France Won’t Start Stake Sales With EDF, Francaise Des Jeux

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BN 11/15 13:17 *FRANCE WON'T START STAKE SALES WITH EDF, FRANCAISE DES JEUX BN 11/15 13:14 *FRANCE NEEDS TO BE PRAGMATIC ON SAVING FACTORIES, MACRON SAYS BN 11/15 13:14 *FRANCE'S MACRON SPEAKS IN LE MONDE INTERVIEW BN 11/15 13:13 *FRENCH ECONOMY MINISTER MACRON SAYS EUROPE NEEDS TO INVEST BN 11/15 13:12 *FRENCH ECONOMY IN `STATE OF EMERGENCY,' MACRON TELLS MONDE

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France Won’t Start Stake Sales With EDF, Francaise Des Jeux 2014-11-15 13:29:18.977 GMT

By Tara Patel Nov. 15 (Bloomberg) -- French government will begin plan to sell stakes in companies with regional airports and those in which it has double voting rights, Economy Minister Emmanuel Macron said in interview in Le Monde. * Privatization plan won’t start with EDF, Francaise des Jeux: Macron tells Monde * Govt will examine ailing factories on ‘case-by-case’ basis before intervening: Monde * Sanofi was warning for govt on importance for French companies to keep industries in country: Macron * French economy in ‘state of emergency’ in need of European investment: Macron Note: Macron Says France to Sell EU5B-EU10B in State Assets {NSN NDHIMD6K50YF <go>} See: interview: http://www.lemonde.fr/economie/article/2014/11/15/m-macron- notre-economie-est-en-etat-d-urgence_4524099_3234.html

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Abengoa Plans to Provide Additional Earnings Information

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Abengoa Plans to Provide Additional Earnings Information 2014-11-15 09:44:36.566 GMT

By Rodrigo Orihuela Nov. 15 (Bloomberg) -- Co. says will hold conference call to offer additional earnings information on Nov. 17. * CEO Manuel Sánchez Ortega and Executive Vice President of Capital Markets and Investor Relations Barbara Zubiria Furest to participate, co. says in regulatory filing * Call scheduled for 08:00 GMT, further details to be announced on co. website: filing * NOTE: Abengoa Class B shares dropped record 37% yday * NOTE: Abengoa Bonds Tumble as Recourse Blur Triggers Funding Concern

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Telecom Italia May Raise Capital for Oi-Tim Merger: Messaggero

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Telecom Italia May Raise Capital for Oi-Tim Merger: Messaggero 2014-11-15 10:03:02.457 GMT

By Lorenzo Totaro and Daniele Lepido Nov. 15 (Bloomberg) -- Plan may be discussed at a Nov. 21 board meeting of Telecom Italia ahead of CEO Marco Patuano’s talks with Oi management, Rome-based daily reports without saying where it got the information. * Telecom Italia management, some of main shareholders divided on need for capital increase ahead of possible merger: Messaggero * NOTE: A spokesperson for Telecom Italia was not immediately available to comment on report NOTE Nov. 13: Oi Chief Open to Tim Merger in Brazil Telecom Consolidation

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FT : Russia braced for ‘catastrophic’ oil plunge

President Vladimir Putin said Russia is bracing itself for a “catastrophic” slump in oil prices. as the world’s leading energy forecaster warned that the price rout had yet to run its course.
The price of oil has fallen 30 per cent since mid-June. But the International Energy Agency said on Friday that it had further to fall, with downward price pressures likely to build further in the first half of next year. “It is increasingly clear that we have begun a new chapter in the history of the oil markets,” it said.

