>>> Gartner: Sees smartphone sales in China and N. America flat in 2016

Gartner: Sees smartphone sales in China and N. America flat in 2016 
- PC shipments to bottom out in 2016, return to growth expected in 2017.
- Global smartphone sales are estimated to reach 1.5b units in 2016, a 7% growth y/y
- Total mobile phone market is forecast to reach 1.9b units in 2016
- Worldwide combined shipments for devices (PCs, tablets, ultramobiles and mobile phones) are expected to reach 2.4b units in 2016, a 0.6% rise y/y
- End-user spending in constant USD estimated to decline by 1.6% y/y

(UBS) Intesa Sanpaolo and UniCredit - Under a cloud, but buyers of ISP capital s

Intesa Sanpaolo and UniCredit - Under a cloud, but buyers of ISP capital strength

* Initiating coverage, with a preference for ISP (Buy) over UniCredit (Neutral)
We believe YTD share price correction creates a buying opportunity in ISP. At 1x PTBV, we see value in
ISP's improving return profile (c10% ROTE in 17E vs. c8% in FY15 despite slowing fees), strong capital
(12.5% UBSe FLCET1 ratio) and best-in-class cash dividend profile (90-95% payout, 7-10% yields).
Although a 0.5x PTBV multiple implies limited downside, we do not see UCI as the "value option", as
earnings upside looks modest, and existing gaps with ISP appear unlikely to narrow in terms of
profitability (c6% ROTE17E) and dividend (9% of market cap returned in 2016/17E, vs. 17% at ISP).

* Fee story slowing, but still resilient; earnings upside related to LLPs
We believe AUM fees (15-25% of revenues) are poised to slow to low/mid-single digit growth (from 10-
20% in 14/15), driven by lower AUM inflows (-30% over 15/18E). That said, we believe recent savings
migration towards AUM is unlikely to be reversed, providing ISP/UCI with a large, stable revenue stream.
We are materially below management's targets (double-digit AUM fee growth, 7-10% total fees),
though current prices appear to discount a more conservative outlook than UBSe. In this report we have
reviewed the fee structure of c.2,000 fund share classes and most popular bancassurance products.

* P&L provisioning support in place, more insulated from loss recognition fears
We believe Italian delinquencies are close to their peak, ISP's/UCI's coverage ratios look adequate, and
both banks are proactively managing their NPLs. That backs our view about gradual LLP declines (c.55bps
by 2018E vs. 80-90bps in FY15), and reduced risk of ECB pressures to accelerate loss recognition.
Extensively analysed in the report, we do not include benefits from government NPL measures, with
shorter recovery times appearing most effective.

* Different capital position, different dividend discussion
Improved earnings and modest RWA growth allow for faster capital formation, with maths still working
in ISP's favour (c330bps over 16-18E; c170bps for UCI), given its structural return advantage. We believe
ISP can afford to distribute its entire 16/17E earnings stream as cash dividends, though slowly eroding
solvency. For us, the main question relates to ISP's policy beyond 17E, when earnings tailwinds fade and
loan growth might accelerate. On UCI, we think previous market concerns about solvency look overdone
after a 90bps CET1 pick-up in FY15, though buffers vs. SREP and unexpected impacts remain moderate.

FT : Fast FT : Bouygues and Orange warn on faltering talks

Bouygues has delayed a decision on whether to sell its telecoms business to Orange, saying that talks with France’s biggest telecoms operator “had not progressed sufficiently”.


The Paris-based construction and telecoms conglomerate said in a statement on Thursday morning that discussions over the future of the business “had not progressed sufficiently,” ahead of a final decision by the start of next week write the FT’s Adam Thomson and Jennifer Thompson.

A few minutes later Orange released a statement of its own, stating that “negotiations were not yet sufficiently advanced,” and that it will examine the situation again by April 3.

The two groups have been in intense negotiations for several weeks over a potential tie-up that would reduce the number of competitors in France from four to three.

Industry executives and analysts believe that the proposed consolidation would help turn the page on a three-year price war and bring about the conditions required for operators to invest more heavily in the expensive roll-out of fibre and 4G networks.

But people close to the negotiations say that the deal, in which market leader Orange would buy third-place Bouygues Telecom for an estimated €10bn in cash and shares, has been devilishly complex.

