(BFW) Qatar, Kuwait Funds May Take Part in Saipem Cap Hike: Giornale

BN 06/10 05:44 *QATAR, KUWAIT FUNDS MAY TAKE PART IN SAIPEM CAP HIKE: GIORNALE
Qatar, Kuwait Funds May Take Part in Saipem Cap Hike: Giornale
2015-06-10 06:26:18.32 GMT


By Chiara Vasarri
(Bloomberg) -- Il Giornale reports, citing unnamed person
familiar with talks.

* NOTE: June 9, FSI May Buy 20% Stake in Saipem From Eni,
Invest Up to EU1b: MF Link

Link to Company News:{ENI IM <Equity> CN <GO>}
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To contact the reporter on this story:
Chiara Vasarri in Rome at +39-06-4520-6325 or
cvasarri@bloomberg.net

To contact the editor responsible for this story:
Jerrold Colten at +39-02-8064-4261 or
jcolten@bloomberg.net

(GS) Europe - Telecom Service conf (ALtice, Liberty Global, Com Hem, Telenet,

* Altice (CL Buy): Upbeat on US & PT cost cutting, M&A options
Altice’s CFO gave new granular detail on the material opportunities for cost
reduction in US cable and at Portugal Telecom; the US adds both
diversification and an attractive source of M&A potential. European M&A
optionality remains substantial, including in France, where the
government/spectrum auction are not seen as obstacles to potential inmarket
consolidation.

* Liberty Global (Buy): Growth accelerating, mobile M&A optionality
LBTY’s CFO highlighted scope for accelerating mid-term OCF growth
driven by price take, network expansion, SME/SOHO, mobile and Liberty
3.0, a new strategy to exploit scale efficiencies. Given expected ongoing
secure supply of MVNO capacity, there is no imperative to buy mobile
assets, although at the right price this could be an attractive option.

* Com Hem (Buy): Confident as customer perception improves
CEO Anders Nilsson has "never been as confident" in 2015 growth
guidance (which implies a material recovery in 2H15 revenue growth). He
laid out how mid-single digit growth is sustainable in the longer-term and
can support shareholder returns of c.10% mkt cap in perpetuity. Com Hem
has structural quality and growth in line with cable peers plus higher M&A
optionality, but trades at a 30% discount to peers on 6.8% 2016E FCF yield.

* Tele Columbus (Buy): Highlighting growth and M&A opportunity
Tele Columbus’ CFO reiterated the company’s growth opportunity driven
by its planned network migrations and upselling, while also highlighting
attractive synergies that could be realized from potential consolidation with
large and small peers. This view was supported by the CFO of Primacom
(NC), who also laid out an attractive roadmap for Level 4 cable growth.

* Telenet (NR) BASE secures mobile future, open to cable M&A
Telenet’s acquisition of BASE reflected the increasing importance of mobile
to the business and, in its view, the attractive price at which it was able to
buy the asset (5.0x EV/EBITDA incl. synergies). Telenet continues to see
themselves as the natural consolidators of Belgian cable, and remain open
to further cable M&A in the near term if assets become available.

* NOS (Neutral): Returning to growth in a more rational market
Improving macro and potentially more rational pricing environment.

(BofA-ML) European Media Conf Feedback Top Picks Havas & WPP

Advertising trends
Advertising growth in Europe remains patchy. The UK remains strong and GroupM
suggests upside risk for TV giving us confidence in our above consensus forecasts
for ITV (NAR +5.5% FY15). Prosieben’s outlook for the German TV market is
unchanged (2-3%). While growth remains aneamic the ad agencies suggested there
are some signs of increased confidence in France & outdoor has seen a return to
+ve growth after losing share in Q1. Italy is mixed with JCD noting better trends but
Mediaset seeing little change (with 2Q muted but better than 1Q). The agencies
believe recovery in Spain is sustainable and Atresmedia continues to guide to TV
market growth of 7-10% in FY15 but the TV market is expected to slow in 2Q (5-6%)
given tough sports comps (particularly for Mediaset Espana). However, it is notable
that this is the first time since the financial crisis that Group M has not seen
pressure on FY European ad forecasts as it approaches the mid-point of the year.

