>>> What to look at today - 22nd of July 2015

Dow-1% S&P-0.42% Nasdaq-0.21% Russell-0.49% VIX 12.22
US MArket Closed lower. Tech was holding before AAPL earnings. United Technologies fell 7.1% after below-consensus revenue and lowered earnings guidance for the year overshadowed an earnings beat. the energy sector (+0.1%) tried to resist the market-wide pressure, but could only eke out a slim gain while crude oil rose 0.9% to $50.87/bbl. Also of note, the top-weighted technology sector (-0.5%) settled just behind the broader market. health care (-0.4%) and consumer staples (-0.3%) settled near the broader market while telecom services (-1.7%) and utilities (-1.0%) underperformed throughout the session. Apple beats by $0.04, reports revs in-line, misses iPhone estimates; guides Q4 revs below consensus, margins in-line, stock -6.8% after hours...FCC Poised to Approve AT&T's $49 Billion Acquisition of DirecTV...Volume in line with average at 700mil shares...US After Hours ISRG +11.7%, CMG +2.1%, GPRO +1.3%, AAPL -6.6%, MSFT -4%, YHOO -1.5% following earnings/guidance...Asian equity markets are broadly lower, tracking weakness in US indices along with disappointing set of earnings from some of the tech heavyweights afterhours. Shares of Apple and Microsoft were down 7% and 4% respectively, weighing on US futures. Front month S&P e-minis are down another 8pts or about 0.4% in electronic trade, while Dax, CAC, and FTSE futures are down about 0.2% heading toward European open. China Conference Board leading index showed another marginal increase, and resident economist noted growth continues to be driven by bank credit rather than stronger performance in the real economy, justifying "fragile" economic outlook. In that vein, China economist Ba Shusong warned annual GDP could slow to 6.0-6.5% in next 5 years, since the recent growth drivers of investment and exports were not sustainable. Ba further called for a more proactive fiscal policy approach.

Nikkei -1.02% Hang Seng -1.14% Shanghai -0.73%

Eur$ 1.0935 JPY 123.66 GBP 1.5568 EURCHF 1.0480 RUB $57.0250 WTI $50.19 (-1.32%)

S&P -0.39% EuroStoxx-0.25% Dax -0.34% SMI +0.01%


Macro :
- Goldman Raises 3-Mo. View on EU Stocks, Cuts View on U.S. Stocks


Keep an ey on :
- ABBN VX : ABB in Cevian’s Sights May Result in Push to Break Up: Real M&A
- ATLN VX : Actelion CEO seeks to defuse takeover talk - Reuters Link : http://reut.rs/1IjOCIa
- ADP FP : French Government to Sell Nice Airport Stake in 2016: Les Echos
- AFR LN : Afren Postpones EGM to Discuss Revised Restructuring Plan
- AIR FP : Airbus China Plant to Deliver A330 Jet in 2018: Xinhua
- AREVA FP : Areva Reactors Unit Now Valued at About EU2.7B, Figaro Says
- BAR BB : Barco 1H Adj. Ebitda EU40.5m; Doesn’t Compare With Est. EU57.9m
- BBVA SM : BBVA Chairman Tells AE He Will Gradually Scale Down Role
- BLT LN : As Commodity Rout Deepens, BHP Output Cuts Seen Flagging Bottom -->-1.55% in Australia
- BMPS IM : Speculation that top shareholders may not renew agreement with the company - Italian Press
- BT/ LN : Sky Tells Regulator BT Purchase of EE Would Hurt Competition
- AM FP : Dassault Aviation to Make Three Rafales a Month, La Tribune Says
- DECB BB : Deceuninck 1H Net EU4.75 Mln; Est. EU3.3 Mln; Confirms Forecast
- GET FP : Eurotunnel 2Q Rev. Rises 9% to EU343.9m vs EU316.2m Restated
- FCT IM : Fincantieri Order Book EU16b; Sees Margins Still Affected
- BAER VX : Julius Baer CEO Collardi Says Strong Franc May Fuel M&A: L’Agefi
- SDF GY : K+S rejects Potash Corp's new attempt at takeover talks - Reuters Link : http://reut.rs/1Mn6tih
- KNEBV FH : Toshiba Completes Sale of 24.2m Class-B Shares in Kone
- LONN VX : Lonza 1H Sales CHF1.91b, Est. CHF1.85b; Reiterates 2015 Outlook
- NOK1V FH : Nokia Said to Debut Virtual Reality Product Next Wk: Re/code
- RDSA NA : Royal Dutch Shell Cut to AA- From AA by S&P, Outlook Negative
- S32 LN : South32 Takes $1.3b Impairment Charge on Manganese Assets
- SSABA SS : SSAB 2Q Oper. Profit Ex-Items Misses Est.; Sales In Line
- SAP GY : SAP CFO Not Interested in Buybacks, FT Says
- SCHP VX : Schindler EGM Proposal Is Illegal, Swiss Takeover Board Says
- SIE GY : Siemens CEO Sees Big Health-Care, Infrastructure Demand in Iran
- SIK VX : Sika’s Urs Burkard Says Founding Family to Fulfill Contract: T-A
- LOCAL FP : Solocal Cuts 2015 Internet Growth Forecast; Net to Be Stable
- TEMN VX : Temenos 2Q Non-IFRS Rev. $132.4m vs Est. $128.2m
- TIE1V FH : Tieto 2Q Ebit Ex-Items Profit Beats Est.; Outlook Unchanged
- VATT SS : Vattenfall's sale of its German brown coal operations could be delayed -Dagens Industri

