(BFW) ECB Mulls Accepting More Greek Assets as Collateral: Kathimerini

BFW 05/20 05:36 *ECB MULLS ACCEPTING MORE GREEK ASSETS AS COLLATERAL:KATHIMERINI
BFW 05/20 05:36 *ECB MULLS RAISING HAIRCUT ON GREEK COLLATERAL: KATHIMERINI
ECB Mulls Accepting More Greek Assets as Collateral: Kathimerini
2015-05-20 05:41:54.796 GMT


By Nikos Chrysoloras
(Bloomberg) -- European Central Bank may “imminently”
raise discount it applies to collateral Greek banks pledge in
exchange for Emergency Liquidity Assistance, Kathimerini
newspaper reports, without citing anyone.
* ECB will, at the same time, expand pool of assets it accepts
as collateral from Greek banks
* Net effect of two simultaneous decisions on maximum
potential ELA for Greek banks will be neutral
* ECB riled by Greek Finance Minister Yanis Varoufakis’s talk
of country not meeting debt payments
* NOTE May 18: Greek Endgame Nears for Tsipras as Bank
Collateral Runs Dry Link


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>>> Asian Update

Asian Mid-session Update: Japan Q1 GDP tops estimates; PBY, TWC, UTX's Sikorsky rumored as takeover targets


***Economic Data***
- (JP) JAPAN Q1 PRELIMINARY GDP Q/Q: 0.6% V 0.4%E; ANNUALIZED GDP: 2.4% (1-year high) V 1.6%E
- (AU) AUSTRALIA MAY WESTPAC CONSUMER CONFIDENCE INDEX: M/M: +6.4% V -3.2% PRIOR; First rise in 3 months

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 +0.7%, S&P/ASX flat, Kospi +0.5%, Shanghai Composite +0.9%, Hang Seng -0.5%, Jun S&P500 flat at 2,123

***Commodities/Fixed Income***
- Jun gold +0.2% at $1,209/oz, Jul crude oil +0.9% at $58.50/brl, Jul copper flat at $2.84/lb
- (US) API Petroleum Inventories: Crude -5.2M (3rd straight draw) v -1.1Me; Gasoline -1.2M v +0.25Me
- (AU) Australia MoF (AOFM) sells A$700M 2026 Bonds; avg yield: 3.0561; bid-to-cover: 2.94x
- (JP) BOJ offers to buy ¥375B in 1-3yr JGBs, ¥375B in 3-5yr JGBs, ¥240B in 10-25yr JGBs, and ¥140B in JGBs with maturity over 25-yr

***Market Focal Points/FX***
- After emerging out of recession in Q4, Japan's Q1 GDP report was even more impressive, growing by its highest rate in a year on an annualized basis at 2.4% - well above consensus. Exports growth slowed to 2.4% from 3.2% and imports increased to 2.9% from 1.4% despite softer Yen and lower energy bill, but the rise in residential and corporate investment more than made up for those headwinds. The former increased by 1.8% after a 0.6% contraction in Q4, while the latter was up 0.4%, up from a flat print last quarter. Despite the strong results, Econ Min Amari warned to maintain vigilance against external risks and also prepare for Japan's recovery to be gradual. Nikkei rose nearly 1% into the morning break, while USD/JPY was up some 30 pips toward the ¥121 handle on risk-on flows.

- Shanghai Composite remained bid with another 1% rise headed into the break. Investors were again enthused by more reform announcemens, as the govt unveiled a "Made in China 2025" manufacturing blueprint with a focus on robotics, aerospace, new-energy and advanced transport. Also of note, Chinese press report noted Shanghai and Shenzhen new trading accounts were down 2.8% on the week, but actively traded accounts were up 4.5%.

- Ahead of the budget release later this week, NZD traded more subdued - NZD/USD consolidated some of the USD rally with a 30pip rise above 0.7370. Likewise, AUD/USD traded in a narrow 30pip range above 0.79 despite the strong rise in Westpac consumer confidence index. Resident economist said this rise was particularly notable since May release normally sees a fall due to the timing of the budget announcement. Westpac's Evans added "The surge in the Index this year represents the first time we have had a strong result in May since 2007... Whilst undoubtedly positive, the impact of the rate cut is likely to have been dominated by the response to the budget."

