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Deals of the Day: Merck, Siemens Ramp Up the Dealmaking

Wall Street Journal MoneyBeat - 35 min 45 sec ago

Deals of the Day is your one-stop-shop for the morning’s biggest news from the finance beat, including M&A, IPOs, banks, hedge funds and private equity. Here’s what’s happening today:

Mergers & Acquisitions

Merck makes $17 billion deal. German pharmaceutical company Merck KGaA on Monday said it would acquire U.S. firm Sigma-Aldrich Corp. for $17 billion to strengthen its position in the life-science industry. Merck will acquire all of Sigma-Aldrich for $140 a share in cash, a 37% premium to Sigma’s closing share price Friday of $102.37. [WSJ]

Siemens nabs Dresser-Rand… German engineering company Siemens AG announced a deal to acquire U.S. oil-equipment maker Dresser-Rand Group Inc. for $7.6 billion. The Houston-based company is fetching $83 a share, in cash. [WSJ]

…and sells stake in BSH Bosch. German engineering group Robert Bosch GmbH will purchase Siemens AG’s 50% stake in household appliances joint venture BSH Bosch und Siemens Hausgeräte GmbH. [WSJ]

EMC weighs merger. Data-storage giant EMC Corp., under pressure from a shareholder activist and faced with the expected retirement of its longtime chief executive, is considering options that could include a merger deal with a rival. [WSJ]

Rebuffing Endo. Auxilium Pharmaceuticals said on Monday that its board of directors had rejected an unsolicited takeover approach from Endo International , a pharmaceutical company that struck an inversion last year and reincorporated in Ireland. [NYT]

Other fish in the sea? Norway’s government said Monday it is prepared to sell its majority stake in Oslo-listed salmon farmer Cermaq AS to Mitsubishi Corp., in a deal valuing the company at 8.88 billion Norwegian kroner ($1.40 billion), but that it was also prepared to consider potential competing offers. [WSJ]

TTM buys Viasystems. TTM Technologies Inc., a maker of circuit boards used in electronic devices, has struck a deal to acquire smaller rival Viasystems Group Inc. [WSJ]

 

IPOs

Alibaba hangover. The real success of Alibaba’s IPO will depend on whether the e-commerce company can keep growing without sacrificing its high profit margins of more than 40%. [WSJ]

Back of the line. Line Corp., the Japanese operator of a popular smartphone messaging application, said Monday that it has decided not to go ahead with an initial public offering in Japan or overseas this year. [WSJ]

Aldermore eyes London listing. Aldermore said on Monday that it intended to pursue an initial public offering later this year, becoming the latest “challenger” bank to Britain’s traditional financial powers to seek to list its shares in London. [NYT]

 

Buyside

War of words. Last week, activist investor Edward J. Bramson, who is pushing for two seats on the board of Electra Private Equity, said in a letter to Electra shareholders that he believed a change in approach at Electra could increase the value of its shares by more than 1 billion pounds, or about $1.6 billion. [NYT]

Offspring’s offshoots. The scions of a number of wealthy families, including the sons of prominent Wall Street figures Howard Marks and Ken Moelis, have either recently launched hedge funds or plan to do so soon, according to people familiar with the matter. [WSJ]

 

Categories: Transactions

Tesco’s Richard Broadbent, a Nonretailer on the Retail Hot Seat

Wall Street Journal MoneyBeat - 40 min 48 sec ago
Tesco Chairman Richard Broadbent says he won’t resign as the company probes an accounting irregularity.
Tesco PLC

Tesco PLC’s admission of accounting irregularity puts the spotlight on Richard Broadbent, who has held on to the chairmanship of the huge U.K. retailer through three years of tumult and decline despite his lack of retail experience.

The company said Monday that it had overstated its forecast first-half results by £250 million ($408.8 million), resulting in its third profit warning in as many months and its fourth since 2012. All of the warnings have come under the tenure of Mr. Broadbent, who joined the supermarket giant as a nonexecutive director in July 2011, becoming chairman that November.

Mr. Broadbent told reporters earlier Monday that he wouldn’t resign, but he said shareholders must decide “whether I am part of the solution or part of the problem.” He wasn’t available to comment for this post.

Mr. Broadbent, 61 years old, started his career in the U.K. government’s economic and finance ministry, before joining British investment bank Schroders in 1986. A few years later, he returned to public service as executive chairman of the government’s custom and excise division and was on the management board of the U.K. civil service.

After serving as chairman of transport group Arriva PLC, Mr. Broadbent was appointed to the board of Barclays PLC in 2003, becoming deputy chairman in 2010.

But at Tesco, he has presided over a raft of profit warnings—the first of which, in January 2012, came after 20 years of unblemished trading. In a chastening past six months, Broadbent has lost both the company’s finance director and its chief executive.

