonperforming loans to Atlante, a fund orchestrated by the government and financed by Italian banks, insurers and pension funds. The plans still needs regulatory approval.

Ireland’s Allied Irish Banks PLC also came in under the 5.5% bar, with a capital ratio of 4.3%. All the other banks came in at over the 5.5% hurdle.

Individual countries’ regulators will use the numbers to calculate each bank’s capital requirement later in the year. Underperforming banks could be guided to hold more capital, but authorities are unlikely to widely force banks to raise more funds. Alternatively, banks could face tougher “qualitative measures” such as improving risk controls.

(BFW) Monte Paschi Restructuring Positive for Italy Banks, Intesa: RBC

>>> European Bank Stress Test - Bbg News

- Banco Comercial Says Had ‘Strong’ Results in ECB Stress Tests

- Danish Banks Are Robust Under EBA Stress Test, FSA Says

- Sweden’s Major Banks All Pass EBA’s Stress Test, FSA Says

- Stress Tests Show KBC, Belfius Improved Resilience: Central Bank

- Raiffeisen Fully-Loaded CET1 Drops to 6.12% in Stress Test

- Nouy Says EBA Stress Test Shows Improved Resilience of Banks

- Bank of France: EBA Tests Show French Banks Can Withstand Shocks

- Italy Banks CET1 Drops by 4.1% Under Adverse Scenario: BOI

- Monte Paschi Capital Wiped Out in European Bank Stress Test

- Paschi Plans Share Sale Up to EU5b, Disposal of All Bad Loans

- Banco Comercial Says Had ‘Strong’ Results in ECB Stress Tests

- Banco Popolare Solid Under Stress Test: CEO to Messaggero

- BBVA to Work With ECB on Capital Planning

- CaixaBank FL CET1 8.5% in Stress Test, Bank Says

- Intesa Strongest Among Europe Big Banks in Stress Test: CEO

- UniCredit to Work With SSM to See If More Cap Measures Needed

- Caltagirone Doesn’t Exclude Increasing UniCredit Stake: Stampa

Barron's : French Telecom Orange’s Shares Could Rise 25%

French Telecom Orange’s Shares Could Rise 25%

Despite its recent thrashing, the stock’s bargain price, 4.6% dividend yield, and potential upside make it attractive.

European telecoms have been pressured for years by cutthroat price competition, tight regulation, and failed mergers, making them a no-go area for many investors.

That might be changing, at least for some players, and Orange (ticker: ORA.France), France’s largest telecom operator, could be among those leading the charge.

In the past decade, European regulators have striven to protect telecom customers, either by capping the amount operators charge for some services—as the European Union has done with roaming fees—or by resisting consolidation. At the same time, new players, such as French billionaire Xavier Niel’s Iliad, have shaken up the market, driving down prices for consumers, while squeezing profit margins for operators.

According to the European Telecommunications Network Operators’ Association lobby group (ETNO), telecom revenue in Europe and Turkey fell a combined 16%, to just over 240 billion euros ($266.38 billion) in the seven years through 2015. This has sparked some mergers. Deal volume among European telecoms was just shy of $67 billion by the middle of 2015—the sector’s liveliest M&A period in five years.

The more successful marriages included British fixed-line operator BT Group’s (BT) roughly $20 billion purchase of mobile carrier EE from Deutsche Telekom (DTE.Germany) and Orange. The previous year, Altice (ATC.Netherlands) bought the mobile and broadband operator SFR from France’s Vivendi (VIVHY) for $23 billion.

That trend appears to have reversed as some more recent deals have withered on the vine. In April, Orange’s hopes of buying the telecom business of French conglomerate Bouygues (EN.France) fell apart when the parties and the French government couldn’t agree to terms. Then, in May, the European Union blocked Hong Kong-based Hutchison Holdings’ (0001.Hong Kong) roughly $14 billion purchase of British mobile operator O2 from Spain’s Telefonica (TEF). Regulators contended the tie-up would reduce competition and boost prices. That led Orange’s deputy chief executive, Gervais Pellissier, to conclude that the EU’s heightened competition concerns could stall telecom M&A for up to two years.

But facing these setbacks has forced some European telecoms to streamline their businesses, making them more efficient and better able to adapt to current market conditions—a factor that not all investors may yet appreciate.

In addition, United Kingdom-based Polar Capital fund manager Nick Davis says that the sector is reaching an inflection point. He argues that, despite the failed deals, “regulators are moving from being pro-consumer to being pro-investment, where Europe has some catching up to do. There’s a need for investment in fiber on the fixed side and in 4G for mobile.”