***Equities***
US equities / ADRs:
- PBY: Said to have received takeover proposals from private equity name Golden Gate Capital and other suitors - financial press; +17.3% afterhours
- CSC: CSC: Reports Q4 $1.26 v $1.20e, R$2.91B v $2.98Be ;*CONFIRMS PLAN TO SEPARATE INTO TWO INDEPENDENT, PUBLICLY TRADED COMPANIES; WILL PAY $10.50 SPECIAL DIVIDEND; +6.2% afterhours
- ADI: Reports Q2 $0.73 v $0.72e, R$821M v $818Me; +1.5% afterhours
- TWC: Altice said to be considering acquiring a US cable operator; Looking and held talks with TWC - financial press; +1.3% afterhours
- YHOO: IRS has not made any decision on spinoff rules; Still considering potential changes - financial press; +1.2% afterhours
- UTX: Boeing, Airbus, and Lockheed said to be considering bids for Sikorsky unit or a minority stake; Unit may be sold for about $10B - financial press; +0.8% afterhours
- QIHU: Reports Q1 $0.57 adjusted v $0.51e, R$384M v $394Me; -0.4% afterhours
- ADSK: Reports Q1 $0.30 v $0.28e, R$647M v $624Me; -1.8% afterhours

Notable movers by sector:
- Financials: WesFarmers WES.AU -0.9% (FY15 capex guidance)
- Technology: Kingsoft 3888.HK -2.8% (Q1 result)
- Energy: Santos Ltd STO.AU -4.2%, Beach Energy BPT.AU -3.6% (Oil price decline)
- Industrials: Cardno CDD.AU -26.7% (FY15 guidance); UGL Ltd UGL.AU +9.4% (be approached by private equity buyer); Shanghai Zhixin Electric 600517.CN +4.9% (new contract); Takata Corp 7312.JP -9.0% (settlement with airbag recall); AviChina Industry & Technology Co 2357.HK +9.5% (China manufacturing plan)
- Materials: Iluka Resources ILU.AU -1.1% (guidance);BHP Billiton BHP.AU -3.2%, Rio Tinto RIO.AU -2.9%, Fortescue Metals Group FMG.AU -7.0%
- Telecom: China Mobile 941.HK -1.1% (set up jv, April operational data)

FT : Altice in talks to enter US cable market

Altice in talks to enter US cable market

Altice, the European cable and mobile group, is in advanced discussions to acquire Suddenlink Communications, the seventh-largest US cable operator with almost 1.5m subscribers, according to people familiar with the matter.
The value of the deal, which could be announced as soon as Wednesday morning, is likely to be in excess of the $6.6bn BC Partners and CPP Investment Board paid in 2012 to buy Suddenlink from another investor group, these people said.

Altice and Suddenlink both declined to comment.
In an industry where economies of scale between neighbouring networks offer big savings, cross-border cable deals are uncommon, sparking speculation that this may not be Altice’s last deal in the US.
Patrick Drahi, Altice’s billionaire founder, once worked for John Malone, and has ambitions that are increasingly putting him in competition with those of the US “cable king”.
People familiar with the matter said Altice recently lost out to Mr Malone’s Liberty Global European cable group in the bidding for Base, a Belgian mobile operator, and the two men could find themselves in competition again in US cable.
Through his investment in Charter Communications, Mr Malone has helped spur recent dealmaking in a US cable market where growth is increasingly driven by broadband internet access rather than video. The failure of Comcast’s $45bn bid for Time Warner Cable has intensified speculation about follow-on deals.
Rich Greenfield, an analyst at BTIG, said Suddenlink’s new owner could look at combining it with MediaCom, but he did not expect Altice to do a deal with a bigger cable company.
1.5m
Number of subscribers at Suddenlink Communications, the seventh-largest US cable operator
Altice, which has a market value of almost €29bn, has made aggressive efforts to consolidate the French communications market, where it controls Numericable-SFR. Expectations of an eventual deal with Bouygues have ebbed, but Dexter Goei, chief executive, told the Financial Times in February that the group is on the hunt for bigger acquisitions.
Suddenlink, led by chief executive Jerry Kent, has operations spanning Texas, West Virginia, Louisiana, Arkansas, North Carolina, Oklahoma, Arizona and elsewhere.
“Altice is effectively buying a broadband monopoly because there’s no fibre in (Suddenlink’s) area,” Mr Greenfield said, describing the company as “a well-run operation that is focused on the cash flow out of the broadband business.”
“Rural cable has always had the benefit of not having the same level of competition. That’s why Suddenlink has been successful — they’ve really focused on being all about broadband,” he said.

