DealZone

from Shop Talk:

Check Out Line: Duke wins, but there’s another bracket to fill

duke1Check out a different kind of tournament bracket still underway.

The Duke Blue Devils may have won yet another college basketball title Monday night, but consumers can still make their "Sweet 16" picks in Consumerist.com's annual "Worst Company in America"  tournament, which runs through April 26.

In its fifth year, the website, owned by Consumers Union, the publisher of Consumer Reports, lets consumers vote for their least favorite companies in matchups much like the NCAA tournament. Starting with 32 "teams," the tournament pairs companies in votes in which the "winner" (think about it, in a worst company vote you want to lose) advances to face the next competitor.

In the first round this year, Bank of America beat Citibank, GM beat Toyota and in an "upset" Cash4Gold beat defending "champion" AIG. Other companies that advanced included Walmart, Ticketmaster, United Airlines, Best Buy, Apple and Comcast, which has lost in the title game the last two years.

In addition to AIG, past winners have included Halliburton, Recording Industry Association of America and Countrywide. In last year's final, AIG whipped Comcast 3,528 to 1,968 as voters took their frustration over the recession out on a company that was bailed out by the U.S. government.

"They were just constantly in the headlines," Consumerist.com co-managing editor Ben Popken said of AIG. "They became a real focal point for what went wrong with the economy."

Citi to sell assets. To whom?

Citigroup As Citi announced plans of a radical dismantling, CEO Vikram Pandit said he “will continue to look at all assets dispassionately.”

For some time to come, that might really be all that he can do when it comes to his plan to sell off non-core assets.

Citi said it will realign into two businesses, Citicorp and Citi Holdings, as it posted its fifth straight quarterly loss. Citicorp will focus on universal banking, the other on brokerage and retail asset management, local consumer finance, and a pool of assets that require special management.

Ice cold rejection

Anheuser-Busch is set to reject InBev‘s $46.3 billion takeover offer, a source tells Reuters. After a few weeks of stonewalling by the company and posturing by Missouri politicians, is that really such a surprise? The company’s defensive strategy will hinge on restructuring  the workforce and spinning off non-core assets like the SeaWorld theme parks, but as DealZone’s David Jones notes, those same strategies have alreclydesdales.jpgady been offered up by InBev as a justification for its bid. Might as well crack open a few icy cold Budweisers — looks like this is going to take a while to sort out.

Fortis shareholders might also be in need of a Stella six-pack, as the Belgian-Dutch financial services group announced plans to shore up its finances with measures worth more than 8 billion euros ($12.54 billion), including issuing new shares, hitting its stock on dilution worries. Fortis will issue 1.5 billion euros in new shares plus up to 2 billion euros of non-dilutive preference shares, save 1.3 billion euros by not paying an interim 2008 dividend, and will also sell non-core assets and sell and lease back real estate. “We believe that 2008 will be a difficult year for our industry and we do not expect an improvement in the economic environment soon,” said CEO Jean-Paul Votron. “The measures announced today will help Fortis navigate through the current challenging market circumstances.”

Goldman analyst William Tanona has pulled a page from the Meredith Whitney playbook, questioning the viability of the Citibank‘s dividend, predicting $8.9 billion in second-quarter writedowns, and adding its stock to the “conviction sell” list. He also said that the bank may have to issue common stock or sell assets to raise capital because regulators may forbid it from issuing more preferred or convertible securities. Citi shares were down 3.7 percent in pre-open trading.

auf Wiedersehen, Citibank?

citibank.jpgCitigroup is eyeing a break-up or sale of its business in Germany as part of a global reorganization, sources familiar with the matter have told Reuters. Citi’s German unit, which makes most of its money from loans for everything from televisions to cars, contributed nearly 3 percent of the bank’s global pretax profit in 2006. Citi’s manager in Germany wrote to staff in March, saying the unit would not be sold, but he was replaced last week.

Lehman Brothers has been taking advantage of the Fed’s new borrowing window for investment banks, the Wall Street Journal reported, by using some of the same financial engineering methods that have brought so much chaos to the financial system. In a nutshell: Move $2.8 billion in unattractive debt into a new investment vehicle, get a AAA credit rating, and use as collateral to borrow much-needed cash from Uncle Sam. Fed officials had been worried that the new borrowing window might carry a stigma, but as it turns out, not so much.

U.S. buyout group J.C. Flowers is prepared to walk away from takeover target Friends Provident, frustrated at a lack of contact with the British insurer’s management. “There is no light at the end of the tunnel,” a source close to the matter told Reuters on Friday. Flowers has a regulatory deadline of April 30, by which time it must either make a firm takeover bid or walk away.