At the same time, telecom operators have cut costs and deleveraged. With profit growth in the mid-single-digits and currently attractive valuations, some have an appealingly defensive profile in today’s choppy markets.

Davis particularly likes Orange, which is trading close to book value and boasts a 4.5% dividend yield. Davis reckons Orange can benefit from the rapid convergence of telecom services with internet, broadband, and other media.

ETNO’s figures show data revenue in Europe and Turkey rose almost 19%, to €72.8 billion, from 2008 through 2015, while mobile and fixed telecom revenue declined.

>>> Weekly Update

Weekly Market Update: Barrage of Data Gives Mixed Signals for Second Half

This week investors digested a deluge of corporate earnings reports and key economic data while oil prices continued retreat. The S&P500 finished out near another all-time high, while the DJIA was weighed down by weak earnings commentary from several component names. The advance Q2 US GDP estimate showed the US economy has grown at less than a 2% pace for three straight quarters. Expectations for Japanese stimulus ratcheted up and the same went for the BOE. The US Federal Reserve hinted towards an increasing willingness to raise rates later this year, but market reaction/expectations suggest the consensus view is the Fed remains firmly in a wait and see mode. For the week, the DJIA fell 0.8%, the S&P500 slipped 0.1%, while the Nasdaq rose 1.2%.

The first estimate of the second quarter US GDP did not see the bump higher that was widely expected. Analysts were calling a healthy rise in Q2 GDP to +2.5% after the anemic +1.1% in Q1. There was no bounce, however, and the advance reading came in at +1.2%, while final Q1 GDP was revised down to +0.8%. Inventory declines continued to drag on GDP, while nonresidential fixed investment declined at a 2.2% y/y pace, the third straight quarterly drop. There were strong components in the report: personal consumption expanded at a 4.2% rate, while outlays on goods advanced 6.8%. And the decline in inventories is apt to deliver a big boost later in the year.

The suspense continues in Tokyo, where neither Abe's government nor the Bank of Japan provided concrete details on their plans for big new stimulus packages. The government has confirmed its stimulus will total ¥28 trillion, however the policy mix making up this humongous plan remains unclear. There was press speculation - later denied - that the government would sell 50-year JGBs, the longest maturity of postwar era, although they did suggest that around 25% of the plan would be new spending. The government did confirm that the new plan would be disclosed in full next Tuesday. Expectations were running high ahead of Friday's BoJ meeting, with analysts debating whether the bank would pursue expanded asset purchases, deeper interest rates cuts, or both. In the event, the bank merely boosted its ETF buying program to ¥6 trillion from ¥3.3 trillion and doubled the size of its dollar lending program to $24 billion. The weaker yen trend seen since the election reversed this week, with USD/JPY dipping back below the 102 handle by Friday.

The Fed held pat on Wednesday, as expected, and tweaked the statement just enough to suggest a slightly more hawkish outlook. The dollar modestly sold off, with EUR/USD trading back up to the high end of its most recent four-week range, closing out the week around 1.1150, suggesting the market now sees the prospect of another rate hike this year as good for risk appetite. The capsule summary of economic conditions was sweetened to reflect improved economic data, while the second paragraph gained a line saying "near-term risks to the economic outlook have diminished." Similar changes in April were thought to herald a June hike (before the Brexit disaster), and analysts suggest the new additions this time indicate a September hike is on the table. Before the statement, fed funds futures showed roughly 30% odds of a rate hike in September and a 48% chance by December. The futures were more or less unchanged after the statement.

UK economic data is starting to expose the negative impact of Brexit on the UK economy, and the Bank of England is gearing up to cut rates and expand its QE program next week. Second quarter UK GDP was ok, however July reports on consumer confidence, retailing and industrial trends all sank deep into the red. The GFK consumer confidence index sank to a two-year low, while the business optimism component of the CBI industrial trends report was stunningly pessimistic. The BoE's Weale told the FT that the Brexit vote had rattled the economy more than he expected. The consensus is that the BoE will cut rates by at least 25 bps and increase QE by £50-75 billion. Other European data was more upbeat, with the German July IFO business confidence survey holding up very nicely, and other measures of Continental consumer confidence not flagging nearly as much as feared. With the euro zone looking solid, many commentators expect the ECB to continue with its wait-and-see policy for a while yet.