Brent, the international benchmark, hit a four-year low of $76.76 a barrel on Friday but later bounced back to $79. However it was still down almost 5 per cent on the week.
The plunge in the oil price has spread alarm among energy producers from Saudi Arabia to Venezuela. Citi analysts have calculated that if crude remains at $80, members of the Opec producers’ cartel could see their annual revenue fall by $150bn.
Russia has been particularly hard hit. The rouble has plunged 23 per cent against the dollar in the past three months, and the central bank is forecasting zero growth for 2015.
Weak oil prices have come as Moscow struggles to cope with the effects of western sanctions. Arriving at the G20 summit in Brisbane on Friday, Mr Putin faced warnings of further penalties unless Russia pulls back from Ukraine.
“We’re considering all the scenarios, including the so-called catastrophic fall of prices for energy resources, which is entirely possible, and we admit it,” said Mr Putin, ahead of the summit. But he said that Russia’s $400bn of reserves would cushion the blow from further price slides.
Shares in some of the largest oil companies have also been hit, as investors fear tumbling oil prices could put at risk their ability to develop high-cost projects and maintain dividend payments. Royal Dutch Shell’s shares are down 7.8 per cent since mid-June, and BP’s have fallen 15 per cent.
But more broadly lower oil prices could provide a lift for western economies wrestling with weak growth. Cheaper energy amounts to a tax cut for consumers, and can also help contain inflationary pressures, ensuring that interest rates remain at low levels.
Each 10 per cent drop in the oil price adds about 0.1 per cent to gross domestic product, says Richard Batley at Lombard Street Research. But the effect may take some time to feed through. “The maximum impact occurs around four quarters after the price reaches that level,” he said.

>>> Weekly Update: US Stocks at New Highs In Spite of Europe & China Stall

Weekly Market Update: US Stocks at New Highs In Spite of Europe and China Stall


The S&P500 and the DJIA both pushed out to fresh record highs again this week though trading volumes remained light. The fall earnings season is all but over and this week featured major US retailers turning in decent but not exceptional quarterly results. CPI and GDP data out of Europe confirmed that the continent's sick economy is not seeing any marked improvements, although the prelim German Q3 GDP q/q reading rose to +0.1% from -0.2% in the advance reading, keeping Europe's largest economy out of official recession territory. Crude prices sank to the lowest level in over four years as OPEC continued to pretend that everything was fine in markets heading into a November 27th meeting. World leaders attended the APEC summit in Beijing, where President Obama and China President Xi reached a bilateral agreement to reduce carbon emissions and member nations endorsed a roadmap for China's Free Trade Area of the Asia-Pacific (FTAAP), Beijing's rival to the Trans-Pacific Partnership (TPP) trade agreement. For the week, the DJIA gained %, the S&P500 rose % and the Nasdaq added %.

President Obama called on the FCC to classify the internet as a utility under Title II regulation (the same treatment given to phone companies), in an attempt to shape the debate over net neutrality. The president's statement came as FCC Chairman Wheeler was briefing members of Congress on his own concept for net neutrality, based on a hybrid model involving elements of both utility-like and free market regulations. House Republican leaders commented that placing internet under title II regulation was beyond the power of the FCC. Time Warner Cable lost as much as 10% and Comcast lost up to 6% in the two sessions following the president's statement, before recovering.

Crude saw more dramatic moves to the downside this week, with crude futures falling to 4-year lows with WTI around $73.25 and Brent below $78 by week's end. The next OPEC meeting is coming up fast on November 27th and there is still no clear indication that the organization will move to lower output. Saudi Oil Minister Al Naimi called talk about an oil price war a misunderstanding while Kuwaiti Oil Minister Ali Al-Omair said OPEC would not change its production quotas. In its monthly report, the IEA said there was more downside yet to come in oil prices, given market dynamics.

Ukraine was back in headlines this week as Russia and its anti-government proxies in Eastern Ukraine were observed concentrating forces for what appears to be a major offensive. NATO said it had seen multiple columns of tanks and materiel arriving in the rebel provinces and Kiev has begun shifting more forces to the east, even as artillery exchanges heated up. The September 5th ceasefire agreement is looking increasingly hollow.

McDonalds October SSS were much better than expected, however comps in all three of the company's regional divisions were still in contraction territory. Recall that with third-quarter earnings, McDonalds CEO warned that October comps would remain negative. On Friday, Jana Partners disclosed a new stake in McDonald's giving investors hope that the activist may propose changes. This comes after tons of speculation that the struggling Micky D's could be a big target for activists.

