FT : Borsa Istanbul in talks over stake sale

Borsa Istanbul in talks over stake sale

A bull sculpture stands at the entrance to the Borsa Istanbul, also known as the Istanbul stock exchange, in Istanbul, Turkey, on Monday, Jan. 13, 2014©Bloomberg
A bull sculpture stands at the entrance to the Borsa Istanbul
Borsa Istanbul is talking to local and overseas financial institutions about taking a stake in the Turkish exchange ahead of its planned initial public offering.
The exchange wants to secure a group of anchor investors by selling a chunk of its 36 per cent shareholding in coming months before proceeding with a listing.

Its flotation and development will be closely watched by investors as the fast-growing emerging Turkish economy finalises an overhaul of its markets. Regulations and trading infrastructure are being brought into line with international norms, aiming to make Turkey a financial hub for the region.
Ibrahim Turhan, chief executive of Borsa Istanbul, said the listing was likely to be scheduled for “early next year”.
“What we have in our mind is to finalise the second part of the strategic plan with financial institutions by the end of February,” he said on the sidelines of an investor conference in London last week. “We will take our time for the IPO. It should be at least 12 months after the share sale.”
The sale of its stake is one of a series of options for Borsa Istanbul. Turkey has set a year-end target for the exchange to be floated, although there is an option to extend the deadline by a year.
The government wants to sell most of its 49 per cent stake, while Borsa Istanbul has to return any remaining stake to Ankara by the end of the year. If the talks with financial institutions fail, Borsa Istanbul may hand back the shareholding and proceed with the flotation before December.
A listing would be the final stage of a radical reshaping of Turkey’s markets. New capital markets laws introduced in 2012 have mandated more transparency and central clearing of over-the-counter derivatives, akin to incoming European standards.
Borsa Istanbul is also a relatively new entity, a single exchange created by combining the Istanbul Stock Exchange, the Istanbul Gold Exchange and the Derivatives Exchange of Turkey. It has also upgraded its technology with systems provided by Nasdaq, the US exchange operator.
Mr Turhan was speaking on a visit to London to sign a deal with the London Stock Exchange Group to allow trading of its blue-chip index on the London market. Futures and options contracts based on Turkey’s blue-chip BIST 30 Index will be cleared by LCH.Clearnet, the LSE’s clearing house.
The exchanges are also planning to launch a partnership for trading index contracts later this year.
With the deal, LSE also aims give a boost to its derivatives business, which traded nearly 11.5m index futures and options contracts last year. About 170,000 BIST 30 index futures contracts are traded per day on Borsa Istanbul.
It’s great for us as the derivatives market has huge potential,” said Mr Turhan. “Derivatives are the fastest-growing part of the industry. I’m sure the local market will also come in very high volumes.”

(BFW) Syriza Places First in Greek Election, Exit Poll Shows

BN 01/25 17:00 *SYRIZA TO GET 35.5%-39.5% OF VOTE, 146-158 SEATS: EXIT POLL
BN 01/25 17:00 *NEW DEMOCRACY TO GET 23%-27% OF VOTE, 65-75 SEATS: POLL
BN 01/25 16:59 *SYRIZA TO GET 35.5%-39.5% OF VOTE: EXIT POLL
BN 01/25 16:59 *ANTI-BAILOUT SYRIZA PARTY SET TO WIN GREEK ELECTION: EXIT POLLS
BN 01/25 16:59 *ANT1 TV RELEASES EXIT POLL AFTER GREEK VOTING CLOSES
BFW 01/25 16:59 *SYRIZA PLACES FIRST IN GREEK ELECTION, EXIT POLL SHOWS
Syriza Places First in Greek Election, Exit Poll Shows
2015-01-25 17:04:10.148 GMT


