Canon said to have no intention of raising offer for Axis - press
-The acceptance period of the Offer was expected to expire on 1 April 2015.
Reminder: shares are giving up the 10%+ gains seen on Thursday, April 2nd On April 2nd, shares of DGLY ticked higher after the company's @DigitalAllyInc Twitter account tweeted "We've got a BIG #announcement! We'll be live-streaming our announcement on #Periscope tomorrow morning at 10am CST!" On April 3rd, the company announced at a press conference a five-year agreement renaming the Midwest Classic the Digital Ally Open, effective immediately
Shire Will Vigorously Defend Patents for Lialda, Gattex
2015-04-06 11:19:40.86 GMT
By Nadine Skoczylas
(Bloomberg) -- Shire acknowledges two petitions filed with
U.S. Patent and Trademark Office by Hayman Capital on April 2
regarding Lialda and Gattex.
* Co. will continue to “defend vigorously” its patents,
“pursue all legal options available to protect its
products”
* NOTE April 2: Hedge Fund Manager Kyle Bass challenging
patents on Lialda, Gattex, according to filings on April 1
with USPTO
* Together, Lialda and Gattex would have made up 12% of
Shire’s rev. in 2014
* Together, Lialda and Gattex would have made up 12% of
Shire’s rev. in 2014</li></ul>
Statement
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Nadine Skoczylas in Jerusalem at +972-2-640-1103 or
nelsibai@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-3525-2645 or
jludden@bloomberg.net
2015-04-06 11:19:40.86 GMT
By Nadine Skoczylas
(Bloomberg) -- Shire acknowledges two petitions filed with
U.S. Patent and Trademark Office by Hayman Capital on April 2
regarding Lialda and Gattex.
* Co. will continue to “defend vigorously” its patents,
“pursue all legal options available to protect its
products”
* NOTE April 2: Hedge Fund Manager Kyle Bass challenging
patents on Lialda, Gattex, according to filings on April 1
with USPTO
* Together, Lialda and Gattex would have made up 12% of
Shire’s rev. in 2014
* Together, Lialda and Gattex would have made up 12% of
Shire’s rev. in 2014</li></ul>
Statement
For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>
To contact the reporter on this story:
Nadine Skoczylas in Jerusalem at +972-2-640-1103 or
nelsibai@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-3525-2645 or
jludden@bloomberg.net
Early premarket gappers
Gapping up: CRIS +7.7%, EGO +6.2%, AUY +6.1%, GAME +6%, ABX +4.5%, GDX +3.6%, SLW +3.6%, AEM +3.5%, NEM +3.4%, FCX +3.1%, TSLA +2.9%, IAG +2.5%, LL +2.4%, SLV +2.3%, PBR +1.6%, GLD +1.5%, MRO +1.3%, SDRL +1.1%, RIG +1.1%, LPSN +0.7%
Gapping down: WBAI -10.5%, DGLY -8.6%, HLF -7.3%, QCOM -2.1%, RF -1.9%, HA -1.7%, ALK -1.7%, JBLU -1.6%, LUV -1.5%, NXPI -1.5%, DAL -1.5%, TWTR -1.3%, BAC -1.2%
BN 04/06 11:33 *TEMPUR SEALY RECOMMENDS HOLDERS VOTE FOR CO'S DIRECTOR NOMINEES
BN 04/06 11:31 *TPX FILES INVESTOR PRESENTATION, MAILS LETTER TO HOLDERS
BN 04/06 11:31 *TPX FILES INVESTOR PRESENTATION, MAILS LETTER TO HOLDERS
Tempur Sealy Files Investor Presentation And Mails Letter To Shareholders
2015-04-06 11:30:02.965 GMT
Tempur Sealy Files Investor Presentation And Mails Letter To Shareholders
Tempur Sealy Has the Right Strategy, Management Team and Board to Continue
Driving Enhanced Value Creation for ALL Shareholders
Board Recommends Shareholders Support Value-Enhancing Initiatives Underway by
Voting the WHITE Proxy Card "FOR" the Company's Highly Qualified Director
Nominees
Materials for Tempur Sealy's Annual Meeting Available at
Investor.TempurSealy.com/AnnualMeeting
PR Newswire
LEXINGTON, Ky., April 6, 2015
LEXINGTON, Ky., April 6, 2015 /PRNewswire/ -- Tempur Sealy International, Inc.
(NYSE: TPX), the world's largest bedding provider, announced today that it has
filed an investor presentation with the Securities and Exchange Commission
("SEC") in connection with its upcoming 2015 Annual Meeting of Shareholders to
be held on May 8, 2015. In addition, Tempur Sealy is mailing a letter to its
shareholders that highlights key elements of the presentation. The
presentation is available on the SEC's website at www.sec.gov and on the
special Annual Meeting section of the Company's website at
Investor.TempurSealy.com/AnnualMeeting.
Highlights of the presentation include:
o Tempur Sealy Today: Creating a Global Bedding Leader
With the transformative acquisition of Sealy Corporation, the Company's
Board and management team have created the world's largest bedding
provider and manufacturer with a complete and complementary portfolio of
iconic brands. Since the announcement of the transaction, Tempur Sealy
has created an additional approximately $1.8 billion in equity value for
shareholders^^1.
o Strategic Actions Underway to Drive Value
Tempur Sealy is focused on executing its strategy to continue delivering
industry leading growth, enhanced profitability, and superior value for
shareholders, including: driving enhanced margins and long term growth
through reinvestment in the business, as evidenced by Tempur North
America's return to a position of strength and profitability; completing
the organizational integration of Sealy; enhancing operating margins; and
leveraging the Company's global scale to execute on its international
growth plan.
o Experienced Management Team and Board of Directors with Proven Track
Record
Tempur Sealy's Board and management team have established the Company as
the leader in its industry, and are responsible for the development and
implementation of Tempur Sealy's value-enhancing strategy. The Board is
committed to representing the interests of all shareholders, and takes an
active approach in overseeing the execution of the Company's strategy,
providing guidance and ensuring management accountability. As a result,
under the Board's oversight and the leadership of CEO Mark Sarvary, Tempur
Sealy has realized an industry-leading total shareholder return of 493%,
more than five times that of the S&P 500^^2.
o Setting the Record Straight on H Partners
H Partners, a shareholder of the Company, has demanded high-risk,
value-destroying leadership changes at the Company, including: the
immediate removal of the Company's CEO and the ceding of effective control
of the Company to an H Partners' hand-picked, unidentified CEO nominee;
the removal of the independent Chairman of the Board as well as another
director; and the immediate appointment of an H Partners' representative
to the Board and the Compensation Committee. Moreover, H Partners has
failed to outline a substantive plan or constructive views on how to
enhance Tempur Sealy's strategy or operations, and has refused to engage
with the Board on these topics while summarily dismissing a proposal to
identify a mutually acceptable, independent director nominee to the Tempur
Sealy Board. Tempur Sealy believes that the changes H Partners seeks would
be disruptive and value-destructive to the Company and its shareholders at
an important time in the execution of its strategy. As such, while the
Tempur Sealy Board is dedicated to constructive dialogue with all
shareholders, including H Partners, it remains firm in its support of the
current management team and Board composition.
o Right Team and Strategy in Place to Enhance Shareholder Value
Today, Tempur Sealy is positioned as the only truly global player in the
industry, with the platform, strategy and resources to build an even
stronger company. The Company believes that with the guidance of its
experienced management team and the oversight of its engaged and highly
qualified Board, Tempur Sealy remains well-positioned for long-term
success and value creation.
