>>> Europe : Brokers Upgrades & Downgrades - 11th of May 2015

>>> Up 
*ABERTIS RAISED TO OUTPERFORM AT RBC CAPITAL
*AZIMUT RAISED TO NEUTRAL VS UNDERPERFORM AT MAINFIRST
*BODYCOTE RAISED TO BUY VS NEUTRAL AT CITI
*JERONIMO MARTINS RAISED TO HOLD VS SELL AT BERENBERG
*ROCKET INTERNET RAISED TO BUY VS NEUTRAL AT UBS

>>> Down
*ABERDEEN ASSET CUT TO HOLD VS BUY AT SOCGEN
*ANTOFAGASTA CUT TO SECTOR PERFORM VS OUTPERFORM AT RBC

>>> PT Change


>>> Initiation
*ALTICE RATED NEW OUTPERFORM AT RBC, PT EU115
*QUINTAIN ESTATES RATED NEW BUY AT LIBERUM, PT 135P

>>> Call

FT : Call for probe into Benetton duty-free sale


Italian regulators have been urged to investigate the auction that led to the Benetton family agreeing to sell World Duty Free group for €3.6bn to a Swiss buyer, amid allegations that the family holding ignored a substantially higher offer from a Chinese bidder.
The Benettons hold a 50.1 per cent stake in WDF through Edizione, the family holding company, allowing it to overrule minority shareholders.

In March, the holding company said it had agreed to sell the international airport retailer to Dufry, a Swiss rival, for €10.25 a share, rejecting offers from two other bidders.
The deal, if completed, would create the world’s biggest travel retail group, with duty-free stores in hubs such as London Heathrow, New York’s John F Kennedy airport, Madrid, Barcelona, Moscow and São Paulo.
According to documents seen by the Financial Times, one of the bidders — the Chinese Boyu group — offered to take over the company at a price of €12.30 a share, a premium of 20 per cent over the winning bid.
That discrepancy is at the centre of a formal complaint sent by a Spanish minority shareholder to Consob, the Italian stock market regulator.
The complaint urges Consob to open a “full investigation on this matter as it is obvious there was a better offer in the market”.
Speaking after the deal was announced, Gianmario Tondato da Ruos, the chairman of WDF, acknowledged that the company had received higher bids.
“The problem was that they were all conditional,” he told the Moodie Report.
But a representative of Boyu, which operates the duty-free shops at Beijing and Shanghai airports, denied there was a difference in conditionality. “The conditions presented in our offer were not different at all from those given in the winning offer.”
A spokesman for Italy’s stock market regulator Consob said that it had received the emailed complaint from the Spanish minority investor.
The spokesman added that Consob was undertaking the normal process of investigation of the offer on WDF as the regulator would in any takeover situation.
Italy has become a major target for Chinese investors and outranked the US and the UK as the main destination for Chinese outbound investment over the past 12 months by value following a €7bn deal struck in March for ChemChina to take over Italian tyres group Pirelli.
The slew of successful deals by Chinese investors in Italy, where asset prices have fallen during a three-year recession and a new government has pursued a more open investment policy, have underlined rapidly improving Chinese outbound dealmaking skills over the past two years, say bankers, although they admit some anomalies.
NIT Holding, a Hong Kong-based group, issued a statement last year saying it was ready to put €10bn into Italy’s third-largest bank Monte dei Paschi di Siena, putting a rocket under the lender’s shares.
Monte Paschi subsequently issued a statement the terms of the offer were so vague and imprecise that it could not be taken seriously by the board.

(LeTemps.ch) Saint-Gobain cherche à rétablir le dialogue avec Sika Willy Boder

Saint-Gobain cherche à rétablir le dialogue avec Sika
Willy Boder

Pierre-André de Chalendar lâche du lest dans une lettre ouverte

Un nouvel épisode intervient dans le feuilleton ouvert début décembre 2014 par la vente discrète d’un paquet d’actions du groupe chimique suisse Sika au géant français Saint-Gobain par la famille propriétaire Burkard.