“The pressure is clearly mounting higher and higher,” said Bernstein Securities analyst Bruno Monteyne. ”[Can] he weather this storm? I didn’t think he would weather the last storm [when Tesco CEO Philip Clarke left]. But with a new CEO in place, you wouldn’t want the chairman to just be stepping down right away.”

Shore Capital analyst Clive Black added: “This development may raise much more fundamental questions over the chairman’s position.”

Mr. Broadbent’s lack of international consumer and retail experience when he was appointed at Tesco raised eyebrows, although his reputation in banking was seen as key at time when Tesco was building up its financial services, analysts said.

Mr. Monteyne said Mr. Broadbent has overseen a “very sharp weakening” of the Tesco board, which has only one current company executive but a heavy representation of Mr. Broadbent’s own professional background.

“If you look at the nonexecutives that he has put on the board, there is not a single retailer among [them]. There are three bankers on there,” Mr. Monteyne said. “Why didn’t he get nonexecutives that could cover for his weaknesses? His priority should have been to get some heavyweight retail guys.”

In Tesco’s 2014 annual report, Mr. Broadbent was frank that Tesco faced challenging times.

“There has been a great deal to occupy us,” he said, adding that “for the time being, the imperative of securing the longer-term future means that our current financial performance remains constrained.”

Categories: Transactions

Stocks to Watch: Sigma-Aldrich, Apple, Clorox

Wall Street Journal MoneyBeat - 41 min 45 sec ago
The new iPhone 6 at an Apple Store in Palo Alto, California, on Sept. 19.
Getty Images

Among the companies with shares expected to actively trade in Monday’s session are Sigma-Aldrich Corp., Apple Inc. and Clorox Co.

German pharmaceutical company Merck KGaA on Monday said it would acquire Sigma-Aldrich for $17 billion to strengthen its position in the life-science industry. Sigma-Aldrich’s shares jumped 34.6% to $137.82 in premarket trading.

Apple said it sold more than 10 million of its new iPhone 6 and iPhone 6 Plus devices during the first weekend of sales, a new high for the company even though the devices have yet to go on sale in China. Shares edged up 0.9% to $101.81 premarket.

Clorox said it is exiting Venezuela as that country’s economic troubles make it increasingly difficult for international firms to operate there. The company also reaffirmed its fiscal 2015 guidance. Shares gained 5.8% to $95.80 premarket.

RadioShack Corp. said Monday it has talked with a major vendor about potential changes to its commercial arrangement that could benefit a financial restructuring of the electronics retailer. Shares rose 7% to 97 cents premarket.

TriMas Corp. reduced its full-year outlook for earnings per share by about 14%, while seeing revenue growth at the lower end of prior expectations. The company also agreed to acquire Allfast Fastening Systems Inc. for about $360 million. Shares fell 4.3% to $28.28 premarket.

AutoZone Inc. said its fiscal fourth-quarter profit inched up while margins expanded, although sales declined because of fewer sales days during the period. Shares fell 1.2% to $520 premarket.

As underwriters unexpectedly were able to sell the overallotment as part of Alibaba Group Holding Ltd.’s initial public offering, that means the company’s market cap is $2.45 billion more than it was at Friday’s close, putting it at $233.9 billion at Monday’s market open. The IPO’s proceeds were a record-breaking $25.03 billion. Shares were down 1% to $92.92 premarket.

Workers at five German Amazon.com Inc. logistics centers have walked out in a two-day strike to support demands for a collective wage agreement, the Verdi labor union said.

Tesco PLC suspended four senior executives and called in outside auditors and legal counsel to investigate the $408.8 million overstatement of the U.K. supermarket operator’s first-half profit.

German engineering company Siemens AG on Sunday announced a deal to acquire U.S. oil-equipment maker Dresser-Rand Group Inc. for $7.6 billion. The Houston-based company is fetching $83 a share, in cash.

Data-storage giant EMC Corp., under pressure from shareholder activist Elliott Management Corp. and faced with the expected retirement of its longtime chief executive, is considering options that could include a merger deal with a rival, according to people familiar with the matter.

American Airlines Group Inc. said it has reached a tentative agreement on a collective bargaining agreement for more than 24,000 of its flight attendants.

Dollar General Corp. began actively soliciting votes against a deal that would unite its two main rivals, ratcheting up its effort to acquire Family Dollar Stores Inc. The move was disclosed in a securities filing Friday. Family Dollar’s board has repeatedly spurned Dollar General in favor of a sale to Dollar Tree Inc.

Starting next year, Bank of America Corp. investors will get a glimpse of two things they haven’t seen in years: a fairly clean income statement and a decent dividend, Barron’s said in a recent report. By 2017, earnings per share could hit $2, versus an estimated 75 cents this year. More important, shareholders by then will have seen a string of steady increases in earnings and dividend payments, the report said.