Suddenlink made headlines recently when it dropped Viacom’s channels in a high-profile dispute with the owner of MTV, Comedy Central and Nickelodeon.
Mr Kent has spoken about “an evolutionary shift in how the [US] pay-TV model works” as media owners, telecoms companies, cable groups and tech companies all experiment with online video and allowing consumers to watch content without cable or satellite subscriptions.
He told the FT earlier this year: “With these shifts, it really has transformed from the old argument that content is king to the consumer is king.”
News of the talks, first reported by the Wall Street Journal, came as Mr Malone told an interviewer there “would be very substantial synergies” in a combination between Liberty Global and Vodafone, the London-listed mobile operator.
He cautioned, however, that such a deal could be hard to pull off. Vodafone was like “a big banana in a jar”, he told Bloomberg: “The question is: how do you get your hand out of the jar with the banana.”

WSJ : Japan’s First-Quarter GDP Growth Is Fastest in a Year

Japan’s First-Quarter GDP Growth Is Fastest in a Year

GDP grows annualized 2.4% in first quarter on household, business spending


TOKYO—Japan’s economy grew at its fastest pace in a year in the first quarter, fueled by household and business spending, an indication that the engines could be starting to fire once again in the world’s third-largest economy.

Japan’s real gross domestic product grew 2.4% in annualized terms in the first three months of 2015, the government said Wednesday, stronger than a revised 1.1% expansion in the previous quarter. That was larger than a 1.5% expansion forecast by economists surveyed by The Wall Street Journal.

The figures offer support for the government and the Bank of Japan’s view that the economy is on its way to recovery, as corporate profits recover and companies have promised to pay workers more. But an increase in unsold goods suggests consumption is still failing to keep pace with production, a factor that casts a shadow on otherwise upbeat figures.

economy on a path to sustained growth with a brew of monetary and fiscal stimulus since taking power in late 2012. Mr. Abe’s efforts have been frustrated by a sales tax increase last year that chilled consumer and business sentiment and pushed the economy into its fourth recession in a decade.

The latest data show an acceleration in the economy’s recovery from that slump as consumption finally starts to pick up. Household spending rose 0.4% on quarter, higher than the 0.2% increase forecast by economists.

But the expansion was also driven by a larger-than-forecast increase in inventories by private companies. The fact that more goods are sitting in warehouses rather than being bought by consumers may signal some weakness in the economy looking ahead.

Inventories contributed 0.5 percentage point to growth, compared with 0.2 percentage point forecast by economists.

Meanwhile, capital spending rose 0.4% on quarter, slightly weaker than a 0.6% increase forecast by economists. That was the first increase on quarter in four quarters.

Some companies, such as Canon Inc. and Panasonic Corp. have shifted some production back to Japan as the yen has weakened against other major currencies, a factor supporting business investment. Furthermore, economists note that a shortage of workers in Japan has likely forced more companies to invest in automation measures or IT to make up for workers they can’t find to hire.

Wednesday’s data also showed Japan’s recovery is still largely driven by demand at home. Exports grew 2.4% on quarter, down from a 3.2% increase in the October-December quarter, though many economists forecast a pickup in coming months.

>>> After Hours Summary: DY +14.9%, CSC +4.8%, QIHU +1.7%, ETSY -17


After Hours Summary: DY +14.9%, CSC +4.8%, QIHU +1.7%, ETSY -17.1%, CISG -8.5%, DL -4.4% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: DY +14.9%, CSC +4.8%, QIHU +1.7%, NQ +1.4%, ADI +0.9%, GPRK +0.5%

Companies trading higher in after hours in reaction to news: SRPT +40.1% (announced a rolling NDA for Eteplirsen, to treat Duchenne muscular dystrophy, following a meeting with the FDA), CSC +4.8% (announced plan to split its Global Commercial and US Public sector businesses and a $10.50/share cash dividend; co also reported earnings), BG +0.8% (authorized new program for the repurchase of up to $500 mln of its common shares; increased regular quarterly cash dividend, from $0.34 to $0.38/share), PCRX +0.3% (announced data from three studies evaluating the clinical and pharmacoeconomic utility of EXPAREL for postsurgical pain control)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: ETSY -17.1%, CISG -8.5%, DL -4.4%, KEYS -3.1%, ADSK -2.1%, NDSN -1.3%, TEDU -0.9%, VSAT -0.5%

Companies trading lower in after hours in reaction to news: XEC -4.0% (intends to commence a registered public offering of 6 mln shares of its common stock), ACHN -3.7% (entered into a worldwide license and collaboration arrangement with Janssen Pharmaceuticals, a Johnson & Johnson (JNJ) unit, for Hepatitis C in up to $1.1 bln deal), NCLH -2.5% (announced a secondary public offering of 20 mln shares by selling shareholders), MGM -1.6% (Land & Buildings issued additional statement: notes it no longer intends to nominate any candidates for election as directors at the Company's 2015 Annual Meeting), EPE -1.3% (priced its offering of $800 mln aggregate principal amount of 6.375% Senior Notes due 2023 at an issue price of 100%) 

Reuters : Altice Said to Look at Acquiring Time Warner Cable: Reuters Link


NEW YORK (Reuters) - French telecom group Altice SA (ATCE.AS) is looking at acquiring Time Warner Cable Inc (TWC.N) and has held talks with the U.S.-based company about a potential deal, according to a source familiar with the matter.