>>> Europe : Brokers Upgrades & DOwngrades - 22nd of July 2015

>>> Up
*ARYZTA RAISED TO BUY VS NEUTRAL AT GOLDMAN

*BOUYGUES RAISED TO BUY VS HOLD AT JEFFERIES
*HUGO BOSS RAISED TO OUTPERFORM AT RBC CAPITAL
*MITCHELLS & BUTLERS RAISED TO ADD VS HOLD AT NUMIS
*PREMIER OIL RAISED TO BUY VS ADD AT NUMIS
*TATE & LYLE RAISED TO NEUTRAL VS SELL AT GOLDMAN

>>> Down
*AUTOLIV CUT TO NEUTRAL VS BUY AT BOFA
*BANK OF IRELAND RAISED TO BUY VS NEUTRAL AT NOMURA
*BORDERS AND SOUTHERN CUT TO HOLD VS BUY AT NUMIS
*ENQUEST CUT TO ADD VS BUY AT NUMIS
*FAROE PETROLEUM CUT TO HOLD VS BUY AT NUMIS
*RENTOKIL CUT TO NEUTRAL VS OUTPERFORM AT CREDIT SUISSE
*SAIPEM CUT TO UNDERPERFORM VS NEUTRAL AT MEDIOBANCA
*SARTORIUS STEDIM BIOTECH CUT TO HOLD VS BUY AT SOCGEN
*STMICROELECTRONICS CUT TO NEUTRAL VS BUY AT CITI
*VALEO CUT TO UNDEPERFORM VS NEUTRAL AT BOFA