By Marcus Bensasson and Christos Ziotis
(Bloomberg) -- Greece’s Syriza party is set to win
country’s parliamentary elections with 35.5% to 39.5% of the
vote vs 23% to 27% for Antonis Samaras’s New Democracy, exit
poll for ANT1 TV shows.
* Led by Alexis Tsipras, Syriza is projected to get between
146 and 158 seats in Greece’s 300-seat chamber, according to
exit poll, possibly enough for an outright majority
* Nationalist, anti-immigrant, Golden Dawn party gets 6.4%-8%
* To Potami, or River, also gets 6.4% to 8%
* Communist Party gets 4.7% to 5.7%
* Socialist Pasok party to get 4.2% to 5.2%
* Independent Greeks party gets 3.5% to 4.5%
* Movement of Democratic Socialists, founded by former PM
George Papandreou, to get 2.2% to 3.2%
* NOTE: A party needs to get at least 3% share of the vote in
order to elect lawmakers in next Greek parliament; winner
needs at least 151 seats to form govt
* NOTE: Polls closed at 7pm local time; interior ministry to
release first official result projection 9:30pm


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(BFW) KKR May Be Interested in World Duty Free, Sole Reports

KKR May Be Interested in World Duty Free, Sole Reports
2015-01-25 14:54:54.958 GMT


By Stefania Spezzati
(Bloomberg) -- KKR is probably looking at World Duty Free,
Il Sole 24 Ore reports, without saying where it got the
information.
* No mandate to adviser; negotiations on deal not started yet;
Benetton family could reduce stake in WDF under 30%: Sole
* NOTE: WDF weighs partnerships that could alter control,
Corriere reported Nov. 24


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Claudia Carpenter

>>> Afren bondholders hire Blackstone advisers

Afren bondholders hire Blackstone advisers
Afren creditors holding bonds worth USD 860m have engaged a team of restructuring experts from Blackstone, The Sunday Times reported. The unsourced report said the advisers were appointed on Friday 23 January to help the bondholders examine their options.

Afren, a UK-listed oil-exploration company, is expected to receive a takeover offer from its Nigerian competitor Seplat within days, the report said. It added that in the event no deal emerges, two potential chief executive candidates have been lined up: Roc Oil’s Alan Linn and Jon Ferrier of Maersk.

Afren’s share price has fallen almost 90% in the past six months amid corporate scandal, a USD 1.2bn debt burden and the plummeting price of oil, the report pointed out.

Morgan Stanley is advising Afren, while its lenders have hired PwC ahead of a USD 50m bank repayment which is due this Friday but which Afren has requested be extended, the report said.

Sunday Times

>>> Aer Lingus recommends EUR 2.50-per-share IAG offer to shareholders - report

Aer Lingus recommends EUR 2.50-per-share IAG offer to shareholders 

Aer Lingus has recommended the Anglo-Spanish airline operator International Consolidated Airline Group (IAG)’s latest EUR 2.50-per-share offer to investors in the Irish carrier, The Sunday Times reported. The unsourced report said IAG’s third bid in recent weeks persuaded the board of Aer Lingus to start formal discussions, leading to the recommendation of the EUR-1.3bn deal.

The situation is thought likely to be announced tomorrow, Monday 26 January, the report said.

The biggest obstacle to a deal may be securing the support of the Irish government, which owns a 25% stake in Aer Lingus, the item stated. It said IAG, which owns British Airways, may try and smooth any government concerns with promises to preserve Aer Lingus routes between Dublin and London Heathrow, while redirecting some Irish BA flights out of Heathrow to more profitable long-haul journeys.

A 29.8% stake in Aer Lingus is owned by rival Irish airline Ryanair, which has previously attempted to acquire Aer Lingus three times. Ryanair chief executive Michael O’Leary was quoted in a separate Sunday Times report signalling that a new offer has not been ruled out. IAG has not offered to acquire Ryanair’s holding this time and rejected an offer to buy it a couple of years ago, he told the newspaper.