Since its merger with Comcast fell apart last month, Time Warner Cable has also being circled by small rival Charter Communications.

Altice is also looking at privately held Suddenlink, Reuters reported earlier on Tuesday.

Time Warner Cable declined to comment while Altice could not immediately be reached for comment.

http://www.reuters.com/article/2015/05/19/us-timewarnercable-altice-exclusive-idUSKBN0O42PR20150519
Altice Said to Look at Acquiring Time Warner Cable: Reuters Link
2015-05-19 23:22:01.840 GMT


By Grant Clark
(Bloomberg) -- http://tinyurl.com/oqmvuva


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WSJ: Altice looking to Merge with Time Warner

Altice in Advanced Talks to Buy Cable Company Suddenlink

European telecom firm is also eyeing Time Warner Cable


Cable tycoon John Malone’s plans to consolidate the fragmented U.S. industry could run into competition from an unlikely player: telecommunications group Altice SA.

The company controlled by French cable investor Patrick Drahi is in advanced talks to acquire U.S. cable operator Suddenlink Communications in a deal that would be valued at $8 billion to $10 billion including debt and could be announced as soon as this week, according to a person familiar with the matter.

Separately, Altice is eyeing Time Warner Cable Inc., the No. 2 U.S. cable operator by subscribers, people familiar with the situation said. Altice has made initial contact with TWC.


Combined, the moves show the deal-hungry European company’s appetite for a major cross-border expansion. And they add another dimension to the complex drama playing out in the U.S. cable industry, bringing a new player into the race to consolidate the sector.

Mr. Malone has been a vocal proponent of consolidation and has pursued those ambitions through his investment in Charter Communications Inc., the fourth-largest operator. Charter is seeking a deal with Time Warner Cable, whose $45.2 billion merger with Comcast Corp. fell apart last month, and also is in talks with closely-held Bright House Networks.

Altice is a Luxembourg-based cable-and-telecom company with a market value of €28.7 billion ($32 billion).

By buying St. Louis-based Suddenlink, Altice would get access to about 1.5 million customers in more than a dozen states from Texas to West Virginia. Suddenlink is the seventh-largest U.S. cable operator by video customers and had revenue of $2.3 billion last year. Suddenlink Chief Executive Jerry Kent, a cable-industry veteran, founded the company early in the last decade and built it up by purchasing cable systems from rivals including Cox Communications Inc. and Charter.

Suddenlink is majority-owned by private-equity firm BC Partners and a Canadian pension fund, who bought it in 2012 in a deal valued at $6.6 billion, including debt.

There is no guarantee the Suddenlink talks won’t fall apart before a deal is reached. No deal with TWC is imminent and any transaction would only happen after a deal with Suddenlink, one of the people familiar with the situation said.

Time Warner Cable, with a $44.5 billion market capitalization, would be a much bigger deal for Altice to digest. The company operates in big city markets including New York and Los Angeles and has nearly 11 million residential cable TV customers. It attracted interest from Charter soon after Comcast terminated its deal with TWC in the face of stiff regulatory resistance.

A deal of such size could be challenging for Altice to pull off financially. Altice has made a name for itself with its record leveraged buyouts last year. The company had net debt of €18.78 billion at the end of the first quarter. Still, Altice believes it could raise enough cash to afford a bid for Time Warner Cable, a person familiar with the matter said.

Mr. Drahi, 51 years old, has made a fortune by investing in underperforming cable companies. Buying into the U.S. would catapult Altice, which now owns communications companies from France to the Caribbean, into one of the world’s largest cable and broadband markets. Mr. Drahi has been betting that the future of the telecom industry lies in combining cable and broadband operators with mobile companies to offer clients higher-priced bundles combining television, broadband, fixed telephony and mobile services.

Entering the U.S. would make Mr. Drahi a direct competitor to Mr. Malone, whose career has served as a model in Mr. Drahi’s expansion over the past decades.