>>> PT Change


>>> Initiation
*AXIARE RATED NEW BUY AT CITI, PT EU13.90
*BENI STABILI RATED NEW NEUTRAL AT CITI, PT EU0.76
*BRITISH LAND RATED NEW BUY AT CITI, PT 1,096P
*CAIRN ENERGY RESUMED HOLD AT NUMIS, PT 175P
*CAPITAL & COUNTIES RATED NEW BUY AT CITI, PT 591P
*DEUTSCHE ANNINGTON RATED NEW BUY AT CITI, PT EU33.6
*DEUTSCHE WOHNEN RATED NEW BUY AT CITI, PT EU29.7
*DERWENT LONDON RATED NEW BUY AT CITI, PT 4,710P
*FONCIERE DES REGIONS RATED NEW NEUTRAL AT CITI, PT EU87.80
*GECINA RATED NEW NEUTRAL AT CITI, PT EU126
*GRAND CITY PROPERTIES RATED NEW BUY AT CITI, PT EU20.5
*GREAT PORTLAND ESTATES RATED NEW BUY AT CITI, PT 1,038P
*HAMMERSON RATED NEW BUY AT CITI, PT 800P
*ICADE RATED NEW BUY AT CITI, PT EU83.90
*INTU PROPERTIES RATED NEW BUY AT CITI, PT 395P
*KLEPIERRE RATED NEW SELL AT CITI, PT EU36.90
*LAND SECURITIES RATED NEW BUY AT CITI, PT 1,596P
*MERLIN ENTERTAINMENTS RATED NEW NEUTRAL AT UBS, PT 485P
*NATIXIS REINSTATED NEUTRAL AT CREDIT SUISSE, PT EU7.68
*QUINTAIN RATED NEW BUY AT CITI, PT 160P
*SEGRO RATED NEW BUY AT CITI, PT 524P
*SHAFTESBURY RATED NEW BUY AT CITI, PT 1,169P
*UNIBAIL-RODAMCO RATED NEW SELL AT CITI, PT EU200.3

>>> Call

Reuters - Actelion CEO seeks to defuse takeover talk


Actelion CEO seeks to defuse takeover talk Link : http://reut.rs/1IjOCIa

ZURICH, July 22 (Reuters) - Actelion Chief Executive Jean-Paul Clozel said he was determined to keep the Swiss biotech company independent, batting away speculation it could become the next takeover target for U.S. firms seeking lower taxes by relocating abroad.

Europe's biggest biotech company has been rumoured as a potential tax inversion target and its strong pipeline of drugs to treat pulmonary arterial hypertension (PAH) could also attract bidders.

Dublin-based Shire Plc last week became the latest drugmaker to be snapped up as part of this trend in a $55 billion deal with U.S. rival AbbVie Inc.
But Clozel, who co-founded Actelion in 1997, said Actelion would be better off as an independent concern, a view he said investors shared.

"Actelion - having a reasonable size, a culture of innovation and science - has the best chance to grow in a healthy way as an independent company and this benefits the shareholders," Clozel said in an interview.

"Our shareholders are really supporting us in the present situation."

Helvea analyst Olav Zilian said expectations of a tax-driven takeover were already priced into Actelion's shares, which have shot up 45 percent so far this year making it the best performer on the Swiss blue-chip index.

"If there's no bid, there will be pressure on the share price," said Zilian, who has a 'hold' rating on the company.
The shares were up 2.4 percent at 0921 GMT, giving the firm a market capitalisation of around 13.5 billion Swiss francs ($15.02 billion). The European healthcare sector was up 0.4 percent.

Zilian said Actelion's size could restrict the number of potential U.S. suitors since the value of the target company post-deal must be between 20 and 40 percent of the combined business to benefit from lower taxes.

He said U.S. biotechs Amgen and Gilead would be too large, while Celgene and Biogen Idec were very different businesses to Actelion and would be a poor fit.

Under pressure from the European Union, Switzerland is also reforming its corporate tax laws, which could act as a further deterrent to any potential bidders.
HEALTHY PIPELINE

While a tax inversion deal with a U.S. firm may be tricky to execute, traders said Actelion could be attractive to other European drugmakers looking to replenish their pipelines and pick up specialist expertise.

"Actelion is the answer to AstraZeneca's chronic pipeline shortage, GlaxoSmithKline's need for expansion and would be an easy morsel for Roche or Novartis to digest," Hobart Capital Markets trader Justin Haque said.

The Swiss biotech's prospects have brightened over the past year after it won approval in the United States and Europe for Opsumit, a treatment for PAH which is a follow-on to its current flagship product, Tracleer.

A strong launch of Opsumit, which beat expectations with sales of 38 million francs in the second quarter, has reassured investors that the company's sales and growth prospects are intact, despite the loss of exclusivity on Tracleer from 2015.