Categories: Transactions

Emerging Market Currencies Feel Squeeze From All Directions

Wall Street Journal MoneyBeat - 43 min 19 sec ago
Turkey’s lira on Monday hit its lowest level against the dollar since March.
Getty Images

The resurgent U.S. dollar continues to pummel key emerging-market currencies, with the Turkish lira, South Africa’s rand and the Brazilian real particularly feeling the heat.

Having already been under severe pressure for weeks, the lira slumped 0.7% to 2.25 against the dollar in early trading Monday —its lowest since March — while the rand depreciated 0.6% to 11.438 against the buck — its lowest since February.

Brazil’s real is down almost 1% on the day at 2.388 to the dollar.

Analysts agree that the dollar’s stubborn rally, spurred by expectations that the Federal Reserve could raise interest rates next year, bears the brunt of the blame for the move, but clearly it’s not the only drag.

Adding to the bad vibes Monday: China.

Overnight, the country’s finance minister said the government won’t change its economic policies drastically because of weakness in one economic indicator, dampening hopes for an aggressive easing of policies to stimulate growth in the world’s second-largest economy.

That sent equities lower and triggered a bid for assets perceived to be safest at times of stress, while weighing on a whole slew of emerging market currencies — often the first to sell-off at times of volatility— as well as those particularly dependent on commodities.

“Whether it’s justified or an overreaction, the market tends to be very quick to react to any news flow surrounding China and especially to any sentiment that can be interpreted as negative,” said Jane Foley, a currency strategist at Rabobank.

Geopolitics are also hurting the lira.

According to Tim Ash, head of emerging market research for Standard Bank in London, the currency is battling “concerns that the Turkish military will get dragged into the conflict in Iraq and Syria” which in turn could “stir things up domestically with Kurds inside Turkey.”  Compounding problems for the lira, figures earlier this month showed that Turkey’s economy grew less than expected in the second quarter because of weak domestic demand.

Lastly, of course, there’s the economy, stupid.

A paper from the Intentional Monetary Fund last week showed that GDP growth in emerging markets has declined from 7% during the pre-crisis period of 2003-2008, to 6% over the post-crisis period of 2010-2013. The fund now sees growth of just 5% over the next 5 years.

Here are three currencies feeling the heat Monday:

Categories: Transactions

The Need for Improved Transparency

Editor's Note: The following post comes to us from Darrell M. West, vice president and director of Governance Studies at The Brookings Institution, and based on a book authored by Mr. West, titled "Billionaires: Reflections on the Upper Crust;" a sample chapter may be downloaded for free here. Work from the Program on Corporate Governance about corporate political spending includes Shining Light on Corporate Political Spending by Lucian Bebchuk and Robert Jackson, discussed on the Forum here. A committee of law professors co-chaired by Bebchuk and Jackson submitted a rulemaking petition to the SEC concerning corporate political spending; that petition is discussed here.

Anyone paying the slightest amount of attention recognizes that the U.S. political system is performing poorly. Washington is gripped by extreme partisanship, which prevents Congress from conducting even routine business, and cooperation between the executive and legislative branches is near historic lows. But as I argue in my new book, Billionaires: Reflections on the Upper Crust, the problem with the nation's politics is even deeper than the daily headlines suggest. There is limited transparency surrounding money and politics, and many institutions that in the past could counterbalance the power of the wealthy and other special interests have grown weak. It is difficult for financially strapped news organizations to provide quality coverage of government, and political parties have become heavily dependent on a relatively small number of wealthy and well-connected people for campaign contributions.

Click here to read the complete post...

Categories: Governance

The State of State Competition for Incorporations

Editor's Note: Marcel Kahan is the George T. Lowy Professor of Law at the New York University School of Law.

The competition by states for incorporations has long been the subject of extensive scholarship. Views of this competition differ radically. While some commentators regard it as “The Genius of American Corporate Law,” others believe it leads to a “Race to the Bottom” and yet others have taken the position that it barely exists. Despite this lack of consensus among corporate law scholars, scholars in other fields have treated state competition for incorporations as a paradigm case of regulatory competition.

Click here to read the complete post...

Categories: Governance

China Offers a Fee Ride

Wall Street Journal MoneyBeat - 1 hour 23 min ago
Agence France-Presse/Getty Images

Each Monday, MoneyBeat publishes a short column in the WSJ print edition highlighting a statistic getting traction in the markets. This week’s “big number“ is $534 million. That’s the amount of investment-banking fees paid by Chinese technology companies going public this year, accounting for 44% of fees from tech IPOs. Move over Silicon Valley. In the biggest year for technology initial public offerings since 2000, China, not Silicon Valley, has been the largest generator of investment banking fees. Alibaba Group Holding Ltd.’s record IPO Friday pushed total investment-banking fees generated from the IPOs of Chinese technology companies to $534 million, according to Dealogic. That is the largest total for Chinese technology companies in a single year on record and accounts for 44% of all fees paid out from technology IPOs this year, according to Dealogic. It is also the highest total for any country’s technology sector since the dot-com days of 1999 and 2000, when fees from U.S. technology IPOs topped $1 billion. In all, 42 technology companies based in China have gone public this year, raising $28.4 billion. By comparison, 28 U.S. technology firms made their debut this year, raising $5.4 billion. Those deals generated $295 million in investment-banking fees, according to Dealogic. Certainly, Alibaba’s IPO provided a big boost to the fee total of Chinese tech companies. The e-commerce giant paid $220 million fees to the banks working on its deal, the most of any technology company this year, according to Dealogic. But even before Alibaba’s debut, the $314 million in investment-banking fees from taking Chinese tech companies public, more than what they had taken from the IPOs of both U.S. and European tech firms.