The full text of the letter is below:
SHOW YOUR SUPPORT FOR THE VALUE CREATING STRATEGIES OF THE
TEMPUR SEALY BOARD OF DIRECTORS
VOTE THE WHITE PROXY CARD "FOR" THE RE-ELECTION OF THE BOARD TODAY
April 6, 2015
Dear Fellow Tempur Sealy Shareholder:
At the Annual Meeting of Shareholders on May 8, 2015, you will have the
opportunity to make an important decision regarding the future of Tempur Sealy
International, Inc.
Since the appointment of Chief Executive Officer Mark Sarvary in 2008, the
Tempur Sealy Board of Directors and management team have guided the Company
through the transformational acquisition of Sealy Corporation and positioned
the Company for continued industry leadership, and strong growth and
significant shareholder returns. In fact, Tempur Sealy has delivered total
shareholder returns of more than 493%, more than five times that of the S&P
500 during that period^^3.
Today, the Company's management team, with the oversight of its independent
and engaged Board, is continuing to make significant progress on the execution
of Tempur Sealy's strategic priorities. We are more confident than ever that
this is the right team and the right Board to continue to drive growth and
oversee continued shareholder value creation.
Your vote is important, and we urge you to make your voice heard at the Annual
Meeting by voting the WHITE card "FOR" the re-election of Tempur Sealy's
highly qualified and experienced director nominees: Evelyn S. Dilsaver, Frank
Doyle, John A. Heil, Peter K. Hoffman, Sir Paul Judge, Nancy F. Koehn,
Christopher A. Masto, P. Andrews McLane, Lawrence J. Rogers, Mark Sarvary and
Robert B. Trussell, Jr.
COMMITTED TO ENHANCING SHAREHOLDER VALUE
AND DELIVERING ON THAT PROMISE
Recent accomplishments by your Board and management team demonstrate the
strength and commitment of your Company's leadership, and that Tempur Sealy is
well-positioned to maintain its record of growth and value creation,
including:
o Returning Tempur North America to a position of strength. As a result of
our focus on innovation and product development, we have revamped our
entire product offering and returned Tempur North America to double-digit
topline growth. We expect this momentum to continue in 2015 and beyond.
o Successfully integrating Sealy. The organizational integration of the
Sealy business in North America is essentially complete, and today Tempur
Sealy has a comprehensive and complementary portfolio of brands and
products to meet each consumer demographic – in the U.S. and
internationally. The Company is positioned to be a leader in all of its
markets with the potential to deliver significant future shareholder
value.
o Intensely focusing on enhancing margins and driving profitability. We
expect to generate approximately $125 million in operating income
improvement by 2018^^4 by continuing to make progress against four
specific operational objectives: driving gross margin improvements for
Sealy U.S.; achieving additional cost synergies from the Sealy
acquisition; reducing adjusted operating expense^^5 as a percentage of
revenue from 29% in 2014 to 28% by 2018; and implementing an enhanced 2015
pricing strategy.
o Executing a global growth plan. Through the 2013 acquisition of Sealy
Corporation, we created a platform with the scale, portfolio and resources
from which to build an even stronger global company. Across our global
footprint we are driving product innovation, making marketing investments,
leveraging distribution synergies, and pursuing acquisitions of licensees
and joint ventures.
TEMPUR SEALY'S BOARD HAS A RECORD OF
SUPERIOR, LONG-TERM PERFORMANCE AND VALUE CREATION
Your Board is composed of 11 highly qualified directors, nine of whom are
independent and all of whom have proven records of value creation. The Tempur
Sealy Board has the diversity, experience and qualifications necessary to
continue to provide effective and independent oversight, while driving the
value-enhancing strategy in place.
Together, the Tempur Sealy Board possesses distinct knowledge and expertise
that is critical to the Company's success. This includes experience leading
and growing companies in the mattress, manufacturing and other consumer and
retail industries. Your Board also includes directors with experience and
backgrounds in disciplines that are highly relevant to the Company's
businesses, including: international expansion, mergers and acquisitions,
accounting, risk management and corporate finance.
CEO / President Senior
Leadership
/ CFO / Finance Consumer /
Independent^^6 / at Company Retail
with
Legal Experience
Experience Global
Operations
Evelyn S. * * * *
Dilsaver
Frank Doyle * * *
John A. Heil * * * *
Peter K. Hoffman * * * *
Sir Paul Judge * * * *
Nancy F. Koehn * *
Christopher A. * * *
Masto
P. Andrews McLane * * * *
Lawrence J. * * *
Rogers
Mark Sarvary * * *
Robert B. * * * *
Trussell, Jr.
Together with the Tempur Sealy management team, your Board of Directors has
developed and put in place a plan that is working. Each director is vital to
the continued successful execution of Tempur Sealy's initiatives to create
shareholder value, and each is committed to continuing to deliver superior
results and serve the best interests of all Tempur Sealy shareholders.
PROVEN MANAGEMENT TEAM DELIVERING SOLID RESULTS
AND DRIVING SHAREHOLDER RETURNS
The leadership of your Board is complemented by Tempur Sealy's deep executive
management team, led by Mr. Sarvary, who collectively bring approximately 190
years of management experience, including significant experience in the
consumer industry, international business expertise and track records of
success.
Mr. Sarvary and his leadership team are directly responsible for the
development and implementation of Tempur Sealy's value-enhancing strategy.
They have transformed the Company with the acquisition of Sealy, creating the
world's largest bedding provider; successfully introduced the TEMPUR Cloud
mattress line, which nearly doubled the Tempur-Pedic's U.S. mattress business;
and launched a record number of new products in 2014 to continue driving
topline growth and maintain Tempur Sealy's industry leadership.
H PARTNERS' SELF-SERVING CAMPAIGN
As part of its self-serving efforts to advance its withhold campaign, one of
Tempur Sealy's shareholders, H Partners, has made a number of misleading and
false assertions regarding Tempur Sealy, its leadership and its strategic
direction. Please do not be misled by H Partners. Here are the facts about
Tempur Sealy's growth strategies, record of performance and the value creation
delivered by your Board of Directors and management team. Tempur Sealy is:
o Leveraging and strengthening our comprehensive portfolio of iconic brands
and products;
o Expanding distribution and seeking highest dealer advocacy;
o Expanding margins with a focus on driving significant cost improvement;
o Leveraging global scale for competitive advantage;
o Making accretive acquisitions of licensees and joint ventures; and
o Creating value for ALL shareholders
In stark contrast to Tempur Sealy's plan, to date H Partners has failed to
offer any constructive ideas to create value or any other suggestions to
enhance the Company's strategy or operations. In fact, the only "real" idea
that H Partners has presented is to remove members of the Board and management
team, including Mr. Sarvary, and replace each with an H Partners
representative or hand-picked, unidentified CEO nominee. Of note, the
value-destructive path H Partners is advocating represents a complete
departure from its previous positive communications in support of Tempur
Sealy's performance and leadership.