"We are really very confident that Opsumit is not only going to be replacing but also topping Tracleer, but we must not be too impatient, it will take time," Clozel said.

Buoyed by Opsumit's launch, Actelion raised its full-year outlook and now expects core earnings growth in at least a mid-teens percentage range in 2014. In February, it expected low single-digit percentage growth.

Core earnings rose to 233 million Swiss francs in the second quarter, lifted by strong product sales and rebate reversals and well ahead of the 171 million average forecast in a Reuters poll.

Strong data from another PAH drug called Selexipag in June have also boosted optimism about further earnings. Clozel said Actelion hoped to file the drug for approval with regulators at the end of this year or the start of next.

>>> Asian Update

Asian Mid-session Update: AUD sinks as RBA Gov Stevens keeps the door open for more easing; Post-earnings weakness in US techs weighs on futures


***Economic Data***
- (AU) AUSTRALIA Q2 CONSUMER PRICES (CPI) Q/Q: 0.7% (6-quarter high) V 0.8%E; Y/Y: 1.5% V 1.7%E; TRIMMED MEAN Q/Q: 0.6% V 0.6%E ; Y/Y: 2.2% V 2.3%E
- (AU) AUSTRALIA JUNE WESTPAC LEADING INDEX M/M: 0.0% V -0.1% PRIOR
- (AU) AUSTRALIA JUN SKILLED VACANCIES M/M: -0.9% V -1.1% PRIOR
- (CN) CHINA JUN CONFERENCE BOARD LEADING ECONOMIC INDEX M/M: 1.0% v 1.1% prior

***Index Snapshot (as of 03:30 GMT)***
- Nikkei225 -1.3%, S&P/ASX -1.1%, Kospi -1.1%, Shanghai Composite -0.4%, Hang Seng -1.0%, Sept S&P500 -0.4% at 2,106

***Commodities/Fixed Income***
- Aug gold -0.8% at $1,094/oz, Sept crude oil -1.4% at $50.15/brl, Sept copper -0.2% at $2.47/lb
- (US) API Petroleum Inventories: Crude +2.3M v -1.5Me (first build in 3 weeks; Largest build in nearly 3 months)
- GLD: SPDR Gold Trust ETF daily holdings fall 4.8 tonnes to 689.7 tonnes; lowest since Sept 2008
- GLD: Aug Gold contract extending decline to $1,092; down 1% in electronic trade
- JGB: (JP) Japan's MoF sells ¥1.09T in 1.3% (1.3% prior) 20-year JGBs; Avg yield: 1.188% v 1.293% prior; bid-to-cover: 3.09x (multi-month high) v 2.56x prior

***Market Focal Points/FX***
- Asian equity markets are broadly lower, tracking weakness in US indices along with disappointing set of earnings from some of the tech heavyweights afterhours. Shares of Apple and Microsoft were down 7% and 4% respectively, weighing on US futures. Front month S&P e-minis are down another 8pts or about 0.4% in electronic trade, while Dax, CAC, and FTSE futures are down about 0.2% heading toward European open.

- China Conference Board leading index showed another marginal increase, and resident economist noted growth continues to be driven by bank credit rather than stronger performance in the real economy, justifying "fragile" economic outlook. In that vein, China economist Ba Shusong warned annual GDP could slow to 6.0-6.5% in next 5 years, since the recent growth drivers of investment and exports were not sustainable. Ba further called for a more proactive fiscal policy approach.

- AUD/USD was the most volatile among USD majors, sinking as low as $0.7370 on RBA Gov Stevens comments leaving the door open to more easing. Speaking at Anika Foundation Luncheon, Stevens also said AUD adjustment is occurring with expansionary effect, endorsing "somewhat lower exchange rate was likely to be a part of the necessary adjustment." On China, Stevens said property market outlook and the broader financial sector are likely to be more important. In terms of longer term policy expectations, Stevens also said neutral rates are lower than in the past and will be so for some time. Also of note in Australia, Q2 CPI was largely in line with expectations and generated little reaction in the exchange rate. AMP economists did note the sub-2% headline inflation could potentially further justify more easing.