From Bouygues’ statement:

At its meeting of 30 March 2016, Bouygues’ Board of Directors noted that the negotiations between Orange and Bouygues had not progressed sufficiently.

Therefore, it will meet before the end of the weekend in order to make a final decision whether to pursue the merger plan or not.

Bouygues had indicated last month it was prepared to walk away from talks with Orange unless it receives a stake of at least 10 per cent of the French operator.

>>> Street Pre-Market Indications

ML
GENMAB - Positive interim result in phase 3 Castor Study of Daratumumab...+6%
SERCO - AWE (includes Serco) successfully renews its contact with UK Govt.+4%
TUI - Positive. FY guidance reit with atleast 10% EBITA growth FY15/16..+2-3%
AO WORLD - U.K. business performed strongly with 4Q rev & EBITDA ahead....+2%
ELEKTA - Sign multiyear partnership with GenesisCare valued at >$100m...+1-2%
NOVARTIS - Release financials with new divisional structure, reit FY16....+1%
RENAULT - Report Renault-Nissan & Daimler plan to deepen cooperation......+1%
ASML - Micro missed on Q2, but EPS better. Also reit FY capex guidance....+1%
VALLOUREC - Wins contract to supply 100,000tn of OCTG, no financials......u/c
RPC - Trading statement has positive/bullish tone but lacking in details..u/c
CARREFOUR - Spec Diniz to increase stake and push for second board seat...u/c
WENDEL - FY15 inline with BVPS €136.4 (+10.7% YoY) & DPS €2.15 (+7.5% YoY)u/c
HOMESERVE - Acquisition of Utility Service Partners for $75m in cash......u/c
MONTE DEI PASCHI - We DOWNGRADE to Neutral, PO to EUR 0.65 from EUR 1.1.-1-2%
ALDERMORE - We cut EPS and lower PO to 180p. See capital as being key.....-2%
BOOKER - Sales rise 10.6% in 12-wks, LFL growth ex-Budgens & Londis -2.5%.-2%
ORANGE - To extend deal talks with Bouygues, held up on valuation; Echos..-3%
ILIAD - Orange and Bouygues to extend deal talks beyond March 31st........-4%
BOUYGUES - To extend deal talks with Orange, held up on valuation; Echos-5-6%

CS:
AO World +4-5% UK strong, revenue and EBITDA ahead of co expectations
Allianz M/P Said to Plan $5b Insurance Portfolio Sale in Italy: Rtrs
Autoliv -1% Takata says it's not true that it's calculated recall costs
Booker -1-2% Profits inline, non tabacco sales cautious
Daimler UNCH Renault-Nissan, Daimler Plan to Deepen Cooperation
Genmab +1% Positive phase 3 update for daratumumab (Darzalex)
Hammerson +1% CS initiate with OUTPERFORM (High quality portfolio)
Intu Props -1% CS initiate with UNDERPERFORM (Balance sheet)
Kingfisher +1% CS reiterate OUTPERFORM, add to the FOCUS LIST (EPS growth)
Klepierre +1% CS initiate with OUTPERFORM (Valuation)
Miners -2% Copper -0.55%, Brent -2.35%, Iron Ore -2.35%, China +0.46%
Oils -1% Brent future rolls today, Brent -2.35% vs Europe close
Renault +1% Renault-Nissan, Daimler Plan to Deepen Cooperation
RPC UNCH Numbers inline with consensus and management expectations
Serco +3-5% Positive contract renewal
Speedy Hire +2-3% FY adj PBT inline, net debt broadly inline with previous YE
Tui +1% Numbers and guidance inline with consensus
Unicredit M/P Reviewing whether to delay sale, Banca Popolare di Vicenza
Unibail UNCH CS initiate with NEUTRAL (Valuation)