Retailers Walmart and Macys had decent results for the third quarter which encompassed the back to school season. Walmart's earnings topped expectations and comps stayed in positive territory, although it narrowed its FY forecast. On its conference call, Walmart said it would start matching prices with major online retailers. Macys widely topped the consensus on earnings, although its comps were negative and the firm trimmed its FY view. Both Walmart and Macys made constructive comments about Q4 holiday business. Both stocks sustained more than 4% gains through week's end. JC Penny and Kohls had problems in their Q3 reports. Headline results from both names were below expectations, JCP's SSS were flat, and KSS's comps were negative. JC Penny asserted that it was in the "final stage" of its turnaround plan.

Alibaba did $9.3 billion dollars in orders on Single's Day (11/11), China's big fall retail sales day, topping all estimates. Chairman Jack Ma said he was happy with the results and even went as far as to say he hoped this new holiday would become a global commerce event in the years ahead. The company also announced it was looking to raise $8 billion in USD bonds, adding fuel to rumors the e-commerce giant might do some shopping of its own. Shares of BABA were volatile, seesawing through week's end after a solid month of gains in the wake of the company's October IPO.

On the M&A front, BB&T Corp agreed to buy Susquehanna Bancshares for about $2.5 billion in cash and stock. The deal gives BB&T a bigger foothold on the East Coast. Berkshire Hathaway said it would acquire the Duracell battery unit of P&G in a cash-and-stock arrangement valued at $6.4B. In other deal talk, there were reports that Actavis was in talks to acquire Allergan for around $210/share, as Vertex's flagging offer looks less and less likely to succeed. Share of Baker Hughes gained sharply towards the end of the week after the company disclosed it was engaged in preliminary discussions with Halliburton about a possible combination.

EUR/USD bounced back and forth in the 1.2400 handle for most of the week in the absence of any major Eurozone news. Final October CPI data and the second reading of Q3 GDP data confirmed the wretched condition of the European economy but held no big surprises. EUR/CHF fell to around 1.2010 on Friday from the 1.2030 level coming into the week. The Swiss National Bank's Jordan said the bank would not abandon the 1.2000 floor for the foreseeable future and called the peg the bank's most important tool for price stability. The SNB's resolve may soon be tested as the Swiss referendum on central bank gold reserves takes place on November 30th, and one poll out this week showed the vote was too close to call, with 44% of respondents in favor of the initiative, 39% against and 17% undecided.

USD/JPY declined to seven-year lows by Friday, topping out around 116.80 before retracing a bit on Friday afternoon. Comments by government officials drove speculation that the final decision on the next planned sales tax increase could be delayed until after early elections, which PM Abe may call in December in order to bolster his mandate. The Bank of Japan warned that any plan that would delay the tax increase could make BOJ's decision harder by hurting fiscal trust and diminishing the attractiveness of Japan's government bonds. The rumors went back and forth all week making it hard to say whether PM Abe would go ahead and actually launch early elections, although it appears that a final decision would wait at least until after Monday's Q3 GDP results.

China published a raft of October economic figures last weekend. October CPI at 1.6% matched the lowest level since Jan 2010, with the food component at 2.5% and non-food at 1.2%. Year-to-date CPI was unchanged from September, just above the 2% level. October exports were still in surplus but imports were slightly lower than expected. Subsequent reports suggested that the trade surplus was driven by the contraction in import growth, domestic demand remains weak, and destocking has led to decline in consumption of cement, coal, iron ore and other raw materials. Thursday saw another round of October economic data drop: industrial production was weaker than expected and power generation contracted on a sequential basis for the third month in a row. China retail sales were pretty soft, and slowed for the fifth moth in a row.