Not only does H Partners lack a plan for Tempur Sealy – it lacks a track
record worthy of shareholder support. For instance, H Partners continues to
cite its investment in, and experience with, Six Flags Entertainment
Corporation. However, H Partners has repeatedly failed to acknowledge that Six
Flags was in bankruptcy when H Partners made its initial investment, and that
the drivers of historical value creation at Six Flags are not relevant or
applicable to Tempur Sealy's future success. We believe H Partners' claim that
its success at Six Flags would translate well at Tempur Sealy is clearly
misplaced.
This is a critical time in Tempur Sealy's history and we believe H Partners'
self-serving agenda would only serve to destroy value by interrupting the
execution of the strategy that is currently underway and already delivering
results.
Notwithstanding H Partners' position, the Tempur Sealy Board continues to
value constructive dialogue with all shareholders. Accordingly, we recently
offered to work with H Partners to identify a mutually acceptable, independent
director to add to the Board. H Partners summarily dismissed the proposal,
underscoring our belief that its interests lie only in its own agenda, no
matter the cost to all Tempur Sealy shareholders.
TEMPUR SEALY HAS THE RIGHT BOARD, THE RIGHT LEADERSHIP,
AND THE RIGHT STRATEGY TO DELIVER SHAREHOLDER VALUE
NOW AND OVER THE LONG TERM
The Tempur Sealy Board and management team are focused on continuing to
deliver superior performance, and we will remain diligent in the pursuit of
our objectives to drive value for all Tempur Sealy shareholders.
We are confident that Tempur Sealy has the right strategy, the right
management team and the right Board of Directors in place to continue
delivering value for ALL Tempur Sealy's shareholders, now and over the long
term.
We strongly urge you to disregard any blue proxy cards that you may receive
from H Partners. Please do NOT return or otherwise vote any blue proxy card
sent to you by H Partners. If you have previously submitted a blue proxy card
sent to you by H Partners, your Board urges you to revoke that proxy and vote
for your Board's nominees by signing, dating and returning the enclosed WHITE
proxy card today. You may also vote by Internet or telephone by following the
instructions set forth on the enclosed proxy card. If your shares are held for
you by a broker, bank or nominee, you must contact the broker, bank or nominee
to receive a previously authorized proxy.
We also encourage you to visit the Tempur Sealy website,
Investor.TempurSealy.com/AnnualMeeting, to find all the Company's materials
regarding the Board's recommendation for the 2015 Annual Meeting, and for
further information on voting your shares.
Protect your investment by voting the WHITE proxy card today "FOR" Tempur
Sealy's highly qualified, experienced director nominees.
We thank you for your continued support.
Sincerely,
The Tempur Sealy Board of Directors
If you need assistance voting your shares, please contact Tempur Sealy's proxy
solicitor D.F. King & Co., Inc. toll free at (877) 283-0319, toll at (212)
269-5550 or email at tpx@dfking.com.
ABOUT TEMPUR SEALY
Tempur Sealy International, Inc. (NYSE: TPX) is the world's largest bedding
provider. Tempur Sealy International, Inc. develops, manufactures and markets
mattresses, foundations, pillows and other products. The Company's brand
portfolio includes many of the most highly recognized brands in the industry,
including Tempur®, Tempur-Pedic®, Sealy®, Sealy Posturepedic®, Optimum™ and
Stearns & Foster®. World headquarters for Tempur Sealy International, Inc. is
in Lexington, KY. For more information, visit http://www.tempursealy.com or
call 800-805-3635.
FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements," within the meaning
of the federal securities laws, which include information concerning one or
more of the Company's plans, objectives, goals, strategies, and other
information that is not historical information. When used in this press
release, the words, "assumes," "estimates," "expects," "guidance,"
"anticipates," "projects," "plans," "proposed," "intends," "believes," and
variations of such words or similar expressions are intended to identify
forward-looking statements. These forward-looking statements include, without
limitation, statements relating to the Company's expectations regarding
its strategic growth initiatives, Tempur North America's growth momentum,
gross margin improvements, cost synergies, reducing operating expenses,
pricing strategies, global growth plans and creating value for shareholders.
All forward looking statements are based upon current expectations and beliefs
and various assumptions. There can be no assurance that the Company will
realize these expectations or that these beliefs will prove correct.
Numerous factors, many of which are beyond the Company's control, could cause
actual results to differ materially from those expressed as forward-looking
statements. These risk factors include risks associated with the Company's
capital structure and increased debt level; the ability to successfully
integrate Sealy Corporation into the Company's operations and realize cost and
revenue synergies and other benefits from the transaction; whether the Company
will realize the anticipated benefits from its asset dispositions in 2014 and
the acquisition of brand rights in certain international markets in 2014;
general economic, financial and industry conditions, particularly in the
retail sector, as well as consumer confidence and the availability of consumer
financing; changes in product and channel mix and the impact on the Company's
gross margin; changes in interest rates; the impact of the macroeconomic
environment in both the U.S. and internationally on the Company's business
segments; uncertainties arising from global events; the effects of changes in
foreign exchange rates on the Company's reported earnings; consumer acceptance
of the Company's products; industry competition; the efficiency and
effectiveness of the Company's advertising campaigns and other marketing
programs; the Company's ability to increase sales productivity within existing
retail accounts and to further penetrate the Company's retail channel,
including the timing of opening or expanding within large retail accounts and
the timing and success of product launches; the effects of consolidation of
retailers on revenues and costs; the Company's ability to expand brand
awareness, distribution and new products; the Company's ability to
continuously improve and expand its product line, maintain efficient, timely
and cost-effective production and delivery of its products, and manage its
growth; the effects of strategic investments on the Company's operations;
changes in foreign tax rates and changes in tax laws generally, including the
ability to utilize tax loss carry forwards; the outcome of various pending tax
audits or other tax, regulatory or litigation proceedings; changing commodity
costs; and the effect of future legislative or regulatory changes.
There are a number of risks and uncertainties that could cause the Company's
actual results to differ materially from the forward-looking statements
contained in this press release. There are important factors, many of which
are beyond the Company's control, that could cause its actual results to
differ materially from those expressed as forward-looking statements in this
press release, including the risk factors discussed under the heading "Risk
Factors" under ITEM 1A of Part 1 of our Annual Report on Form 10-K for the
year ended December 31, 2014. There may be other factors that may cause the
Company's actual results to differ materially from the forward-looking
statements. Any forward looking statement speaks only as of the date on which
it is made, and the Company undertakes no obligation to update any forward
looking statements for any reason, including to reflect events or
circumstances after the date on which such statements are made or to reflect
the occurrence of anticipated or unanticipated events or circumstances.
USE OF NON-GAAP FINANCIAL MEASURES
The Company provides information regarding adjusted operating expenses, which
is not a recognized term under U.S. generally accepted accounting principles
("GAAP") and does not purport to be an alternative to GAAP as a measure of
operating performance. A reconciliation of GAAP operating expenses to adjusted
operating expenses, which is GAAP operating expenses less integration and
financing costs, is provided below. Management believes that the use of
adjusted operating expense provides investors with useful information with
respect to the operating performance of the Company excluding the impact of
integration and financing costs related to the Sealy acquisition and the
Company's initiative to deleverage operating expenses during 2015-2018.