Key theme: agency reviews – WPP / Havas preferred picks
The agencies suggested that the key driver of the unprecedented number of media
pitches (in the US) was clients ensuring they are getting the best expertise as they
migrate to digital, rather than procurement pressures. WPP described the c$30bn of
billings that are up for grabs as a "once in a life time opportunity" as it is the incumbent in
less than half. Both WPP and Havas are underweight in the US and see pitches as a net
opportunity vs a net risk for Publicis. Preparing for pitches will incur some additional cost
although WPP / Havas were confident that they could still expand margins 30bps this
year and Publicis said it could absorb the costs albeit with margins falling due to the
integration of Sapient. The risk is that re-pitching could be a drag on industry margins
next year for both those losing accounts (with the time it takes to right size variable
costs), for those retaining business should they sacrifice margin to do so and those
winning business given start up costs. We have a Buy rating on WPP, which is less
expensive than peers trading on just 12.7x 2016E PE after adjusting for tech
stakes/dividends. WPP is “best-of-breed” in our view and differentiated by its scale,
geographic mix, digital assets / Xaxis and its investment in data & technology. We are
Buyers of Havas (14.3x 2016 PE post dividend) which is seeing the best organic growth
driven by new business and has the greatest exposure to a European recovery. We are
Neutral on Publicis (13.2x 2016E PE post dividend) given Sapient integration risks and
net risks from re-pitching.

Other picks
Pro7 – where we see scope for earnings upgrades from Q4 ad share gains in, exits
& M&A, & upside from internet optionality, HD & Maxdome. Mediaset – a free
option on an ad recovery (even if it is proving elusive) & potential for a pay TV deal.
JCDecaux – structural growth, European recovery play with small cell upside.
Vivendi – where we see substantial upside from music. 
ITV - good momentum,
cheap play on content / retrans . Informa – least expensive stock in the sector with
potential for perception change as it continues to turn around Business Intelligence.

(Kepler-Cheuvreux) Alcatel-Lucent : Will the merger between Nokia and Alcatel-Lu

Will the merger between Nokia and Alcatel-Lucent create value?
In the past, big mergers in the telecom equipment sector have been extremely painful. Nokia and Siemens took five years to fully turn around, and Alcatel-Lucent should finally do so by year-end, after nine years of intense restructuring. The groups struggled with cultural and product integrations, while management leadership (particularly at Alcatel-Lucent) was unclear in the initial phases of the mergers. Despite strong deal rationale and large potential value creation in the medium term, both stocks have been under pressure since the deal was announced, as investors fear a long, difficult and uncertain integration process and question the potential value creation over the medium term.

Yes, we see strong value creation mid-term with 40% upside ahead
We believe the merger between Nokia and Alcatel-Lucent makes a lot of strategic sense, because: 1) the new group will be uniquely positioned to address operators’ fixed-to-mobile convergence strategy (leading market position in wireless access, IP routing, optics, FTTH, virtualisation, services); 2) it will benefit from a larger scale effect and a more diversified presence; and 3) the EUR900m synergy target looks credible. Contrary to past mega-mergers in the sector, execution risk looks relatively low, as product overlap remains limited (only affecting a few clients in wireless access), the two groups now have lean cost structures and Nokia’s management is taking a clear leadership role in the group, with its strong record of integration and execution. Overall, we believe the merger could create significant value for shareholders in the medium term, with a fair value of over EUR12 per share by 2019E (90% upside) and EUR9 now (40% upside). We have Buy ratings on both Alcatel-Lucent and Nokia, but Alcatel-Lucent remains our preference for playing the merger.