Telegraph : 'Britain has to be prepared to walk away from the EU’ P.Hammond

'Britain has to be prepared to walk away from the EU’
But the new Foreign Secretary, Philip Hammond, a noted Eurosceptic, is now more confident of 'meaningful’ restrictions on immigration – and spiking Ukip’s guns

Even 4,500 miles away in the intense heat of West Africa, the European Union is never far from Philip Hammond’s thoughts. The Foreign Secretary has just spent a day seeing the devastation left in Sierra Leone by the deadly Ebola virus, but he is now on the front line of a battle to prevent a Conservative meltdown caused by the upcoming Rochester and Strood by-election.
With Vladimir Putin’s aggression in Ukraine and the rise of jihadist groups such as Isil in the Middle East, Mr Hammond is struggling with the busiest overseas policy agenda faced by a foreign secretary in years. But, in the official residence of the High Commissioner in Ghana ahead of a seven-hour flight back to the UK, his focus is on the EU, immigration, and the by-election.
Ahead of Thursday’s crucial vote, which the Conservatives face losing to Ukip, Mr Hammond has chosen to go further than even David Cameron in warning that Britain could leave the EU if the country does not gain control over its borders. Britain must get “substantial, meaningful reform” from Brussels ahead of the in-out referendum Mr Cameron has pledged to hold in 2017, Mr Hammond says. He makes clear that the Government is now “prepared to stand up from the table and walk away”.
The next seven days will be critical for the Tories and could do more to determine the outcome of May’s general election than any other moment in the last four years. If the Conservatives lose badly to Ukip defector Mark Reckless – as pollsters predict – it could trigger a crisis for the Prime Minister that will lead many in his own party to conclude that they cannot win the election.
Senior Conservatives believe that the only way to confront the “existential threat” posed by Nigel Farage and Ukip is to take an increasingly hard line on immigration and EU reform.

And Mr Hammond does just that by making clear that “we have to be prepared” to leave the EU if reforms to the immigration system are resisted. “We’re in the beginning stages of a negotiation and – first of all, never, never go into any negotiation unless you’re prepared to stand up from the table and walk away,” he says. “We have to be prepared to. In this case it isn’t even our decision because there’s going to be a referendum at the end of this process.
“We have to be candid with our European Union partners as we’re negotiating about what we think the verdict of the British people would be. I’d like to be telling my German counterpart honestly, if you draw the line there, I don’t think we’re going to get this past the British public in a referendum – but if you could move your line to there, I think we might.”
When Mr Hammond replaced William Hague in July’s reshuffle, it was seen as a promotion that took Britain closer to leaving the EU.
Mr Hammond is a noted Eurosceptic and has said he would vote to leave the EU if Britain is unable to achieve substantial reforms. In recent months, he has not disappointed those in the Tory party who passionately support an EU exit by saying that it is “lighting a fire under the European Union” by holding an in-out referendum.
Mr Hammond appears to concede that when he stood in Mr Cameron’s Downing Street office and accepted the role of Foreign Secretary, he took it thinking Britain would ultimately leave the EU. However, following a series of behind-the-scenes negotiations with his counterparts across Europe, he now says he is “much more optimistic” that Britain can get reforms to the immigration system that will lead to a vote to stay in the EU.
He makes clear that a vote to stay in Europe is “definitely not a certainty”, but adds: “I’m much more optimistic about that now than I was before I started doing this job because – perhaps I read too many newspapers – I slightly had the impression that I was going to be going into battle as a lonely voice. And what I found in fact, was that I was going in and saying this is our problem, and people were saying we completely get it, it’s our problem, too.”
In recent weeks, a series of European leaders including Angela Merkel, the German chancellor, appeared to torpedo Mr Cameron’s attempts to reform EU freedom of movement rules. Mrs Merkel told Mr Cameron that Germany would not accept any of his demands on freedom of movement. German officials were reported to have said that they would be prepared to countenance the possibility of a “Brexit” if the Prime Minister insists on changing the rules that allow an unlimited number of EU citizens to come and live and work in the UK.
But Mr Hammond insists it is “nowhere near as black and white” as the noises off from within the Bundestag would suggest. “It isn’t the case that either the Germans agree that we can have total control of our own borders, or we’re never going to do a deal with the Germans,” Mr Hammond says.
“If your ambition is that we have total unfettered control of our own borders to do what we like, that isn’t compatible with membership of the European Union, it’s as simple as that. And people who advocate that know jolly well it is not compatible with membership of the European Union. So if that’s what you want, you’re essentially talking about leaving the European Union.”
The Foreign Secretary makes clear that his negotiations can result in Britain having the “ability to avoid the kind of destabilising movements that we’ve seen over the last decade or so”.
It is not the case that Britain will be unable to actively reduce the number of migrants coming to the UK, Mr Hammond insists. Plans floated in recent weeks by senior Conservative sources suggested that Mr Cameron wants to announce plans for quotas – limiting the number of EU migrants who can come to the UK annually.
After those plans were firmly rejected by allies – including Germany – that idea looked to have been scrapped. But Mr Hammond suggests that the possibility of quotas in all but name is still very much an option. It is just a question of the language and tone used during the negotiations, he says.
Britain will push for a “stretched definition” of existing EU treaties, Mr Hammond says. It will allow freedom of movement rules to be altered without treaty change, something Germany has said is impossible.
Asked if the idea of imposing quotas on EU migrants is now dead, Mr Hammond says: “There are bits of language which make things more difficult. I wouldn’t go into a discussion with my European colleagues talking about quotas. But I might be talking about a mechanism that delivered the same kind of outcome. But if you put a word like quota on the table, you immediately cause shutters to go up. So I think it’s about exploring the ideas and engaging, talking and that’s what we’re trying to do now. This negotiation isn’t going to begin until after the next election. What we can do at this stage is try to understand where people’s red lines really are, what they’re really thinking.”
In an attempt to recover from the expected loss to Ukip in next week’s by-election, Mr Cameron will in the coming weeks give a major speech on the EU and immigration to try to convince Ukip voters to return to the Conservative Party. The message will be that only Mr Cameron and the Tories can deliver change for those angry Ukip voters.
Some people are seeing Mr Cameron’s speech as his last throw of the dice on immigration before voters go the polls in May. According to Mr Hammond, it is a roll of the dice that may just work.

