TheChek News Flow

DuPont (NYSE:DD) on 6 April announced that it has filed a new investor presentation with the US Securities and Exchange Commission (SEC) in connection with the Company’s 13 May 2015 Annual Meeting of Shareholders. The presentation is available under the shareholder materials section of www.dupontdelivers.com and on the SEC's website at www.sec.gov.

The presentation highlights the growth of DuPont’s ongoing, post-spin business, demonstrating the strength of the next generation DuPont. The ongoing business has delivered 6% segment sales growth and a 19% adjusted operating EPS compound annual growth rate since 31 December 2008. In addition, the Company’s segment adjusted operating margin has improved 740 basis points.

The presentation also outlines DuPont’s strong and consistent track record of superior performance; its strategy to grow leading positions in three areas of strategic focus; and the qualifications of its world- class board of directors to drive higher growth and higher value for our shareholders.

In addition, the presentation illustrates in greater depth why DuPont’s board unanimously opposes Trian’s efforts to replace four highly accomplished directors in order to advance its high-risk, high-cost breakup agenda, which the board has unanimously determined would be value-destructive and not in the best interests of shareholders.

Presentation attached

- Follow Up: Greece Min Tsakalotos: Upcoming trip to Russia does not alter Greek foreign policy; reiterates main focus is EU and remaining in euro zone; hopes reforms will reverse ECB position on funds; Reiterates will repay IMF.

- Composite PMI: 52.4 v 51.0 prior (3rd straight month of expansion and highest since July)

Vivendi Bolloré goes on the attack

According to information from WanSquare, the man has a strong Vivendi new ally: Colette Neuville who believes that a company is for invest and not distribute dividends too generous likely weaken society. Bolloré shows that he has every intention to reinvest its cash by making an offer on Dailymotion.

With the approach of the meeting of April 17, Vivendi, opinions fuse on the folder Vincent Bolloré on the opponent PSAM activist funds. The latter calls essentially an upward revision of the amount of the special dividend paid to the shareholders of the French company. Claim in which the strong man of the media group and its supervisory board is not all ready to go, while PSAM now trying to place the subject on the legal ground in challenging the recent rapid rise in capital Vincent Bolloré.

Once is not custom, it has a protagonist here very influential circles financial, and regulatory beside him (the only intellectually) by Colette Neuville person who, as a proxy for the US group ISS mbelieves that the company does not have to be impoverished to please some of his shareholders. Certainly, Vivendi is now at the head of a pretty cash package after the different operations of disposals in recent months, but the liquidity should also and especially be used to develop the company to seize opportunities that will enable it to bounce back after being relieved of most of its assets. "The shareholders take risks by investing in a listed company, but it is primarily to help it grow and not to touch cash. Impose a very important special dividend is contrary to the spirit of company law. The purpose of a business is primarily to grow to satisfy all stakeholders, not just shareholders and especially not to hold too generous distributions or share buybacks rather destructive value than anything else "Colette Neuville launches.

For its part, the boss of the PSAM fund denies wanting to dismantle the group, as he said this weekend Reuters: "Bring out the value of Universal through a total or partial demerger is not a rollback. It could only relate to the 15%m society, with the remainder held by Vivendi, "reiterating that the ultimate objective of the fund was to create value for query actionnaires. This Query comes even as Vivendi has just made an offer of € 250 million to resume Dailymotion. Showing that the group is indeed the maneuver to reinvest their cash in the media, as stipulated from the beginning Vincent Bolloré. And, with the help of Bercy, Emmanuel macron having finally managed to dissuade the PCCW Hong Kong to bid on Dailymotion.

Vivendi : Bolloré passe à l'attaque

EURO TELCO

Russian billionaire Mikhail Fridman is drawing up plans for a $16bn investment spree in telecoms and technology businesses in Europe and the US boosted by the appointment of a heavyweight advisory board of industry entrepreneurs. 

