TheChek News Flow

- A decision about whether to buy back shares could come in the second half of next year

European antitrust authorities will make the filing official later on Friday, according to two sources familiar with the situation. The extra time will allow the European Commission to test the proposal with the market, writes Philip Stafford.

Brussels sent the deal to create Europe’s largest exchanges operator for an in-depth investigation at the end of September. Authorities cited concerns about potential curbs to competition in stocks, futures and repo markets, which provide a crucial source of short-term funding for banks.

To assuage the concerns the LSE has said it would be willing to sell the Paris-based arm of LCH, the clearing house it controls. The business, better known in the industry under its previous brand name Clearnet, clears credit default swaps, repo, equities and futures trades.

A final decision was initially due on February 13 but that has now been put back to March 6, at the request of the exchanges, the sources said.

Clearing, in which a party stands between two sides of a deal and manages fallout if one side defaults, is one of the pillars of global policymakers’ efforts to reinforce markets after the financial crisis.

Innovation is frequently cited as being the lifeblood of consumer staples. Indeed, many of the

consumer staple majors were founded by great innovators: Henri Nestle; William Lever; Will

Kellogg; Milton Hershey; and Henri-Louis Pernod to name but a few. So where are we today?

As the industry giants have pursued scale, they have lost sight of a consumer which now favours

personalisation and authenticity. Individualism and experimentation are not to be encouraged

within the majors when ZBB, simplification and immediate earnings growth are seemingly the path

to share price riches. As barriers to entry have declined, smaller brands are filling the void.

In the above context, we believe that the majors will increasingly look towards inorganic investment

to acquire innovation which they can then look to scale. Dollar Shave Club, Seventh Generation,

Annies, It Cosmetics, Monkey 47, Camden Town are but a few recent examples.

We believe that the industry is effectively starting to move towards a model more akin to biotech /

mainstream pharma. Arguably this is not new, but we see the pace accelerating.

Keeping the above in mind, we thought it worth exploring the view from outside the mainstream

and within the M&A ‘hotspot’. We have worked with the pre-eminent US consumer investment

marketplace, CircleUp, to get their perspective. Where is the US industry headed? What are the

key factors in determining innovation success? What would they do if running a staples’ major?

Answers within.

En prenant le contrôle de Mitsubishi Motors via Nissan, le PDG de Renault devient le président de trois groupes automobiles très différents, dont il est l’unique trait d’union.

On pourra désormais l'appeler le triple président. Déjà PDG de Nissan depuis 2001, de Renault depuis 2005, Carlos Ghosn va désormais prendre la présidence de Mitsubishi Motors. La direction opérationelle sera certes assurée par l'actuel patron de Mitsubishi, Osamu Masuko. Mais la présence de l'homme qui avait restructuré Nissan en un temps record au début des années 2000 est un signal fort, notamment vis-à-vis de l'ingénierie de Mitsubishi, réputée toute-puissante.

Chez Nissan, Carlos Ghosn s'appuiera sur son fidèle Hiroto Saikawa, qui a été promu au rang de « co-PDG », une trouvaille maison. Mais pas question de lâcher le manche. « Ce n'est pas du tout un pas en retrait de ma part. J'ai juste besoin de prendre plus de temps pour épauler Osamu Masuko chez Mitsubishi et je ne veux pas que Nissan souffre d'une dispersion », insiste le triple patron.

Déjà dantesque, l'agenda du manager globe-trotter, qui parcourt le monde à bord de son Gulfstream G550, pourrait devenir infernal. Pourra-t-il être aussi présent côté Renault ? « Je tiens à terminer la transformation chez Renault », indique-t-il. Le constructeur au losange est de fait engagé dans un renouvellement inédit de ses gammes et devrait franchir cette année le cap des 3 millions de véhicules. Mais la question d'un patron opérationnel dédié pour le groupe - comme l'étaient en leur temps Carlos Tavares ou Patrick Pélata - pourrait revenir sur la table.

En attendant, Carlos Ghosn est partout et continue à construire à sa main son empire automobile. Au niveau opérationnel, les résultats actuels plaident pour lui. Mais les questions se concentrent sur la gouvernance. « Carlos Ghosn est PDG, pas actionnaire », tentait de recadrer, il y a un an, le ministre de l'Economie, Emmanuel Macron, qui avait osé défier le dirigeant sur les questions de droits de vote au sein de l'Alliance.