(BFW) Danone Said to Weigh Medical-Nutrition IPO as Sale Talks Falter


BN 11/14 21:13 Danone Said to Weigh Medical-Nutrition IPO as Sale Talks Falter

Danone Said to Weigh Medical-Nutrition IPO as Sale Talks Falter
2014-11-14 21:18:53.890 GMT


By Aaron Kirchfeld and Ruth David
Nov. 14 (Bloomberg) -- Co. preparing possible listing next
year even as it still discusses a sale, people familiar say.
* Danone has so far failed to reach agreement after talks with
Fresenius, buyout firms, Hospira, Nestle
* Medical-nutrition unit could be valued at >EU3b, people
familiar have said
Story Link:NSN NF1SAB6TTDS4<GO>

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--With assistance from Corinne Gretler in Zurich and Dinesh Nair
and Manuel Baigorri in London.

To contact the reporter on this story:
Andrea Snyder in Washington at +1-202-624-1831 or
asnyder5@bloomberg.net
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Andrea Snyder at +1-202-624-1831 or
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Barron's : A Casino Worth a Wager, French food retailer Casino Guichard Perracho

A Casino Worth a Wager
French food retailer Casino Guichard Perrachon’s shares look tasty, particularly in light of its planned IPO of Cnova, its e-commerce business.

Casino could pay off handsomely—even though it sounds like a gamble.

As if the name alone isn’t enough to set off alarm bells, Casino Guichard Perrachon (ticker: CO.France) is a food retailer, a sector in which profits have slid substantially in Europe as consumers’ shopping habits change and discounters increase their market share. Even Warren Buffett has been caught out, conceding this month he made a “huge mistake” with his investment in food chain Tesco (TSCO.UK).

What makes Casino different? The French company’s management was quick to identify the shift in domestic shoppers’ preferences from superstores to convenience shops, and it focused its international operations on some of the most promising emerging markets. It also pursued a real estate strategy, developing shopping centers around its big stores to generate rental income.