Pas moins de six procédures judiciaires sont en cours ou en voie d’être ouvertes pour défendre ou combattre cette transaction qui permet à Saint-Gobain, spécialisé dans les matériaux de construction et la chimie associée au bâtiment, de prendre une majorité de contrôle de Sika en détenant 16,1% du capital.

Incertitude néfaste

Ce conflit, dont l’issue reste toujours incertaine, inquiète les analystes financiers, s’il devait perdurer, en raison de l’incertitude qu’il fait peser sur l’avenir de Sika, dont les 16 000 employés peuvent se sentir déstabilisés. Face à la détermination du conseil d’administration de Sika, présidé par Paul Hälg, de s’opposer à la transaction, avec un fort appui des actionnaires majoritaires en nombre d’actions mais minoritaires en nombre de voix, le patron de Saint-Gobain, Pierre-André de Chalendar, tente de faire pencher la balance de son côté.

Dans une lettre ouverte adressée aux actionnaires, aux employés et aux clients de Sika, Pierre-André de Chalendar rappelle les promesses déjà faites, à savoir le maintien du siège de Sika en Suisse et la préservation au maximum de la culture d’entreprise et de l’autonomie du groupe suisse, qui devrait être intégré dans Saint-Gobain en tant que filiale.

Cette lettre ouverte, publiée dans deux journaux dominicaux alémaniques, est écrite sur un mode nettement plus conciliant que les déclarations précédentes provenant du groupe français, dix fois plus important en chiffre d’affaires annuel que Sika, qui a affiché l’an dernier des ventes pour 5,57 milliards de francs, en hausse de 8,3%.

Réseau à l’étranger préservé

Pierre-André de Chalendar a toujours affirmé, sans être pris au sérieux par la direction et le conseil d’administration de Sika, qu’une autonomie maximale du groupe suisse serait assurée. Dans sa lettre ouverte, le patron de Saint-Gobain fait un pas de plus dans cette direction. Après avoir répété les promesses de maintien de la cotation et du siège social en Suisse, il lâche du lest sur le réseau des succursales à l’étranger.

Dans son plan initial, Saint-Gobain entendait remanier totalement le réseau en confiant les activités commerciales du nouveau groupe soit à Sika, soit à Saint-Gobain, selon l’importance des affaires dans tel ou tel pays. Les deux entreprises étant fortement concurrentes dans le domaine du mortier, cette intention a soulevé une vive opposition de la part des dirigeants de Sika. Or, Pierre-André de Chalendar lâche pour la première fois du lest sur ce point en promettant que les succursales de Sika à l’étranger pourront être conduites sans changement comparé à la situation actuelle.

Reste à savoir si cela sera suffisant pour amener à la table de négociations les dirigeants de Sika, renforcés par le fort soutien des actionnaires le 14 avril lors de l’assemblée générale. Sur le plan juridique, la décision de la Cour de cassation du Tribunal cantonal de Zoug sur le blocage des propositions de changement de majorité décidé par les actionnaires est la plus attendue.

(BFW) German Stocks Attract Investor Interest After April Slump


German Stocks Attract Investor Interest After April Slump
2015-05-10 23:03:16.92 GMT


By Roxana Zega and John Simpson
(Bloomberg) -- German stocks, rejected by investors in
April, are luring them back this month as buyers added most in a
year -- more than EU570m -- to the biggest exchange-traded fund
tracking the equities last week.
* Benchmark DAX Index had its biggest jump in 2 mos. on
Friday, options data show traders betting on further gains
* Most-owned contract is calling for a 2.5% advance by June
* While DAX’s biggest monthly loss since July has seen
valuations sinking to lowest level this yr relative to
Europe’s equities, decline is opportunity to invest in
German cos., according to Didier Duret of ABN Amro Bank
* Economists have increased nation’s growth forecast each mo.
this year, raising appeal of its shares
* “Valuations were discounted by the correction, so it is a
good thing,” said Duret. “Germany remains the engine of
growth in Europe. If you act on fundamentals, you should
buy”

Link to Story: NSN NO5CBB6KLVR4<GO>

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To contact the reporter on this story:
John Simpson in Toronto at +1-416-203-5726 or
jsimpson12@bloomberg.net
To contact the editor responsible for this story:
Andrea Snyder at +1-202-624-1831 or
asnyder5@bloomberg.net