Because not all companies use identical calculations, these presentations may
not be comparable to other similarly titled measures of other companies.
Tempur Sealy International, Inc. Year Ended
(in millions, except percentage amounts) December 31, 2014
Consolidated net sales $2,989.8
Selling and marketing expenses 619.9
General, administrative and other expenses 280.6
Operating Expenses 900.5
Operating Expenses as a % of Consolidated Net Sales 30%
Operating Expenses $900.5
Less: Integration and financing costs 43.8
Operating Expenses less Integration and financing costs $856.7
Adjusted Operating Expenses as a % of Consolidated Net 29%
Sales
CONSTANT CURRENCY INFORMATION
In this press release the Company refers to, and in other press releases and
communications with investors the Company may refer to, net sales or earnings
or other historical financial information on a "constant currency basis",
which is a non-GAAP financial measure. These references to constant currency
basis do not include operational impacts that could result from fluctuations
in foreign currency rates. To provide information on a constant currency
basis, the applicable financial results are adjusted based on a simple
mathematical model that translates current period results in local currency
using the comparable prior year period's currency conversion rate. This
approach is used for countries where the functional currency is the local
country currency. This information is provided so that certain financial
results can be viewed without the impact of fluctuations in foreign currency
rates, thereby facilitating period-to-period comparisons of business
performance.
NOTE REGARDING TRADEMARKS, TRADE NAMES AND SERVICE MARKS
TEMPUR, Tempur-Pedic, TEMPUR-Cloud, TEMPUR-Choice, TEMPUR-Weightless,
TEMPUR-Contour, TEMPUR-Rhapsody, TEMPUR-Flex, GrandBed, TEMPUR-Simplicity,
TEMPUR-Ergo, TEMPUR-UP, TEMPUR-Neck, TEMPUR-Symphony, TEMPUR-Comfort,
TEMPUR-Traditional, TEMPUR-Home, Sealy, Sealy Posturepedic, Stearns & Foster,
and Optimum are trademarks, trade names or service marks of Tempur Sealy
International, Inc. and/or its subsidiaries.
^^1Represents performance from September 26, 2012, the date prior to the
announcement of the Sealy acquisition, to March 27, 2015. Equity value
calculated using basic shares outstanding.
^^2Represents performance from August 4, 2008, the date Mr. Sarvary joined as
CEO, to March 27, 2015. Total shareholder return includes stock price
appreciation and dividends reinvested.
^^3Represents performance from August 4, 2008, the date Mr. Sarvary joined as
CEO, to March 27, 2015. Total shareholder return includes stock price
appreciation and dividends reinvested.
^^4Represents initiatives to be achieved by 2018. Our expectation is that they
will ramp through the period. Approximately 30% of the total $125 million is
incorporated into our full year 2015 adjusted EPS guidance issued in February
2015. See "Forward Looking Statements". Target expressed in constant currency.
For information on the methodology used to present constant currency
information please refer to "Constant Currency Information" at the end of this
press release.
^^5Adjusted operating expense is a non-GAAP financial measure. For information
on adjusted operating expense, including a reconciliation of GAAP operating
expense, please refer to "Use of Non-GAAP Financial Measures" at the end of
this press release.
^^6Based on NYSE rules.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/tempur-sealy-files-investor-presentation-and-mails-letter-to-shareholders-300061083.html
SOURCE Tempur Sealy International, Inc.
Contact: Company Contact - Mark Rupe, Vice President, Investor Relations,
Tempur Sealy, 800-805-3635, Investor.relations@tempursealy.com; Investor
Contact - Jordan Kovler, D.F. King & Co., Inc., (212) 269-5550, Media Contact
- James Golden / Nick Lamplough / Alyssa Cass, Joele Frank, Wilkinson Brimmer
Katcher, 212-355-4449
-0- Apr/06/2015 11:30 GMT
2015-04-06 11:30:02.965 GMT
Tempur Sealy Files Investor Presentation And Mails Letter To Shareholders
Tempur Sealy Has the Right Strategy, Management Team and Board to Continue
Driving Enhanced Value Creation for ALL Shareholders
Board Recommends Shareholders Support Value-Enhancing Initiatives Underway by
Voting the WHITE Proxy Card "FOR" the Company's Highly Qualified Director
Nominees
Materials for Tempur Sealy's Annual Meeting Available at
Investor.TempurSealy.com/AnnualMeeting
PR Newswire
LEXINGTON, Ky., April 6, 2015
LEXINGTON, Ky., April 6, 2015 /PRNewswire/ -- Tempur Sealy International, Inc.
(NYSE: TPX), the world's largest bedding provider, announced today that it has
filed an investor presentation with the Securities and Exchange Commission
("SEC") in connection with its upcoming 2015 Annual Meeting of Shareholders to
be held on May 8, 2015. In addition, Tempur Sealy is mailing a letter to its
shareholders that highlights key elements of the presentation. The
presentation is available on the SEC's website at www.sec.gov and on the
special Annual Meeting section of the Company's website at
Investor.TempurSealy.com/AnnualMeeting.
Highlights of the presentation include:
o Tempur Sealy Today: Creating a Global Bedding Leader
With the transformative acquisition of Sealy Corporation, the Company's
Board and management team have created the world's largest bedding
provider and manufacturer with a complete and complementary portfolio of
iconic brands. Since the announcement of the transaction, Tempur Sealy
has created an additional approximately $1.8 billion in equity value for
shareholders^^1.
o Strategic Actions Underway to Drive Value
Tempur Sealy is focused on executing its strategy to continue delivering
industry leading growth, enhanced profitability, and superior value for
shareholders, including: driving enhanced margins and long term growth
through reinvestment in the business, as evidenced by Tempur North
America's return to a position of strength and profitability; completing
the organizational integration of Sealy; enhancing operating margins; and
leveraging the Company's global scale to execute on its international
growth plan.
o Experienced Management Team and Board of Directors with Proven Track
Record
Tempur Sealy's Board and management team have established the Company as
the leader in its industry, and are responsible for the development and
implementation of Tempur Sealy's value-enhancing strategy. The Board is
committed to representing the interests of all shareholders, and takes an
active approach in overseeing the execution of the Company's strategy,
providing guidance and ensuring management accountability. As a result,
under the Board's oversight and the leadership of CEO Mark Sarvary, Tempur
Sealy has realized an industry-leading total shareholder return of 493%,
more than five times that of the S&P 500^^2.
o Setting the Record Straight on H Partners
H Partners, a shareholder of the Company, has demanded high-risk,
value-destroying leadership changes at the Company, including: the
immediate removal of the Company's CEO and the ceding of effective control
of the Company to an H Partners' hand-picked, unidentified CEO nominee;
the removal of the independent Chairman of the Board as well as another
director; and the immediate appointment of an H Partners' representative
to the Board and the Compensation Committee. Moreover, H Partners has
failed to outline a substantive plan or constructive views on how to
enhance Tempur Sealy's strategy or operations, and has refused to engage
with the Board on these topics while summarily dismissing a proposal to
identify a mutually acceptable, independent director nominee to the Tempur
Sealy Board. Tempur Sealy believes that the changes H Partners seeks would
be disruptive and value-destructive to the Company and its shareholders at
an important time in the execution of its strategy. As such, while the
Tempur Sealy Board is dedicated to constructive dialogue with all
shareholders, including H Partners, it remains firm in its support of the
current management team and Board composition.
o Right Team and Strategy in Place to Enhance Shareholder Value
Today, Tempur Sealy is positioned as the only truly global player in the
industry, with the platform, strategy and resources to build an even
stronger company. The Company believes that with the guidance of its
experienced management team and the oversight of its engaged and highly
qualified Board, Tempur Sealy remains well-positioned for long-term
success and value creation.