Based on Friday’s close of 84.58 euros a share, Casino has a market value of €9.5 billion ($11.8 billion) and trades at 14.5 times estimated 2015 earnings. It looks pricey, compared with other European food retailers; Carrefour (CA.France) has a 13.7 multiple; Royal Ahold (AHONY), 13.6. But the pending initial public offering of Casino’s e-commerce unit, Cnova, merits a reappraisal of the valuation. Cnova, which runs Cdiscount sites in France, Brazil, and other markets, boasts almost 13 million active customers and reported 23.6 million orders in 2013. Sales were €2.9 billion last year, and are growing by double digits.

Cnova’s preliminary prospectus points to a valuation for the company of €4.1 billion to €4.6 billion., but gives no timetable for the New York listing. Stripping out Cnova, Bernstein Research analyst Bruno Monteyne reckons, Casino is trading at a price/earnings ratio of 9 to 9.5 times, little more than troubled Tesco. He rates Casino Outperform, with a €115 price target, or upside of about 35%. “Time for investors to fill up their [shopping carts],” Monteyne says.

THAT’S WHAT SHOPPERS APPEAR TO BE DOING at Casino, especially overseas, where it gets 60% of its sales in markets characterized by high development potential, large and young populations, and strong growth. The company controls Companhia Brasileira de Distribuicao (PCAR4.BR), Brazil’s top retailer; Colombia’s largest food retailer, Almacenes Exito (EXITO.Colombia); and Big C Supercenter Public (BIGC.Thailand), Thailand’s No. 2 large-format food retailer.

Organic sales from international operations alone grew 12% last year. Sales in France, where Casino runs 10,500 stores under the Casino, Franprix, Leader Price, and Monoprix names, rose 5.7%. Overall sales climbed 16%, to €48.65 billion, in 2013, and earnings before interest, taxes, depreciation, and amortization (Ebitda) were €3.33 billion. Sales should hit €49.69 billion this year and €52.91 billion next, according to analysts’ consensus estimate. Ebitda is forecast to nudge up to €3.37 billion in 2014 and €3.67 billion in 2015., while earnings are estimated at €4.88 a share this year and €5.81 in 2015. Casino’s balance sheet is solid and net debt at the end of last year was €5.4 billion, or 1.6 times Ebitda.

As at any casino, there’s more than one game to play. Rallye (RAL.France), a holding company, controls 48% of Casino’s shares and almost 60% of the voting rights. Rallye closed Friday at €32.39—13.6 times forecast 2015 earnings, making it cheaper than Casino. It also has a bigger dividend yield: 5.6% versus 3.7%.

Either way, Casino’s story is worth a punt.

>>> Zoetis adopts one-year shareholder rights plan - Press Release

Zoetis adopts one-year shareholder rights plan - Press Release

Zoetis Inc. (NYSE: ZTS) today announced that its Board of Directors has adopted a one-year shareholder rights plan (the “Plan”) and declared a dividend distribution of one preferred share purchase right (a “Right”) for each outstanding share of the Company’s common stock. The Plan will automatically expire on 16 November 2015, unless the Rights are earlier redeemed, exchanged or terminated.

The Plan is intended to protect shareholders and the Company from any attempt to take control of the Company that the Board of Directors determines is not in the best interest of shareholders and does not reflect the Company’s unique industry position and long term value. It is also designed to provide the Board sufficient time to make fully informed decisions in response to any open market or other accumulation of shares.

The Plan is not intended to prevent an offer to acquire the Company or any other business combination the Board may approve and, as such, may be amended, redeemed or terminated by the Board at any time prior to being triggered.

Under the Plan, the Company is issuing one Right for each current share of common stock outstanding at the close of business on 24 November 2014. If the Rights become exercisable, each holder of a Right will be entitled to buy one one-thousandth of a share of preferred stock at an exercise price of USD 200, subject to adjustment as provided in the Plan. The Rights are not taxable to shareholders. Shareholders are not required to take any action to receive the Rights.

The Rights will be exercisable only if a person or group (an “Acquiring Person”) acquires 15% or more of Zoetis common stock. If a shareholder’s beneficial ownership of Zoetis common stock as of the time of this announcement of the Plan and associated dividend declaration is at or above 15% (including through entry into certain derivative positions), the Rights would become exercisable if at any time the shareholder increases its ownership percentage by .001% or more. In those situations, each holder of a Right (other than an Acquiring Person, whose Rights will become void and will not be exercisable) will be entitled to purchase a number of shares of Zoetis’ common stock for USD 200 that have a market value of twice the exercise price of the Right.

