FT : Commerzbank US settlement set to top $1bn

Commerzbank US settlement set to top $1bn

Commerzbank is in talks to pay US authorities more than $1bn in fines to resolve allegations that the German bank broke anti-money laundering and sanctions laws — at least $400m more than previously thought.
The settlement is in the final stages of negotiations, people familiar with the matter said, and could be announced by the end of the year.

Commerzbank had been in talks to pay more than $600m in penalties to state and federal authorities over the investigation into its dealings with Iran and other countries on the prohibited list, but a parallel money laundering probe by the US attorney’s office in Manhattan could nearly double that sum.
As part of the deal, the German bank is expected to agree to a deferred prosecution agreement, in which criminal charges are dropped after a set period of time if the bank does not break the rules again.
The resolution, if reached, would be the latest in a string of non-US banks taken to task for violating US sanctions laws. BNP Paribas pleaded guilty and paid a record $8.9bn penalty to US authorities this year.
The US Department of Justice, New York’s Department of Financial Services and the New York county district attorney are investigating Commerzbank for business dealings with Iran, Sudan and other countries on the US sanctions list.
The US attorney’s office in Manhattan has been looking into poor risk controls over the bank’s anti-money laundering compliance programme, these people said.
Commerzbank and officials for the government agencies declined to comment.
Commerzbank has disclosed the investigation into whether the bank breached US embargoes, “particularly with respect to Iran, Sudan, North Korea, Myanmar and Cuba”. It warned it “cannot rule out” paying a “considerable sum of money in order to settle the case”.
While the bank is expected to resolve both investigations in the deal now being negotiated, people familiar with the probe cautioned that the terms of the settlement had not been finalised and details could still change.
DFS had been seeking clawbacks of pay or disciplinary actions against bank employees with links to the alleged misconduct. It is not clear whether any related actions will take place as part of the settlement.
Commerzbank, which is 17 per cent owned by the German government following a bailout during the financial crisis, reported better than expected third-quarter earnings last month.
It is not clear what role if any BaFin, the German finance regulator, is playing in the negotiations. Representatives for BaFin could not immediately be reached for comment.
The increased scrutiny of foreign banks by US authorities has created tension with some European countries. One French official called the US’s case against BNP “economic warfare”.
Other foreign banks, including Deutsche Bank, Société Générale and Crédit Agricole, remain under investigation by US authorities for possibly violating US sanctions laws.
The push for a deferred prosecution agreement, or DPA, represents a return to more familiar legal territory for banks. Recent criminal investigations, including the one into BNP, have required the more severe sanction that banks or their relevant subsidiaries plead guilty, following criticism that US authorities believed banks were “too big to jail”.

(BN) Staples Would Get 60% Boost From Office Depot Takeover: Real M&A

Staples Would Get 60% Boost From Office Depot Takeover: Real M&A
2014-12-11 20:35:21.907 GMT


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

By Tara Lachapelle
Dec. 11 (Bloomberg) -- Staples Inc. has a chance to
increase next year’s earnings by at least 60 percent through an
acquisition of Office Depot Inc., the only other major U.S.
office-supplies chain still in business.
With analysts estimating that more than $1 billion of costs
could be cut by combining the struggling retailers, earnings per
share in the 2015 calendar year would rise about 60 percent in
an all-stock merger, according to data compiled by Bloomberg. If
Staples were to pay entirely with cash or debt, the accretion
would be twice that, while a mix of cash and stock would yield
something in between, the data show.
The synergies, or redundant expenses, are derived from
Staples and Office Depot having stores in overlapping areas.
There are more than 3,000 North American locations between the
two of them, which could be reduced by 30 percent, according to
Credit Suisse Group AG’s Gary Balter, who forecast $302,000 of
synergies per closed store in a September report.
“It definitely makes sense strategically because the
office space is over-stored and this would be a way to continue
to close more stores,” Brian Yarbrough, a St. Louis-based
analyst at Edward Jones & Co., said in a phone interview. “It’d
probably be a more viable long-term business plan.”

Activist Investor

Starboard Value, the activist investor that successfully
pushed for the merger of Office Depot and OfficeMax Inc. last
year, disclosed a 5.1 percent stake in Staples today and
increased its holding in Office Depot to 9.9 percent. It plans
to push the companies to merge and cut overlapping expenses in
an industry with too many stores, according to a person familiar
with the matter.
While most analysts agree a deal makes sense, some
including Yarbrough are concerned that regulators might block a
combination. The U.S. Federal Trade Commission last year allowed
the Office Depot-OfficeMax transaction, which brought together
the country’s No. 2 and No. 3 office-supply retailers. The FTC
determined then that online retailing ensured competition in the
market.
It may be tougher to argue for further consolidation in
which Staples, the No. 1 chain, is the only one left, Yarbrough
said.
“This is an industry that’s in major decline, it’s under
severe competitive pressures and there’s not a lot of growth
here, so it’s a way you could create some value,” he said.
“But I’m still not sure this can pass the antitrust.”

‘Blessed’ Deal

Balter, a New York-based analyst for Credit Suisse,
believes it can. He cites the wording in the FTC’s decision to
approve last year’s merger, in which it explained how the
industry has changed with competition coming from mass merchants
such as Wal-Mart Stores Inc. and Target Corp. as well as
Internet retailer Amazon.com Inc.
“We believe this is a highly synergistic combination that
has been essentially blessed by the FTC’s wording from the
ODP/OMX deal, and can finally position the remaining player to
compete with all the outside threats in retail, online and in
serving corporate customers,” Balter wrote in his September
analysis of a potential combination.
Office Depot shares rose 27 percent since it closed the
OfficeMax transaction a year ago through yesterday. Staples
shares were down 7.7 percent over that span.
Today, both surged, with Office Depot gaining 12 percent as
of 3:34 p.m. New York time, while Staples climbed 8 percent to
its highest price in a year.
The accretion estimates assume Staples would pay a typical
takeover premium of 30 percent, which equates to almost $10 a
share. An actual offer, should one emerge, may be higher or
lower than that.