{http://www.ft.com/cms/s/0/f0a1579a-d876-11e4-ba53-00144feab7de.html#axzz3WbMTqpit}

FT : Telecoms must address technology disrupters, says LetterOne head

For someone overseeing more than $13bn of telecoms assets, Alexey Reznikovich does not seem to have much time for the industry.

Or at least, that is, for the parts of the telecoms industry stuck in the past — which form the majority in his view — and that are being disrupted by technology groups and so face an uncertain future.

Mr Reznikovich, pictured below, runs LetterOne Technology, the newly named holding group for the 48 per cent stake in VimpelCom and 13 per cent share of Turkcell controlled by Russian billionaire Mikhail Fridman and his Russian partners.

“The telecoms industry has become a victim of its inability to transform itself to address the new challenges. Many companies will go under or be merged. They will vanish one way or another,” says Mr Reznikovich.

VimpelCom is not spared in his assessment of the sector. The company — which serves 220m customers across 14 countries such as Russia, Italy, Ukraine, Bangladesh and Pakistan — needs a “complete revamp”, says Mr Reznikovich.

He sees an opportunity to substantially increase the company’s value by stripping as much as two-thirds off the costs of running the business by moving operations to a more digital platform.

Mr Reznikovich points out some of the absurdities of the old-fashioned telecoms business. “We have 10,000 tariffs in Russia,” he says, shaking his head at the expense of managing such complex arrangements. “It needs a complete revamp of the whole thing. That’s the only way to do it.”

He estimates that only a fifth of the industry will be able to change, however. “I am hopeful that VimpelCom will. The shareholders have a clear vision of where VimpelCom needs to go. We will start to do this in a number of business units this year.”

Mr Fridman and his partners battled Telenor to become the largest shareholder in VimpelCom more than two years ago. Telenor still owns 43 per cent of the listed Amsterdam-headquartered group compared with the 48 per cent controlled by LetterOne.

In five years, Mr Reznikovich says, VimpelCom could have scaled back its workforce from 60,000 to as low as 10,000, with a fourfold cut in IT spending.

“The idea is to make VimpelCom a much more valuable company — not to have a multiple of five or six times [earnings], but to have a multiple of 10 or 12. We need to do something different,” he says.

“The industry has not been able to pay for its cost of capital for the last five years. This is extremely inefficient from an investor standpoint. And it’s going to get worse.”

Alongside the cost-cutting, Mr Reznikovich wants to bring in a more entrepreneurial culture aimed at meeting specific customer needs.

He is appalled that the telecoms industry is not using its relationship with customers, pointing out the technology groups are light years ahead in knowing what people want and when.

“The telecoms industry is extremely inefficient in how they deliver services,” he says. And this is in spite of telecoms groups owning a vast amount of information about the people who use their services, he adds.

“Do you know how many email addresses we have of our 15m customers in Italy? Five thousand. This is a joke! But we have all the information about how they pay, use the internet, their profiles . . . We can use this to make tailored offers and charge more — and improve revenues.”

Mr Reznikovich has overseen Mr Fridman’s telecoms business at various holding groups since 2002, including Altimo and LetterOne Telecoms.

LetterOne Technology is the latest incarnation. The name was chosen to reflect the shift in strategy to more digital platforms, as well as the intention to make further major acquisitions in the telecoms and technology sectors.

The group will take over the activities of LetterOne Telecoms, with the name change and board appointments reflecting the focus outside traditional telecoms for the first time.

Mr Reznikovich says there is a cash pile of $16bn to invest from the 2013 sale of Russian oil producer TNK-BP.

The office has been set up in London to “better manage the deal flow”, he says. Two-thirds of the revenues of VimpelCom were generated outside the UK.

The decision to move the international businesses of Mr Fridman and his colleagues to London was made before the hostilities in Ukraine, which Mr Reznikovich admits has made being based in Russia more difficult.

$16bn

Amount of cash available to invest from the 2013 sale of Russian oil producer TNK-BP

The company wants to invest in struggling companies that need funds to succeed, as well as look at markets such as data centres and telecoms infrastructure, as well as technology groups that could add services for VimpelCom to use.