Crude prices saw another week of sustained losses, as both WTI and Brent sank toward the $40 level amid persistent reports of oversupplied markets. The Baker Hughes rig count has marched higher for five weeks in a row, with total rigs working on North American drilling up about 10% in a month. US crude inventory reports showed more gains in oil stores, and supply disruptions are being resolved in Libya, Nigeria and Canada. Cheap crude has led refiners to produce lots of refined products, which has pushed down margins worldwide, while anemic global growth is not delivering robust demand. There was a slight bounce higher at week's end as short-covering kept WTI and Brent from dipping into the 30s. In second-quarter earnings out this week, Exxon and Chevron both took a severe beating, with Exxon's profits down 60% y/y, while revenue at both firms fell more than 20% as refining margins were pressured.

Earnings from global manufacturers Ford and Caterpillar carried pronounced warnings about the global economy. Ford warned there were risks that could keep it from achieving its FY guidance, and the CEO cautioned that the US economy remains under pressure. Cat said "world economic growth remains subdued and is not sufficient to drive improvement in most of the industries and markets we serve." Consumer names continued to indicate some problems: McDonald's headline results were good, but the firm's sales comps were way below expectations, as analysts had predicted a much bigger bump from the firm's big all-day breakfast push. Google, Amazon and Facebook all widely beat expectations and saw continued huge rates of growth in their core internet services. Apple saw its second consecutive quarter of lower revenue and lower iPhone sales, however shares of the tech giant saw solid gains on optimism about the next smartphone cycle.

Yahoo reached a deal to sell off its core operations, with Verizon agreeing to pay $4.83 billion in cash to acquire its internet assets. The sale did not include Yahoo's cash, its shares in Alibaba Group, its ownership stake in Yahoo Japan, and the non-core patent portfolio. These will continue to be held by Yahoo, which will change its name at closing and become a publicly traded investment company. Verizon plans to combine Yahoo with its AOL unit. Oracle reached a deal to acquire NetSuite for about $9.3 billion, or $109 per share in an all-cash deal. While their service offerings are similar, NetSuite offers Oracle access to companies sized smaller than its traditional client base, and could also give it some additional competitive edge in taking on primary rival Salesforce.

>>> US Close Dow -0.13% S&P+0.16% Nasdaq+0.14% Russell+0.21%

Closing Market Summary: Bad is Good, Good is Bad - Short Sellers Remain Sad

The stock market ended a bouncy week on a flat note as the S&P 500 (+0.2%) clawed back to little changed for the week (-0.1%). The Nasdaq Composite (+0.1%) also settled just above its flat line, but gained 1.2% for the week. True to this week's form, the Dow Jones Industrial Average (-0.1%) underperformed, extending its weekly decline to 0.8%. The Dow, S&P 500, and Nasdaq posted respective July gains of 2.8%, 3.6%, and 6.6%.

The S&P 500 settled near last Friday's closing level, but not before marking a fresh intraday record high at 2177.09. Strikingly, that record high was established after the release of disappointing growth data for the second quarter.

Dollar weakness was among the residual undertones from the overnight session after the Bank of Japan underwhelmed stimulus-hungry investors; however, greenback softness promptly set the tone for the U.S. cash session after second-quarter GDP (1.2%; consensus 2.6%) missed estimates by a wide margin. First-quarter GDP was revised down to 0.8% from 1.1%.

The Dollar Index (95.51, -1.18) slumped to levels from early July on the back of a 3.0% surge in the yen (102.10). The swoon opened the door for dollar-denominated crude oil to rally, in turn improving sentiment in the broader market. Furthermore, the intraday strength in oil helped the energy sector (+0.7%) overcome a 1.4% loss in ExxonMobil (XOM 88.95, -1.25) after the energy giant reported below-consensus quarterly results. ExxonMobil's disappointing results contributed to the daylong underperformance in the Dow while other influential Dow components like Goldman Sachs (GS 158.81, -1.72) and Travelers (TRV 116.22, -1.39) lost 1.1% and 1.2%, respectively.

The financial sector (-0.2%) was one of just two cyclical groups that settled in negative territory. Industrials (-0.3%) also underperformed, but gained 3.4% in July. Similarly, the financial sector gained 3.4% for the month while top-weighted technology led the way with a 7.8% spike.

Outperformance in the technology sector was on full display earlier in the week, but Friday's affair did include the release of Alphabet's (GOOGL 791.34, +25.50) upbeat results that were met with a 3.3% spike in the stock.

In a way, the Friday uptick can be tied back to the expectation that the Federal Reserve will remain accommodative in its approach to monetary policy, given lagging growth. The likelihood of a rate hike, as estimated by the fed funds futures market, declined to 33.0% from last week's 47.8%.

Weak growth data sparked a bid across the Treasury complex, sending the 10-yr yield lower by four basis points to 1.46%.

