M & A wrap: Owners, insiders jockey ahead of LME sale
Market parties are jockeying ahead of a sale of the London Metal Exchange (LME), a deal that could radically alter the sway that banks and brokers hold over the world’s largest metals market.
Meanwhile, London Stock Exchange chief Xavier Rolet says he aims to put last year’s failed bid for Canada’s TMX Group behind him by forging ahead with plans to diversify.
Eastman Chemical is buying specialty chemical maker Solutia Inc for about $3.38 billion in cash and stock to extend its reach in emerging markets, particularly the Asia-Pacific region.
In a punishing year for hedge funds, the world’s biggest hedge fund is also one of the best performers, DealBook says. Bridgewater Associates, which manages nearly $120 billion, posted returns of 23 percent in 2011 — a year when the average hedge fund portfolio lost 5 percent, it added.
Roche Holding AG’s rivals Sanofi SA and Novartis AG see no need to match the Swiss drug maker in buying a gene-decoding business like Illumina Inc and reckon they can do partnerships instead.
M & A wrap: Illumina unveils poison pill to stave off Roche
Gene sequencing company Illumina unveiled a “poison pill” defense strategy against a hostile bid from Swiss drugmaker Roche, saying it would trigger a rights agreement if any party bought 15 percent of its stock. Roche is offering $5.7 billion in cash for Illumina.
Analysts say it is likely to be a protracted battle lasting well into 2012 based on Roche’s past deal playbook and possible regulatory hurdles. “This is going to take a while. There’s room for a protracted wait-them-out strategy as Roche puts pressure on Illumina’s board,” one arbitrageur, who declined to be named, told Reuters.
Amgen Inc, the world’s largest biotechnology company, says it would pay over $1 billion to buy Micromet Inc, which has several cancer drugs in development.
Japan is set to launch a $13 billion bailout of the stricken Tokyo Electric Power Co after the utility dropped resistance to a public fund injection, sources say. Tepco’s Fukushima plant was wrecked by a quake and tsunami last March, sparking the world’s worst nuclear crisis in 25 years. It will be one of the world’s biggest bailouts outside the banking sector.
The chief executive officers of some of Europe’s richest companies discuss takeovers at this week’s World Economic Forum amid a flood of negative economic forecasts, Bloomberg reports.
M & A wrap: Roche goes hostile for gene firm Illumina
Roche is offering $5.7 billion in cash to buy U.S. gene sequencing company Illumina Inc in an unfriendly takeover bid that marks a major play by the Swiss drugmaker into the gene technology field.
AMR Corp, the bankrupt parent of American Airlines, is the prize in a likely bidding war by rival carriers, but any merger involving the third largest U.S. airline is expected to come on its own terms and timing, Soyoung Kim and Kyle Peterson write.
Morgan Stanley’s tech team is going after a big prize — the chance to lead the much-anticipated Facebook IPO that is expected to raise $10 billion, The Wall Street Journal reports.
Hedge funds that in the last month or so have purchased an estimated $5.2 billion of beaten down Greek bonds that mature on March 20 are now trying to unload their positions, DealBook says.
The Deal Professor takes a look at efforts to study the value of private equity.
M & A wrap: NYSE-Deutsche Boerse deal faces tough vote
NYSE Euronext and Deutsche Boerse are unlikely to garner enough support from European Union commissioners to overturn a looming veto over their plan to create the world’s largest exchange, Bloomberg says, citing four people familiar with the situation.
Here are the various options open to Deutsche Boerse and NYSE Euronext ahead of the Commission’s decision.
SPX Corp plans to sell its automotive service business to Germany’s Robert Bosch GmbH for $1.15 billion in cash as the diversified U.S. manufacturer looks to focus on its fast-growing flow technology segment.
The new chief executive at Research In Motion dismissed talk of drastic change at the BlackBerry maker. “I don’t think that there is some drastic change needed. We are evolving … but this is not a seismic change,” said Thorsten Heins, who took the helm at a once-dominant smartphone company that now struggles to compete. But impatient investors say Heins has only 12 to 18 months to turn RIM around.
Oil and gas deal-making is on fire so far this year, leading all sectors as a target for mergers and acquisitions, Deal Journal quoted Dealogic as saying.
Japan’s Elpida Memory is in talks to merge with Micron Technology and Taiwan’s Nanya Technology, the Yomiuri newspaper reported, as the memory chip makers battle a weak market and well-funded South Korean rivals.
M & A wrap: Takeover talk swirls around BlackBerry maker
Takeover talk swirled around Research In Motion as investors and analysts pondered whether new Chief Executive Thorsten Heins had been appointed to lead a turnaround of the struggling phonemaker or prepare it for sale.
Here is a brief biography of Thorsten Heins, the little known insider at RIM’s helm.
Gas producer Apache is to buy privately owned oil and gas company Cordillera Energy Partners III in a cash-and-stock deal valued at $2.85 billion to expand its acreage of oil and petroleum liquid fields. The deal will give Apache access to Cordillera’s portion of Granite Wash — a geological formation that holds tight gas trapped in its sands.
Sony Corp and Fujifilm Holdings are leading contenders for an equity stake in Olympus Corp, sources familiar with the situation told Reuters, as the scandal-hit medical equipment maker moves to shore up its finances.