“Telecoms is a pipe,” Mr Reznikovich says. “If we execute the first part of our strategy, we will have much more information on customers and then use our digital companies to feed the system and help VimpelCom offer new things, almost as a distribution channel.”

There is also an opportunity to invest in companies that are in markets open to consolidation, he says, pointing to an easing of regulatory opinion about mergers in the sector.

Deals are already in the offing. “We are working on all fronts,” Mr Reznikovich says. “We hope to have a result on all three areas [of our strategy] this year.”

If confirmed, this increase should assert his share of criticism of the government. The amount of 0.57% is indeed that the dealers had submitted to the state in late November 2015, on the basis of the adjustment formula contained in the contract. But at the time, the Minister of Ecology, Segolene Royal, had rebelled against the proposal, the ruling "unacceptable" and promised that "we will not give [it] not such authorization."

Two months later, she still claimed that "it would be scandalous to increase tariffs highways while EVOLU countries [ed] in a context of crisis." At the time of final arbitration, dealers have finally been successful on the strict implementation of concession agreements. Motorists may console themselves by noting that this increase is the lowest in recent years (in 2014 it was 1.29%).

The question of the toll increase was among the topics that were blocking the signing date of the agreement between the dealers and the government ("Les Echos" from March 10). But according to our information, there are still others. Monday night, discussions were continuing actively, hoping to be able to make an announcement Wednesday at the Council of Ministers, or Thursday at the General Meeting of the National Federation of Public Works (FNTP).

BTP professionals demanding for months that the state and the dealers found common ground: the agreement provides that the State highway sign the stimulus package, amounting to 3.2 billion euros, which would boost their business. The creation of an investment fund of several hundred million euros, fueled by the Caisse des Dépôts et Consignations and dealers to finance the construction of transport infrastructure is black cohosh. But negotiations stalled over the level of contribution to the fund highway, blocking the entire agreement.

* Ratings & POs cut after incorporation of capital-raising risks

We think that the risk of capital raising is increasing for Greek banks, even assuming a positive political outcome. For us, the risk stems from the potential for stricter ECB requirements aimed at capital quality and/or provisioning levels, or domestic regulatory changes, such as debt-relief programmes or required write-offs. In this report, we value the Greek banks under four scenarios and find an average, to arrive at new POs. We think the market needs to be convinced that there is no dilution risk before valuing these banks using traditional methods such as Gordon

Growth model or comparable multiples. We cut our PO for Alpha Bank by 48% to €0.30 (Neutral, down from Buy), for Piraeus Bank by 66% to €0.33 (Underperform reiterated), and for Eurobank by 47% to €0.10 (Underperform, down from Neutral).

* Four scenarios, three of which suggest capital needs

- Scenario 1: Gradual recovery of the operating environment and banks’ financials in 2016-17, no additional capital needs. If we were to value Greek banks on this scenario, they would deserve to trade at 0.6-0.8x P/BV, and our

implied POs would suggest significant (65-89%) upsides.

- Scenario 2: Capital needs due to the exclusion of eligible DTA from banks’ capital adequacy ratios (even if not imminent). We estimate potential capital needs here at €1.6-3.0bn per bank, and additional share issuance at 33-63% of share count (post increase).

- Scenario 3: Capital needs due to an increase in provisions required by the ECB. We estimate potential capital needs here at €2.1-5.5bn per bank, and additional share issuance at 54-72% of share count.

- Scenario 4: Capital needs due to negative domestic regulatory changes, which would require write-offs at Greek banks. We estimate potential capital needs here at

* Volatility High but Declining — Due to political and macro uncertainties, Greek

banks’ stock price volatility spiked in February 2015 to 10% daily standard

deviation, before declining to 5.7% in March. This is 2 to 3 times the 2014 average

daily volatility of below 3%. The next event: in the coming weeks, Greece needs to

repay close to half a billion Euros of IMF loans (9th Apr) and refinance €2.4 billion of

treasury bills (14th/17th Apr). For bank stock price volatility to "normalise" investors

needs to see agreement between Greek government and the Eurogroup on reform

proposals and implementation of a follow-up action plan.