Categories: Transactions

Auxilium’s Board Rejects Takeover Approach From Endo

New York Times DealBook - 1 hour 30 min ago
Auxilium, a biopharmaceutical company based in Pennsylvania, agreed in June to acquire QLT, a smaller Canadian rival, and reincorporate in Canada, but received an unsolicited bid worth $2.2 billion from Endo International earlier this month. Endo engaged in its own inversion last year and reincorporated in Ireland.
Categories: Transactions

Energy Journal: Oil’s Train Age

Wall Street Journal MoneyBeat - 1 hour 37 min ago

Here’s your morning jolt of news, insight and analysis on the global energy business. Send us tips, suggestions and complaints: andrew.peaple@wsj.com

Click here to receive this morning email newsletter

OIL ON TRAINS

A worker climbs off a crude oil train after setting the handbrake at Eighty-Eight Oil’s transloading facility in Ft. Laramie, WY. 
Reuters

The U.S. shale revolution has provided a major boost to the country’s energy output. But one problem has emerged; how to move the black stuff around the country?

Enter the train.

The WSJ’s Russell Gold and Chester Dawson have documented the rise of train transportation as a method of transporting oil around North America. An amount equivalent to 20% of U.S. oil production rides the rails every day. Gold and Dawson have a striking statistic that “if all the railcars loaded with crude on one day were hitched to a single locomotive, the resulting train would be about 29 miles long.”

It isn’t just the gush of oil that has given rise to this latest age of the train. In part, it’s down to the lack of pipelines in the U.S., with construction of new pipes often delayed by environmental protests and political infighting—witness the long-delayed Keysotne XL pipieline.

But several accidents have raised concerns regarding the amount of crude travelling by rail, especially after 47 people were killed last year after a train carrying oil was derailed in Quebec.

In response, regulators have begun tightening the rules governing oil transportation by rail. That might eat into the profits of companies who have benefited from trains gaining ground in oil transportation, but it seems a small price to pay for safety.

SIEMENS DEAL

The oil sector hasn’t seen as much action in the sphere of mergers and acquisitions as some others this year. But Germany’s Siemens has jumped in with a $7.6 billion all-cash offer for U.S. oil equipment maker Dresser-Rand.

The acquisition looks to be in line with Siemens’ plans to grow its oil equipment business. It should also give the German giant more chance to profit from the U.S. shale revolution. After all, back home in Europe, shale has hardly got out the ground.

MARKETS

Crude oil prices were down Monday, as high supply continues to weigh on prices. You can read the Journal’s latest oil markets report here.

Categories: Transactions

Mitsubishi to Buy Salmon Producer for $1.39 Billion

New York Times DealBook - 2 hours 22 min ago
Cermaq, which has operations in Chile and Canada, as well as in Norway, is one of the biggest companies in the world in salmon farming
Categories: Transactions

Macro Horizons: China Commitment to Fiscal Stimulus Questioned, Markets Spooked

Wall Street Journal MoneyBeat - 2 hours 33 min ago

Macro Horizons covers the main macroeconomic and policy news events affecting foreign-exchange, fixed income and equity markets around the world, as selected by editors in New York, London and Hong Kong.

WRAP: It’s striking how much the outlook for China’s economy has become a driver of global markets. While Friday’s $21 billion Alibaba IPO has given investors a reminder of the earning power of a strategy tied to the Chinese economy, the condition of that economy is increasingly a worry for them. That was clear Monday when comments by Chinese Finance Minister Lou Jiwei spooked not only Asian markets but also those in Europe. Mr. Lou said the government had no plans to change policy despite recent weak data. His comments challenged long-held expectations that the Chinese government will take advantage of low nominal debt-to-GDP ratios and ride to the economy’s rescue if it weakens too far. But some in China worry that any fiscal plan could merely double-down a dependence on investment-led growth, revive dangerous property speculation and so create problems down the road if household consumption doesn’t rise to absorb the excess capital. There’s a fear that the obligations of the state could rapidly expand if it had to bail out banks, state-owned enterprises and heavily indebted provincial governments. If such concerns feed into a reticence to act in Beijing, investors who’ve come to expect high levels of Chinese growth may have to recalibrate their expectations. (MC)

 CHINA: Finance Minister Lou Jiwei said the government won’t make any drastic changes to economic policies merely because of weakness in one economic indicator, an apparent reference to the industrial production index, which last month dropped to its lowest level since the 2008 global financial crisis. Policy makers will continue to focus on a combination of growth objectives, especially employment and inflation, Mr. Lou said in a statement on the ministry’s website on Monday.

