from Funds Hub:
Icahn’t: Carl says no time for blogging, too little interest
Could Carl's silence be golden?
Our favorite billionaire blogger and corporate raider Carl Icahn is safely avoiding writer's cramp. His Icahn Report, launched to much fanfare as a hub for corporate governance and reform, has not been updated since April 16.
Reuters caught up with Icahn this week to discuss his intervention in CIT's attempted rescue. The legendary investor threw a bomb into the lender's efforts to strike a debt swap deal with its creditors, and to stay in business through a reorganization plan, by offering a $6 billion loan. Asked about the lack of production on his blog, Icahn explained he's been fully engaged this year:
"I've been sort of busy. And right now, with the market up, there's not as much interest in corporate governance like the were was a couple of months ago. I've been so busy, with all these positions we've got. There's a lot going on."
So we checked with Damien Park, who runs activist research group Hedge Fund Solutions LLC and has his own blog tracking activist activity. He observed that Icahn has been seeking board seats at Enzon Pharmaceuticals, Biogen, Amylin and Lions Gate. He was actively pestering Yahoo late last year and has remained a vocal shareholder.
"He's been livelier than most of the larger activist investors this year. That's for sure," Park said.
More interesting, perhaps, is Icahn's point that corporate governance fades as an issue when markets rebound. He announced the blog in 2007 and finally posted his first item on June 2008, as the credit crisis worsened. Perhaps his logging off is a good signal.
Yahoo’s deal with Google: Band-Aid
So Yahoo and Google scaled back the terms of their search advertising deal in what looks like a last-ditch, attempt — at least for Yahoo — to get it past U.S. regulators.
Some analysts called it the Band-Aid deal, while others said it smacks of desperation.
Frost & Sullivan’s digital media global director Mukul Krishna said the revised terms were “more of a Band-Aid than the extensive surgery” Yahoo needs.
Barclays Capital’s Douglas Anmuth had a similar take: “We have long viewed the search outsourcing deal as a Band-Aid-not-a-panacea for Yahoo, but compromised terms or an outright rejection of the deal would likely force Yahoo to consider other strategic measures.”
Those “other” measures are a merger of Yahoo and Time Warner’s AOL unit, or Yahoo shareholders’ ultimate dream: Microsoft coming back to woo Yahoo.
Eric Jackson, the dissident Yahoo shareholder who sold his fund’s 3 million Yahoo shares in September after being convinced regulators would nix the Google deal, said: “You just gotta hope that the love bug bites Microsoft again and they want to come back.”
Sanford Bernstein analyst Jeffrey Lindsay said he expects Yahoo’s deal with Google to falter and for Microsoft to come back next year with a bid of around $20 per share. That may not sound too bad considering Yahoo is trading at $13, but remember that the last Microsoft offer had been for $33 a share.
Getting Sirius
Oprah, meet Howard. Reports in the Washington Post and The Wall Street Journal say the head of the FCC will support the merger of XM, home to Ms. Winfrey, and Sirius, where Mr. Stern holds court, removing the last regulatory hurdle to the long-awaited merger of the country’s only two satellite radio operators. Aides to the FCC chief said he decided to give his support after the companies agreed last week to concessions intended to prevent the new company from raising prices or stifling competition among radio makers, the Post reported. As of last week there was still some static coming from members of Congress, but with the FCC backing the deal it’s unclear how they will make themselves heard.
In his first public comment on the end of the Yahoo/Microsoft merger talks, billionare financier Carl Icahn, said on Sunday the subsequent deal Yahoo forged with Google “might have some merit.” He had previously said a Google deal should be considered a secondary alternative to the Microsoft offer. “While the Google deal is not the same as an offer of $34.375 per share for Yahoo, I am continuing to study it,” Icahn told Reuters. Icahn declined to comment on whether he would continue to press his proxy battle to replace the board of Yahoo.
Belgian brewer InBev warned U.S. rival Anheuser-Busch that it should fully explore its $46 billion takeover offer before doing a deal with Mexico’s Modelo. In a letter that appeared to be aimed at Anheuser-Busch shareholders, InBev suggested that doing a deal with Modelo could impact the value of its $65-a-share takeover offer. Inbev’s Chief Executive Carlos Brito wrote to Anheuser-Busch’s CEO August Busch IV that he was committed to a “friendly combination,” and “we would expect that prior to proceeding with any alternative transaction, especially if your shareholders will not be given the opportunity to vote on it, you would first fully explore our offer and the potential adverse consequences any such transaction could have on the ability of your shareholders to receive our premium offer.”
Other deals of the day:
* French market watchdog AMF has approved the merger document of Gaz de France and Suez, removing one of the last hurdles to the utilities’ long-delayed 100 billion euro ($153.3 billion) merger.
* Shareholders in Australian miner Zinifex approved a A$4.3 billion ($4.0 billion) takeover by fellow miner Oxiana, creating Australia’s third-largest diversified mining group. The new company said it would look at any assets BHP Billiton may need to sell to satisfy anti-trust regulators in its bid to acquire Rio Tinto
* Rio Tinto dismissed concerns that it could be barred from digging a huge iron ore mine in Africa, as it builds its defense against a $180 billion bid from bigger rival BHP Billiton.