- BHP Billiton reported mixed quarterly output data for Q4, and shares were down about 1.5% in late session. Q4 iron ore output of 60M tons was up from 59.0M q/q and 14% y/y. Copper output fell 1%, Aluminum down 67%, and energy coal was down 5%. For the year, 2015 iron ore was at 233Mt, above 230Mt prior forecast, while FY16 target was set at a more ambitious 247Mt. Copper production was in line with prior guidance of 1.7M, though FY16 forecast was set lower at 1.5Mt.

- Going into tomorrow's RBNZ decision, NZIER Shadow Board recommended not to cut rates too aggressively, calling for a 25bp move even as a 50bp move was discussed. NZD/USD was down about 30pips, falling to $0.66 level. BNZ also lowered its outlook for dairy payout prices, joining other economists who had similar reaction to the latest disappointing auction results in recent sessions.

***Equities***
US equities / ADRs:
- ISRG: Reports Q2 $4.57 v $3.98e, R$586M v $568Me; +12.5% afterhours
- NUAN: Guides Q3 higher $0.31-0.32 v $0.27e; R$485-489M v $475Me (prior $0.25-0.29; R$468-482M); Name Dan Tempesta CFO; +4.1% afterhours
- CMG: Reports Q2 $4.45 v $4.41e, R$1.20B v $1.22Be; authorized repurchases of common stock up to $100M (0.5% of market cap); +2.2% afterhours
- GPRO: Reports Q2 $0.35 v $0.25e, R$420M v $395Me; Guides Q3 $0.29-0.32 v 0.23e, R$430-445M v $404Me; +1.4% afterhours
- VMW: Reports Q2 $0.93 v $0.91e, R$1.52B v $1.59Be; +0.7% afterhours
- YHOO: Reports Q2 $0.16 v $0.18e, R$1.04B ex tac v $1.03Be; Guides Q3 op income $50-90M, Rev $1.0-1.04B (ex-TAC) v $1.06Be; -1.8% afterhours
- MSFT: Reports Q4 adj $0.62* (ex $1.02 in charges) v $0.56e, R$22.2B v $22.0Be; -4.0 afterhours
- LLTC: Reports Q4 $0.54 v $0.56e, R$379.5M v $385Me; -5.6% afterhours
- AAPL: Reports Q3 $1.85 v $1.80e, R$49.6B v $49.1Be; -6.9% afterhours
- ILMN: Reports Q2 $0.80 v $0.78e, R$539M v $543Me; -9.5% afterhours

Notable movers by sector:
- Consumer discretionary: SA SA International Holdings 178.HK -3.8% (Q1 result); Wumart Stores Inc 1025.HK -3.7% (H1 result); Anhui Jianghuai Automobile Co L 600418.CN +10.0% (private placement)
- Financials: Guotai Junan International Holdings 601211.CN +1.2% (H1 result); Gemdale Properties and Investment Corp 535.HK +2.2% (H1 guidance); Evergrande Real Estate Group 3333.HK +0.4% (unit filed for listing); SooChow Securities 601555.CN +2.8% (H1 result); Haitong Securities 6837.HK -1.7% (proposes employee stock ownership plan)
- Industrials: Boral Ltd BLD.AU +1.3% (FY15 guidance); Mitsui Chemical 4183.JP +9.6% (raises H1 guidance)
- Technology: ZTE Corp 763.HK +1.1% (H1 result); Asahi Glass Co 5201.JP +1.5% (Raises FY15/16 guidance)
- Materials: China Coal Energy 1898.HK -1.3% (June result); Energy Resources of Australia ERA.AU +1.4% (to write down deferred tax assets); Silver Lake Resources SLR.AU +7.1% (Q4 result); Saracen Mineral Holdings SAR.AU +2.7% (FY15 result); South32 S32.AU -1.0% (FY15 result); BHP Billiton BHP.AU -1.5% (Q4 result)
- Energy: China Petroleum & and Chemical Corp 386.HK -1.3% (H1 result); Datang International Power Generation 991.HK -1.7% (H1 power generation); Huadian Power International Corp 1071.HK -2.9% (H1 power generation); S-Oil Corp 010950.KR +1.3% (Q2 result)