 The statement came at a sensitive moment as it preceded HSBC’s “flash” preliminary reading for its purchasing manager’s index, which is due out early Tuesday in China. The index, a closely followed gauge of business activity, was last month barely holding above the 50 threshold that indicates expansion. (MC)

ITALY: July industrial orders fell 1.5% on the month and down 0.7% on the year.

Italian industry is struggling. Industrial orders fell in June and July, driven by a particularly large drop in foreign orders but also slippage in domestic bookings. The Italian economy contracted during the first two quarters of the year. These industrial orders data don’t offer much encouragement for a recovery during the third. (AM)

WORLD: Finance leaders from the Group of 20 biggest economies reaffirmed a pledge to sharply boost global growth through more infrastructure spending. The G-20 statement was released after a ministerial meeting in Cairns in which some country made strong demands on European countries go further beyond the stimulus measures outlined in what is known as the G-20’s Brisbane Action Plan. That plan will be formally unveiled in the Australian city of the same name when heads of government meet there in mid-November.

The plan, which pledges to boost combined economic output by at least 2% above currently projected levels by 2018, is an impressive for its goals, but like everything that the G-20 does it will come down to implementation and may well suffer from a lack of enforcement and coordination. To be effective, governments will need to borrow more to fund the investment, which could face political resistance given high debt-to-GDP ratios. Concerns about freeloading also may arise because policies will need to be designed differently across different countries – China, for one, needs to focus on building consumer-led demand, not investment in infrastructure. (MC)

COMING UP:

EUROZONE: 10 a.m. EDT. (4 p.m., Brussels) September consumer confidence. [Expected -10.5 vs. 10.0 in August.]

The historical charts for this indicator, including the amalgamated country data that produce a synthetic eurozone index dating back through the years before the euro’s launch in 1999, are downright depressing. The number has only ever been in positive territory for a brief period in 2000, meaning that in every other year since 1985 there have been more pessimistic eurozone consumers than positive. What’s more, it seems that every time it takes a run at getting above the zero, something sends it hurrying lower again before it can reach positive territory. That’s the case right now. There had been a steady recovery from a November 2012 cyclical low of -26.4 after the euro crisis subsided until it peaked at -7.1 in May of this year, but it has since then shown successive declines for three months. Now the index is expected to go lower again, which hardly seems surprising given the rut the region’s economy has slid into. (MC)

U.S.: 10 a.m. EDT. National Association of Realtors August existing home sales. [Expected +1.0% to 5.2 million annualized units vs. +2.4% in July to 5.15 million.]

There was an extremely big drop in housing starts and building permit numbers for August, according to a report out last week, but that particular data series seems to be especially erratic, with the decline clearly representing payback from a similarly large gain in July. Nonetheless, if this apparently better behaved indicator meets forecasts it could dispel any concern that we’re headed back into another housing market slump. Until now, the recovery in the sector over the spring and early summer had been seen as a good sign of a recovery economy. (MC)

U.S.: 10 a.m. EDT. Federal Reserve Bank of New York President William Dudley speaks at Bloomberg Markets “Most Influential” conference in New York.

Mr. Dudley is a key, permanent voting member of the Federal Open Market Committee, and while he is generally seen as moderately dovish he has of late sounded less concerned about the economy and more comfortable with the idea of a rate increase in the spring or early summer, perhaps suggesting that he is further down that path than, say, Fed Chairwoman Janet Yellen. Maybe this speech and the questions that follow it could give people more clarity on that matter, although it surely requires reading between the lines. (MC)

EUROZONE: 11 a.m. EDT (5 p.m, Brussels). European Central Bank President Mario Draghi appears before the European Parliament’s Committee on Economic & Monetary Affairs.

When will the ECB launch its asset-buying (quantitative easing) program? How aggressive will it be? What assets will it buy? How unified is the central bank’s policy committee in seeking these goals? Does last weeks’ disappointing uptake by banks of the ECB’s latest long-term refinancing operation mean that QE will need to be bigger? Let’s hope the MEPs ask the right, tough questions. There’s a lot on riding on how this program unfolds. (MC)

U.S.: 7:30 p.m. EDT. Federal Reserve Bank of Minneapolis President Narayana Kocherlakota speech in Marquette, Mich.

Mr. Kocherlakota, a voter in the current roster of the FOMC is one of the committee’s more unpredictable members. This year, however, he has presented himself as a forceful dove, dissenting over the language of one FOMC statement back in March and then explaining that he wished it had made a clear commitment to pushing inflation to, and perhaps above, the 2% target. (MC)

MEXICO: Time N/A. President Enrique Pena Nieto speaks to the Economic Club of New York.