Time’s Joe Klein writes about the trouble with private equity.
M & A wrap: Kodak files for bankruptcy
Eastman Kodak, which invented the hand-held camera and helped bring the world the first pictures from the moon, has filed for bankruptcy protection, capping a prolonged plunge for one of America’s best-known companies. The more than 130-year-old photographic film pioneer said it had also obtained a $950 million, 18-month credit facility from Citigroup to keep it going.
Kodak is preparing to appoint a chief restructuring officer who would report to the board and could have broad powers to manage the company’s finances and operations, The Wall Street Journal reports.
BankUnited Inc’s private equity owners abruptly pulled the lender off the market after a brief sale process drew offers below expectations.
The New York Times says hedge funds may sue Greece in a human rights court if the country doesn’t make good on its bond payments.
Hedge fund titan Steven A. Cohen is once again in the spotlight over allegations of improper trading at his $14 billion SAC Capital Advisors.
The transactions that JPMorgan handled for MF Global are drawing increased scrutiny because understanding MF Global’s money flow could aid in identifying missing customer funds, people familiar with the situation told Reuters.
M & A wrap: “Chief Yahoo” resigns
Yahoo co-founder Jerry Yang has quit the company he started in 1995, appeasing shareholders who had blasted the Internet pioneer for pursuing an ineffective personal vision and impeding investment deals that could have transformed the struggling company.
Wall Street views the exit of “Chief Yahoo” Yang as smoothing the way for a major infusion of cash from private equity, or a deal to sell off much of its 40 percent slice of China’s Alibaba, unlocking value for shareholders.
Yang’s exit removes one of the last vestiges of a management team chided by investors for failing to find a buyer or negotiate a sale of stakes in Asian assets worth more than $10 billion, Bloomberg says.
Goldman Sachs Group Inc’s fourth-quarter profit fell 56 percent as trading and investment banking revenue plunged, but the bank managed to beat analysts’ expectations, which had dropped considerably in recent weeks.
How much does a Goldman employee make? Average pays at Goldman Sachs is $367,057 for 2011, that’s down 15 percent from a year ago, according to Deal Journal.
Solyndra failed to attract any bids from buyers who could have restarted production, brought back some laid off staff and kept the bankrupt solar panel maker operating.
Samsung says BlackBerry maker Research In Motion is not on its immediate shopping list.
M & A wrap: Swift takeover for Olympus unlikely
Olympus Corp should be the easiest of takeover targets: a profitable business with its share price in tatters, its management in utter disgrace and its balance sheet in need of fresh capital. But not in Japan. Reuters reporter Isabel Reynolds explains why.
Bonuses are sinking at Morgan Stanley, with cash payouts capped at $125,000, The Wall Street Journal reports.
Want to know how Wall Street firms determine bonuses to their employees? The New York Times talks to “the invisible hand behind bonuses on Wall Street”.
AIA Group, Asia’s No.3 insurer and about one-third owned by American International Group Inc, may bid for the $6 billion Asian insurance operations of ING, sources said, with the prospective sale expected to draw heavy interest from rivals.
Japan’s Sumitomo Mitsui Financial Group (SMFG) and Sumitomo Corp are buying the aircraft-leasing business of Royal Bank of Scotland in a deal worth $7.3 billion, in the most aggressive acquisition by a Japanese lender since European banks began offloading non-core assets.
Private equity executive Paul Levy defends his business in an interview with DealBook, saying “I think it’s a pretty honorable industry.”
M & A wrap: Weak deal-making hurts JPMorgan earnings
JPMorgan Chase & Co’s fourth-quarter earnings fell 23 percent, in line with Wall Street expectations, as the European debt crisis depressed trading and corporate deal-making. Its figures show Wall Street firms such as Goldman Sachs and Morgan Stanley are in for a tough quarter as investment banking results suffer.
Private equity firm TPG Capital is willing to invest about $1 billion in Japan’s Olympus Corp in a joint deal with Sony Corp or another suitor circling the scandal-hit firm, a source told Reuters.
Meanwhile, TPG, US Airways Group and Delta Airlines are among several parties interested in potential bids for AMR Corp, the bankrupt parent of American Airlines.
Kodak is in advanced talks with Citigroup to provide bankruptcy financing, Bloomberg reports.
Deal Journal explains why it’s tough for the New York Times Co to sell the Boston Globe.
M & A wrap: RBS’s fresh jobs cull
Royal Bank of Scotland abandoned ambitions to be a top global investment bank and said it would cut another 4,450 jobs as it bows to pressure from the UK government to shut down risky operations and prepare for tougher international regulations.
General Motors could shift more vehicle production to its European factories in a cost-cutting deal with its German union that could avert a damaging standoff and keep Opel out of bankruptcy, people familiar with the discussions told Reuters.
South Korea’s Samsung Electronics is open to forging an alliance with Japan’s troubled Olympus Corp, potentially joining other electronics firms in circling one of the world’s biggest names in medical equipment.
Reuters reporters Svea Herbst and Katya Wachtel take an insightful look at the great hedge fund humbling of 2011.
The Wall Street Journal says Mitt Romney’s role at buyout firm Bain Capital is opening divisions in the Republican Party. On that note, is private equity a hero or villain, asks Randall Forsyth at the Barron’s.