The approval of the XM merger is long overdue. I love satrad and trust that the four other members of the Commission approve this quickly. It has been nearly 17 months people.
Satrad is entertaining and highly educational. My family has four radios and loves it!
Game, Google
With Google looking like the big winner after doing an ad search deal with Yahoo, pretty much everyone else involved is looking like a loser. Microsoft will have to take its mammoth war chest and try to find another way to make a meaningful stab at the coveted online ad space — or concede the market altogether. Though Yahoo is waving enhanced revenue and cash flow figures around, the deal is seen as better for Google, which is the undisputed heavyweight champion in ad search and just gets a juicy space to show how mighty it is. “Google has made an enormous gain strategically. This move might well have shut Microsoft out of the online space altogether,” said Sanford Bernstein analyst Jeffrey Lindsay. Speculation is rising that the Yahoo/Google deal could provoke antitrust scrutiny, and Carl Icahn still has his troops massing to oust Jerry Yang and the Yahoo board. But if he had any clout to force Yahoo into a deal with Microsoft, it wasn’t on show yesterday. Did he lose cred, or does he plan to keep fighting? He may say soon, but probably not on his blog.
With signs that its wealthy clientele are growing nervous, UBS has wrapped up a 16 billion franc ($15.4 billion) rights issue. Flows into its wealth management business slowed to a trickle in the first three months of the year, and this is the Swiss bank’s second effort to resuscitate finances ravaged by the global markets crisis. Dieter Ewald, a fund manager at UBS shareholder Frankfurt Trust, said such concerns had prompted him recently to pare back his investment in the Swiss bank. “UBS is handicapped,” he said. “We are worried that wealth management will be hit. We want to see that the new management can bring it back on track, and then we would invest more again.”
Pfizer may bid for Ranbaxy Laboratories, countering a $4.6 billion offer by Japan’s Daiichi Sankyo for the Indian generic drug maker, the Business Standard newspaper said. Ranbaxy’s shares jumped nearly 5 percent on the report while Daiichi Sankyo’s shares dropped 2 percent. Daiichi Sankyo and Ranbaxy are seeking to become a pharmaceuticals powerhouse that sells both branded drugs and generics. The newspaper added Pfizer had held talks with the Ranbaxy founders for a possible acquisition a year earlier.
An infrastructure fund managed by Australia’s Babcock & Brown is to buy UK train leasing firm Angel Trains from Royal Bank of Scotland for 3.6 billion pounds ($7 billion) including debt. The deal came as shares in Babcock and Brown plunged for a second day on concerns about its debt and ability to raise funds but it will help Royal Bank of Scotland, Britain’s second-biggest bank, which is selling off non-core assets to further boost its balance sheet after raising 12 billion pounds ($23.5 billion) this week in the biggest ever rights issue.
Other deals of the day:
* Britain’s AEA Technology said it would buy U.S. company Project Performance Corp for $65 million and would raise 39.7 million pounds ($77.6 million) through a rights issue to help fund the deal.
* Struggling Finnish fine paper maker M-real Oyj cancelled a plan to divest its Reflex paper mill in Germany to Arjowiggins Group, citing to a condition set by the European Commission.
Wrigley Field deal hits the wall
A plan to sell the Wrigley Field, home of the Chicago Cubs, has failed to make progress after an Illinois state group said it could not agree to terms set by Tribune Co, the field’s owner. The proposed deal hinged on a plan to sell fans “equity seat rights” which they could then split or trade.
The Chicago Tribune had slightly different take on the story, saying “the state’s efforts to purchase Wrigley Field slammed into an ivy-covered wall Monday when owner Tribune Co. rejected a no-tax proposal.” Regardless of who rejected whom — perhaps the Curse of the Billy Goat is to blame? — it looks like the deal isn’t happening, which could be good news for Internet billionaire Mark Cuban, who has said he wants to buy the Cubs together with Wrigley Field.
A Yahoo employee severance plan meant to protect workers after a merger or change of control should be scrapped, according to a new shareholder lawsuit against the Internet company and its directors, The New York Times reported on Tuesday.The plaintiffs, two Detroit pension funds, and billionaire investor Carl Icahn, who is waging a battle for control of the Yahoo board, have criticized the severance plan as costly and said it was an obstacle to any merger. The lawsuit claims Yahoo could be faced with up to $2.4 billion in potential severance payouts under the plan — which was put in place as the prospect of a Microsoft acquisition was looming, but would also be triggered if Icahn were to take control of the company.
Other deals of the day:
** Global brewer SABMiller Plc said it had agreed to buy Russian brewer LLC Vladpivo. The value of the gross assets to be acquired is about $69 million, said SABMiller in a statement. It did not disclose the purchase price.
** Norway’s government has bought 498,900 more shares in Norwegian oil and gas producer StatoilHydro as part of its long-term plan to boost its stake to 67 percent from 62.5 percent, the company’s share registry showed.