Numis:
* AO WORLD +3%; Strong statement, UK trading ahead of forecasts, Europe in line with expectations
* BOOKER mkt; In line with expectations
* CHESNARA +1%; PBT £42.8m dividend up 2.9%
* CMC MARKETS +1%; Active client growth +13% (very brief statement)
* COUNTRYSIDE PROPERTIES +1%; NUMIS INITIATE, note available on request
* EMPIRIC STUDENT PROPERTY mkt; Acquisition of land and entered into forward funded development agreement for 115 student beds in York for £11.1m.
* GRAFTON +1%; Appointment of Michael Roney, current CEO of Bunzl, as new Non-Exec Chairman
* HILTON FOODS +3%; PBT beat +11% yoy, moved from net debt £ (7.7m) to net cash position £12.7m, +VE o/look
* HOMESERVE mkt; Purchase of utility service partners for £75m in cash
* LOW & BONAR mkt; Remains on track to meet FY expectations
* MEDICLINIC +1%; Trading in line. Al Noor performing well. Net debt small better. Upbeat outlook.
* NORCROS mkt; Has announced the appointment of Shaun Smith to the Board as Group FD with effect from 4 April 2016 (formerly FD of AGA)
* OILS -0.5%; Brent $38.84 vs LDN close $39.54, WTI $37.80 vs $38.60, on DOE US inventories reporting 2.29mmbbls build despite gasoline draw of 2.51mmbls and another draw at Cushing. UK names strong yesterday.
* REDCENTRIC +3%; +VE update. Trading as expected and mgmt are conf in o/look
* RENEW +1%; Decent update, LFLs ahead and net debt reduction expected
* RPC +2%; OP in line with forecasts. Vision 2020 strategy on track
* SIERRA RUTILE mkt; EPS Miss due to obsolete inventory provision – FY results for 2015 during which it produced 126kt of rutile (+10% YoY) with revenues of $105.8m, EBITDA of $16.1m and a loss for the year of -$13.2m
* SPEEDY HIRE +2%; Bottom line in line. Net debt as expected. Interim FD appointed
* WINCANTON +2%; Trading in line with expectations. No surprises
* WIRELESS GROUP +2%; FY results ahead of our expectations, confident outlook


ShoreCap:
AO WORLD - strong Q4 trading EBITDA ahead of expec,sees FY revs +18.5%......+3%
TUI - 2015/16 closing out as expected.Summer bookings ahead of last year....+2%
BOOKER - 12 week lfl slaes -2.5%.Profits for 52 weeks remain in line........-1%
SPEEDYHIRE - Confirms fy ptp to be in line.45m bought goodwill write off....-1%
WINCANTON - Trading continues to be in line with views.....................UNCH
LOW & BONAR - Made solid start to year.Remains on track for FY.............UNCH
CMC MARKETS - trading inline,client growth strong,modest rev increase.....+0.5%
MEDICLINIC - trading inline,slight regulatory & competition headwinds......UNCH
POLYPIPE - revs +8%,PBT +28%,margins at record lvls,2016 starts well......+1.5%
HILTON FOOD - revs -0.4%,volume +5.5%,PBT +11% £28m,divi +9.8%.............UNCH
NUMIS - sees 1H revs and profits above the previous years..................UNCH
REDCENTRIC - revs and EBITDA inline,H2 strengthed...........................+1%
SCISYS - saw recovery in H2,encouraging start to 2016,GBP/EUR rates a factor+2%
IOMART - revs and EBITDA inline,saw solid organic growth,well placed.......UNCH
RPC - sees FY revs and profits significantly ahead of prev year.............+4%


RBC:
BOUYGUES -2% Deadline for talks with ORANGE extended
CARREFOUR +1% Speculation Diniz (owns 8.05%) looking to increase stake.
CMC MKTS +1% Active client growth +13.5%, ahead of 10% expectations
GENMAB +3% Positive phase III study, ADR +4%.
ORANGE -2% Deadline for talks with BOUYGUES extended
RIO/BLT -1% Negative article on Iron Ore from McKinsey - nothing new.
SIERRA R. -5% FY revs and EBITDA well below expectations, production weak.
TUI 0% Inline FY update, Summer '16 bookings ahead


