>>> Migros: Anadolu Endustri may bid for whole company in future, pricing may no

Migros: Anadolu Endustri may bid for whole company in future, pricing may not correspond to market capitalisation 

Anadolu Endustri Holding, the Turkish conglomerate, may consider buying out Migros in the future, although it is currently bidding for a stake, according to a report in Milliyet. The Turkish language report quoted Anadolu Chairperson Tuncay Ozilhan as saying that the group is new to the retail sector, and wants to evaluate the potential of the sector for new investments. Ozilhan said that the talks may take more than a month. According to Ozilhan, the acquisition price would be different from the market capitalisation of Migros, since the company would have to consider Migros' debts as well, considering that it is bidding for joint control in the target.


Source Milliyet

>>> Tesco rejected bid approach from TPG for Dunnhumby marketing

Tesco rejected bid approach from TPG for Dunnhumby marketing subsidiary months ago

Tesco plc has rejected a bid approach from the private equity firm TPG for the listed UK-based supermarket group’s Dunnhumby marketing subsidiary, Sky News reported. TPG approached Tesco regarding Dunnhumby while previous Chief Executive Philip Clarke was still managing the supermarket group, the item added, citing an unspecified source for the claim.

The report cited insiders who said TPG is still interested in Dunnhumby despite Tesco’s rejection of its offer. TPG and Tesco had not entered into formal discussions, the item added.

Tesco is currently conducting a strategic review, and its future ownership of Dunnhumby is under consideration as part of that review, the article said.

Bankers cited by the report said Dunnhumby is worth considerably more than GBP 2bn (EUR 2.54bn), with some bankers estimating a valuation of up to GBP 3bn.

Other buyout groups and large marketing companies are likely to make offers for Dunnhumby should Tesco begin a formal sale process for the subsidiary, the item continued.

Separately, the report cited analysts who said Tesco might try to sell its Asian and Central European businesses, its UK-based garden centres operations and its banking subsidiary.

TPG and Tesco refused to comment on Monday, 6 October, the item said.


Source Sky News

>>> Rio Tinto board confirms that no discussions are taking place with Glencore

Rio Tinto board confirms that no discussions are taking place with Glencore regarding a potential merger

The board of Rio Tinto notes the recent press speculation regarding a possible combination of Rio Tinto and Glencore. This is according to a press release on 7 October.

The Rio Tinto board confirms that no discussions are taking place with Glencore.

In July 2014, Glencore contacted Rio Tinto regarding a potential merger of Rio Tinto and Glencore.

The Rio Tinto board, after consultation with its financial and legal advisers, concluded unanimously that a combination was not in the best interests of Rio Tinto’s shareholders.

The board’s rejection was communicated to Glencore in early August and there has been no further contact between the companies on this matter.

Rio Tinto remains focused on the successful execution of its strategy, which the board of Rio Tinto is confident will continue to deliver significant and sustainable value for shareholders.

Rio Tinto chairman Jan du Plessis said “Under the leadership of Sam Walsh and Chris Lynch, Rio Tinto has made significant progress in refocusing and strengthening its business.

“The board believes that the continued successful execution of Rio Tinto’s strategy will allow Rio Tinto to increase free cash flow significantly in the near term and materially increase returns to shareholders. Rio Tinto’s shareholders stand to benefit from the very considerable value that this will generate.”

>>> London Mining rumoured to have received bid approach from Cape Lambert

London Mining rumoured to have received bid approach from Cape Lambert

London Mining, the UK-listed iron-ore mining company, is believed to have been approached by the Australian exploration company Cape Lambert Resources, The Times reported. The market report cited unattributed rumours that Cape Lambert, in which London-listed African Minerals owns a 20% stake, had contacted London Mining regarding a potential deal.

The item also noted media reports yesterday, 6 October, suggesting London Mining has entered takeover discussions with the India-based steel group JSW.

The report pointed out that Cape Lambert and London Mining own adjacent licences in Africa, and London Mining would benefit from the use of African Minerals’ railway assets for transporting iron ore to port.

London Mining has a GBP 6.78m (USD 10.87m) market cap.


Source The Times

>>> SABMiller CEO denies Heineken approach was intended to deter Anheuser-Busch

SABMiller CEO denies Heineken approach was intended to deter Anheuser-Busch InBev bid
SABMiller’s recently rejected takeover approach to Heineken was not intended to pre-empt any bid from rival brewer Anheuser-Busch InBev, the chief executive of SABMiller said. The Times reported that CEO Alan Clark dismissed any suggestion that the UK-headquartered drinks giant was moving to fend off a potential approach from Belgium-based Anheuser-Busch InBev.