Sunday Times

FT : Human investment managers risk obsolescence

Human investment managers risk obsolescence
Illustration for 'Automated algorithms offer greater choice, but risks remain'
Human investment managers are at risk of being rendered obsolete by rapid advances in algorithmic trading technology, according to the brains behind one of the world’s leading computer-driven hedge funds.
Leda Braga, who runs the $8.9bn BlueTrend hedge fund, said traditional investment approaches might soon struggle to keep ahead of so-called “systematic” computer models, as human fund managers are undercut by cheaper and more efficient technology.

“Right now there is a place for both approaches,” she said. “That is the present. But then we have the future. Does the future hold a world where the systematic approach dominates? I suspect yes.”
She compared it to the world of Swiss watchmaking. “There is still a place for artisanal watches. But if you really want to know the time in an efficient way then you buy a quartz watch.”
Ms Braga, a Brazilian-born engineer, is one of a handful of women to have risen to the top of the hedge fund world. Her comments come as many traditional fund managers have struggled to make money for clients in the past year, with computer-driven hedge funds outpacing most of their human rivals in 2014.
Late last year Ms Braga, who created the systematic computer trading business at hedge fund BlueCrest, spun off her two funds into a new separate $8bn hedge fund called Systematica Investments.
While human fund managers had the ability to interpret market colour and psychology in a way computer-driven systems could not, Ms Braga said the human mind would never be able to keep track of the quantity of information that systematic funds can.
“In the case of our equities fund we trade 4,500 stocks. As a human being it would be very difficult to keep track of and control risks across that number of stocks,” she said.
“There is now more pressure on managers to be transparent. But if investors want to see your portfolio and you only have three ideas, you will be sensitive about showing what you are doing. But if you use a technique where you are trading across hundreds of markets, this is not a problem.”
We were not long [fixed income] as a punt — we had analysed the data. Because the systematic approach does this in an objective way, it means we can be contrarian
- Leda Braga, BlueTrend
Her BlueTrend fund has risen 7 per cent this year to the middle of January, having gained 8.3 per cent during the whole of last year.
Computer-driven hedge funds struggled during several years of large-scale central bank intervention in global markets. But last year their cold ability to make trades outside the consensus helped them make money.
Ms Braga said her fund had bet on bond yields falling last year, although most strategists believed that a rise in US interest rates meant yields could only go up.
“My colleague said at the time, ‘Only the fools and the trend followers are long fixed income in 2014.’ But it paid off,” she said. “We were not long as a punt, but because we had analysed the data. Because the systematic approach does this in an objective way, it means we can be contrarian.”

(BN) Samsung’s $63 Billion Cash Pile Augurs Tech Takeovers: Real M&A

Samsung’s $63 Billion Cash Pile Augurs Tech Takeovers: Real M&A
2015-01-25 15:00:01.2 GMT


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

By Jungah Lee and Angus Whitley
(Bloomberg) -- Whether or not Samsung Electronics Co. has
BlackBerry Ltd. in its sights, it should spend some of its $63
billion of cash on takeovers.
Samsung, which has an alliance with BlackBerry, this month
denied reports it proposed buying the Canadian smartphone maker
for as much as $7.5 billion. Even so, a takeover would give
Samsung the software to help its products communicate, according
to Current Analysis Inc.
The $190 billion South Korean conglomerate makes dozens of
consumer goods, from phones and televisions to vacuum cleaners
and ovens. What it needs is technology to link all the devices
together online in the wireless homes of the future. Other
potential targets include Atmel Corp. and Freescale
Semiconductor Ltd., whose chips help devices talk to each other,
said CM Research Ltd.
“Samsung is a hardware company caught up in a software
revolution,” said Cyrus Mewawalla, managing director at London-
based CM Research. “So it needs to make acquisitions.”
The goal is to profit from what’s known as the Internet of
Things, a world where everyday items, from toasters and washing
machines to phones and printers, are sewn together online and
controlled by devices. The market for the Internet of Things
could reach $7.1 trillion by 2020, research firm IDC has said.
“There are many areas in Internet of Things,” from sensor
technology to components, Samsung said in an e-mailed statement.
“Samsung regards M&A as one of our key business strategies, in
conjunction with organic growth, and we continue to remain open
to partnership and acquisition opportunities.”