Mainfirst:
*DBK-Loses core business market share says Boersen.................-0.5%
*ROCHE-To initiate testing for Zika Virus at US Blood Centres......U/C
*NEMETSCHEK-2016 Ebitda 77-80m(80.4),Rev 319-325m(320.6)-inline....+2%
*ORANGE/BOUYGUES-Sets Sunday deadline for talks,ORA BD meet 3/4....-2%
*EURAZEO-To buy brands from Mondelez for €250mln - Les Echos.......+0.5%
*NOVARTIS-2016 Group outlook reiterated,no change to 2015..........+0.25%
*WENDEL-FY Rev 7.87b(7.657),Net -146m,Div €2.15,13/17 tgts met.....+1%
*MAERSK-Terminal Unit to invest €758mln inb New Morocco Facility...U/C
*VESTAS-Says it will defend its market position from Chinese.......+0.5%
*ACS-Sues Alstom for Industrial espionage in Israel-Expansion......U/C
*C/CLEAN-FY Rev 58.6m(59.53),Ebitda 45.7m(46),Ebit 23.7m(24.1).....-2%
*RIB-FY Sales 82.1m,Ebitda 25m,FY16 Ebitda 20-25m(25.8),Div 16c....-3%
*TUI-Reits FY o/lk for Underlying Ebita Grth,Summer 47% sold.......+2%
*CARREFOUR-Diniz considering bossting his stake in Carrefour.......U/C

>>> What to look at today - 31st of March 2016

Dow+0.47% S&P+0.44% Nasdaq+0.47% Russell+0.12%
US Market closed higher. Equity indices opened their day sharply above their flat lines as global bourses rallied in response to yesterday's dovish remarks from Fed Chair Yellen. Ms. Yellen's cautious tone boosted risk appetite overseas and at home as she advocated a more gradual path to interest rate normalization. Furthermore, an early rally in crude oil worked to buttress the opening move higher. WTI crude was able to end its day in positive territory, settling up 0.2% at $32.86/bbl. the heavily-weighted technology (+0.7%) and financial (+0.6%) sectors led while consumer discretionary (+0.6%) and materials (+0.5%) followed, countercyclical utilities (-0.2%), health care (-0.1%), and telecom services (UNCH) underperformed. volume were well below average at 700mil shares. US After Hours MU +1%, PRGS -10% following earnings MDVN +13.7% (headlines that they are attempting to defend themselves from takeover interest ), EGLE +9.3% on recap news. Asian equity markets are mixed as the risk-on rally fanned by dovish Fed chair Yellen remarks appears to have run its course. The focus is turning to monthly manufacturing PMI figures in tomorrow's session, followed by March non-farm payrolls report on Friday. BOJ Gov Kuroda reiterated central bank's intentions to bring inflation to a stable 2% target before easing off the accommodative stance. Kuroda added there was no evidence in the market about concern that investors see BOJ underwriting govt debt. In China, an influential former PBoC adviser Yu called for more aggressive fiscal response to slowing property investment. He said fiscal deficit target could be expanded to 5% from the current 3% to stimulate demand, since the anticipated 10% slide in real estate investment may shave off about 1% of overall GDP. Another report saw expectations of PBoC planning to offer loans targeted at boosting consumption with the focus on rural regions.

Nikkei +0.38% Hang Seng-0.21% Shanghai +0.33%

Eur$ 1.1323 CNH 6.4722 CNY 6.4661 JPY 112.27 GBP 1.4341 0.9655 RUB$ 68.24 WTI $37.87 (-1.17%)

S&P -0.13% EuroStoxx -0.45% Dax-0.35% SMI -0.30%


Macro :
Templeton’s Mobius to Pass on Responsibilities in End of Era
Gross’s Janus Fund Capping Its Best Quarter Since He Took Charge
U.S. Individual Investor Bulls Fall to Lowest Since Mid-Feb