Speaking at a London investor seminar, Clark also defended the Heineken approach as normal strategy for SABMiller, the item reported. He said that situation was only unusual because news of the negotiations was leaked, leading Heineken to announce its rejection of SABMiller.

SAB is always looking at potential opportunities and some may take years to happen, while others might come to nothing, the CEO said.

SABMiller has a GBP 54.1bn (USD 86.8bn) market cap.


Source The Times

Fwd: Br>>> US After Hours: CAMP +5.8%, IDT +0.6%, TCS -12.3%, EZPW -1

NAfter Hours Summary: CAMP +5.8%, IDT +0.6%, TCS -12.3%, EZPW -11.6% following earnings/guidance

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings: CAMP +5.8%, IDT +0.6%

Companies trading higher in after hours in reaction to news: OXGN +3.7% (announced that data from the Phase 2 GOG186I study of fosbretabulin in combination with bevacizumab will be presented on November 9 at the International Gynecologic Cancer Society), REGN +2.0% (EYLEA (aflibercept) Injection received FDA approval for macular edema following retinal vein occlusion), ACHN +1.8% (disclosed it entered into a Master Security Agreement for a $1,000,000 Capital Expenditure Line of Credit), SBLK +1.6% (collected $8.016 mln from the sale of its claim against PAN OCEAN)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings: TCS -12.3%, EZPW -11.6%

Companies trading lower in after hours in reaction to news: IBIO -15.0% (filed for sale of up to 23,418,172 shares of common stock by Aspire Capital Fund), KCAP -4.3% (commenced 3 mln share public offering), KOS -4.1% (announced secondary public offering of 15 mln common shares), BBEP -3.4% (announced public offering of 14 mln common units), END -2.8% (announced the appointment of a Chief Restructuring Officer), OTIV -1.6% (filed for $50 mln mixed securities shelf offering), DYN -1.3% (launched 22.5 mln share common stock and 4 mln share mandatory convertible preferred stock offerings)

(Makor)Relative Value/MRPT - long BASF vs. AKZO, XLB

Trade action flash – LONG BASF / SHORT AKZO, SHORT BASIC MATERIALS ETF (XLB US)

October 6, 2014

Relative value / MRPT© mean reverting pair trading strategies

BAS GR: Eur70.15; AKZ NA: Eur51.32 ; XLB US: US$48.43

Following the significant underperformance of BASF over the last four months, we recommend to go long BASF and short Akzo Nobel as well as the US basic materials ETF XLB (Materials Select Sector SPDR) with which BASF is most mean reverting.  Following a price drop of 20% since June (reduced expectations/exposure to Russia), BASF is significantly undervalued in the global Chemicals sector, although in absolute terms the stock is overvalued (as the rest of the sector) – hence our long/short recommendation with a market neutral exposure, possibly slightly net short.

FULL REPORT ATTACHED

>>> Asian Update


Asian Market Update: RBA maintains policy stance and view of AUD; Hong Kong PMI contracts for 2nd month


***Economic Data***
- (AU) RESERVE BANK OF AUSTRALIA (RBA) LEAVES CASH RATE TARGET UNCHANGED AT 2.50%; AS EXPECTED (13TH STRAIGHT PAUSE)
- (AU) AUSTRALIA SEPT AIG PERFORMANCE OF CONSTRUCTION INDEX: 59.1 (9-year high, 3rd consecutive rise) V 55.0 PRIOR
- (AU) Australia ANZ Roy Morgan Weekly Consumer Confidence Index: 112.6 (first decline in 3 weeks) v 113.7 prior
- (HK) HONG KONG SEPT HSBC PMI: 49.8 (2nd consecutive contraction) V 49.6 PRIOR
- (JP) JAPAN SEPT OFFICIAL RESERVE ASSETS: $1.26T (1-year low) V $1.28T PRIOR
- (NZ) NEW ZEALAND Q3 NZIER BUSINESS OPINION SURVEY: 19 (2-yr low) V 32 PRIOR

***Index Snapshot (as of 02:30 GMT)***
- Nikkei225 flat, S&P/ASX -1.0%, Kospi flat, Shanghai Composite closed, Hang Seng +0.1%, Dec S&P500 flat at 1,955