>>> US After Hours Summary: ISRG +11.7%, CMG +2.1%, GPRO +1.3%, AAPL -

After Hours Summary: ISRG +11.7%, CMG +2.1%, GPRO +1.3%, AAPL -6.6%, MSFT -4%, YHOO -1.5% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: HUBG +13%, ISRG +11.7%, HAWK +4.3%, PKG +3.7%, NUAN +3.6%, IBKR +2.6%, MANH +2.2%, CMG +2.1%, IRBT +1.9%, VASC +1.5%, GPRO +1.3%, VMW +1%, CHFC +0.2%, ACE +0.1%

Companies trading higher in after hours in reaction to news: GLNG +4.1% (executed agreements for conversion of the 126,000 m(3) LNG carrier Gandria to a Golar floating liquefaction facility), PKG +3.7% (announced Board authorization for an additional $150 million to be added to the company's share repurchase authorization; co also reported earnings), PRKR +3.5% (co and RFMW signed a worldwide distribution agreement for ParkerVision products and services), STAY +3.5% (appointed Gerardo Lopez as CEO, effective August 24, 2015), DTV +1.1% (FCC Chairman issued statement; transaction with AT&T may be approved with conditions)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: ILMN -7.9%, EXPO -7.1%, AAPL -6.6%, LLTC -5.6%, MSFT -4%, YHOO -1.5%, FTI -1%, RNST -0.3%, FCB -0.2%

Companies trading lower in after hours in reaction to news: VDSI -9.7% (disclosed it recently become aware that certain of its products which were sold by a VASCO European subsidiary to a third-party distributor may have been resold by the distributor to parties in Iran; sales may be in violation of U.S. economic sanctions), EXEL +8.6% (to offer 20 mln shares of its common stock in an underwritten public offering), RDUS -6.0% (disclosed that the FDA denied its re-request for breakthrough therapy designation for abaloparatide-SC, including the 18-month top-line results of its ACTIVE trial), FXCM -3.9% (Board approved a 1-for-10 reverse split), FCSC -2.1% (commenced a public offering of common stock; size and price not disclosed), Z -2.0% (announced its Board has unanimously approved a stock dividend of non-voting Class C capital stock), DVAX -0.8% (announced a public offering of common stock; size and price not 

(BN) ABB in Cevian’s Sights May Result in Push to Break Up: Real M&A



ABB in Cevian’s Sights May Result in Push to Break Up: Real M&A
2015-07-21 22:05:34.848 GMT


(For a Real M&A column news alert: {SALT REALMNA <GO>}.)

By Alex Webb
(Bloomberg) -- ABB Ltd., formed in 1988 with the merger of
Swiss and Swedish industrial giants, may soon come under
pressure to split in two again.
Activist investor Cevian Capital AB has built a 5.1 percent
stake in ABB, making it the second-biggest shareholder in the
$48 billion company. That may be a prelude to pushing for a
breakup or other changes at the world’s largest maker of power
grids, according to a person familiar with Cevian’s plans, who
asked not to be identified discussing the Swedish investment
firm’s possible strategy.
With faster growth projected for ABB’s automation
operations and its power business facing decline, a split may
make sense, said William Mackie, a London-based analyst at
Kepler Chevreux. Automation specialists have an enterprise value
of about 2.3 times revenue, compared to a multiple of about 1
for power-equipment makers, according to Mathias Leijon, chief
investment officer at ABB shareholder Nordea Bank AB. ABB now is
valued at about 1.3 times its revenue in the past 12 months.
Cevian may decide just to push for cost cuts and improved
operational efficiency, according to someone who has worked with
Cevian in the past. ABB’s earnings before interest, taxes,
depreciation and amortization declined to 12 percent of revenue
last year from a high of 15.8 percent in 2011. Competitor
Rockwell Automation Inc.’s adjusted Ebitda last year was 21
percent of revenue, according to data compiled by Bloomberg.
“If we don’t see a margin progression towards 16 percent-
plus and a very prudent capital allocation, which drives cash
return, then I think one should be very open to the idea that
the structure is too complex,” said Nordea’s Leijon. Nordea is
the 10th-biggest ABB shareholder, according to data compiled by
Bloomberg. “If they don’t deliver that, then we believe there’s
probably a case to break up the company, and we should know that
within the next 18 to 24 months.”