Unique trait d'union

Las, les politiques passent et Carlos Ghosn reste. Quitte à alimenter l'image d'un patron tout-puissant, qui affiche sans états d'âme une rémunération impressionnante - 15 millions d'euros pour Renault et Nissan -, laquelle devrait encore gonfler avec la présidence de Mitsubishi.

Au-delà des « pour » et des « contre », la question de fond est toujours ouverte : comment pérenniser l'avenir de l'édifice ? Carlos Ghosn a toujours refusé de fusionner Renault et Nissan - et demain Mitsubishi -, au nom du respect des cultures des constructeurs. En l'absence d'unité capitalistique, l'empire dépend avant tout de son créateur, qui n'est pas éternel. Ces dernières années, les évictions de différents numéros deux - Patrick Pélata, Carlos Tavares, Andy Palmer, Toshiyuki Shiga - ont renforcé les questions autour de l'« après-Ghosn ». A moyen terme, l'homme, âgé de soixante-deux ans, pourrait demeurer simple président de l'Alliance et s'appuyer sur des patrons opérationnels pour chaque constructeur.

Reste à savoir qui sera son futur successeur à la tête de l'ensemble, tant il apparaît comme l'unique trait d'union entre des constructeurs très différents.

* Short Hope — Equity funds globally are on track to register net annual outflows for the first time in four years (-$224bn or -1.7%AUM). Annualised, this would be a bigger net outflow than the previous record in 2008. Global equity fund flows are part of our bear market checklist as a contrarian indicator. Current outflows are not outright bullish, although equity markets performed well following previous big net outflows, but certainly are not bearish either.

* Takeaway #1: EM Inflows, Europe Outflows — EM equity funds are on track for their first year of net inflows since 2012 ($13bn or 1.3% of AUM). Alternatively, DM funds have suffered from redemptions of $237bn (-2.2% of AUM). Within DM equity funds, the largest outflows so far this year have been from European and US funds.

* Takeaway #2: US Equity Gains Despite Outflows — EM equity market performance has the strongest traditional coincident relationship with flows. The US has the weakest. Tobias Levkovich highlights that corporates are a bigger buyer of US equities via buybacks than investors via fund flows. This might explain why the US equity market has managed to go up this year despite large outflows.

* Takeaway #3: Shift From Active To Passive — There has been an ongoing shift from active funds into passive equity funds. The rise of passive investing may help explain the structural increase in pairwise correlations within equity markets. However, this “passive markets mean more correlated stocks” story has not really worked in recent years.

- Equities: $3.9bn outflows (outflows in 5 of past 6 weeks) ($6.2bn mutual fund outflows vs $2.3bn ETF inflows)

- Bonds: $2.7bn inflows (inflows in 15 of past 16 weeks)

- Precious metals: $0.5bn inflows (4 straight weeks)

Altice USA, the cable operator that Netherlands-based Altice NV (ATCA.AS) put together by acquiring Cablevision and Suddenlink Communications, is drawing up plans for a potential initial public offering, according to people familiar with the matter.

The move would allow Altice's founder, French billionaire Patrick Drahi, to expand his budding U.S. cable empire by giving Altice USA public stock that it can use as currency to help finance more acquisitions, the people said on Thursday.

Altice USA, which is now valued at between $25 billion and $30 billion, plans to invite investment banks to make presentations in the coming weeks about their role in a potential IPO in New York, the people said.

Based on these pitches, Altice USA may hire IPO underwriters by January, and could go public sometime in 2017, subject to market conditions, the people said. The IPO could raise close to $2 billion, one of the people added.

The IPO plans are preliminary, and Drahi may decide to keep Altice USA private, the people cautioned, asking not to be identified because the deliberations are confidential.

Altice was not immediately available to respond to requests for comment.

Altice, which Drahi built into a telecoms and cable empire through debt-heavy acquisitions in Europe and Israel, entered the U.S. market last year by acquiring regional cable company Suddenlink for $9.1 billion.

A few months later, it extended its reach to 20 U.S. states by snapping up the country's fourth-largest operator, Cablevision, which provides cable and broadband services in New York, New Jersey and Connecticut, for $17.7 billion.

Having a U.S. listing would allow Altice, which has accumulated 46 billion euros of debt, to keep expanding rapidly in the country through acquisitions of midsize players that it believes can receive antitrust clearance, the people said.

Altice's U.S. shopping free follows the purchase of rival French mobile telecommunications firm SFR in 2014, which was financed with $21.9 billion-equivalent in debt, raising concerns among credit rating agencies and analysts.

Beyond the France and United States, Altice has operations in Belgium, Luxembourg, Portugal, Switzerland, Israel, the French Caribbean and the Dominican Republic.