Keep an eye on :
- ALV GY : Allianz Said to Plan $5b Insurance Portfolio Sale in Italy: Rtrs
- STS IM : Ansaldo STS Board Members Including CEO Submitted Resignation
- BLU IM : *BLUE NOTE SHARES SUSPENDED FROM TRADING INDEFINITELY: BORSA
- EN FP : Orange, Bouygues Talks Said Held Up on Deal Valuation: Echos
- EN FP : Orange, Bouygues to Extend Deal Talks Beyond March 31: Reuters http://reut.rs/1RMoRPb
- EN FP : Bouygues Sets Sunday Deadline for Orange Talks: Le Figaro
- CA FP : Billionaire Diniz Said Considering Boosting Carrefour Stake
- EDF FP : EDF union board rep to vote against Hinkley Point project - FT
- ENEL IM : Enel and F2i start talks over control of Metroweb - Il Sole 24 Ore
- EI FP : French Antitrust Head Says No Conflict of Interest on Essilor
- RF FP : Eurazeo to Buy Brands From Mondelez for EU250m, Les Echos Says
- HYDR LI : RusHydro: energy ministry proposes reducing size of additional share issue - Vedosmonti
- KCR1V FH : Konecranes still has plenty of options for Terex; company could be split between Konecranes and Zoomlion - Kauppalehti
- MAU FP : Maurel & Prom 2015 Net Loss EU95m Vs Profit of EU13m
- MDLZ US : Eurazeo to Buy Brands From Mondelez for EU250m, Les Echos Says
- MDVN US : Medivation Said to Work With Advisers to Defend Against Takeover
- ORA FP : Orange, Bouygues Talks Said Held Up on Deal Valuation: Echos
- ORA FP : Orange, Bouygues to Extend Deal Talks Beyond March 31: Reuters http://reut.rs/1RMoRPb
- ORA FP : Bouygues Sets Sunday Deadline for Orange Talks: Le Figaro
- SU FP : Nest Said to Generate $340m in Sales in 2015: Re/code
- SQ US : Square Gains as Much as 10%; Mizuho Calls Co. Acquisition Target
- RNO FP : Renault-Nissan, Daimler Plan to Deepen Cooperation: Handelsblatt
- ROG VX : Roche to Start Testing for Zika Virus at U.S. Blood Centers
- SOLB BB : Solvay, Ineos Sign Binding Pact on Solvay’s Exit From Inovyn
- STL NO : Statoil Chairman Says ‘Right’ to Have Operations in Angola: DN
- UCG IM : UniCredit Assessing Whether to Delay Pop. Vicenza IPO, Cap Hike
- WBMD US : WebMD Added to S&P MidCap 400, SciClone to S&P SmallCap 600
- RF FP : Wendel Says Has Already Met 2013-2017 Targets

>>> Europe : Brokers Upgrades & Downgrades - 31st of March 2016

>>> Up
*ANTOFAGASTA RAISED TO BUY VS HOLD AT CANACCORD
*ARCELORMITTAL RAISED TO BUY VS HOLD AT BERENBERG
*BALL CORP. RAISED TO OVERWEIGHT AT JPMORGAN
*TALANX RAISED TO BUY AT SOCIETE GENERALE

>>> Down
*PEKAO CUT TO SELL VS BUY AT CITI
*WILLIAM HILL CUT TO UNDERPERFORM AT JEFFERIES

>>> PT Change


>>> Initiation
*COUNTRYSIDE PROPERTIES RATED NEW BUY AT PEEL HUNT, PT 290P
*HAMMERSON RATED NEW OUTPERFORM AT CREDIT SUISSE; PT 630P
*INTESA RATED NEW BUY AT UBS; PT EU2.85
*INTU PROPERTIES RATED NEW UNDERPERFORM AT CREDIT SUISSE, PT SET AT 300P
*KLEPIERRE RATED NEW OUTPERFORM AT CREDIT SUISSE; PT EU46.60
*UNIBAIL RATED NEW NEUTRAL AT CREDIT SUISSE; PT EU252.80
*UNICREDIT RATED NEW NEUTRAL AT UBS; PT EU3.7

>>> Call
>> Stock
*KINGFISHER ADDED TO EUROPE FOCUS LIST AT CREDIT SUISSE

>>> Starwood seen demanding 10-digit reverse termination fee...according to sour

MergerMArket

Starwood seen demanding 10-digit reverse termination fee, attorneys say
* Multiple signoffs needed in China
* Fee must account for Marriott loss, regulatory risk

Anbang Insurance may have to offer Starwood Hotels & Resorts Worldwide (NYSE:HOT) a reverse termination fee of more than USD 1bn to cover regulatory risks, according to two industry attorneys.

Earlier this week, the Beijing-based group raised its takeover bid to nearly USD 14bn in cash for the Stamford, Connecticut-based hotel operator. The bid again trumped Marriott International's (NASDAQ:MAR) sweetened USD 13.6bn cash-and-stock offer. If Starwood abandons its signed deal with Marriott, it must pay a USD 450m termination fee, along with additional expenses.

Starwood said on Monday that it is discussing "non-price terms" with Anbang and working to finalize a binding agreement. It cautioned that it may not reach a final agreement that is superior to the Marriott deal.