The full text of the letter is below:
SHOW YOUR SUPPORT FOR THE VALUE CREATING STRATEGIES OF THE
TEMPUR SEALY BOARD OF DIRECTORS
VOTE THE WHITE PROXY CARD "FOR" THE RE-ELECTION OF THE BOARD TODAY
April 6, 2015
Dear Fellow Tempur Sealy Shareholder:
At the Annual Meeting of Shareholders on May 8, 2015, you will have the
opportunity to make an important decision regarding the future of Tempur Sealy
International, Inc.
Since the appointment of Chief Executive Officer Mark Sarvary in 2008, the
Tempur Sealy Board of Directors and management team have guided the Company
through the transformational acquisition of Sealy Corporation and positioned
the Company for continued industry leadership, and strong growth and
significant shareholder returns. In fact, Tempur Sealy has delivered total
shareholder returns of more than 493%, more than five times that of the S&P
500 during that period^^3.
Today, the Company's management team, with the oversight of its independent
and engaged Board, is continuing to make significant progress on the execution
of Tempur Sealy's strategic priorities. We are more confident than ever that
this is the right team and the right Board to continue to drive growth and
oversee continued shareholder value creation.
Your vote is important, and we urge you to make your voice heard at the Annual
Meeting by voting the WHITE card "FOR" the re-election of Tempur Sealy's
highly qualified and experienced director nominees: Evelyn S. Dilsaver, Frank
Doyle, John A. Heil, Peter K. Hoffman, Sir Paul Judge, Nancy F. Koehn,
Christopher A. Masto, P. Andrews McLane, Lawrence J. Rogers, Mark Sarvary and
Robert B. Trussell, Jr.
COMMITTED TO ENHANCING SHAREHOLDER VALUE
AND DELIVERING ON THAT PROMISE
Recent accomplishments by your Board and management team demonstrate the
strength and commitment of your Company's leadership, and that Tempur Sealy is
well-positioned to maintain its record of growth and value creation,
including:
o Returning Tempur North America to a position of strength. As a result of
our focus on innovation and product development, we have revamped our
entire product offering and returned Tempur North America to double-digit
topline growth. We expect this momentum to continue in 2015 and beyond.
o Successfully integrating Sealy. The organizational integration of the
Sealy business in North America is essentially complete, and today Tempur
Sealy has a comprehensive and complementary portfolio of brands and
products to meet each consumer demographic – in the U.S. and
internationally. The Company is positioned to be a leader in all of its
markets with the potential to deliver significant future shareholder
value.
o Intensely focusing on enhancing margins and driving profitability. We
expect to generate approximately $125 million in operating income
improvement by 2018^^4 by continuing to make progress against four
specific operational objectives: driving gross margin improvements for
Sealy U.S.; achieving additional cost synergies from the Sealy
acquisition; reducing adjusted operating expense^^5 as a percentage of
revenue from 29% in 2014 to 28% by 2018; and implementing an enhanced 2015
pricing strategy.
o Executing a global growth plan. Through the 2013 acquisition of Sealy
Corporation, we created a platform with the scale, portfolio and resources
from which to build an even stronger global company. Across our global
footprint we are driving product innovation, making marketing investments,
leveraging distribution synergies, and pursuing acquisitions of licensees
and joint ventures.
TEMPUR SEALY'S BOARD HAS A RECORD OF
SUPERIOR, LONG-TERM PERFORMANCE AND VALUE CREATION
Your Board is composed of 11 highly qualified directors, nine of whom are
independent and all of whom have proven records of value creation. The Tempur
Sealy Board has the diversity, experience and qualifications necessary to
continue to provide effective and independent oversight, while driving the
value-enhancing strategy in place.
Together, the Tempur Sealy Board possesses distinct knowledge and expertise
that is critical to the Company's success. This includes experience leading
and growing companies in the mattress, manufacturing and other consumer and
retail industries. Your Board also includes directors with experience and
backgrounds in disciplines that are highly relevant to the Company's
businesses, including: international expansion, mergers and acquisitions,
accounting, risk management and corporate finance.
CEO / President Senior
Leadership
/ CFO / Finance Consumer /
Independent^^6 / at Company Retail
with
Legal Experience
Experience Global
Operations
Evelyn S. * * * *
Dilsaver
Frank Doyle * * *
John A. Heil * * * *
Peter K. Hoffman * * * *
Sir Paul Judge * * * *
Nancy F. Koehn * *
Christopher A. * * *
Masto
P. Andrews McLane * * * *
Lawrence J. * * *
Rogers
Mark Sarvary * * *
Robert B. * * * *
Trussell, Jr.
Together with the Tempur Sealy management team, your Board of Directors has
developed and put in place a plan that is working. Each director is vital to
the continued successful execution of Tempur Sealy's initiatives to create
shareholder value, and each is committed to continuing to deliver superior
results and serve the best interests of all Tempur Sealy shareholders.
PROVEN MANAGEMENT TEAM DELIVERING SOLID RESULTS
AND DRIVING SHAREHOLDER RETURNS
The leadership of your Board is complemented by Tempur Sealy's deep executive
management team, led by Mr. Sarvary, who collectively bring approximately 190
years of management experience, including significant experience in the
consumer industry, international business expertise and track records of
success.
Mr. Sarvary and his leadership team are directly responsible for the
development and implementation of Tempur Sealy's value-enhancing strategy.
They have transformed the Company with the acquisition of Sealy, creating the
world's largest bedding provider; successfully introduced the TEMPUR Cloud
mattress line, which nearly doubled the Tempur-Pedic's U.S. mattress business;
and launched a record number of new products in 2014 to continue driving
topline growth and maintain Tempur Sealy's industry leadership.
H PARTNERS' SELF-SERVING CAMPAIGN
As part of its self-serving efforts to advance its withhold campaign, one of
Tempur Sealy's shareholders, H Partners, has made a number of misleading and
false assertions regarding Tempur Sealy, its leadership and its strategic
direction. Please do not be misled by H Partners. Here are the facts about
Tempur Sealy's growth strategies, record of performance and the value creation
delivered by your Board of Directors and management team. Tempur Sealy is:
o Leveraging and strengthening our comprehensive portfolio of iconic brands
and products;
o Expanding distribution and seeking highest dealer advocacy;
o Expanding margins with a focus on driving significant cost improvement;
o Leveraging global scale for competitive advantage;
o Making accretive acquisitions of licensees and joint ventures; and
o Creating value for ALL shareholders
In stark contrast to Tempur Sealy's plan, to date H Partners has failed to
offer any constructive ideas to create value or any other suggestions to
enhance the Company's strategy or operations. In fact, the only "real" idea
that H Partners has presented is to remove members of the Board and management
team, including Mr. Sarvary, and replace each with an H Partners
representative or hand-picked, unidentified CEO nominee. Of note, the
value-destructive path H Partners is advocating represents a complete
departure from its previous positive communications in support of Tempur
Sealy's performance and leadership.
