DealZone

Deals wrap: Splitting up ConocoPhillips

Integrated energy company ConocoPhillips said it would split its businesses into two stand-alone, publicly traded corporations by spinning off its refining and marketing business.

Borders Group’s buyout deal with private equity firm Najafi Companies collapsed, raising the possibility that the bankrupt bookseller could be forced to liquidate its remaining stores and go out of business.

L-3 Communications, which faces breakup pressure from an activist investor, is expected to divest some low-end services assets but does not plan a broader portfolio restructuring such as a breakup, people familiar with the situation said.

“A group led by Joshua Harris, a co-founder of the private equity firm Apollo Global Management, announced late on Wednesday that it had reached an agreement to buy the Philadelphia 76ers basketball team from the sports company Comcast-Spectacor,” reports DealBook.

Deals wrap: Dodgers strike out

The Los Angeles Dodgers filed for bankruptcy protection, blaming Major League Baseball for refusing to approve a television deal with News Corp’s Fox Network to give the financially strapped baseball team a quick injection of cash.

The WSJ’s DealBook reports the best part of the filing is who the Dodgers owe money to. Manny Ramirez is owed $21 million.

London Stock Exchange boss Xavier Rolet faces a crucial test this week as TMX Group owners vote on their planned merger with the LSE – a deal on a knife-edge that is likely to define his tenure.

Deals wrap: Blavatnik’s Access Industries wins bid for Warner Music

The headquarters of Warner Music Group is pictured in Burbank, California August 5, 2008. REUTERS/Fred Prouser

Russian-born billionaire Len Blavatnik’s Access Industries has won control of Warner Music Group with an offer of $8.25 a share, according to a source familiar with the matter. The agreement would set the world’s third-largest music company’s enterprise value at approximately $3.3 billion.

The NYTimes’s Ben Protess shines a light on Len Blavatnik, chairman of Access Industries and the new controlling stakeholder of Warner Music Group. Well-known for his investing prowess, he came to America as a penniless teenager and after building a fortune on oil and metal companies, he’s worth roughly $10 billion.

from Breakingviews:

GM needs to double earnings to repay taxpayers

General Motors' much anticipated initial public offering filing finally landed on Wednesday. But investors shouldn't get too caught up in the hype. Sure, the automaker looks in pretty decent shape thanks to last year's bankruptcy clean-up, and car sales are motoring away from last year's lows. But to repay U.S. taxpayers in full, GM needs to at least double its earnings.

That's assuming the carmaker is valued at the same earnings multiple as Ford Motor. Granted, GM and its bankers could argue that it has advantages over its cross-town rival that may warrant a higher valuation. It has far less debt, for starters. And it has a stronger position in fast-growing China.

But operationally GM is still lagging: the pre-tax margin on its global autos business was 5.7 percent in the second quarter. After years of losses and in a fairly low-margin industry, that's worth shouting about. But it falls shy of Ford's 7.2 percent margin in the same period. There's an even bigger gap of more than three percentage points between the margins the two manufacturers make in the key North American market.

Deals wrap: Can Genzyme play hardball?

A sign marks the headquarters of Genzyme in Cambridge, Massachusetts August 3, 2010. REUTERS/Brian Snyder   Genzyme may be holding out for more money from suitor Sanofi-Aventis, but will find it difficult to persuade investors it is better off on its own.  *View article *View Genzyme timeline

When GM filed for bankruptcy last summer, the automaker wiped out creditors, and critics warned that Wall Street investors would have a long memory. What a difference a year makes. *View article

What’s better than an angel investor? That would be a super-angel investor, of course. This new breed is shaking up the venture-capital industry. *View WSJ article

Deals wrap: Selling the ex-bankrupts

A Chevrolet logo is seen on a car displayed on the exhibition stand of Chevrolet during the first media day of the 80th Geneva Car Show at the Palexpo in Geneva March 2, 2010.      REUTERS/Valentin Flauraud General Motors’ coming initial public offering may be a hard sell. After all, the automaker burnt investors with its Chapter 11 filing a little over a year ago. The IPO of GM and, in time, those of other cleaned up ex-bankrupts like Delphi and Chrysler, deserve cautious investor interest. *View article

Barnes & Noble shares soared 21 percent after the struggling bookseller said it was up for sale and could get a bid from its founder to go private. *View article *View NYT’s article on who may bid for the company

Citigroup is poised to put its British online bank Egg up for auction as part of a plan to dispose of billions of dollars in unwanted assets, the Financial Times says. *View article

from Breakingviews:

As ex-bankrupt, GM deserves cautious IPO interest

General Motors' coming initial public offering may be a hard sell. After all, the automaker burnt investors with its Chapter 11 filing a little over a year ago. But companies that emerge from bankruptcy can significantly outperform the stock market. On the other hand, a third of them go bust again. The IPO of GM and, in time, those of other cleaned up ex-bankrupts like Delphi and Chrysler, deserve cautious investor interest.

Shares of formerly-bankrupt companies tend to do well if markets are anywhere from plodding to bullish. A portfolio of such stocks including Federated Stores (which later became Macy's) in the early 1990s, and another after the dot.com bust in the early 2000s, would have sharply outperformed stock indices. The early 1990s batch returned about 28 percent more over 200 days than stocks of similar pubic firms, according to a study by New York University professor Edward Altman.

There are several possible explanations. Analysts caught out by companies going bust may be overly cautious about their prospects when they return to the public eye. Executives may also be tempted to lowball expectations. After all, they get to take credit -- and some of the profit -- for beating targets.

General Growth battle intensifies

The battle for control of General Growth, owner of shopping centers across America, continues, as it  weighs two rival offers.

General Growth, which is trying to exit bankruptcy, will consider at a board meeting Thursday whether to postpone a key court hearing set for Friday as it continues talks with suitors Simon Property and Brookfied Asset Management.

It has asked Simon to increase its $5.8 billion bid. General Growth may also come back with a new counter0ffer on antitrust issues that could arise from a merger of the two largest U.S. mall owners.

Blockbusted – Icahn cuts stake in troubled video chain

Blockbuster‘s biggest shareholder, and one of the market’s most prominent activist investors, is heading for the door, heaping another note of gloom to the video chain’s hopes to avoid bankruptcy.

Filings show Billionaire investor Carl Icahn cut his stake in Blockbuster by selling more than 13 million shares. Over the past week he trimmed his ownership of the Class A shares to 5.1 percent as of March 29, according to a federal filing. In January he reported a 16.9 percent stake. He also reduced his stake in the company’s Class B shares.

To be fair, Blockbuster is already positioning itself for a trip to Bankruptcyland, having said earlier this month that it might need to file for protection from creditors.