>>> Asian Update

Asian Mid-session Update: PBoC pulls the rate cut trigger again after soft trade and underwhelming CPI data

***Economic Data***
- (CN) PBOC CUTS 1-YEAR BENCHMARK RATES BY 25 BPS, EFFECTIVE MAY 11
- (CN) CHINA APR CPI Y/Y: 1.5% V 1.6%E; 4-month high
- (CN) CHINA APR PPI Y/Y: -4.6% V -4.5%E; (38th straight month of decline)
- (AU) AUSTRALIA APR NAB BUSINESS CONFIDENCE: 3 V 3 PRIOR; CONDITIONS: 4 V 6 PRIOR
- (NZ) NEW ZEALAND APR TOTAL CARD SPENDING M/M: -1.1% V +1.2% PRIOR; RETAIL SPENDING M/M: -0.7% V +0.5%E (1st decline in 9 months)

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 +1.3%, S&P/ASX +0.2%, Kospi +0.9%, Shanghai Composite +1.1%, Hang Seng +0.7%, Jun S&P500 flat at 2,108

***Commodities/Fixed Income***
- Jun gold flat at $1,184/oz, Jun crude oil -0.1% at $59.33/brl, May copper -0.7% at $2.91/lb
- (JP) BOJ offers to buy ¥375B in 1-3yr JGBs, ¥375B in 3-5yr JGBs, ¥240B in 10-25yr JGBs, and ¥140B in JGBs with maturity over 25-yr
- GLD: SPDR Gold Trust ETF daily holdings fall 10.8 tonnes to 728.3 tonnes; lowest since Jan 16th - update

***Market Focal Points/FX***
- Nikkei225 and Shanghai Composite are leading the charge in the far east to open up the new trading week. The former - Nikkei225 - is benefiting from weaker Yen amid overall risk-on mode after the Wall St rally on Friday, even though the non-farm payrolls data were largely in line and the initial USD/JPY reaction was to the downside. In early Monday trade, USD/JPY is up about 20pips above 119.90. Shanghai Composite meanwhile has added to a 2%+ rebound on Friday with another 1.1% rise after the weekend move by the PBoC to cut key rates for the 2nd time this year. The easing - a 25bp cut in deposit and lending rates to 2.25% and 5.10% respectively - was widely telegraphed by analysts following last week's downbeat trade numbers, though PBoC also noted it will continued to "promote real interest rates back towards reasonable levels" in response to the economy facing downward pressure. Meanwhile, economists with ANZ and Nomura anticipate further key rates moves by the PBoC amid powerful headwinds to the economy.

- Also out of China over the weekend and just ahead of the central bank easing, April CPI inflation rose by a decimal to a 4-month high of 1.5% but still missed expectations. YTD CPI of 1.3% was also underwhelming, as it remains well below the official 2015 target of 3.0%. Food CPI was once again much higher at 2.7% vs 0.9% for non-food, although Stats Bureau researcher said the "supply of meat and fresh vegetables has been stable, so there are no expectations of a sharp jump in food prices in the near term."

- In other USD majors, the greenback was particularly firm against NZD in early going. NZD/USD fell about 100pips below $0.74, as both ANZ and First NZ Capital forecast RBNZ cutting cash rates by 50bps this year. ANZ pointed to "high NZD, dairy income squeeze, inevitability of a prudential response toward housing and continued low core inflation reads" in calling for lower OCR. AUD/USD also fell by about 50pips in early going below 0.7880 as traders await Australia's annual budget that will be unveiled late on Tuesday. PM Abbott said it will not be especially dramatic but rather "measured, responsible and fair".

- EUR/USD is consolidating some of its recent gains, falling about 80pips below $1.1140. Greece remained in the headlines ahead of Monday meeting with European creditors, as PM Tsipras called for "clear confirmation of the progress that has been made" in expressing optimism that a breakthru at today's talks can be achieved. Earlier, Dep Foreign Min Tsakalotos (debt negotiation team) also said "the deal is very close and will be reached in the coming period."

