Unstructured Finance

Corporate Express Stapled

June 11, 2008

corp-express.jpgWhen at first you don’t succeed, raise, raise again. Another upped bid from Staples convinced Corporate Express management to back the unsolicited offer. The resweetened bid for the Dutch firm was 1.7 billion euros ($2.65 billion), or 9.25 euros per share, from the 9.15 euros it offered last week and a fair bit above the 7.25 euros it offered in February. Corporate Express’s defensive play for French competitor Lyreco has been scrapped (for a tidy 30 million euro breakup fee).

Earth to Tom Brown…..

June 10, 2008

tbrown.gifGive Tom Brown credit for his convictions.

The financial stocks maven and head of hedge fund Second Curve Capital LLC is hanging on to names the market is pummeling. We’re talking such train wrecks as First Marblehead and CompuCredit. And in recent months, Second Curve has picked up bond insurers including Ambac Financial Group and MBIA Inc that have done nothing but fall.

Food recalls worry shoppers

June 10, 2008

tomato.jpgShoppers loading up their carts may be becoming more wary of the food they pick up from the shelves, according to a food safety survey by Deloitte Consulting LLP.
The survey, which polled 1,110 consumers across America on April 21, found that 57 percent of people stopped eating a type of food either permanently or temporarily because of a food recall. 
The poll also found a sharp contrast in consumer perceptions of imported food versus domestic food, with 56 percent reporting that they think imported food is “not at all” or “somewhat” safe. Eighty percent said they think food produced domestically is safe.
Meat recalls ranked as a top food safety concern. Seventy-eight percent of consumers were concerned about beef recalls, while 67 percent were worried about chicken recalls.
Dairy recalls and fresh fruit/vegetable recalls followed at 53 percent each.
The results were released as restaurants and retailers began to pull certain types of tomatoes from their menus and shelves after a salmonella scare that has resulted in 145 reported cases and 23 hospitalizations, the U.S. Food and Drug administration said as of Saturday. The largest recall ever of meat in the U.S. occurred in February, mainly involving beef products.
Survey respondents also overwhelmingly (89 percent) said they want to see stores sell more fresh fruits and vegetables from local farms, and 69 percent said they were willing to pay slightly more as a result.
Full survey results can be found here.

Check Out Line: Here a Nerf, there a Nerf…

June 10, 2008

nerf.jpgCheck out that foam-rubber t-shirt!?!
Hasbro is putting the Nerf brand everywhere with a series of licensing deals announced today at the International Licensing Show in New York.
Among the deals is one for Nerf apparel with Fortune Fashion. The plan calls for an array of t-shirts for tween boys this summer, with an array of other items such as hoodies and track pants to follow. (Okay, the clothes will probably not be made of the same stuff as a Nerf ball).
Video game maker Electronic Arts will also come out with the “N-Strike” video game bundle for the Nintendo Wii, combining the fun of shooting foam-rubber weapons with the uber-popular video game. So your fake digital avatar can use your fake foam-rubber gun to shoot at fake stuff on your real television.
“This makes it the first time that Hasbro has put a forceful effort behind the licensing program supporting Nerf,” said Bryony Bouyer, senior vice president of licensing at Hasbro.
We’re guessing Hasbro could use some help in its push to expand the Nerf name. What would you like to see rendered in Nerf?
Also in the basket:
Dubai World buys Wal-Mart property firm Gazeley
Constellation sells some wine brands

Wrigley Field deal hits the wall

June 10, 2008

tribune.jpg 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.

A sharp pullback for the SENSEX

June 10, 2008

SENSEX weeklyWell since I’ve been on holiday a lot seems to have happened. I only got back to India in the early hours of Monday morning.
The first thing that strikes me is the fact we are oversold after the sell-off of the past couple of sessions according to the RSI, the near-term technical signals are bearish but longer term we are at a big support level and a double bottom might be forming on the weekly chart.
On the attached chart you can see major support coming up at 14,677, the Q1 low, and we could be looking at a possible double bottom formation to get us back up to our longer-term trendline.
As you can see this has already provided support on Tuesday so we need to watch it closely.
What was looking like a simple reaction low has overextended to the downside. What we need to see is some of the short-term bear signals turning to coincide with a double bottom formation.
I notice from our latest Reuters Poll that the market has downgraded its consensus forecast to 17,000 by the year end from 19,000. I’ve marked this on the chart and as you can see this is below the longer-term trendline we have been watching.

Getting down to nuts and bolts

June 9, 2008

(Updates with company declining to comment.)

Honeywell International Inc’s disclosure on Monday that it would sell its aerospace fastener business to B/E Aerospace Inc in a $1.05 billion deal could be a sign that the U.S. manufacturer is taking a more critical look at its broad portfolio, which ranges from making cockpit electronics and automation systems for large commercial buildings to selling Prestone antifreeze.

Verizon finally dumps Airfone on LiveTV

June 9, 2008

jetblue.jpgAfter years of looking for a buyer, Verizon Communications Inc on Monday agreed to sell its Airfone in-flight telephone service to LiveTV LLC.

The hedge fund industry is big. Make that really big. Or sorta big?

June 9, 2008

Question: How big is the hedge fund industry, by assets under management?

1. $1.87 trillion
2. $2.65 trillion
3. $2.9 trillion
4. unknown

If you chose 4., you would be right, because no one really knows how much money is in hedge funds. That’s because hedge funds are private and clustered around the globe and mostly aren’t required to report much of anything, except funds with various kinds of public listings in the US, the UK and elsewhere. And even then, the information is sketchy. The above – rather wide – estimates are from various industry data compilers (see below).

Temperatures favor retailers for a change

June 9, 2008

beach.jpgRetailers looking to sell seasonal merchandise got a helping hand from the weather last week — at least in some parts of the country.