DealZone

Deals wrap: A status update from Twitter

Twitter co-founder Biz Stone attends the "World Economy and Future Forum" hosted by broadcaster MBN in Seoul March 3, 2011. Stone denied a report that Twitter was in talks to sell a $450 million stake of the company to a JP Morgan fund, reiterating that it was committed to remaining independent.   REUTERS/Lee Jae-WonCross Twitter off your IPO watch-list, at least for now. Co-founder Biz Stone told Reuters in an exclusive interview that the social networking service has no plans to go public or raise funds any time in the immediate future, saying his company is making enough money on its own at the moment.

Stone also flat-out rejected a Financial Times report earlier this week that said a J.P. Morgan technology fund was in talks to take a 10-percent stake in the social networking message service. “(The report is) made up,” he said.

News Corp CEO Rupert Murdoch’s media empire is about to get a little bit bigger. The British government gave a green light to the company’s planned $14-billion buyout of satellite pay-TV company British Sky Broadcasting after Murdoch and co agreed to spin off a chunk of his Sky News channel into a separate company.

Taxpayers should celebrate that AIG is a step closer today to paying off its bailout debt to the U.S. government. The insurer sold $9.6 billion worth of MetLife shares on Wednesday, which should give it about $6.3 billion in gross proceeds to send back into the Treasury’s coffers.

Expect to see more mega-deals in the mining sector this year. A new report that shows a surge in global mining M&A last year also points out that deal valuations in the sector are set to increase this year as mining companies continue to reap the benefits of rising metal prices. The survey by PricewaterhouseCoopers tracked 2,693 global mining deals in 2010 worth a total of $113 billion.

Deals wrap: A second NYSE bidder?

A pedestrian walks past the NASDAQ building in New York City, April 30, 2010. REUTERS/Lucas JacksonNasdaq OMX Group could launch a rival bid for NYSE Euronext to avoid being left on the sidelines, a source said.

The recent wave of exchange mergers marks an era of consolidation that will leave no more than four global trading firms in five years’ time, said Xavier Rolet, the chief executive of the London Stock Exchange.

Merger and acquisitions activity in the global mining sector is expected to accelerate in 2011, fueled by strong commodity prices and repaired balance sheets, Ernst & Young said.

Deals wrap: Battle in the Arctic

A woman pushes a baby pram while walking along a dirt road at dusk in Iqaluit, Nunavut on Baffin Island in the Canadian Arctic August 16, 2009. REUTERS/Andy Clark Nunavut Iron Ore sweetened its hostile bid for control of Baffinland Iron Mines, extending a battle with steel giant ArcelorMittal for a vast iron ore deposit in the Canadian Arctic.

Groupon, the social buying site that spurned a $6 billion takeover bid from Google earlier this month, has attracted several big institutional investors, writes NYT’s Evelyn M. Rusli.

Carlyle Group has sold a 2.5 percent stake worth around $860 million in China Pacific Insurance (Group) Co Ltd, sources said, helping the buyout fund recoup its investment in what could be one of its best Asian deals to date.

Deals wrap: Striking coal

Handout image of an excavator working at a Rio Tinto coal mine in the Hunter valley. REUTERS/Rio Tinto/HandoutAnglo-Australian miner Rio Tinto offered $3.9 billion to buy African-focused coal miner Riversdale in an agreed deal that is likely to be challenged by rivals seeking to secure coking coal reserves.

Companies issuing yuan denominated bonds are finding that raising funds in Hong Kong  is the easy part. It’s getting the money into China that’s hard.

Retailers have been prominent buyout targets again this year, and one private-equity firm has been particularly busy: Leonard Green & Partners, writes the NYT’s Dealbook

from Breakingviews:

Mining deals show M&A funding market is open again

By Nicholas Paisner and Neil Unmack

The credit markets are slowly getting back to full health. The latest sign of vigour is a flurry of acquisition financing in the mining sector. On Monday, a consortium of banks lent Vedanta Resources $6.5 billion to help fund its purchase of a majority stake in Cairn India. Two days later, six large banks put up $45 billion to finance BHP Billiton's hostile bid for Canada's Potash Corp, according to Reuters.