Not Enough

The Suwon-based company in August bought SmartThings, a
startup that makes mobile applications to remotely control
household goods. And the previous year, Samsung bought Novaled
AG, a German maker of material to light up a gadget’s screen,
and MOVL, which has developed a service that allows users to
share content between devices such as phones and TVs.
Those deals don’t go far enough, said Neil Shah, research
director for devices and ecosystems at Counterpoint Research.
“Samsung has the vision of how the connected future will
be, but still lacks the expertise and capabilities to tie all
the assets together,” Shah, who is based in Mumbai, said in an
e-mail.

Competitive Pressure

Samsung said in November 2013 it would be more aggressive
in pursuing targets after spending only $1 billion on takeovers
in three years. The earnings power from its Galaxy smartphone
lineup is fading and Apple Inc. and Xiaomi Corp. are gaining
ground. Samsung’s own Tizen software platform has struggled to
gain traction.
“In the near term, it’s hard to see the pressure coming
off them from Xiaomi and all the others,” said Dan Baker, an
analyst at Morningstar Inc. in Hong Kong. “Samsung at the
moment doesn’t really have a software advantage.”
BlackBerry could “potentially be a great acquisition,”
Shah at Counterpoint Research said. BlackBerry has messaging
software that could be rolled out to connect a chain of Samsung
products, and a software program that manages different devices
at once. BlackBerry’s QNX automotive software, which enables
drivers to make hands-free calls, sports three-dimensional
navigation and 3-D gaming for rear seats, is also a draw, he
said.
Samsung co-Chief Executive Officer Shin Jong Kyun said this
month he wanted to develop the two companies’ alliance, rather
than pursue an outright purchase of BlackBerry. Both denied a
Reuters report that Samsung had made a takeover offer.

Chip Push

While Samsung is the world’s second-largest semiconductor
maker, it still could make acquisitions in this area to boost
its capabilities.
Last week, people with knowledge of the matter said Samsung
will use its own chips in the next Galaxy S smartphone and drop
a Qualcomm Inc. unit. That’s a sign Samsung wants more control
of the processors in its products, Morningstar’s Baker said. San
Jose, California-based Atmel, which has a market value of $3.5
billion, and the $7.9 billion Freescale, are both feasible
chipmaking targets for Samsung, he said.
Atmel is among chipmakers focusing on the Internet of
Things, developing technologies that help machines talk to each
other and building wireless-radio capabilities. Atmel’s chips
power washing machines and cookers as well as car doors and
windows. Freescale’s semiconductors are used in everything from
space hardware to household goods.
A representative for Atmel declined to comment on whether
it’s been approached by buyers or has explored a sale. A
representative for Austin, Texas-based Freescale didn’t respond
to a phone call or e-mail seeking comment.

European Targets

Other targets that Samsung might consider: Opera Software
ASA, a Norwegian maker of Internet browsers for phones, tablets
and computers, which has a market value of $1.9 billion; and
closely held AlertMe Ltd., a U.K. company that has developed
technology to control dozens of devices from different
manufacturers on a single network, according to Mewawalla at CM
Research.
Sensor makers would also make sense as targets, said Park
Hyun Je, a creative planner at a research and development center
under the South Korea’s science ministry.