***Equities***
US equities / ADRs:
- BIDU: Three director-level employees are under internal investigation for possible corruption - Chinese press
- CHTR: Said to be in early talks with banks to arrange $25-30B in debt financing to pursue a friendly merger with TWC - financial press
- SYT: Monsanto has not given up proposed takeover bid - financial press
- ZU: Alibaba raises its stake to 9.3%; Not aiming to acquire the company - press

Notable movers by sector:
- Consumer discretionary: Skyworth Digital 751.HK +0.6% (April results)
- Financials: Evergrande Real Estate Group 3333.HK -2.4% (April results); Agile Property 3383. HK +3.4% (April results); Dalian Wanda Commercial Properties 3699.HK +1.6% (April results); Poly Real Estate Group 600048.CN +1.8% (April results); China Vanke 000002.CN +1.3%, Industrial and Commercial Bank of China 1398.HK +0.3%, Bank of China 3988.HK +0.8%, China Construction Bank 939.HK +1.0% (PBoC cuts interest rate by 25bps over the weekend)
- Industrials: Incitec Pivot IPL.AU -3.1% (H1 results)
- Technology: Sharp Corp 6753.JP -24.0% (speculation on capital structure); Toshiba Corporation 6502.JP -16.6% (withdraw FY14/15 guidance)
- Materials: PanAust PNA.AU +6.9% (recommends GRAM increased offer)

(BFW) Hedge Funds Most Bullish WTI Since July as Drillers Plan Return


Hedge Funds Most Bullish WTI Since July as Drillers Plan Return
2015-05-10 23:01:00.6 GMT


By David Marino
(Bloomberg) -- Money managers’ net-long position up 10,032
contracts of futures, options to 268,183 in wk ended May 5,
highest since July 29, according to CFTC data.
* EOG plans to increase drilling once prices stabilize
~$65/bbl, PXD to use more rigs as early as July
* RBOB net-longs down 700 to 24,969
* ULSD net-shorts down 5,188 to 8,426
Story link


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WSJ : IMF Works With Bank Regulators on Contingency Plans for Greek Default

IMF Works With Bank Regulators on Contingency Plans for Greek Default
Discussions with authorities in southeastern Europe aimed at girding for potential failure of bailout talks

BRUSSELS—The International Monetary Fund is working with national authorities in southeastern Europe on contingency plans for a Greek default, a senior fund official said—a rare public admission that regulators are preparing for the potential failure to agree on continued aid for Athens.

Greek banks are big players in some of its neighbors’ financial systems. In Bulgaria, subsidiaries of National Bank of Greece SA, Alpha Bank SA, Piraeus Bank SA and Eurobank Ergasias SA own around 22% of banking assets, roughly the same as Greek banks own in Macedonia. Greek banks are also active in Romania, Albania and Serbia.

“We are in a dialogue with all of these countries,” said Jörg Decressin, deputy director of the IMF’s Europe department. “We are talking with them about the contingency plans they have, what measures they can take.”

As part of the discussions, the IMF has asked national supervisors to ensure that subsidiaries of Greek banks have enough assets that they can exchange for emergency financing at their own central banks—in case financing from their parent institutions is suddenly cut off—and that deposit-insurance funds are at sufficient levels, Mr. Decressin said.

Negotiations between Greece and its international creditors—the other eurozone countries and the IMF—have been advancing slowly, despite warnings from Greek officials that the government is close to running out of money.

“It would be foolish for anyone in the policy world not to be worried at this stage,” Mr. Decressin said.

European officials expect no breakthroughs at a meeting of the currency union’s finance ministers on Monday. That means Greek lenders will remain under pressure, dependent on relatively expensive liquidity from the Greek central bank and at risk of bank runs in case doubts emerge over their ability to pay out deposits.

Overall, the IMF believes that subsidiaries of Greek banks in southeastern Europe should be able to withstand the failure of their parent companies. “Our assessment of the Greek banks in that region is that they are fairly liquid; we have not seen major deposit outflow,” Mr. Decressin said.

Because they are subsidiaries, rather than branches, the lenders have to hold their own capital buffers and can refinance themselves at national central banks. That would make it easier to split them off from their parent banks if necessary.