At any time prior to 10 business days following a public announcement that a person has become an Acquiring Person, the Company may redeem the Rights in whole, but not in part, at a price of USD 0.001 per Right. Immediately upon the action of the Board of Directors ordering redemption of the Rights, the Rights will terminate and the only right of the holders of Rights will be to receive the USD 0.001 redemption price.

Details of the Plan will be communicated in a Form 8-K to be filed with the US Securities and Exchange Commission.

>>> Baker Hughes/Halliburton could see bidders line up for possible divestitures

Baker Hughes/Halliburton could see bidders line up for possible divestitures, industry sources say

While a deal may still be cooking, oil and gas players are likely to be scrambling to look at possible asset acquisition opportunities which may stem from a possible combination of Halliburton (NYSE: HAL) and Baker Hughes (NYSE: BHI).

Baker Hughes confirmed on 13 November it was engaged in preliminary discussions with Halliburton regarding a potential business combination. Today Bloomberg reported that talks may have already stalled due to concerns about divestitures and disagreements over price, but negotiations could be revived.

The two giant oilfield service players have product overlap in too many areas to name, but a few specific areas that could lead to antitrust concern and subsequent divestment include drilling tools, chemicals, pressure pumping, drill bits and wireline, according to one industry banker. A previous report from this news service noted that the deal, if successful, could result in USD 7bn-USD 10bn in divestitures.

Several industry sources noted energy-focused private equity funds would be prime buyers for many of these assets. Among strategic buyers, players like Weatherford (NYSE: WFT), Superior Energy Services (SPN), National Oilwell Varco (NYSE:NOV) and Cameron (NYSE: CAM) were cited as logical names, but the banker noted that Halliburton and Baker Hughes would probably rather not sell assets to direct competitors.

As to the wireline business, which is likely to attract high levels of interest as it can be integral to the fracking process, two energy industry attorneys cited FTS International (NYSE: FTSI) as a logical bidder, and one further added that FTS had “immense capabilities” to afford such a deal. On 3 November, FTS International acquired J-W Wireline Company, one of the largest independent cased-hole wireline companies in North America, for an undisclosed amount. J-W Wireline has 400 employees.

FTS International was not immediately available to comment.

In the chemicals space, where the banker noted that Baker Hughes is number one in market share, one logical bidder could include Ecolab (NYSE: ECL),which provides water, hygiene and energy technologies and services, according to one energy consultant and one energy attorney. Ecolab, which serves several segments of the oil and gas industry, acquired Champion Technologies for USD 2.2bn at the end of 2012.

Ecolab did not immediately return request for comment.

In pressure pumping, Patterson UTI (NASDAQ: PTEN), and RPC Inc. (NYSE: RES) could be possible suitors, an industry executive said. Patterson closed several pumping asset buys in October, the executive noted. C&J Energy Services (NYSE: CJES) also operates in the space, but is focused on integrating its pending merger with the North American completion and production business of Nabors Industries (NYSE: NBR), the executive said. C&J did not return calls for comment. Patterson and RPC could not be reached for comment.

The banker noted that with so many players in pressure pumping, divestitures in that space may be less notable.

While GE (NYSE:GE), with its vast oil and gas presence, was mentioned as a possible suitor by the banker, one of the energy attorneys said it was his opinion that GE was more interested in manufacturing related to the oilfield service space. With its CEO Jeff Immelt moving away from lower-margin businesses, recently announcing it would sell its appliances business, it has been moving toward higher-margin products such as jet engines and electric turbines, he explained. For example, it acquired Lufkin Industries, which manufactured pump jacks, for USD 3.3bn in April 2013.

The banker also noted that GE is occupied with its proposed energy sector alliance with France’s Alstom (FR: ALO), so the timing is not ideal.

Goldman Sachs is advising Baker Hughes, and Credit Suisse is advising Halliburton, as reported.