Track Record

Sandra Wiesner, a spokeswoman for Zurich-based ABB,
declined to comment, as did a representative for Cevian. ABB
will report second-quarter earnings results on July 23.
Cevian pushed through a similar transformation at Metso
Oyj, the Finnish maker of rock crushers and mining equipment.
In 2013, Metso spun off its less profitable paper, pulp and
power unit, a move that was broadly welcomed by investors.
The Stockholm-based investor has a track record of buying
enough shares to earn a seat on the board, and has installed
managers at German steelmaker ThyssenKrupp AG and industrial
services specialist Bilfinger SE in the past year.

Laggard Stock

ABB shares have performed worse than any of the company’s
main peers during the past five years. The stock gained just 1.2
percent in that time, while Rockwell and Honeywell International
Inc. more than doubled. Siemens AG and General Electric Co. also
did better.
At ABB, “the power portfolio is low-growth and under
competitive pressures,” Kepler Cheuvreux’s Mackie said in a
phone interview. Significant parts of the automation business --
comprising businesses such as software, systems, drives, motors,
inverters and robotics -- should comfortably sustain 3 percent
to 5 percent growth and operating margins up to 20 percent over
the next decade, he added.
“Creating specialized companies could make sense,” said
Volker Stoll, an analyst at Landesbank Baden-Wuerttemberg in
Stuttgart, Germany. “A sum-of-the-parts valuation, particularly
when it comes to making strategic decisions, can be higher as
stand-alone businesses than as part of a bigger conglomerate.”

Wallenberg Stake

The January death of Peter Wallenberg might mean that the
appetite for transformational change is greater at Investor AB,
the largest ABB shareholder. The patriarch of the family, which
controls Investor, had helped establish ABB in 1988 by merging
Sweden’s ASEA with Switzerland’s Brown, Boveri & Cie.
Stefan Stern, a Stockholm-based spokesman for Investor AB,
declined to comment when asked about the firm’s stake in ABB.
“We prefer to discuss company strategy directly with
management than through the media,” he said in a telephone
interview.
An ABB breakup might allow Cevian to then push to combine
the automation business with ThyssenKrupp’s. The board of Kuka
AG, which competes with ABB in the robotics market, may also be
open to a merger, according to a person familiar with the German
company’s strategy. It might be difficult, though, to seal
antitrust approval for such a deal, said the person, who asked
not to be identified discussing possible deals.
A representative for ThyssenKrupp declined to comment, as
did a spokeswoman for Kuka.
Even if the two businesses split apart without any further
deals, operating as separate companies would allow them to
allocate capital more quickly and better react to competition,
according to Nordea’s Leijon. “The more focused you are, the
better it is,” he said.

For Related News and Information:
ABB Plans $4 Billion Buyback to Boost Underperforming Stock
ABB Beats Estimates as Power Systems Unit Returns to Profit
Peter Wallenberg Sr., Swedish Creator of Companies, Dies at 88
Cevian Builds ABB Stake to Become Second-Biggest Shareholder
Scrolling industry stories: NI INDUSTRIES <GO>
Real M&A columns: NI REALMNA <GO>
Bloomberg Intelligence, multi-industrials: BI MULTG <GO>
Top deal stories: DTOP <GO>

--With assistance from Aaron Kirchfeld in London.