Mr. Pena Nieto has embarked on some bold reforms, firstly in seeking to break up a telecommunications monopoly, secondly and most importantly, by inviting outside energy companies into Mexico’s oil sector to curtail the power of the inefficient state monopoly Pemex. Until the second quarter saw a pickup in the economy these changes had failed to materialized into stronger growth, which in turn created political problems for the president’s reform agenda. He needs his reforms to bear fruit. Most economists believe that will happen; there is an overwhelming pro-Mexico mindset on Wall Street these days. But local politics don’t follow Wall Street’s dictates. All good fodder for conversation at this event, which is packed with city’s top economists. (MC)

CHINA: 9:45 p.m. EDT. (9:45 a.m. EDT) September HSBC China preliminary “flash” manufacturing PMI. [In August was 50.2]

Last month, this closely watched indicator dropped to a three-month low and barely held in the expansionary 50-plus range. It marked an end to hopes that the summer would show a rebound in China, a disappointment that has been matched in other data. If the number were to this time drop back below the 50 threshold, it could have a fairly negative impact on markets. (MC)

Categories: Transactions

What Matters for Global Markets in the Week Ahead

Wall Street Journal MoneyBeat - 2 hours 43 min ago

 

Caption
Blooomberg

With Scotland’s referendum and Alibaba’s flotation now done and dusted, it’s time to get back to watching the data. Here’s what’s on the radar from all four corners of the world this week, from European Central Bank President Mario Draghi‘s testimony in front of a European parliamentary committee, to China’s latest flash manufacturing PMIs amid concerns about slowing growth, and Turkey’s latest attempt to tackle stagflation.

MONDAY

EUROZONE: 10 a.m. EDT. (4 p.m., Brussels) September consumer confidence. [Expected -10.5 vs. 10.0 in August.]

This historical charts for this indicator, including the amalgamated country data that produce a synthetic eurozone index data back through the years before the euro’s launch in 1999, are downright depressing. The number has only ever been in positive territory for a brief period in 2000, meaning that in every other year since 1985 there have been more pessimistic eurozone consumers than positive. What’s more, it seems that every time it takes a run at getting above the zero, something sends it hurrying lower again before it can reach positive territory. That’s the case right now. There had been a steady recovery from a November 2012 cyclical low of -26.4 after the euro crisis subsided until it peaked at -7.1 in May of this year, but it has since then shown successive declines for three months. Now the index is expected to go lower again, which hardly seems surprising given the rut the region’s economy has slid into. 

U.S.: 10 a.m. EDT. National Association of Realtors August existing home sales. [Expected +1.0% to 5.2 million annualized units vs. +2.4% in July to 5.15 million.]

There was an extremely big drop in housing starts and building permit numbers for August, according to a report out last week, but that particular data series seems to be especially erratic, with the decline clearly representing payback from a similarly large gain in July. Nonetheless, if this apparently better behaved indicator meets forecasts it could dispel any concern that we’re headed back into another housing market slump. Until now, the recovery in the sector over the spring and early summer had been seen as a good sign of a recovery economy. 

U.S.: 10 a.m. EDT. Federal Reserve Bank of New York President William Dudley speaks at Bloomberg Markets “Most Influential” conference in New York.

Dudley is a key, permanent voting member of the FOMC, and while he is generally seen as moderately dovish he has of late sounded less concerned about the economy and more comfortable with the idea of a rate hike in the spring or early summer, perhaps suggesting that he is further down that path than, say, Yellen. Maybe this speech and the questions that follow it could give people more clarity on that matter, although it surely requires reading between the lines. 

EUROZONE: 11 .am. EDT (5 p.m, Brussels). European Central Bank President Mario Draghi appears before the European Parliament’s Committee on Economic & Monetary Affairs.

When will the ECB launch its asset-buying (quantitative easing) program? How aggressive will it be? What assets will it buy? How unified is the central bank’s policy committee in seeking these goals? Does last weeks’ disappointing uptake by banks of the ECB’s latest long-term refinancing operation mean that QE will need to be bigger? Let’s hope the MEPs ask the right, tough questions. There’s a lot on riding on how this program unfolds. 

U.S.: 7:30 p.m. EDT. Federal Reserve Bank of Minneapolis President Narayana Kocherlakota speech in Marquette, Mich.

Mr. Kocherlakota, a voter in the current roster of the Federal Open Market Committee is one of the FOMC’s more unpredictable members. This year, however, he has presented himself as a forceful dove, dissenting over the language of one FOMC statement back in March and then explaining that he wished it had made a clear commitment to pushing inflation to, and perhaps above, the 2% target.

MEXICO: Time N/A. President Enrique Pena Nieto speaks to the Economic Club of New York.