Participation was boosted by month-end flows, which resulted in more than 1.1 billion shares changing hands at the NYSE floor.

Economic data included Q2 GDP, Employment Cost Index, Chicago PMI, and Michigan Sentiment:

The advance estimate for second quarter GDP showed output increasing at an annual rate of just 1.2% (consensus 2.6%) on the heels of a downwardly revised 0.8% increase (from 1.1%) in the first quarter

The price deflator was 2.2% (consensus 1.9%)

Real final sales, which exclude the change in inventories, were up 2.4%

Personal consumption expenditures (PCE) increased 4.2%, which was the strongest gain since the fourth quarter of 2014. That gain accounted for nearly all of the growth in the second quarter, contributing 2.83 percentage points. Net exports contributed 0.23 percentage points

On a seasonally adjusted basis, compensation costs for civilian workers increased 0.6% in the second quarter, which was in-line with the consensus estimate and the same rate of increase registered in the first quarter
Wages and salaries, which make up about 70% of compensation costs, rose 0.6% in the second quarter while benefits, which make up the remaining portion of compensation costs, jumped 0.5%

The Chicago Purchasing Managers Index (PMI) dipped to 55.8 in July from 56.8 in June, which was better than the consensus estimate (54.0)
The report indicated that this was the first time since January 2015 that all five barometer components were in expansionary territory (above 50.0)

The final reading of the University of Michigan Consumer Sentiment report for July checked in at 90.0, down from the final June reading of 93.5 and slightly below the consensus estimate of 90.4
There was a downturn in both the Current Economic Conditions Index (from 110.8 to 109.0) and the Index of Consumer Expectations (from 82.4 to 77.8)

Monday's data will be limited to the 10:00 ET release of the July ISM Index (consensus 53.1) and Construction Spending for June (consensus 0.7%).

Russell 2000 +7.4% YTD

S&P 500 +6.3% YTD

Dow Jones Industrial Average +5.8% YTD

Nasdaq Composite +3.1% YTD

>>> SABMiller plc confirms Board recommendation of AB InBev (BUD) revised and fi

SABMiller plc confirms Board recommendation of AB InBev (BUD) revised and final offer

The Board of SABMiller has now met formally to consider the revised and final offer for the entire issued and to be issued share capital of SABMiller as announced by Anheuser-Busch InBev SA/NV ("AB InBev") on 26 July 2016 (the "Revised Offer"). The Revised Offer comprises an all-cash offer of GBP 45.00 per share (the "Cash Consideration") and a partial share alternative (the "PSA"), available for approximately 41% of the SABMiller shares, consisting of 0.483969 unlisted shares and GBP 4.6588 in cash for each SABMiller share. SABMiller shareholders on the register on 5 August 2016 will also receive and retain the final dividend in respect of the financial year ended 31 March 2016 of US 93.75 cents per share to be paid on 12 August 2016. The SABMiller Board intends to recommend unanimously the Cash Consideration and that SABMiller Shareholders vote in favour of the UK Scheme at the UK Scheme Court Meeting and in favour of the SABMiller Resolutions to be proposed at the SABMiller General Meeting. The SABMiller Board also unanimously concluded that it intends to propose to the UK Court that Altria and BEVCO be treated as a separate class of shareholders and therefore to allow other SABMiller shareholders to vote on the Revised Offer separately.
"The Board's decision was difficult given changes in circumstances since the Board originally recommended £44 per share in cash last November. At that time we were satisfied that the 50% premium to the undisturbed share price appropriately reflected the quality of the business and its long term prospects. "Since then, various factors have affected the value of the offer, most importantly the impact of the Brexit vote on the value of Sterling and the re-rating of comparable companies. This has made the Board's decision more challenging, and we believe the final cash consideration of £45 per share to be at the lower end of the range of values considered recommendable....Now that the regulatory pre-conditions are satisfied, the Board and management will continue to work constructively with AB InBev to bring about successful completion of the transaction as soon as practicable".

RTR - Call center software maker Interactive Intelligence explores sale: sources

Call center software maker Interactive Intelligence explores sale: sources {INI US Equity }

Interactive Intelligence Group Inc, a U.S. provider of software and services for call centers operators, is exploring strategic alternatives, including a potential sale, according to people familiar with the matter.

Interactive Intelligence is working with boutique investment bank Union Square Advisors LLC on a sale process that has attracted other telecommunications software companies, as well as private equity firms, the people said this week.

The sources cautioned that no deal is certain and asked not to be identified because the sale process is confidential. Union Square Advisors and Interactive Intelligence did not immediately respond to requests for comment.