To contact the reporter on this story:
Alex Webb in Munich at +49-89-24447-8802 or
awebb25@bloomberg.net
To contact the editors responsible for this story:
Beth Williams at +1-212-617-2307 or
bewilliams@bloomberg.net;
Simon Thiel at +44-20-3525-2814 or
sthiel1@bloomberg.net
Simon Thiel

>>> Notable after hours earnings movers: ISRG +8.7%, HUBG +5.7%, NUAN +3.6%, ILM

Notable after hours earnings movers: ISRG +8.7%, HUBG +5.7%, NUAN +3.6%, ILMN -9.5%, AAPL -6.4%, CMG -4.2%


>>> Companies trading higher after hours following earnings/guidance:
ISRG +8.7%, HUBG +5.7%, NUAN +3.6%, VASC +2.6%, MANH +1.9%, IRBT +1.8%, IBKR +1.6%, FTI +0.4%, CATY +0.4%, CHFC +0.2%, ACE +0.1%

>>> Companies trading lower after hours following earnings/guidance:
ILMN -9.5%, AAPL -6.4%, CMG -4.2%, MSFT -3.5%, GPRO -3.2%, ZIXI -3%, EXPO -2.7%, YHOO -2.2%, VMW -1.7%, FCB -0.2%

>>> Apple beats by $0.04, reports revs in-line, misses iPhone estimates; guides

--> AAPL -6.8% after hours


Apple beats by $0.04, reports revs in-line, misses iPhone estimates; guides Q4 revs below consensus, margins in-line

Reports Q3 (Jun) earnings of $1.85 per share, $0.04 better than the Capital IQ Consensus of $1.81; revenues rose 32.5% year/year to $49.6 bln vs the $49.39 bln consensus.
iPhones 47.5 mln vs ~48 mln ests vs 35.2 mln last year
iPads 10.9 mln vs ~10.8 mln ests vs 13.3 mln last year
Macs 4.8 mln vs ~4.7 mln ests vs ~4.4 mln last year
Watches (not disclosed, as expected) ests 4.1 mln
AAPL sees Q4 gross margins of 38.5-39.5% vs ~39% ests vs 38% last year.
Q3 gross margins of 39.7% vs ~39.5% ests (guidance 38.5-39.5% vs 39.4% last year).
Co issues downside guidance for Q4, sees Q4 revs of $49-51 bln vs. $51.03 bln Capital IQ Consensus; gross margin 38.5-39.5% vs. ~39% ests.

Reuters - K+S rejects Potash Corp's new attempt at takeover talks

K+S rejects Potash Corp's new attempt at takeover talks

FRANKFURT, July 21 (Reuters) - Salt and fertilizer group K+S has rejected a new attempt by Canada's Potash Corp to entice the German company into takeover talks, a K+S spokesman said on Tuesday.

K+S earlier this month rebuffed Potash Corp's 7.9 billion euros ($8.65 billion) proposed bid of 41 euros per share as too low and suggested the suitor was planning to shrink the company.

A K+S spokesman said Potash Corp Chief Executive Jochen Tilk had met the state premier of the German regional state of Hesse - where K+S is headquartered - and had handed over documents about Potash Corp's plans to preserve jobs after a takeover. K+S was also given the documents.

"We've looked into these statements and concluded that they contain nothing substantial beyond what we had already been given in writing. That's why we still see no basis for talks," the spokesman said.

A Hesse government spokesman confirmed the meeting had taken place at the request of Potash Corp but declined to comment further. State premier Volker Bouffier has said he would fight to preserve K+S's German sites.

A Germany-based spokesman for Potash Corp said the company had in the meetings laid out the advantages of a tie-up for K+S and Potash, while trying to allay the state of Hesse's concerns.

K+S has suggested that about 40 percent of its German operations were at risk because Potash has more cost effective idle capacity in Canada.

Analysts and investors say this is an exaggeration, citing prohibitive shipping costs from Potash Corp's main hub in Saskatchewan to Europe.

Potash Corp previously committed funds to boost its annual capacity to more than 17 million tonnes over the next few years, up from almost 11 million tonnes in 2015, but it is now reining in production amid a boost in supply from major rivals Uralkali and Belaruskali, who stopped collaborating two years ago.