Mr. Pena Nieto has embarked on some bold reforms, firstly in seeking to break up a telecommunications monopoly, secondly and most importantly, by inviting outside energy companies into Mexico’s oil sector to curtail the power of the inefficient state monopoly Pemex. Until the second quarter saw a pickup in the economy these changes had failed to materialized into stronger growth, which in turn created political problems for the President’s reform agenda. He needs his reforms to bear fruit. Most economists believe that will happen; there is an overwhelming pro-Mexico mindset on Wall Street these days. But local politics don’t follow Wall Street’s dictates. All good fodder for conversation at this event, which is packed with city’s top economists.

CHINA: 9:45 p.m. EDT. (9:45 a.m. EDT) September HSBC China preliminary “flash” manufacturing PMI. [In August was 50.2]

Last month, this closely watched indicator dropped to a three-month low and barely held in the expansionary 50-plus range. It marked an end to hopes that the summer would show a rebound in China, a disappointment that has been matched in other data. If the number were to this time drop back below the 50 threshold, it could have a fairly negative impact on markets. 

TUESDAY

EUROZONE: 3 a.m-4 a.m. EDT(9 a.m.-10 a.m, Brussels) Markit Economic “flash” PMI readings.

  • FRANCE: Manufacturing index expected 47.0 vs. 46.9 in August; services 50.2 vs. 50.3.
  • GERMANY: Manufacturing index 51.2 vs. 51.4 in August; services index expected 54.6 vs. 54.9.
  • EUROZONE: Composite Index expected 53.0 vs. 53.1 in August.

Germany’s PMI outlook is still in positive territory and that’s keeping the Eurozone’s overall readout above the 50 threshold too. But we know that German business sentiment is deteriorating, especially in its vital manufacturing sector. It’s possible that this more concrete measure of business activity could also be in for a downward shock.

TAIWAN: 4 a.m. EDT (4 pm., Taipei) August industrial output. [Expected +7.43% on-year vs. +6.08% in August.]

The recovery in Taiwan’s industrial sector has been one of most surprising developments in the Asian economic region and economists’ forecasts for August suggest it continued last month. And since it plays a crucial role in producing semiconductors and other key electronics components, some are looking to this rebound as a hopeful sign that demand for new smartphones (Apple iPhone 6 orders?) and other new gadgets captures a nascent rebound in consumer demand around the world. Because of where its industries sit in global supply chains, Taiwan’s data can function as leading indicators. 

WEDNESDAY

BRAZIL: 9:30 a.m. EDT. (10:30 a.m., Sao Paulo). August current account balance. [In July, current account deficit $6.02 billion or 3.45% of GDP.]

Brazil’s current account gap stays stubbornly above the 3% of GDP threshold that seen as a gauge of health. It’s especially worrying that this has happened while the economy is performing badly, since that would normally diminish domestic demand and boost the current account. The gap also defies a weaker Brazilian real. In all, it reflects deeper structural problems, such as stubbornly high inflation and inefficiencies in uncompetitive state-protected industries. 

U.S.: 10:00 a.m. EDT. New Home Sales for August. [Expected 428,000 annualized rated (+3.9% on-month) vs. 412,000 (-2.4% on-month) in July.]

As with the existing home sales data, we’re looking for indications that the real-estate sector continues on a steady improvement path despite some lumpy data in the construction business. 

U.S.: 12:05 p.m. EDT Federal Reserve Bank of Cleveland Loretta Mester speech at the Cleveland Association for Business Economics.

Some were surprised that we didn’t hear a dissent last week from this newcomer to the Fed, who entered as an FOMC voter after Sandra Pianalto left her post at the Cleveland Fed in the midst of her latest one-year tour on the voting team. Ms. Mester had given a speech that very much located in the same camp as the FOMC’s firmest hawk, Charles Plosser. It’s possible that she’s not ready to rock the boat until she’s had a few meetings under her belt. Maybe we’ll hear more about her rationale for voting with the majority during this speech. 

U.S.: 1 p.m. EDT. Federal Reserve Bank of Chicago President Charles Evans speech at the Conference on Labor Market Slack, sponsored by Peterson Institute for International Economics, Washington, DC.

Mr. Evans is one of the more dovish members of the FOMC, and though he is not a voter this year he has in the past proven to be an influential player from that wing in shaping Fed thinking. 

AUSTRALIA: 10:30 p.m. EDT. (12:30 p.m., Melbourne) Reserve Bank of Australia Governor Glenn Stevens speaks at the Melbourne Economic Forum.

The Australian economy is still struggling and unemployment is worsening, but with rates at a record low 2.5%, Mr. Stevens and others at the RBA have sounded reluctant to do more. Has that changed in the wake of even weaker data out of China, which directly hurts Australia’s powerful mining industry, or with the ECB and BOJ both considering more aggressively monetary easing? 

THURSDAY

TURKEY: 7 a.m. EDT. (2 p.m., Ankara) Central Bank of Turkey September interest rate decision. [The benchmark one-week repo interest rate currently sits at 8.25%.]