* Deposit Outflow High but Slowing — Since end-Nov 14, around €28bn or 17% of

deposits have been withdrawn from the Greek banking system. The biggest outflow

was in Jan 15 (€12bn) with declining outflows in Feb (€8bn) and in March (€3-4bn

or c2% of system deposits). The funding gap has been filled by temporary ELA

funding. As of end of March, Eurosystem funding reached 28% of banking system

assets (vs c30% at 2012 peak) or €110bn, of which €71bn are ELA funding (vs

historical peak: €135bn/€120bn). We estimate the 2015 NII hit for each Greek bank

to be below €100m lower yoy (c6-8% of Greek NII) due to higher ELA funding cost

and deposit outflows, primarily during 1H15.

* Delayed NPL Recovery — Consensus 2015 Greek GDP has been revised down in

recent months on the back of renewed macro uncertainties. Citi economists now

expect 2015 GDP to contract by 0.2% (vs GDP forecast of +1.3% -6M) before

increasing to 1.5% in 2016 (vs GDP forecast of +1.6%, -6M). 1Q15 NPL formation,

particularly for mortgage loans, has increased due to moral hazard reasons. We

estimate system NPL to peak in 2016, one year later than our previous forecast.

* Capital Headwinds — We expect Greek banks to make a loss in 1H15 due to

lower NII and trading income as well as higher provisions, vs prior forecasts. This

should erode Greek bank’s capital position. Moreover, GGB 2Y yield was up 6.5ppt

in 1Q15, similar to 4Q14. The AFS reserve hit to equity and capital in 4Q14 could be

repeated in 1Q. Except NBG, whose capital should benefit from divestments, we

expect other Greek banks’ fully loaded B3 CET1 ratio to be down c50-150bps yoy in

2015. Excluding DTCs, Eurobank’s capital remains the lowest.

* Buy, Revised TP — Greek banks’ are currently trading on crisis valuations of 0.40x

trailing P/B, even lower than the Jan 15 post-election levels. Our base case is that

Greece remains part of the Euro Area. But our EPS estimates have been cut: 2015

by 80%-96% for 2 banks and from break-even to negative for the other 2; 2016 by

11-61%; 2017 by 2-31%, reflecting lower NII (ELA funding) and trading income

(higher GGB yields) and higher NPLs/loan losses (delayed economic recovery,

moral hazard). We increase cost of equity for Greek banks from 12% to 14% (sum

of Citi average 2015-16 10Y GGB yield forecast of 8% and 6% ERP). We revise TP

for Greek banks (Alpha: €0.47; Eurobank: €0.16; NBG: €1.74; Piraeus: €0.61).

Given the large drops in share prices YTD we reiterate our Buy ratings.

Dow+0,66% S&P+0,66% Nasdaq+0,62% Russell+0,39%

Nikkei +0.91% Hang Seng +0.77% Shanghai +1.77%

RUB $55.40 WTI $51.87 (-0.52%) EURCHF 1.0464 CHF $0.9570

Eur$ 1.0934 S&P Flat EuroStoxx +1.02% Dax +1.03% SMI +0.97%

Macro :

- Russia May Offer Greece Cheaper Gas, New Loans: Kommersant

Keep an eye on :

- AIR FP : Airbus Partners With 6 Indian Companies for Naval Deal: Express

- ALCAR FP : Carmat Heart Transplant Patient Says He’s Completely Recovered

- DAI GY : Daimler May Decide on Russian Plant in May: Interfax

- ITV LN : Weinstein Said Set to Sell TV Unit to ITV for $950m: NYT {http://nyti.ms/1DFPRPK}

- TNTE NA : FedEx Offers to Buy TNT Express for EU8 Per Share in Cash --> +33% premium vs Fri. close

- DG FP : French Highway Tariffs to Rise Average 0.57% in 2015: Echos

- VIV FP : Vivendi to acquire Dailymotion for EUR 250m