Slumping Sales

Both chains have been experiencing declining revenue and
shutting stores to reduce costs. Office Depot’s same-store sales
fell or were flat every quarter since 2006. At Staples, they
slipped at least 4 percent in each of the past four periods.
Office Depot says that synergies from integrating OfficeMax
are more than offsetting the continued pressure on sales. During
an earnings call last month, the company said it increased its
projection for synergies and restructuring benefits to $840
million annually by the end of 2016.

For Related News and Information:
Starboard Acquires Staples Stake, Fueling Merger Speculation
Merger Calculator: MRGC <GO>
Real M&A columns: NI REALMNA <GO>
Top deal stories: DTOP <GO>

--With assistance from Erik Schatzker in New York.

To contact the reporter on this story:
Tara Lachapelle in New York at +1-212-617-8911 or
tlachapelle@bloomberg.net
To contact the editors responsible for this story:
Beth Williams at +1-212-617-2307 or
bewilliams@bloomberg.net
Elizabeth Wollman

>>> Vitol sees acquisition opportunities in downstream, CEO says

Vitol sees acquisition opportunities in downstream, CEO says
Vitol Group sees an increased industrywide acquisition focus on upstream energy assets, which could present acquisition opportunities of downstream buys for the global trader, according to CEO Ian Taylor.

Elaborating on comments he made during a luncheon Q&A at the Platts Global Energy Outlook Forum in New York, Taylor said that the company feels most at home in the downstream sector, though acquisitions could also come in the midstream sector, in response to a question from Mergermarket. He referenced the company's recent acquisition of Total's wholesaling business and said that Vitol continues to look for opportunities.

Taylor also mentioned poorer performing downstream assets in the North Sea, without elaborating.

During his comments during the luncheon, Taylor said that potential targets would need to be "standalone," and would need to work by themselves.

Varo Energy, a Vitol subsidiary, and Carlyle Group acquired the Swiss storage and distribution assets of Total in July, without disclosing the terms of the deal. Varo also holds a 45% stake in Germany's Bayernoil refinery, Petrotank storage facilities in Germany as well as storage facilities in Switzerland, and other downstream assets in Germany.

>>> Campari's wine brands receive interest from China

Campari's wine brands receive interest from China - sources

Campari [CPR IM], the listed, Italian drinks company, has received interest from China for some of its wine division assets, this news service has learned. In the fall fall, this news service reported that Campari mandated Mediobanca to sell its wine division which included Sella & Mosca, Terruzzi Puthod and Enrico Serafino.

Several Chinese wine producers have made inquiries to Campari and the assets could be sold separetly, several sources familiar with the situation said.

Interested bidders could include Changyu Group Co, the biggest and the most centuries-old wine producer in China, Dinasty Fine Wine, an investment holding company, that produces and sells grape wine products primarily in China and Hong Kong, as well as Chinese food producer Bright Food, two of the sources said.

The Chinese conglomerate Cofco could be especially interested in acquiring the Campari’s wines division, as it aims to make International investment and sell globally-sourced wines under their winebrand Great Wall, they both noted.

Sella & Mosca, the biggest of the three assets, and Terruzzi would be valued around 3x sales, the second source said, recalling that Sella & Mosca and Terruzzi generated revenues of around EUR 30m and EUR 5m, respectively.

Mediobanca was not available to comment. A Campari spokesperson said the company does not comment on market rumors.

(Makor) TECH VIEW FP FP (42.66 last) - buy at mkt price, target 48.00


Summary

 

·         The stock fell sharply with the prices of crude but now that crude has reached $60 and the stock has moved back down to re-test the 2007-2008 highs (this time as support) I believe that this dip could provide a buying opportunity

·         Looking at the weekly chart the stock is trading in a rising channel with trend line support at 41.50

·         A reasonable target would be the 200dma which stands at 48.35

 

Strategy: Long from 42.66, target 48.00 with a stop on a close below 40.50

 

Weekly chart

 

Monthly chart


 

 

>>> Yum! more tasty for an activist : was this morning : YUM +2.91%

stock is moving on that...

From: LAURENT CHEKROUN () At: Dec 11 2014 07:47:09
Subject: >>> Yum! more tasty for an activist
Yum! Brands (NYSE:YUM) printed less-than-desirable operating update last night ahead of its 11 December investor day. 2014 EPS growth is now expected in the positive mid-single digits, versus 9% consensus, and China sales are recovering, but at a slower pace than expected. That news has shares of the Louisville, Kentucky-based fast food operator down around 4.5% pre-market. Not including last night’s fall, YUM’s stock is down roughly 0.5% year-to-date versus a broader market that is up 11.5% over that period. That begs the question whether YUM could find itself on an activist’s menu. Fast food peer McDonald’s (NYSE:MCD) has already been speculated as a possible target following a series of disappointing sales reports in 2014. Shares of the golden arched company have fallen over 5% in the past two days after a disappointing November same-store-sales report before Monday’s open. And one could argue YUM has an even more compelling agenda for a possible agitator than its supersized peer. YUM has been asked numerous times about separating its China business—most recently on its 3Q14 earnings call in October. Weakness in China was behind last night’s lower than expected 2014 EPS growth—with full year same-store sales for the division in the negative mid-single digits. With the company’s once all-powerful growth engine sputtering, the spin question could become even more prevalent. Of course, the flip side may be that YUM’s China operations need to get back on track before a separation becomes truly feasible. YUM’s nomination deadline for the 2015 AGM is 31 January.