>>> Europe : Brokers Upgrades & Downgrades - 10th of June 2015

>>> Up
*CAIRN ENERGY RAISED TO BUY VS NEUTRAL AT CITI
*MEYER BURGER RAISED TO OUTPERFORM FROM UNDERPERFORM AT WOLFE
*SBERBANK RAISED TO BUY VS HOLD AT HSBC
*VOPAK RAISED TO BUY VS NEUTRAL AT UBS
*WASHTEC RAISED TO BUY VS HOLD AT HSBC

>>> Down
*TAYLOR WIMPEY CUT TO SELL VS NEUTRAL AT CITI

>>> PT Change


>>> Initiation
*SAVE RATED NEW NEUTRAL AT MEDIOBANCA; PT EU13.4
*ULTRA ELECTRONICS RESUMED NEUTRAL AT JPMORGAN, PT 1965P

>>> Call
>> Stock
*ALCATEL_LUCENT REITERATE BUY AT KEPLER CHEUVREUX - NOTE ATTACHED

>>> What to look at today - 10th of June 2015

Dow-0.01% S&P+0.04% Nasdaq-0.15% Russell-0.32%
US Market closed near their flat lines, didn't manage to close above its 100d MA. Equity indices slumped at the start with investor sentiment pressured by the continued lack of progress between Greece and its creditors. The ongoing uncertainty weighed on European markets, but they were able to climb off their lows into the close. Meanwhile, U.S. stocks hit their lows not long before Europe closed for the day before returning to their flat lines. LULU +11% after ERN. Energy sector finish unch., which retreated from its opening high even as crude oil spiked 3.4% to $60.12/bbl. Volume were below average with 700mil shares. US After Hours SURG +7.5%, OXM +7.4%, SIGM +5.8%, LMNR -1.8%, MFRM -0.8%, URBN -0.2% following earnings/guidance...Shanghai Composite plummeted by 2% in the opening minutes after MSCI deferred on including the A-Shares in its emerging market index. MSCI added the mainland shares may still be included as soon as a "few important remaining issues" of market accessibility are resolved, remaining on 2016 review list for potential inclusion. MSCI will also continue to work with CSRC on resolving those issues. Shanghai Composite entered its midday break well off the lows however, with technically key 5,000 level and 1-month low holding firm. Nikkei225 is up 0.35% returning from break, recovering some ground from steep losses in yesterday's session. BOJ Gov Kuroda reiterated the central bank is prepared to adjust policy as needed, and even though trends are improving they are still only halfway to reaching target. Kuroda did endorse the recent trend of weaker yen, noting FX trend has not had negative effects on overall economy thus far.

Nikkei +0.28% Hang Seng +0.23% Shanghai +0.20%

Eur$ 1.1298 JPY 12..69 GBP 1.5424 EURCHF 1.0505 RUB $55.4290 WTI $61.08 (+1.56%)

S&P +0.07% EuroStoxx -0.18% Dax -0.04% SMI-0.09%

Macro :
- Germany’s Gabriel Ready to Eliminate Climate Dues: Handelsblatt
- API Petroleum Inventories: Crude -6.7M v -2Me; Gasoline -3.9M v 0e; Distillate +0.04M v +1.5Me - Cushing inventory -0.95M --> +1.51%
- *GERMAN PARLIAMENT OPPOSITION AGAINST GREEK AID GROWS: BILD
- Bernstein Weighs Impact of Spike in Italy Sovr Yields on Banks
- MSCI Defers China Inclusion, Opts to Work With Regulator
- Sakakibara Says Japan Needs 20% Sales Tax to Avert Fiscal Crisis