The IMF has nevertheless urged national supervisors and governments to keep a close eye on the situation. “There is high-frequency monitoring going on at the level of the authorities and our advice is that this needs to continue,” Mr. Decressin said.

One scenario that the IMF is concerned about is what could happen if panic over Greece’s finances pushes savers in the region to pull their money out of Greek-owned banks. “These banks…may be totally fine, but there could still be in the population a perception, these are Greek banks and they are not fine, and people would turn up and try to withdraw their deposits. That is something you cannot model,” Mr. Decressin said.

National safety nets have in the past been vulnerable to rumor-fueled bank runs. In June last year, the Bulgarian government had to take over Corporate Commercial Bank, after depositors pulled out their savings amid negative news reports about the lender’s main shareholder. It took the government six months to compensate the bank’s depositors, far longer than the 25 days mandated under European Union law.

Since then, the Bulgarian government has taken steps to bolster its deposit-insurance fund. The Bulgarian central bank, which supervises the country’s banks, didn’t respond to requests for comment.

>>> What to look at this week end - 9th & 10th of May 2015

Global equities lost altitude through Thursday as the parade of poor economic data and bond market choppiness continued. Early in the week, the ADP jobs report raised real worries that the US would see another anemic payrolls number for April, while Chinese trade data was concerning. There was no breakthrough on Greece, with both sides seemingly committed to forcing negotiations down to the wire. The global bond market rout continued apace this week and the surge in yields kept pressure on stocks worldwide, nudged further by Fed Chair Yellen weighing in on equity valuations. The stampede out of stocks and bonds sent European indexes to their lowest levels in two months. Note that the UST 10-year yield peaked just below 2.3% on Wednesday and then headed back below 2.12%, while the 10-year Bund peaked around 0.777% on Thursday and quickly dropped below 0.540% by Friday. The surprise landslide victory by the Conservative government in UK elections and Friday's not-too-hot, not-too-cold US jobs report helped equities recoup their losses for the week, with DJIA gaining 0.9%, the S&P500 adding 0.4% and the Nasdaq ending just above flat.


Macro :
- China Cuts 1-Year Interest Rates by 0.25 Percentage Point
- China Adds Stimulus With Third Interest-Rate Cut in Six Months
- Greece Cuts 2015 Growth Forecast, Reuters Reports
- Iran Can Raise Oil Exports by 500,000 Bpd Once Sanctions Lifted
- China April Consumer Prices Rise 1.5% Y/Y; Est. 1.6% Gain
- Greek Deal With Creditors to Unlock 7 Projects: Kathimerini
- German Fin Min Schaeuble: concerned about potential for surprise default in Greece; Germany will do everything to keep Greece in the eurozone 
- Norway Christian Democrats to Seek More Oil Fund Exclusions
- Merkel Pressed to Give Up on Greece as Germans Urge Strong Euro

Keep an eye on :
- ABBN VX : ABB CEO Tells SRF He Plans No Big Restructurings, Wants to Build
- AH NA : Ahold, Delahize Decline to Comment on Merger Talks Report
- AIR FP : Airbus A400M Crash, First Ever, Leaves 4 Dead, 2 Injured
- AIR FP : Airbus Says Test Flights of A400M Aircraft to Proceed: Reuters
- ATL IM : Atlantia 1Q Ebitda Misses; Italy Traffic +0.9%
- BARC LN : U.K. Banks May Get GBP4b Windfall From Visa Deal, Sky Reports
- BMPS IM : Monte Paschi Sees Possible Merger With Cooperative Banks: Sole
- BMW GY : BMW CEO Faces Investor Opposition to Chairmanship Move: FAS
- BP/ LN : US appeals court finds the company can appeal damages awards from oil spill in the Gulf of Mexico (Deepwater Horizon) - financial press - Court finds existing rules of settlement that gave the claims fund administrator full discretion on paying claims violated BP's rights by not providing it with acceptable methods to for it to appeal decisions.
- CA FP : Carrefour Brazil shareholder Diniz negotiating BRL 1bn raise from Qatari fund to boost stake 
- DPW GY : Deutsche Post Faces Strikes After Wage Talks Collapse: Ver.di
- GIL GY : DMG Mori Seiki AG to Be Renamed DMG Mori AG, CEO Says at AGM
- EXO IM : Exor Said to Weigh PartnerRe Bid Raise at Tues. Meeting: Reuters
- MB IM : Mediobanca confirms plans to sell stakes in Telecom Italia and other companies - Il Sole 24 ore
- PFV GY : Pfeiffer Vacuum may make large acquisitions- http://bit.ly/1ElK8JV
- SGO FP : Saint-Gobain Remains Open for Talks With Sika Board, CEO Says
- SCYR SM : Blackstone, Merlin Among Bidders for Sacyr’s Testa: Expansion
- SIE GY : EU Regulators Said Set to Unconditionally Clear SI/DRC: Reuters http://reut.rs/1Qwp9Ma
- SYNN VX : Syngenta trading higher in NYC on report of Shareholders backing a $50b deal
- SYNN VX : Monsanto to Pursue Syngenta Takeover After Bid Rejected: Reuters
- TEVA IT : Mylan chairman tells investors he would consider buying Teva http://reut.rs/1H5lW1F
- UBER IPO : Uber Fund-Raising Points to $50 Billion Valuation - NYT
- V US : Said to be in early stage talks to buy Visa Europe for as much as $20B