Not only does H Partners lack a plan for Tempur Sealy – it lacks a track
record worthy of shareholder support. For instance, H Partners continues to
cite its investment in, and experience with, Six Flags Entertainment
Corporation. However, H Partners has repeatedly failed to acknowledge that Six
Flags was in bankruptcy when H Partners made its initial investment, and that
the drivers of historical value creation at Six Flags are not relevant or
applicable to Tempur Sealy's future success. We believe H Partners' claim that
its success at Six Flags would translate well at Tempur Sealy is clearly
misplaced.
This is a critical time in Tempur Sealy's history and we believe H Partners'
self-serving agenda would only serve to destroy value by interrupting the
execution of the strategy that is currently underway and already delivering
results.
Notwithstanding H Partners' position, the Tempur Sealy Board continues to
value constructive dialogue with all shareholders. Accordingly, we recently
offered to work with H Partners to identify a mutually acceptable, independent
director to add to the Board. H Partners summarily dismissed the proposal,
underscoring our belief that its interests lie only in its own agenda, no
matter the cost to all Tempur Sealy shareholders.
TEMPUR SEALY HAS THE RIGHT BOARD, THE RIGHT LEADERSHIP,
AND THE RIGHT STRATEGY TO DELIVER SHAREHOLDER VALUE
NOW AND OVER THE LONG TERM
The Tempur Sealy Board and management team are focused on continuing to
deliver superior performance, and we will remain diligent in the pursuit of
our objectives to drive value for all Tempur Sealy shareholders.
We are confident that Tempur Sealy has the right strategy, the right
management team and the right Board of Directors in place to continue
delivering value for ALL Tempur Sealy's shareholders, now and over the long
term.
We strongly urge you to disregard any blue proxy cards that you may receive
from H Partners. Please do NOT return or otherwise vote any blue proxy card
sent to you by H Partners. If you have previously submitted a blue proxy card
sent to you by H Partners, your Board urges you to revoke that proxy and vote
for your Board's nominees by signing, dating and returning the enclosed WHITE
proxy card today. You may also vote by Internet or telephone by following the
instructions set forth on the enclosed proxy card. If your shares are held for
you by a broker, bank or nominee, you must contact the broker, bank or nominee
to receive a previously authorized proxy.
We also encourage you to visit the Tempur Sealy website,
Investor.TempurSealy.com/AnnualMeeting, to find all the Company's materials
regarding the Board's recommendation for the 2015 Annual Meeting, and for
further information on voting your shares.
Protect your investment by voting the WHITE proxy card today "FOR" Tempur
Sealy's highly qualified, experienced director nominees.
We thank you for your continued support.
Sincerely,
The Tempur Sealy Board of Directors
If you need assistance voting your shares, please contact Tempur Sealy's proxy
solicitor D.F. King & Co., Inc. toll free at (877) 283-0319, toll at (212)
269-5550 or email at tpx@dfking.com.
ABOUT TEMPUR SEALY
Tempur Sealy International, Inc. (NYSE: TPX) is the world's largest bedding
provider. Tempur Sealy International, Inc. develops, manufactures and markets
mattresses, foundations, pillows and other products. The Company's brand
portfolio includes many of the most highly recognized brands in the industry,
including Tempur®, Tempur-Pedic®, Sealy®, Sealy Posturepedic®, Optimum™ and
Stearns & Foster®. World headquarters for Tempur Sealy International, Inc. is
in Lexington, KY. For more information, visit http://www.tempursealy.com or
call 800-805-3635.
FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements," within the meaning
of the federal securities laws, which include information concerning one or
more of the Company's plans, objectives, goals, strategies, and other
information that is not historical information. When used in this press
release, the words, "assumes," "estimates," "expects," "guidance,"
"anticipates," "projects," "plans," "proposed," "intends," "believes," and
variations of such words or similar expressions are intended to identify
forward-looking statements. These forward-looking statements include, without
limitation, statements relating to the Company's expectations regarding
its strategic growth initiatives, Tempur North America's growth momentum,
gross margin improvements, cost synergies, reducing operating expenses,
pricing strategies, global growth plans and creating value for shareholders.
All forward looking statements are based upon current expectations and beliefs
and various assumptions. There can be no assurance that the Company will
realize these expectations or that these beliefs will prove correct.
Numerous factors, many of which are beyond the Company's control, could cause
actual results to differ materially from those expressed as forward-looking
statements. These risk factors include risks associated with the Company's
capital structure and increased debt level; the ability to successfully
integrate Sealy Corporation into the Company's operations and realize cost and
revenue synergies and other benefits from the transaction; whether the Company
will realize the anticipated benefits from its asset dispositions in 2014 and
the acquisition of brand rights in certain international markets in 2014;
general economic, financial and industry conditions, particularly in the
retail sector, as well as consumer confidence and the availability of consumer
financing; changes in product and channel mix and the impact on the Company's
gross margin; changes in interest rates; the impact of the macroeconomic
environment in both the U.S. and internationally on the Company's business
segments; uncertainties arising from global events; the effects of changes in
foreign exchange rates on the Company's reported earnings; consumer acceptance
of the Company's products; industry competition; the efficiency and
effectiveness of the Company's advertising campaigns and other marketing
programs; the Company's ability to increase sales productivity within existing
retail accounts and to further penetrate the Company's retail channel,
including the timing of opening or expanding within large retail accounts and
the timing and success of product launches; the effects of consolidation of
retailers on revenues and costs; the Company's ability to expand brand
awareness, distribution and new products; the Company's ability to
continuously improve and expand its product line, maintain efficient, timely
and cost-effective production and delivery of its products, and manage its
growth; the effects of strategic investments on the Company's operations;
changes in foreign tax rates and changes in tax laws generally, including the
ability to utilize tax loss carry forwards; the outcome of various pending tax
audits or other tax, regulatory or litigation proceedings; changing commodity
costs; and the effect of future legislative or regulatory changes.
There are a number of risks and uncertainties that could cause the Company's
actual results to differ materially from the forward-looking statements
contained in this press release. There are important factors, many of which
are beyond the Company's control, that could cause its actual results to
differ materially from those expressed as forward-looking statements in this
press release, including the risk factors discussed under the heading "Risk
Factors" under ITEM 1A of Part 1 of our Annual Report on Form 10-K for the
year ended December 31, 2014. There may be other factors that may cause the
Company's actual results to differ materially from the forward-looking
statements. Any forward looking statement speaks only as of the date on which
it is made, and the Company undertakes no obligation to update any forward
looking statements for any reason, including to reflect events or
circumstances after the date on which such statements are made or to reflect
the occurrence of anticipated or unanticipated events or circumstances.