Keep an eye on :
- AIR FP : Airbus-Safran JV Seen Buying 34% of Arianespace: Les Echos
- ALV GY : Allianz to Cut 28 of 88 Branches in Germany: Handelsblatt
- AF FP : Sabre Weakness on Air France-KLM Comments ‘Overreaction’: BofA
- AF FP : Air France Wants to Speed Up Union Talks on Cost Cuts: Echos
- AZN LN : Receptos turns down GBP 4.1bn offer from AstraZeneca; Gilead, Teva eye rival bids - independent
- CAP FP : Cap Gemini Completes Sale of New Shrs at EU75.50/Shr (EU500m Capital Increase for IGATE Deal)
- ALCLS FP : Cellectis reports Q1 adjusted EPS of EUR 0.23 per share vs EUR 0.00 in prior year, revs EUR 9.2 mln vs EUR 26.5 mln in prior year
- BN FP : Danone CEO Confident on Fresh Dairy Products, Le Figaro Says
- DTE GY : German Mobile Spectrum Auction Reaches EU2.9b After 95th Round
- DBD UD : Diebold Gains; In Talks With Wincor Nixdorf, FAZ Says
- DRI GY : Drillisch Sees Profit Margin Falling Due to Stores, Boersen Says
- ECP FP : EuropaCorp preparing stock exchange exit along with financial partner, Vivendi talks put on hold, Financial player will buy 34% shareholding which represents the current free-floating - La Lettre de L'Expansion
- EZJ LN : Emirates, EasyJet Discussing Possible Cooperation: Telegraaf
- FCA IM : Fiat Chrysler HR Executive Retires Ahead of UAW Talks:Free Press
- GWI1 GY : Gerry Weber Says FY Sales, Earnings Targets ‘No Longer Ensured’
- HEI GY : HeidelbergCement Seeks to Raise Oper. Ebitda to >EU4b by 2019
- HDD GY : Heidelberger Druck FY Sales In Line, FY Net Loss EU72m After-Tax
- ITX SM : Inditex 1Q Sales, Ebitda, Net Beat Ests.
- ITV LN : ITV Said Close to Buying U.K. Production Co. TwoFour: Guardian
- NOVN VX : Novartis Sees Sustained Secukinumab Efficacy in AS Patients
- POP IM : Popolare Di Milano Hires Citigroup, Lazard as Advisers
- ROG VX : Roche Says FDA Grants Breakthrough Status for Actemra
- RKET GY : Rocket’s CEO Samwer Eager for More M&A, Also in New Areas
- SAN FP : Regeneron/Sanofi’s PCSK9 Drug Wins FDA Panel’s Backing
- SOLB BB : Solvay Reaffirms 2016 Profit Goals on More Savings, Topping Est.
- FP FP : Total CEO Warns Alberta NDP Against Tax Hike: The Globe & Mail
- TRELB SS : Trelleborg CEO Plans to Make Acquisitions, Dagens Industri Says
- UNA NA : Unilever sees speculation of Colgate merger - FT
- WIN GY : Talks on Wincor Nixdorf Takeover by Diebold Have Begun, FAZ Says

>>> Arianespace 34% stake acquisition by Airbus and Safran to receive nod from F

Arianespace 34% stake acquisition by Airbus and Safran to receive nod from French government 

The French Prime Minister Manuel Valls is expected to green light the proposed acquisition of a 34% stake in satellite launch operator Arianespace by a joint venture (JV) between Dutch group Airbus and France's Safran, French daily Les Echos reported.

The report, which did not reveal its source of information, said the meeting to okay the deal will take place today Wednesday, adding that the vendor, state-owned CNCEs, could receive between EUR 100m and EUR 200m.

According to the report, the Airbus Safran Launchers (ASL) JV will hold 75% of Arianespace after the deal is completed.

The original article appeared in print; Page 13

Les Echos


Le Premier ministre valide mercredi, une étape importante pour Ariane 6.

Etape importante, ce mercredi, pour Ariane 6. Le projet de nouvelle génération du lanceur - crucial pour que l'Europe conserve son autonomie d'accès à l'espace autant que son leadership sur le marché des lancements de satellites de télécoms - est l'objet d'une réunion à Matignon à l'issue de laquelle Manuel Valls va, sauf énorme surprise, autoriser la cession des 34 % d'Arianespace détenus par le CNES au tandem Airbus-Safran. « Tous les clignotants sont au vert », confirmait-on mardi soir de sources proches du dossier. L'Etat devrait retirer entre 100 et 200 millions d'euros de la transaction, toujours selon nos informations.