>>> Carrefour Brazil shareholder Diniz negotiating BRL 1bn raise from Qatari fun

Carrefour Brazil shareholder Diniz negotiating BRL 1bn raise from Qatari fund to boost stake 

Abilio Diniz is in advanced negotiations to obtain about BRL 1bn (USD 336m) from a sovereign wealth fund in Qatar to raise his stake in retailer Carrefour Brazil, Veja reported.

The large circulation Portuguese-language newsweekly did not give a source for the information in the story in its Radar column in the current edition of the magazine.

Diniz, the former chairman of Cia. Brasileira de Distribuicao (Bovespa: PCAR4), Brazil’s second-largest retailer, known as Pao de Acucar, raised his stake in the parent company, French retailer Carrefour to 5.1% from 2.4%, Valor Economico reported on 9 April, becoming the fourth-largest shareholder in Carrefour. The Sao Paulo-based business daily cited a statement from Peninsula Participacoes, the company that manages the Diniz family's fortune, in the item last month.

Diniz has acquired 10% of Carrefour Brazil in recent years, this news service reported in early April.

Carrefour regained the position of largest supermarket chain in Brazil in 2014, surpassing Pao de Acucar, business magazine IstoE Dinheiro reported in its edition dated 6 May 2015. The weekly magazine cited a trade association known by the Portuguese acronym Abras for the information.

Casino Guichard Perrachon [CO FP], the listed French retailer, has controlled Pao de Acucar since June 2012.

The original article (Veja) appeared in print, Page 44

The original article (IstoE Dinheiro) appeared in print, Page 38
Veja, IstoE Dinheiro

>>> Delhaize and Ahold in preliminary merger talks

Delhaize and Ahold in preliminary merger talks 

Belgian supermarket group Delhaize and its Dutch competitor Ahold are in preliminary merger talks, Belgian daily De Tijd reports, citing unnamed sources familiar with the situation.

The report said talks are not yet nearing an official agreement.

If the two were to merge they could take over the market leading position in Belgium from supermarket chain Colruyt. Neither Delhaize nor Ahold gave a reaction following the news.

The two supermarket groups have already been in talks in 2006-2007, but despite negotiations being in an advanced stage, the deal did not go through. The two parties failed to reach agreement on the structure of the deal.

The families holding Delhaize are not controlling the company as much as ten years ago, the report said. They now hold about 20%, while institutional investors have increased their holdings in Delhaize in recent years. Both groups have received investments from large institutional investors including Norges Bank, JPMorgan, Vanguard, ING and BNP Paribas.

Ahold has a turnover of EUR 33bn and operates 30 Albert Heijn shops in Belgium. Delhaize reported a EUR 21bn turnover in 2014. Ahold's profitability is higher than Delhaize's, a report in Dutch financial daily Het Financieele Dagblad said following the news.

De Tijd, Financieele Dagblad