** Private equity company Cinven Ltd said it had agreed to buy British financial services firm Partnership Assurance (PA) in a deal worth around 200 million euros ($316 million).
What goes around…
Lehman Brothers is looking for fresh capital in South Korea, the Wall Street Journal reports. If the investment bank does end up tapping South Korea, it will have taken slightly over a decade for the 1997 multibillion loan from the IMF, backed by Wall Street and the Federal Reserve, to come full circle. The Journal says Lehman is looking to state-run Korea Development Bank and Woori Financial Group as it searches for funds to ward off a Bear Stearnsian crisis of confidence. The IMF demanded strict economic reforms for its money. A South Korean lender, like the Chinese and Arab investors bailing out Citi and Merrill Lynch, might just want a juicier cut.
The best part of waking up is Folgers in your cup — with a side of Smuckers jelly. The maker of Jif peanut butter and Crisco oil said it would buy Folgers from Procter & Gamble for stock valued at $2.95 billion plus the assumption of $350 million in debt. J.M. Smucker & Co also acquired Jif and Crisco from P&G.
Yahoo set its annual shareholder meeting for Aug. 1 in the heart of Silicon Valley, as it braced for a proxy showdown with billionaire activist investor Carl Icahn. Earlier, The Wall Street Journal reported that Icahn would seek to remove Jerry Yang as Yahoo chief executive, citing the company’s failure to reach a merger or partnership deal with Microsoft. Icahn had proposed an alternate slate of directors for Yahoo’s board, but until now had not directly targeted Yang. “It’s no longer a mystery to me why Microsoft’s offer isn’t around,” the Journal quoted Icahn as saying. “How can Yahoo keep saying they’re willing to negotiate and sell the company on the one hand, while at the same time they’re completely sabotaging the process without telling anyone?”
Novartis has bought privately held biotech company Protez Pharmaceuticals in a deal worth up to $400 million, giving it rights to an antibiotic which could be used to fight superbugs. Protez has a broad-spectrum antibiotic given by injection that is currently in mid-stage Phase II development against drug-resistant infections, and Novartis hopes to submit it for regulatory approval in 2012. The Swiss group will pay $100 million immediately for the business, with a potential for up to $300 million of additional payments depending on the future success of the new drug with the catchy code name: PZ-601.
Corporate Express will open its books to U.S. office supplies retailer Staples, which has made an unsolicited bid for the Dutch office goods wholesaler, Het Financieele Dagblad reports. On Tuesday, Staples raised its offer to 9.15 euros a share, or 1.7 billion euros ($2.65 billion), on the condition that Corporate Express shareholders reject the company’s plan to buy privately owned French peer Lyreco. The paper added that Corporate Express will probably give a neutral recommendation to its shareholders about the bid.
Other deals of the day:
* Australia’s Warrnambool Cheese and Butter Factory said it and National Foods, owned by Japan’s Kirin Holdings, would jointly pursue a bid for Australian dairy producer Dairy Farmers.
Waiting for Icahn, Day 99
Ok, we understand that Carl Icahn has been a little bit busy, as today’s Yahoo news illustrates. But ever since that memorable February day when he promised to deliver his trademark brand of incisive commentary to the blogosphere, we’ve been waiting. For 99 days now we’ve checked out The Icahn Report, only to find that same taunting message: “Blog coming soon.”
He has blamed the delay on his lawyers: “Every night, I write for an hour and they tear it up.”
He has promised that the blog was “a week or two away” — that deadline passed yesterday.
Mr. Icahn, we respectfully submit that today’s letter to the Yahoo board would make a stellar debut entry. Take it from us: cut-and-paste is to blogging what proxy fights are to activist investing.
The long wait for Icahn’s blog is nearly over
Every day we hit the refresh button, full of hope that billionaire investor Carl Icahn’s blog will finally arrive despite long odds and uncooperative lawyers. Looks like we’re almost there.
Icahn told Reuters on Wednesday that The Icahn Report is finally going live — “in a week or two” — with its founder’s famously strong opinions about corporate governance and the individual companies that fail to live up to his standards.
“I think the time has finally come when people are starting to focus on the many abuses in a number of companies in corporate America and the damage they do,” the 71-year-old financier and hedge fund operator said.
The blog will arrive in the wake of Icahn’s successful, highly publicized demands for change in companies including Motorola Inc and Time Warner Inc , both of which ultimately gave in to his demands that they change leadership and spin off major divisions. He also was instrumental in clearing roadblocks in Oracle Corp’s $8.5 billion bid to acquire BEA Systems.
Not all of Icahn’s investments work out, however, notably real estate developer WCI Communities Inc , whose shares have collapsed over the past year as the high-end condominium market dried up. Icahn is WCI’s largest shareholder, with 4.8 million shares, according to regulatory filings.
Icahn, whose net worth is estimated at $14.5 billion by Forbes, dismissed the lackluster performance in some stock plays, saying investors need to be patient.
He pointed out that he bought the Stratosphere Casino and other Las Vegas properties a decade ago for around $300 million. Last week, he closed on a deal to sell them to real estate funds managed by Goldman Sachs for $1.3 billion, a $1 billion gain.