Fixer un prix a demandé quelques efforts d'imagination à l'Agence des participations de l'Etat et aux deux industriels, tant Arianespace est une société un peu particulière. Chargée de commercialiser les tirs des trois lanceurs qu'elle exploite à Kourou - Ariane 5, Vega, et Soyouz - auprès des opérateurs de télécoms ou des agences spatiales, elle jouit d'une position de leader, en dehors du marché public américain fermé à toute concurrence étrangère. Son carnet de commandes est bien rempli, mais ses comptes ne sont équilibrés que grâce à des subventions des pays européens.

En clair, Ariane 5 est trop chère et aura de plus en plus de mal à tenir la route face à la concurrence, de l'américain SpaceX principalement. La société du milliardaire Elon Musk a d'ailleurs décidé de casser les prix encore un peu plus : elle proposerait actuellement aux opérateurs de mettre en orbite leurs petits satellites pour moins de 60 millions de dollars, là où Arianespace en facture environ 70. Pour les gros satellites, l'écart serait encore plus important : 85 millions contre 110 millions.

Tout l'enjeu d'Ariane 6 est là : concevoir un nouveau lanceur beaucoup plus compétitif. C'est ce qu'ont décidé les Etats qui financent la fusée, lors du dernier conseil ministériel de l'Agence spatiale européenne, en décembre dernier à Luxembourg, avec un objectif très serré : premier tir en 2020. Il n'y a pas de temps à perdre et c'est là que le transfert des parts du CNES joue tout son rôle.

Une étape importante

Airbus et Safran, qui à eux deux représentent 70 % de la valeur d'Ariane, sont prêts à s'engager sur des coûts et des délais, mais à condition que la gouvernance de la filière soit simplifiée. En clair, qu'on les laisse travailler comme ils veulent. Avec la bénédiction de l'Elysée, les deux industriels ont donné un coup de pied dans la fourmilière, il y a un an, en annonçant le rapprochement de leurs activités de lanceurs spatiaux dans une coentreprise. Baptisée « Airbus Safran Launchers » (ASL), elle sera totalement constituée en octobre. Restait une étape importante : prendre le contrôle d'Arianespace pour assurer une meilleure continuité entre conception, production et commercialisation d'Ariane, en supprimant une série de niveaux de contrôle dévoreurs de temps, et donc d'argent. Avec les parts du CNES, qui s'ajoutent à celles qu'Airbus et Safran détenaient en propre, ASL détiendra 75 % d'Arianespace.

Pour emporter le morceau auprès du gouvernement, Airbus et Safran se seraient notamment engagés à ne pas toucher aux emplois. Ce qui n'empêchera pas Arianespace de continuer à réduire ses coûts, sans attendre Ariane 6.

>>> Receptos turns down GBP 4.1bn offer from AstraZeneca; Gilead, Teva eye rival

Receptos turns down GBP 4.1bn offer from AstraZeneca; Gilead, Teva eye rival bids

Receptos, the San Diego, California-headquartered drugs group, is believed to have turned down an approach from UK-based pharmaco AstraZeneca, The Independent reported. The market report, which cited unnamed sources, said London-listed AstraZeneca was offering USD 200 per share, or GBP 4.1bn (USD 6.3bn).

Nasdaq-quoted Receptos is believed to be waiting for a bid of USD 350 per share or more, the item reported. It noted that the company’s current stock price is USD 157.

The report went on to say that Nasdaq-listed Gilead Sciences of California and Israel-based Teva Pharmaceuticals are also hoping to acquire Receptos.

AstraZeneca declined to comment, the report said.

