>>> Zatarra Response to Wirecard statement - read the facts

Zatarra Research @ZRI2016 Response to #WDI statement - read the facts

see full document attached

Wirecard has provided investors, analysts and the media with false and misleading statements. Wirecard’s explanations to Zatarra’s findings have been so easily identified to be false and misleading that Wirecard has required continuous backtracking to its own statements.
Wirecard’s hope is that the majority of these recipients have not read Zatarra’s reports and are unfamiliar with the evidence contained within. For if they had, then they would easily be able to determine the false and misleading elements of Wirecard’s “rebuttal” and understand the significance of the evidence provided.
Quite simply, neither Wirecard, nor any of its promoters, have been able to disprove the extensive, documented and publicly available evidence that Zatarra has provided.
Zatarra encourages Wirecard’s investors, analysts and the media to become more familiar with the devastating evidence because there is much more to come.
In the meantime, you may find Zatarra’s response in red highlighting below as to how Wirecard’s “rebuttal” is false and misleading.
1. As one of the world’s leading online payment companies, Wirecard has excellent relations with all credit card organisations. It is an active licensee/member of such organisations through its regulated entities in the UK and Germany, and has been for more than a decade. Further to its role as an acquirer and issuer for various credit card organisations, Wirecard holds strategic partnerships with these card organisations and has acquired assets and subsidiaries from them.
2. Wirecard continuously discloses the nature of the transaction volumes processed by the company and the revenues related to each client industry segment in its audited annual reports. Online gambling transactions solely originate from regulated online gambling operators and volumes constitute about 7% of Wirecard’s total transaction volumes. They are aggregated under the ‘digital goods’ segment of Wirecard’s public reporting. Any claim that Wirecard obfuscates payment jurisdiction and associated merchant risk, to circumvent high risk categorization and authentication requirements within the credit card organisation networks, is wrong. Wirecard’s compliance and merchant account setup procedures are repeatedly audited by regulatory bodies as well as the credit card organisations themselves. The allocation of country and merchant category codes to individual merchant accounts is conducted fully in accordance with all regulatory, tax and credit card organisation rules.

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance: BBRY -7.8%, MRVL -4%, (files to delay Form 10-K, expects to incur a net loss for fiscal 2016)

M&A news: MAR -5.2% (Starwood Hotels confirms Anbang consortium has withdrawn offer; reaffirms commitment to merge with Marriott), HOT -4.2%

Select EU related names showing weakness: NVS -3.4%, VOD -2.9%, AZN -1.8%, HSBC -1.5%, SNY -1.5%, ABB-1.4%, SAP -1.3%, CCL -0.9%

Select metals/mining stocks trading lower: RIO -2.3%, BHP -2.2%, VALE -2.1%, FCX -1.8%, X -1.7%.

Select oil/gas related names showing early weakness: WLL -3.5%, SDRL -3.3%, TOT -3.1%, RDS.A -2.9%, BP -2.8%,CHK -2.2%.

Other news: SUNE -7.4% (discloses receipt of subpoena from the DOJ, informal inquiry from SEC), HLT -5% (in sympathy with HOT/MAR), VWR -3.5% (prices 8 mln common stock offering by selling stockholder Varietal Distribution Holdings at $26.00/share), GNCA -2.6% (following today's 95% gain amid cautious commentary from Biotech blogger Adam Feuerstein ),CHCT -2.4% (to sell 4.5 mln common shares in underwritten public offering), SNE -2.3% (Nikkei down 3.6% overnight),WYNN -1.3% (Macau Gaming Inspection and Coordination Bureau reported March gross gaming revenue down 16.3% YoY),TM -1.2% (Nikkei down 3.6% overnight), MPEL -0.7% (Macau related), LVS -0.6% (Macau related)

Analyst comments: CMG -1.8% (downgraded to Neutral from Buy at Goldman), AAL -1.5% (downgraded to Hold from Buy at Deutsche Bank), VIAB -1% (downgraded to Neutral from Buy at Citigroup)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance: VJET +7%, CSII +6.6%, URBN +2%, (Urban Outfitters discloses that thus far during Q1 of fiscal 2017, comparable Retail segment net sales are low single-digit positive which includes the benefit of a leap year)