Still Early

For companies attempting to profit from the Internet of
Things, it’s tough to pick the right targets because the concept
is in its infancy, said Avi Greengart, research director for
consumer devices at Sterling, Virginia-based Current Analysis.
“It’s not clear which layer of the technology stack will
provide the most value and control,” Greengart said in an e-
mail. “Any investment, whether homegrown or via acquisition,
may lead to dead ends.”
Samsung is willing to spend. The company this month said it
will invest more than $100 million in developers of smart
technology for homes and devices. Samsung Ventures, a venture
capital firm, led a $20 million funding round for Israel’s
EarlySense Ltd., the companies said in a Jan. 20 statement.
All the same, takeovers might be the fastest way for
Samsung to prepare for the explosion of connected devices that’s
expected this decade.
When it comes to software, Samsung “looks far behind its
competitors,” said Mewawalla at CM Research.

For Related News and Information:
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Samsung Takes Google Challenger to TVs as Smartphone Flops
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--With assistance from Tara Lachapelle in New York.

To contact the reporters on this story:
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jlee1361@bloomberg.net;
Angus Whitley in Sydney at +61-2-9777-8643 or
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Beth Williams, Elizabeth Wollman

FT : Novo Nordisk to launch weight-loss drug

Novo Nordisk is preparing a big push behind a new weight-loss treatment that it believes can overcome the reluctance of doctors and healthcare providers to use drugs to tackle obesity.
The Danish company has set a target for revenues of $1bn a year or more from its Saxenda medicine as it bets that pharmaceuticals will play an increasing role in helping people lose weight.

“There is a growing recognition that [medicines] can be effective in combination with changes in behaviour and diet,” said Mads Krogsgaard Thomsen, chief science officer. “We’re not saying take this drug and nothing else; we see it as an adjunct.”
The European Medicines Agency on Friday recommended Saxenda for approval, clearing the way for it to be launched on both sides of the Atlantic this year after receiving a green light from the US Food and Drug Administration last month.
Novo Nordisk said it was planning to commit 500 of its 3,000-strong US sales force to the product in a sign of its ambition to make obesity a significant new business on top of its dominant position in the diabetes market.
Pharmaceuticals companies have long eyed the potential of weight-loss drugs as levels of obesity have risen across the developed world — and increasingly in emerging markets such as China and Brazil.
However, existing treatments have struggled to take off because of concerns over side effects and doubts about their long-term benefits.
Saxenda has also faced scrutiny over possible risks including acute pancreatitis among some people taking the drug and the EMA has ordered further monitoring and restrictions on usage.
However, the EU drugs regulator said it was persuaded that benefits outweighed risks for obese adults who also suffer at least one related condition such as diabetes or high blood pressure.
In clinical trials, Saxenda helped 92 per cent of people lose weight compared with 62 per cent on diet and exercise alone. Patients taking the drug lost an average of 9.2 per cent of their body weight, compared with 3.5 per cent for those on a placebo.

September 2014: Rising insulin sales have made Novo Nordisk one of the strongest growth stories in the pharma sector. The FT’s Andrew Ward asks chief executive Lars Sørensen if the company prefers treating the disease rather than finding a cure
The treatment involves a reformulation of Novo Nordisk’s existing liraglutide medicine for type 2 diabetes, marketed as Victoza. Taken at a higher dose, it has been shown to regulate appetite by suppressing feelings of hunger.
Novo Nordisk has not yet announced its pricing but Mr Thomsen acknowledged that cost was likely to be a deterrent to widespread uptake in Europe.
There are signs, however, that the region’s public-funded health systems are beginning to look beyond diet and exercise as remedies for obesity.
England’s National Institute for Health and Care Excellence, which judges cost-effectiveness in healthcare, last year recommended a big expansion in surgical intervention such as stomach bypasses and gastric bands.
Sir Stephen Bloom, an expert on diabetes and obesity at Imperial College London, predicted that weight-loss drugs would also become increasingly accepted.
“We’ve been telling people for almost 100 years to eat less and do more exercise yet we have continued to get fatter,” he said. “This is lowering people’s life expectancy because it increases the risk of cancer, heart disease, stroke and many other diseases.
“When prices come down in the long run and side effects are reduced they will be impossible to resist.”