***Commodities/Fixed Income***
- Dec gold -0.2% at $1,204/oz, Nov crude oil -0.1% at $90.20/brl, Dec copper +0.1% at $3.04/lb
- SLV: iShares Silver Trust ETF daily holdings fall to 10,857 tonnes from 10,884 tonnes prior

***Market Focal Points/Key Themes/FX***
- Reserve Bank of Australia was on hold at 2.5% for the 13th straight meeting as widely expected, reiterating "monetary policy is appropriately configured" and "inflation is consistent with the 2-3% target". The accompanying statement was nearly a carbon copy with a marginal update on exchange rate, noting AUD remains high by historical standards (previously said "above most estimates of fundamental value"). RBA also acknowledged a "volatile" labor data after AUG employment change put in a 36-year high. AUD/USD briefly fell about 20pips above 0.8730 post-RBA before erasing all of those losses.

- Rio Tinto was up over 3% on overnight speculation of a potential bid from Glencore down the line despite formally stating that no talks are taking place. Rio added combination would not be in the best interest of shareholders. Samsung Electronics put out its prelim Q3 results below the median estimates but better than some of the worst analyst expectations, supporting shares. Samsung noted earnings are affected by smartphone competition, mobile margins are declining, and that uncertainty could persist into Q4.

- BOJ policy statement is delayed by Gov Kuroda's speech at Japan's parliament. Kuroda noted export growth is lacking momentum despite softer JPY and sales tax rise impact has been prolonged, reiterating he is prepared to ease further if the economy undershoots forecasts. An earlier press report indicated the majority of the policy board is now in favor of doing away with the 2-yr inflation target timeframe given the slower rise in CPI in the past few months. USD/JPY rose about 50pips from session lows to test 109.20

- Hong Kong PMI contracted for the 2nd consecutive month, though it rose marginally from last month's levels. HSBC economist said "the impact of the cyclical slowdown is being felt through deteriorating labour market conditions, (and) new orders will likely have to pick up more significantly in the coming months before the downward trend in employment reverses." Separately, Hong Kong student leader said the Occupy Central will respond if talks with the govt fail, adding they are not very optimistic about the outcome of negotiations for any constitutional reform.

- North and South Korea patrol boats exchanged gunfire in the western sea after the former reportedly entered the waters of the South. This follows weekend reports that the two sides have agreed to hold high level talks this year. North Korea's patrol boat was quick to leave the scene, and no casualties were reported.

- Fed's George (non-voter, hawk) reiterated her hawkish stance, forecasting wage growth accompanying stability in the labor market. George also noted most FOMC participants expect rates to start rising in 2015, and that it was generally better to have tighter policy in the event of another recession.


***Equities***
US markets:
- TCS: Reports Q2 $0.11 v $0.11e, R$193M v $200Me; - Guides FY14 $0.41-0.46 (ex items) v $0.50e, Rev $800-810M v $823Me; -13.2% afterhours
- EZPW: Q4 Guidance to be cut below prior range (prior Q4 $0.37-0.39 (cont ops) v $0.36e); -11.6% afterhours
- Z: Reports Sept monthly unique users 82.8M v 86.3M m/m (4-month low and 2nd straight decline); -1.7% afterhours
- SWK: Guides FY14 EPS lower to $5.30-5.50 v $5.54e (prior $5.50-5.60) - filing; -0.8% afterhours
- REGN: FDA approves EYLEA (aflibercept) Injection for expanded indication in Macular Edema Following Retinal Vein Occlusion (RVO); +1.9% afterhours

Notable movers by sector:
- Materials: Glencore Xstrata 805.HK +3.8%, Aluminum Corporation of China 2600.HK +2.2%, Rio Tinto +3.4% (reports of possible joint bid for Rio; rumors later dispelled); Newcrest Mining NCM.AU -0.3% (Q1 gold production)
-Technology: MediaTek 2454.TW -2.3% (Sept results); TDK Corp 6762.JP +1.0% (to increase hard-desk capacity); Fujifilm 4901.JP +5.6% (positive use of drug in Ebola case); Samsung Electronics 005930.KR +1.2% (prelim Q3 results)
- Energy: China Longyuan Power Group 916.HK +0.7%, Huaneng Renewable Corp 958.HK +3.0% (China to support wind power development)
- Utilities: Tepco 9501.JP +1.4%, Chubu Electric 9502.JP +1.5% (thermal power partnership)