Independent

>>> EuropaCorp preparing stock exchange exit along with financial partner – repo

EuropaCorp preparing stock exchange exit along with financial partner 

EuropaCorp, the listed French independent film studio, is understood to be preparing its exit from the Paris stock exchange, newsletter La Lettre de L’Expansion reported.

The unsourced report said that shareholder Luc Besson and Christophe Lambert have appointed HSBC to advise on the matter and would retain a majority 54% stake in the business while a financial player could acquire a 34% shareholding, which represents the current free-floating.

According to the report, discussion held between EuropaCorp and Vivendi have been put on hold.

La Lettre de l'Expansion

(GS) - MSCI & A-shares


What's happened?

MSCI announced on June 9, 2015 ET (June 10 am HKT) that China A shares will not be included in the MSCI Emerging Markets Index as part of its 2015 Annual Market Classification Review.

At the same time, MSCI and the China Securities Regulatory Commission (CSRC) will form a working group to facilitate discussion and aim to resolve investors' concerns regarding investing in the A-share market, including quota allocation process, capital mobility restrictions and beneficial ownership of investments.

MSCI also stated that it may announce the decision to include China A-shares in the MSCI Emerging Markets Index as soon as the issues it has outlined are resolved and this may happen outside the regular schedule of its annual Market Classification Review.

It is a surprise?

No, in our view.

In our report China Strategy: The case for re-rating (Part 4): Index matters, April 29, we put a 50% probability for June 2015 inclusion. Additionally, our recent conversations with international investors also suggested that their expectations for June inclusion were low. Indeed, in early May, a MSCI spokesperson explicitly mentioned that MSCI may not adhere to its usual operating cycle for major index events (i.e. announcement in June and implementation in the following May) if they see significant changes in market conditions which warrant a more flexible, off-cycle approach. This suggested to us that the June inclusion wasn't a high probability event, but...

...4Q15 inclusion is still on the cards

Despite the favorable size (second largest globally), liquidity (most actively traded cash market globally), and policy (a number of key capital market liberalization measures have been made) arguments, one of the key obstacles going against the inclusion is that international investors can’t access Shenzhen-listed stocks, which represent 41% of total A-share market cap, in an open and unobstructed manner unless they are eligible for and granted (R)QFII quotas.

Our expectation is that the SZ-HK Connect scheme could be unveiled in the near future and could be up and running in 4Q15. If our expectations prevail, a key pre-requisite for A-share inclusion to global indices will be fulfilled, and could open a special review by the MSCI, in our view.

Additionally, we note a rising reception of embracing A shares by index compilers and investors. On May 26, FTSE announced the creation of 2 transitional (R)QFII Emerging Market indexes which aim to facilitate the potential inclusion of A shares to FTSE’s standard global indexes. On June 2, Vanguard announced that its EM ETF (VWO, AUM of US$67bn) will switch from FTSE Emerging to FTSE Emerging All Cap China A Inclusion Index where A shares represent 5.6% of index weight. According to FTSE, 'China' could potentially represent close to 60% of EM in FTSE on full A-share inclusion.

Bottom line: A question of when, not if. China could be 1/3 of EM and APJ investors' benchmark in 2 years

Instead of focusing on the exact timing of the inclusion, we believe it’s sensible for investors to take a medium-term view and understand how their benchmarks will evolve over time. Fast-forwarding to mid-2017, we estimate that 'China' could represent 1/3 of EM and APxJ investors’ benchmark by aggregating the current index cap of MSCI China constituents (i.e. H shares, Red Chips, and P Chips), the confirmed inclusion of overseas-listed Chinese companies in the US, and the potential announcement of A-share inclusion in the next 6 to 12 months assuming an initial inclusion factor (IF) of 10%.

Given our assessment that global investors by various mandates are still meaningfully underweight Chinese stocks, and the potential increases of China's index weight over the next 12 to 24 months, we continue to expect

strong passive flows into and active allocation/positioning normalization demand for Chinese equities
. See Asia-Pacific Strategy: Asia fund positioning: Funds still UW China post the rally, May 31.

 

 

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