FT : Syriza lead widens as Greeks go to the polls

Syriza lead widens as Greeks go to the polls


THESSALONIKI, GREECE - JANUARY 25: A left-wing Syriza party vote inside a voting envelope is pictured on January 25, 2015 in Thessaloniki, Greece. According to the latest opinion polls, the left-wing Syriza party are poised to defeat Prime Minister Antonis Samaras' conservative New Democracy party in the election, which will taking place today. European leaders fear that Greece could abandon the Euro, write off some of its national debt and put an end to the country's austerity by renegotiating the terms of its bailout if the radical Syriza party comes to power. Greece's potential withdrawal from the eurozone has become known as the 'Grexit'. (Photo by Vladimir Rys Photography via Getty Images)©Getty
Greeks are voting in a snap election that the anti-bailout Syriza party is tipped to win, putting Athens on a potential collision course with its international lenders.
The mood appeared to be cheerful as voters crowded outside polling stations in the city centre on a mild sunny morning, with lively political discussions taking place in nearby cafés.

“It’s time to try something different . . . After so many years of austerity I don’t feel there’s anything left to lose,” said Maria Paterakis, a 73-year-old pensioner who voted for Syriza.
Two opinion polls published on Saturday showed the radical leftwing Syriza, led by Alexis Tsipras, widening its lead over the centre-right New Democracy party of Antonis Samaras, the prime minister, from around 4 per cent to over 6 per cent in the run-up to the vote. A third opinion poll gave the far-left party a 5.3 per cent lead.
A victory would make Syriza the first of Europe’s populist movements to win power following a devastating economic crisis.
In an interview published on Saturday, Mr Tsipras said Greece’s economy “would be safe in Syriza’s hands”, adding that a Syriza government’s first priority would be to launch a €2bn welfare package to assist an estimated 35 per cent of the population living in poverty.
Antonis Samaras, the prime minister, attacked his opponents in his final campaign rally, saying: “Greece’s sacrifices are coming to an end and the issue of debt will soon be resolved . . . But a Syriza government would create new deficits prompting another “memorandum” (the Greek term for the country’s €245bn bailout programme).”
That message resonated with Rovertos Kastrioti, a mechanic. “I’m afraid of an economic collapse here if the left wins power,” said Mr Kastrioti, who migrated from Albania two decades ago and now holds Greek citizenship. “I support New Democracy but many Greeks I work with are voting for Syriza.”
Despite its widening lead in the polls, it was still unclear on Sunday whether Syriza could achieve an outright majority as the final distribution of seats under Greece’s proportional voting system will depend on how many parties exceed the 3 per cent of the vote threshold for entering parliament.

Two small parties, the rightwing Independent Greeks (Anel), and the Movement of Democratic Socialists, a new party founded by former premier George Papandreou, were not expected to beat the threshold. But they gained ground in the final days of campaigning and could make the cut, one pollster said.
“The more parties in parliament, the more likely it is that Syriza will fall a few seats short of an overall majority,” said Costas Iordanides, a veteran political commentator.
Mr Tsipras would not lack possible coalition partners: both Panos Kammenos, the Anel leader, and Mr Papandreou have expressed willingness to co-operate with a Syriza government.
The leaders of two slightly larger parties, the centre-left To Potami (The River) and the PanHellenic Socialist Movement (Pasok) that are certain to be represented in the 300-member parliament have already offered conditional backing for Syriza.
To Potami, led by Stavros Theodorakis, is set to take third place with 5-6 per cent of the vote, according to most opinion polls.
Yet some observers believe that the neo-Nazi Golden Dawn party, whose leaders are running for parliament from jail where they are await trial for running a criminal organisation, could overtake To Potami as it did in the European elections last May.
“It seems likely that a ‘silent vote’ will push Golden Dawn into third place . . . that means they would receive a mandate to form a government if it’s a hung election — something that would be a disgrace for Greek democracy,” said Aristides Hatzis, an Athens university law professor.