Altice has other ties to Mr. Malone: Dexter Goei, the chief executive of Altice, was a member of the slate of directors Charter nominated to replace Time Warner Cable’s board early last year, during its hostile attempt to take over TWC. That effort was headed off when Comcast struck its ill-fated TWC deal.

A foreign player acquiring U.S. cable companies would require approval from the Committee on Foreign Investment in the U.S. Such a deal would also require approval from the Federal Communications Commission and could be subject to antitrust review from the Justice Department.

Mr. Drahi is the second French telecom billionaire to attempt to venture into the U.S. in less than a year. Last summer, rival Xavier Niel with his low-cost operator Iliad SA made a bid to buy U.S. carrier T-Mobile U.S., but his offer was rebuffed.

Altice has been searching for assets to buy in the U.S. for some time and has looked at several potential targets, other people familiar with the matter said.

Mr. Drahi over the past year has emerged as one of the most aggressive deal-makers in a fragmented European telecom market.

In April last year, Altice won a hard-fought takeover battle to buy French cellphone carrier SFR in a $23 billion deal. Only a few months later, the company agreed to buy former Portuguese telecom monopoly PT Portugal for around $9 billion.

>>> FEMSA aggressively pursuing M&A opportunities in drugstore sector, seeking t

DEAL REPORTER

FEMSA aggressively pursuing M&A opportunities in drugstore sector, seeking to grow scale
FEMSA (FEMSAUBD:MX), Coca Cola´s largest bottler outside the US, is aggressively looking to acquire drug store chains through its arm FEMSA Comercio, an IR officer told Mergermarket. The company is seeking to enter Mexico City, Monterrey and Guadalajara, markets where it does not currently operate, said the officer.

Reaching a scale of more than 1,000 units would give the owner of the ubiquitous OXXO convenience store chain enough leverage to negotiate directly with drug makers, the officer said.

FEMSA currently operates roughly 600 units in the South of the country through its majority-owned brands Farmacias YZA and Farmacias Moderna, as well as 200 more units under its recently acquired brand Farmacias Farmacon, located in the Northeast of the country. The Farmacon deal is expected to close in 2Q15, the officer said.

There are currently three drugstore formats in Mexico right now, according to the IR officer. That of Farmacias Guadalajara is like a mini supermarket, with sales of drugs accounting for 50% of sales, and around 400-500 sq m in layout. Benavides, acquired by Walgreens Boots Alliance (WBA), maintains a mid-sized format of 250 sq m, where home and beauty products account for a big part of sales; and Farmacias del Ahorro is around 100 sq m in size, with 80% of sales coming from drugs, the officer said.

"FEMSA would like to have a smaller format, the size of an OXXO (90 sq m), where drugs account for 50%-60% of sales, 25% comes from beauty products, and the rest from convenience products," he said.

Farmacias San Pablo and Farmacias Farmatodo are seen as likely targets and have long been subject to speculation in the local press. San Pablo has 61 units in the Mexico City area, according to a source close to the company. Farmatodo has around 150 units in Mexico City, Puebla and Queretaro, according to its website.

“It is not easy to create a national network because there are few national chains in Mexico you can buy, so you have to go little by little,” said a sector banker, speaking about consolidation opportunities in the country. “FEMSA´s interest has also had the effect of pushing valuations up to 10x or 11x EBITDA, and there are at least two players from South America who want in, plus a few Europeans.”

According to the National Association of Drugstores of Mexico (ANAFARMEX), there are close to 40,000 drugstores in the country. Most of the businesses are “mom and pop shops,” and that is not going to change in the next five to ten years, according to a consultant and the banker.

Farmacias Guadalajara (FRAGUAB:MX) is seen as the biggest in the country, according to the banker. It ended 2014 with 1,322 drugstores in 23 states of the country, plus Mexico City, according to official filings with the Mexican Bolsa (MexBol). Sales for the full year were MXN 32.03bn (USD 2.09bn), according to the filings.

Farmacias del Ahorro, seen as the second largest, does not disclose its figures, but its CEO told the press last year it was expecting to end the year with close to 1,300 units.

Walgreens Boots Alliance is third in the country after last year it acquired 1,000 drugstores in Mexico operated under the names Benavides and ABC from Casa Saba. The MXN 8.5bn (USD 557.11m) deal included 400 additional units in Chile under the brand Ahumada.

Mirtha Luque, IR officer at Farmacias Guadalajara, did not respond to requests for comment. Farmacias SanPablo did not immediately respond to e-mails seeking comment. Farmatodo did not immediately respond to e-mails seeking comment.