Other news: TERP +9.8% (Appaloosa boosts active stake to 10.88% (Prior 9.50%), files amended complaint), TSLA +7.8% (introduced Model 3 last night), REGN +3.2% (Regeneron Pharma and Sanofi (SNY) report positive topline results for Dupilumab from two Phase 3 trials; US regulatory submission for dupilumab planned for Q3)

Analyst comments: BOX +3.7% (initiated with a Buy at Drexel Hamilton), JCOM +0.8% (upgraded to Buy from Neutral at Citigroup), NFLX +0.5% (upgraded to Overweight from Neutral at Atlantic Equities)

FT : Who’d be the referee? Takeover Panel under fire from all sides


It is said that a referee has done a good job when the managers of both teams feel equally aggrieved. A similar argument can be made for market regulators.
Take the UK Takeover Panel. Dealmakers tend to complain that the Panel’s rules and deadlines add mostly arbitrary complications to their offers progressing. Investors, meanwhile, dislike the ambiguity that stems from the Panel’s clubby, industry embedded way of operating. The regulator is criticised either for being too tough or too soft, too rigid or too pliable. It all depends on who you ask.

At press time we have been unable to ask the opinion of Gavin Darby, the chief executive of Premier Foods. Mr Darby and the Panel have become intimately acquainted in recent weeks, after the Mr Kipling cakemaker angered its own shareholders by rejecting three takeover offers from US suitor McCormick in favour of a co-operation arrangement with Japan’s Nissin Foods.
The headlines that followed have been uncomfortable. Within 24 hours of McCormick’s interest being made public, Nissin made itself kingmaker on any future deal by buying 17.3 per cent of Premier from Warburg Pincus, the private equity house. (It has since raised the stake to nearly 20 per cent.) What made the news particularly awkward was that Premier, in the course of talks with Nissin that had been running for around a year, had told the Japanese of McCormick’s approach before informing its own shareholders.
In the rumpus that followed, Mr Darby told the Daily Telegraph he was “sure” McCormick had been “involved” in the trade that moved Warburg’s stake to Nissin. A day later, under pressure from the Panel, Premier had to clarify that Mr Darby was “not aware, nor could he have been, of any discussions” between McCormick and Warburg. The rumpus escalated into a brouhaha.
“This is all part of their strategy,” complains one of Premier’s team, with a hint of grudging admiration. “There are advisers who specialise in using the Takeover Code as an offensive weapon. They do it to wear down the target, to weaken their resistance.”
But did Mr Darby’s clumsy phrasing create a false market for Premier shares? In theory, possibly, though the price looks to have been unaffected. Shareholders were given at most an isolated kind of clarity from Premier’s clarification, whereas McCormick’s team was able to claim a victory on a technicality. It looks a lot like point scoring, where the regulator has been recast as a referee and the Takeover Code makes up the rules of a complicated, very expensive game.
Premier is unusual. Policing of UK M&A is mostly private. Companies are guided on what they need to tell the market via prompts and pointed questions in private meetings. It’s a system that has, historically at least, caused very little friction. Yet recently, the regulator’s light-touch approach has looked increasingly at odds with its dogmatism once the Takeover Code has been activated.
Take the case of Imagination Technologies, the designer of the iPhone’s graphics chip, which spent most of a session last month in a false market. The stock spiked 20 per cent higher on a mostly accurate report that it was in talks to sell itself to Apple. It took seven hours and 20 minutes of trading for Apple to confirm that it had approached Imagination about a takeover, but that the talks had ended. Imagination was allowed to say nothing.
Saying nothing has become the norm. M&A advisers talk of getting more leeway to keep shtum, particularly when faced with the kind of rumours that surface in market reports. It is worth their while to avoid a statement, as going public can seriously damage the chances of a deal progressing. The Takeover Code puts named potential bidders on a 28-day deadline to make a firm offer or walk away, and, even if talks are nonexistent, a public denial will under normal circumstances lock that party out for six months.
But silence creates its own problems. First, it gives a free run to anyone trading on inside information (or, more commonly, anyone who thinks they might be). Second, it has a chilling effect on the press. Put simply, reporters are less likely to put market rumours in front of a wider audience when even a true story is more likely to be met with silence than a confirmation.
This is all good for dealmakers, of course. For investors, the benefits are less clear. It all feels a long way from the regulator’s purpose of keeping the market honest.
So is the Panel too tough or too soft? It really does depend on who you ask.