USE OF NON-GAAP FINANCIAL MEASURES
The Company provides information regarding adjusted operating expenses, which
is not a recognized term under U.S. generally accepted accounting principles
("GAAP") and does not purport to be an alternative to GAAP as a measure of
operating performance. A reconciliation of GAAP operating expenses to adjusted
operating expenses, which is GAAP operating expenses less integration and
financing costs, is provided below. Management believes that the use of
adjusted operating expense provides investors with useful information with
respect to the operating performance of the Company excluding the impact of
integration and financing costs related to the Sealy acquisition and the
Company's initiative to deleverage operating expenses during 2015-2018.
Because not all companies use identical calculations, these presentations may
not be comparable to other similarly titled measures of other companies.
Tempur Sealy International, Inc. Year Ended
(in millions, except percentage amounts) December 31, 2014
Consolidated net sales $2,989.8
Selling and marketing expenses 619.9
General, administrative and other expenses 280.6
Operating Expenses 900.5
Operating Expenses as a % of Consolidated Net Sales 30%
Operating Expenses $900.5
Less: Integration and financing costs 43.8
Operating Expenses less Integration and financing costs $856.7
Adjusted Operating Expenses as a % of Consolidated Net 29%
Sales
CONSTANT CURRENCY INFORMATION
In this press release the Company refers to, and in other press releases and
communications with investors the Company may refer to, net sales or earnings
or other historical financial information on a "constant currency basis",
which is a non-GAAP financial measure. These references to constant currency
basis do not include operational impacts that could result from fluctuations
in foreign currency rates. To provide information on a constant currency
basis, the applicable financial results are adjusted based on a simple
mathematical model that translates current period results in local currency
using the comparable prior year period's currency conversion rate. This
approach is used for countries where the functional currency is the local
country currency. This information is provided so that certain financial
results can be viewed without the impact of fluctuations in foreign currency
rates, thereby facilitating period-to-period comparisons of business
performance.
NOTE REGARDING TRADEMARKS, TRADE NAMES AND SERVICE MARKS
TEMPUR, Tempur-Pedic, TEMPUR-Cloud, TEMPUR-Choice, TEMPUR-Weightless,
TEMPUR-Contour, TEMPUR-Rhapsody, TEMPUR-Flex, GrandBed, TEMPUR-Simplicity,
TEMPUR-Ergo, TEMPUR-UP, TEMPUR-Neck, TEMPUR-Symphony, TEMPUR-Comfort,
TEMPUR-Traditional, TEMPUR-Home, Sealy, Sealy Posturepedic, Stearns & Foster,
and Optimum are trademarks, trade names or service marks of Tempur Sealy
International, Inc. and/or its subsidiaries.
^^1Represents performance from September 26, 2012, the date prior to the
announcement of the Sealy acquisition, to March 27, 2015. Equity value
calculated using basic shares outstanding.
^^2Represents performance from August 4, 2008, the date Mr. Sarvary joined as
CEO, to March 27, 2015. Total shareholder return includes stock price
appreciation and dividends reinvested.
^^3Represents performance from August 4, 2008, the date Mr. Sarvary joined as
CEO, to March 27, 2015. Total shareholder return includes stock price
appreciation and dividends reinvested.
^^4Represents initiatives to be achieved by 2018. Our expectation is that they
will ramp through the period. Approximately 30% of the total $125 million is
incorporated into our full year 2015 adjusted EPS guidance issued in February
2015. See "Forward Looking Statements". Target expressed in constant currency.
For information on the methodology used to present constant currency
information please refer to "Constant Currency Information" at the end of this
press release.
^^5Adjusted operating expense is a non-GAAP financial measure. For information
on adjusted operating expense, including a reconciliation of GAAP operating
expense, please refer to "Use of Non-GAAP Financial Measures" at the end of
this press release.
^^6Based on NYSE rules.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/tempur-sealy-files-investor-presentation-and-mails-letter-to-shareholders-300061083.html
SOURCE Tempur Sealy International, Inc.
Contact: Company Contact - Mark Rupe, Vice President, Investor Relations,
Tempur Sealy, 800-805-3635, Investor.relations@tempursealy.com; Investor
Contact - Jordan Kovler, D.F. King & Co., Inc., (212) 269-5550, Media Contact
- James Golden / Nick Lamplough / Alyssa Cass, Joele Frank, Wilkinson Brimmer
Katcher, 212-355-4449
-0- Apr/06/2015 11:30 GMT
Telecoms must address technology disrupters, says LetterOne head
VimpelCom staff demonstrate mobile phones to customers at their store in Moscow, Russia, on Dec 15 2004©Bloomberg
VimpelCom staff demonstrate phones in a Moscow store
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.”
Greece assures on €450m payment to IMF
Greece has assured the International Monetary Fund that it will not miss a €450m payment to the fund due on Thursday, easing fears that Athens was set to become the first developed country in the IMF’s history to default on its debts to the institution.
The Greek finance minister, Yanis Varoufakis, on Sunday met for more than two hours with Christine Lagarde, the IMF’s managing director, after flying in for what was billed as an “informal meeting” by the fund. He is due to meet with senior US officials on Monday.
In a statement issued after their meeting, Ms Lagarde said Mr Varoufakis had confirmed that Athens would make the next payment due April 9 as part of the plan agreed by a previous government to repay the fund for Greece’s first bailout in 2010.
Greece this year is due to repay the IMF more than €9bn as part of a repayment plan that fund officials insist cannot be rescheduled unless Athens agrees to a fresh IMF program, something the new government does not want to do.
Ms Lagarde also said Mr Varoufakis had agreed that discussions in Brussels on Greece’s proposed new reform program, as well as efforts by IMF and European officials to conduct “due diligence” in Athens, would “resume promptly on Monday”.
The unscheduled weekend flight to Washington by the Greek finance minister had prompted speculation of a more dramatic turn of events, or that Athens was turning to the IMF and the US in a bid to persuade its European creditors to adopt an easier tone in negotiations with Greece.
Those negotiations have grown increasingly acrimonious in recent weeks with European officials openly questioning the makeup of the new government in Athens which has been in power for less than four months.
Further fuelling tensions, officials, including Mr Varoufakis, have said the government would rather pay public sector workers’ salaries than the IMF in the event of a cash crunch.
But after the Easter Sunday meeting Ms Lagarde seemed determined to play any chances that Greece would take what would amount to a nuclear option by missing a payment to the fund.
Though doing so would not immediately be officially deemed a default by the IMF, especially if a payment was made within 30 days, it would have significant implications for other creditors and could trigger events that might lead to the country’s exit from the eurozone.
In her statement Ms Lagarde said she and Mr Varoufakis had agreed that “effective cooperation is in everyone’s interest” and “noted that continuing uncertainty is not in Greece’s interest”.
LetterOne Telecom has USD 16bn for acquisitions in US, Europe
LetterOne Telecom, the London-based investment platform, has USD 16bn to invest in telecoms and internet technology businesses in the US and Europe, the Financial Times reported.