Anbang’s proposed acquisition would require regulatory approvals from Chinese regulatory agencies, including the National Development and Reform Commission (NDRC) and the Chinese Insurance Regulatory Commission (CIRC), said a person familiar with the matter. In America, Anbang would need approval from the Committee on Foreign Investment in the US (CFIUS), the person said.

Marriott has said it stands by its offer and that Starwood shareholders should give “serious consideration” to Anbang’s ability to close its deal, particularly around financing and timing of regulatory reviews.

To assuage potential concerns about that regulatory exposure and to cover the costs of walking away from Marriott, Anbang would likely need to stipulate in its Starwood merger agreement a significant reverse termination fee, according to three industry attorneys. Two of these attorneys said the value of the fee would likely have to exceed USD 1bn, and potentially surpass USD 1.5bn.

These fees have proven to be a thorny issue in cross-border M&A negotiations. On Monday, California biotech firm Affymetrix (NASDAQ:AFFX) rejected an interloper bid from a China-backed group in part over disagreements about the size and structure of the fee along with financing risk.

Attorneys said Starwood will look to secure a reverse termination fee that covers several risks.

The first is that Starwood would terminate a “sure thing” merger with Marriott, said the first attorney, who practices corporate law and has experience in the hotel industry. Marriott has secured American and Canadian competition approvals and had planned to shortly hold shareholder votes before Anbang’s interloper offer earlier this month.

The fee would also have to cover the expense of terminating the Marriott transaction and the significant harm Starwood would face from a strategic perspective should the sale fall through, the first attorney said. There would be “no assurance that Marriott would come back,” the attorney said.

Anbang has launched an aggressive acquisition spree in the past few years to acquire financial and real-estate assets around the world. That has raised concerns about its ability to continue making deals and securing approvals from Chinese regulators.

The Chinese insurance industry is heavily regulated, said the second antitrust attorney, who practices antitrust law and has experience in China mergers. There are “strict limits” on Chinese companies acquiring foreign assets and the CIRC would need to sign off on a USD 14bn acquisition, the attorney said.

Chinese law limits insurance companies from investing more than 15% of their assets abroad, the third attorney said. If that threshold is breached, CIRC can impose sanctions, said the attorney, who was unaware of any precedents for such sanctions.

Anbang’s elusive Chairman Wu Xiaohui recently said Anbang’s assets exceed USD 154.39bn and allow for foreign investments such as the Starwood acquisition, according to Chinese news service Caixin. In an SEC filing connected to Anbang’s proposed acquisition of US insurer Fidelity & Guaranty Life (NYSE:FGL), Anbang is reported to have more than USD 140bn in total assets.

Earlier this month, Caixin reported that the CIRC disapproved of Anbang’s separate bids to acquire Starwood and USD 6.5bn in luxury hotel real-estate assets from the Blackstone Group (NYSE:BX). Citing a person close to the regulator, Caixin reported that the two hotel deals would cause Anbang to breach the 15% threshold.

In China, regulated businesses such as insurance companies “cannot do anything past the permitted, totally allowable procedures,” the second attorney said. If an insurance company exceeds the preapproved foreign investment level, it either needs to get approval from the regulator each time it moves beyond the threshold, or it needs to get a type of extension from the regulator, the attorney said.

Anbang could have already received approval for such an extension, as the company has engaged in multiple rounds of bids against Marriott, the second attorney said. The question is the limit of that extension. If the price of Starwood keeps increasing via rival bids, Anbang might have to go back to the regulator about the extension and could then be rejected, the attorney added.

“They absolutely need approval to do the investment at this point,” the second attorney said. “I don’t know what the number is. It could be USD 15bn, it could be USD 14bn, or it could be USD 18bn. But it’s a number, and they’re not just going to let Anbang buy Starwood no matter what.”

It is unclear whether Anbang’s bid for Starwood would require approval from the Ministry of Commerce (MOFCOM), the Chinese regulator responsible for administering and overseeing overseas investment.

The NDRC's review would take around a month to obtain, the third attorney said. Even with approval from NDRC, Anbang will still have to confront the insurance regulator. The CIRC’s reaction is “difficult to foresee” at this point, this attorney said.

The CIRC along with New York and Iowa insurance regulators have yet to sign off on the Fidelity & Guaranty deal, which carries no revese termination fee. Anbang has secured clearance from CFIUS for Fidelity & Guaranty and the purchase of real estate for the luxury Waldorf-Astoria hotel in New York.