The recent deals follow a good summer for large companies in the bond market. Earlier in August, blue chips IBM and Johnson & Johnson sold bonds at record low yields. July was the busiest-ever month for debt issues by emerging market governments and companies.

This buoyancy has allowed companies to refinance bank borrowings in the capital markets, freeing up lenders' balance sheets. The result has been a sharp drop in the cost of corporate loans. The average spread over Libor for an "A" rated borrower has halved from 145 basis points in the second quarter of 2009 to around 70 basis points today, according to Thomson Reuters LPC.

DealZone Daily

United Airlines has restarted merger talks with Continental Airlines as it eyes the top spot as the world’s largest air carrier. The two laid much of the ground work for a deal in 2008 but decided to puruse an alliance instead. A deal could leave US Air jilted despite four months of negotiations with United but, in a further twist to the aerial saga, United has also raised the topic of a deeper three-way cooperation between the airlines.

Top Macarthur Coal shareholder CITIC Resources said it has not yet decided whether to support a A$16 a share offer from Peabody Energy valuing the Australian miner at $3.8 billion. The 22.4 percent stakeholder said it needs more information to make a final decision on the Peabody bid.

Prudential’s Asia CEO said the British insurer is under no pressure from its shareholders to cut the $35.5 billion purchase price for AIG’s Asian life insurance unit.

DealZone Daily

Peabody Energy has raised its offer for Macarthur Coal by 14 percent to $3.8 billion — trumping a sweetened offer from local rival New Hope Corp.  In order for the deal to go through, Macarthur must ditch a vote on a proposed takeover of Gloucester Coal, a smaller local rival. The vote had been delayed to April 19.

R0bert Hingley — outgoing director general of the UK’s Takeover Panel — is joining Lazard’s financial advisory group, Lazard says. All the more interesting as senior Lazard banker Peter Kiernan is set to become the Panel’s new head. But his arrival has been delayed, ever since British lawmakers started probing Kraft’s takeover of British chocolatier Cadbury — a deal Kiernan was one of the main architects for.

Royal Bank of Scotland is whittling down the list of suitors for its 3 billion pound payment processing firm WorldPay, sources tell us. UK payments firm Voice Commerce and other suitors have dropped out of the running.

The afternoon deal: Mining and Steel Summit

Workers weld steel bars at a factory in Huaibei, Anhui province, February 28, 2010. REUTERS/China DailyResource nationalism, China’s continuing hunger for commodities and the endless search for growth were dominant themes at the Mining and Steel Summit. Here are some stories from the summit:

Miners grapple with resource nationalism
China keen to invest in SAfrica mines
AngloGold may split ops, eyes Americas
Movie “Avatar” has few fans among mining execs

Great reads from the Web:

Bankruptcy Watch: Waiting for the Next Big Wave (WSJ)
“It is fashionable to look at the relative dearth in recent bankruptcy activity and declare an end to the financial crisis’s restructuring wave.” – WSJ

DealZone Daily

U.S. mall owner General Growth Properties is looking to raise up to $2 billion from public markets to buy its way out of bankruptcy and fend off an unwanted takeover approach. The U.S. no. 2 is facing pressure to enter talks with market leader Simon Property Group, itself in discussions with Blackstone about the private equity firm co-investing in its bid.

National Australia Bank said it is actively pursuing AXA Asia Pacific, despite concerns the takeover fight for the regional arm of the French Insurer was distracting it and hurting earnings growth. The competition regulator last week raised concerns over an NAB-AXA alliance, bolstering the position of rival AMP.

Meanwhile, AXA Private Equity has entered exclusive talks to buy the private equity assets of investment bank Nataxis, which hopes to sell them for 507 million euros, plus a premium to valuation based on performance.