Part of the LetterOne Group (the investment vehicle founded by MIkhail Fridman) LetterOne Telecom will use technology to transform existing business practice, the unit's Chief Executive Alexey Reznikovich was cited as saying. With a debt-free balance sheet, LetterOne Telecom would leverage up to USD 25bn, Reznikovich said.
LetterOne Telecom targets companies operating in a range of business areas including traditional telecommunications, Reznikovich noted. App makers and companies offering streaming services are also of potential interest, he added.
Financial Times
European Biotech’s American Dream
Companies on the Continent are finding richer rewards by listing their shares in the U.S.
If you can’t beat them, join them. European biotech companies increasingly look across the Atlantic where investors’ enthusiasm for nascent health-care companies seemingly knows no bounds.
With the Nasdaq Biotechnology Index up nearly threefold in the past three years, European companies have benefited from listing on U.S. exchanges rather than at home. Some, like Denmark’s Forward Pharma and the Netherlands’ Prosensa, recently acquired by BioMarin , skipped their domestic markets to list in the U.S. Others, like France’s DBV Technologies and Cellectis, have issued American depositary receipts.
ENLARGE
The fact is that, bubble or otherwise, these companies get attention and liquidity from a specialist investor base not readily available in Europe. No European biotech companies sold shares in the U.S. from 2010 to 2012, according to Dealogic, but fundraising has picked up markedly since.
Cellectis, active in the red-hot area of oncology known as CAR-T, already was getting noticed by U.S. investors. But the stock really flew after it confirmed in January it was pursuing a U.S. listing. Shares in DBV Technologies, which develops allergy treatments, similarly soared as it moved closer to a Nasdaq listing.
Bankers say another reason to favor U.S. markets is the ease of raising further equity; pre-emption rights in Europe limit this. Last week, several U.S.-listed biotechs announced plans to sell more stock.
After a busy 2014, Europe’s biotech emigration may slow. But the lure of a better life in America is well established now. When asked whether many European biotech companies were considering a listing stateside, one banker said: “A lot to all of them.” Best to make the most of long-distance love before the ardor fades.
EU Mid-Market Update: US participants get to react to disappointing payroll data from last Friday
***Notes/Observations***
- Price action subdued as most markets closed in both Asia and Europe
- Friday's miss in Mar US jobs data having analysts rethink 1st potential Fed rate hike
**Economic data***
- (IN) India Mar Services PMI: 53.0 v 53.9 prior; Composite PMI: 53.2 v 53.5 prior
- (JP) Japan Feb Preliminary Leading Index CI: 105.3 v 105.1e; Coincident Index: 110.7 v 110.7e
- (ES) Spain Mar Net Unemployment M/M: -60.2K v -13.5K prior
Fixed Income
- (PH) Philippines sold total PHP14.46B vs. PHP20.0B indicated in 3-month, 6-month Bills and 12-month Bills
- (IN) India sold total INR140B in 3-month and 12-month Bills
*** SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM ***
**Equities**
Indices [Stoxx50 closed, FTSE 100 closed, DAX closed, CAC-40 closed, IBEX-35 closed, FTSE MIB closed, SMI closed, Athens Stock Exchange closed, S&P 500 Futures -0.7% at 2,044]
- Market Focal Points/Key Themes: With the major European bourses closed for holiday, S&P 500 Futures have declined by over 0.6%, as traders assess recent US payrolls data. US corporate earnings are also in focus this week, as Alcoa is due to report its results on Wed April, 8th (after the close). Commodities are sharply higher, as traders have pushed back Fed rate hike bets following the US jobs report (Copper +2.3%, NYMEX Crude Futures +2.8%, Gold Futures +1.7%); Upcoming comments from Fed official Dudley (dove, FOMC voter)
**Speakers**
- Spain PM Rajoy reiterated that the country's 2015 GDP growth was seen above 2.4% vs 2.0% official target and could create 500K jobs in 2015
- France Finance Ministry to maintain its 2015 GDP growth outlook of 1.0% when it presents broad outline to public finance council this week
- Greece Fin Min Varoufakis expected initial deal related to Greece at the April 24th Eurogroup meeting
- Turkey Central Bank commented on March inflation data: Reiterates core inflation is slowing on basic goods, ex-food inflation trend fall continued
- Turkey Econ Min Zeybekci: 3% GDP growth is unacceptable
- Israel Central Bank (BOI) Mar Minutes: Decision to hold rates steady at 0.10% was unanimous
- JPMorgan revised its Fed call; now saw a rate hike in Sept vs June prior view
**Currencies***
- The USD consolidated its recent losses after Friday's release of non-farm payroll laid an egg and missed expectations. Various analysts were pushing back their call for the 1st Fed rate hike
- EUR/USD still contained within its post FOMC trading range from the past two week. EUR-buy stops above 1.1050 area were unable to be taken out (elected) despite the miss in US jobs data.
- The weaker USD has helped commodities. Spot gold was higher at $1,222/oz while front month WTI oil contract was above $50/barrel
**Political/In the Papers:
- IMF's Lagarde confirmed that Greece would make the planned repayment to IMF on Apr 9th
**Looking Ahead***
All times listed for economic events are denominated in Eastern Standard Time (Add 4 hours for GMT equivalent)
- 07:30 (CL) Chile Central Bank Meeting Minutes
- 07:30 (CL) Chile Economic Activity Index (Monthly GDP) M/M: -0.1%e v 0.8% (revised from 0.4%); Y/Y: 1.8%e v 3.0% prior
- 07:30 (BR) Brazil Central Bank Weekly Economists Survey
- 08:30 (US) Fed's Dudley (dove, FOMC voter) on economic outlook in NJ
- 09:00 (BR) Brazil Mar Services PMI: No est v 52.3 prior; Composite PMI: No est v 51.3 prior
- 09:00 (MX) Mexico Feb Leading Indicators M/M: No est v -0.07 prior
- 09:45 (US) Mar Final Markit Services PMI: 58.5e v 58.6 prelim; Composite PMI: No est v 58.5 prelim
- 10:00 (US) Mar Labor Market Conditions Index Change: No est v 4.0 prior
- 10:00 (US) Mar ISM Non-Manufacturers Composite: 56.8e v 56.9 prior
- 10:00 (CA) Canada Mar Ivey Purchasing Managers Index (Seasonally Adj): 51.0e v 49.7 prior; PMI (unadj): 51.0e v 50.8 prior
- 10:30 (CA) Bank of Canada Q1 Senior Loan Officer Survey: -1.0e v -2.7 prior; Business Outlook Future Sales: 0.00e v 8 prior
- 11:30 (US) Treasury to sell $48B in 3-Month and 6-Month Bills
- 16:00 (US) Crop Condition Report
- 21:00 (PH) Philippines Mar CPI M/M: 0.0%e v 0.1% prior; Y/Y: 2.6%e v 2.5% prior; CPI Core Y/Y: 2.7%e v 2.5% prior
- 21:30 (AU) Australia Feb Retail Sales M/M: 0.4%e v 0.4% prior
- 23:00 (TH) Bank of Thailand to sell 3-month, 6-month and 12-month
- 23:35 (JP) Japan to sell 6-Month Bill
- (AU) RBA Rate decision (Early Tues)
- (IN) RBI rate decision (early Tues)