All the three attorneys agreed that Anbang likely already has a degree of support from the Chinese government. If the government were to reject Anbang’s Starwood deal, it would represent a “significant loss of credibility” for Chinese companies in similar transactions, the first attorney said.

Regarding the reverse termination fee, Anbang could deposit the funds with a US escrow agent to further assure the seller, or Anbang could seek a letter of credit from a US or international bank that would be held by an escrow agent and then drawn on by Starwood if the deal were to fall apart, the first attorney said.

Anbang would likely be able to simply cut a check, as opposed to seeking a letter of credit, the second attorney said. Anbang likely has bank accounts in the US, as it bought the Waldorf-Astoria and did other US acquisitions, the attorney added.

In several cross-border transactions, US sellers have demanded foreign buyers place funds in escrow accounts for reverse termination fees. In some cases, only a portion of the fee has been moved into escrow or the amount has risen the longer a transaction remains outstanding.

Anbang declined to comment. Starwood did not return a request for comment.

>>> RusHydro: energy ministry proposes reducing size of additional share issue (

RusHydro: energy ministry proposes reducing size of additional share issue 

Russia’s Ministry of Energy proposes to reduce the size of the additional share issue of RusHydro, the state-controlled Russian hydropower company, reported Vedomosti.

The Russian daily cited Vyacheslav Kravchenko, Deputy Minister of Energy, as saying that the parameters of the additional share issue of RusHydro could be seriously reviewed.

The parametres of the additional share issue were determined last year, and its main objective is the repayment of debt of RusHydro’s subsidiary RAO Energy Systems of East, the article reported.

It has been assumed that RusHydro will conduct an additional share issue for RUB 154.7bn (USD 2.27bn). The paper reported that for its shares, RusHydro was expected to get the government’s shares in Far Eastern Energy Company and a 99.99% stake in state-owned Far Eastern Energy Management Company. RAO Energy Systems of East currently owns a 51.03% stake in Far Eastern Energy Company.

The paper reported that further 20% of RusHydro’s shares were to be acquired by state-run lender VTB, which was to sell them back to RusHydro in five years.

However, in mid-February, Russia’s Deputy Prime Minister Yuri Trutnev announced that property assets may be excluded from the transaction, Vedomosti reported.

The parametres of the deal with VTB may be also reviewed, as thanks to the optimization of RusHydro’s investment program, the amount of payment could be reduced, the paper noted, quoting Kravchenko.

According to a RusHydro spokesperson, the company is not inclined to link the sum planned to be received for the new shares with the change in the parameters of financing the investment programme, adding that the payment has been agreed by the government . The paper also reported that RusHydro’s investment program will be reduced by RUB 22bn this year, and that the final details will be disclosed later.

The article continued, citing Kravchenko, that various options to provide support to RAO Energy Systems of East are being considered, including the optimization of the investment program of parent company, and proceeds from the liberalization of the hydroelectric power market in Siberia.

Vedomosti

>>> Enel and F2i start talks over control of Metroweb - Il Sole 24 Ore

Enel and F2i start talks over control of Metroweb - Il Sole 24 Ore

Enel [BIT: ENEL], the Italian utilities group and F2i, the Italian infrastructure fund, have started talks over Metroweb, the Italian fibre optic operator, Italian language daily Il Sole 24 Ore reported.

The unsourced report said the talks are regarding Enel taking joint control of Metroweb with F2i.

The operation would see all of Metroweb and its subsidiaries transferred into a newco. Enel and F2i are now looking to appoint an advisor for the proposed deal, the article noted.

F2i currently controls 53.8% of Metroweb and the remainder is held by FSI, the investment fund controlled by CdP, the holding of the Italian Treasury, the item noted. The stakes of both companies would be reduced to allow the entry of Enel, which is looking at taking a 30%, it added.

Enel may take the stake in a consortium with a number of infrastructure funds that might also become shareholders in Metroweb, the report noted.

The item added that CdP is also likely to take direct control of the Metroweb stake in April. The purpose of the operation is to raise EUR 2.5bn to extend a fibre optic network to 250 towns and cities.

The article said F2i and FSI are being advised by Vitale & Co.

Il Sole 24 Ore