Turkey’s facing a serious problem: stagflation. Both jobs and inflation are heading in the wrong direction, with the latter coming in at 9.54% in August, well above the central bank’s 5% target, not long after unemployment rate rose to 9.9% in the June readout, the most recent available. The central bank is under political pressure from Prime Minister Recep Tayyip Erdogan to cut rates but many believe that would even further exacerbate inflation and kill confidence. Goldman Sachs called the last inflation number “arguably the most serious inflation overshoot” since the central bank began setting formal targets in 2006. 

CZECH REPUBLIC: 7 a.m. EDT. (1 p.m. EDT) Czech National Bank interest rate decision. [Benchmark rate currently at 0.05%.]

The Czech Republic is about as stark a contrast as you get from Turkey. It has low inflation and is potentially at risk of deflation. Its central bank has set ultra-low interest rates but, like Switzerland’s, has also been force to adopt a currency intervention program to prevent the koruna from advancing above a fixed threshold euro. The Czech Republic has a healthy banking industry, also like Switzerland, but an export sector that’s hurting from the euro zone’s slowdown. With the ECB now adopting fresh stimulus and the euro falling again, more of the accommodation is expected. 

U.S.: 8:30 a.m. EDT.

  • August advancer report on durable goods. [Expected -18% vs. +22.6% in July.]

Don’t be alarmed by those gigantic swings in the forecast. July’s headline number was wildly distorted by some big aircraft sales for Boeing, and now economists expect payback in August. In fact, if you look at the ex-transportation number from last month’s report it was down -0.8%, so that adjusted figure may even head in the other direction. 

  • Unemployment insurance weekly claims report. [Initial Claims expected 299,000 vs. 280,000 in prior week.]

After a couple of weeks in which the claims data had backed up a bit, we headed sharply lower again last week, re-affirming the impression that the labor market is truly now sustaining far fewer layoffs underway. This number at least — if not wages — reflects tighter labor conditions. It’s one of those data points that helps build the hawk’s case for a rate hike sooner rather than later. 

U.S.: Time N/A. Federal Reserve Bank of Atlanta Dennis Lockhart speech at the U.S. Senator Thad Cochran Forum on American Enterprise

Mr. Lockhart is this year a non-voter on the FOMC but is seen as an important moderate voice on the committee. So comments of his recently in which he was clearly reluctant to declare victory in the U.S. economic recovery and thus to consider a rate hike soon in the New Year were an important indication of the barriers to monetary tightening within the FOMC.

JAPAN: 7:30 p.m. EDT. (8:30 a.m. Friday, Tokyo)

  • August national consumer prices index. [Core CPI was +3.3% on-year, overall CPI was +3.4% on-year, unchanged on month.]
  • September CPI for Tokyo. [Core CPI was +2.7% on-year, overall CPI was +2.8% on-year, +0.2% on month.]

In the national CPI data for Japan you need to look at the monthly data. The headline annual numbers are distorted by the impact of the one-off sales tax increase in April, but in the monthly numbers we see, once again, an inclination toward disinflation. The good news is that Tokyo’s data look a bit more reasonable and these lead the rest of the nation, since they come out a month earlier. Still, if there is no clear sign of the return to inflation sought by the central bank, the Bank of Japan may have to act. Markets will feel more convinced of that following comments from Governor Haruhiko Kuroda last week who vowed to do what’s necessary to achieve the BOJ’s 2% annual inflation target (free of sale tax hike effects.)

FRIDAY

U.S.: Second Quarter GDP, 3rd estimate. [Expected +4.6% vs. +4.2% in second estimate.]

Fresh data showing a big increase in medical spending last quarter has led economists to up their estimates beyond the already strong result shown in the second GDP estimate.

MEXICO: 9 a.m EDT. (8 a.m., Mexico City.) August preliminary trade balance. [Trade deficit in July was -$979.9M, with exports rising 4.5% on-year and imports up 3.1%.]

Last month, we started seeing a long-awaited pickup in Mexican sales to the U.S., which points to continued gains for the country on the back of a U.S. recovery. But what Mexico most needs to improve its trade balance is for Prime Minister Pena Nieto’s reforms of the energy sector to be implemented and translate into a bigger lode of oil discoveries, production and sales. 

Categories: Transactions

Morning Agenda: Alibaba’s I.P.O. Aftermath

New York Times DealBook - 2 hours 48 min ago
Alibaba soared in its public market debut. | Siemens agreed to buy the Dresser-Rand Group. | EMC weighed a deal with H.P. | Public pension funds may be souring on hedge funds.
Categories: Transactions

Siemens Makes $7.6 Billion Bet on Fracking in U.S.

New York Times DealBook - 2 hours 56 min ago
With its all-cash deal to buy Dresser-Rand Group, the German engineering conglomerate is positioning itself in the American energy sector, which is seeing a boom in shale oil.
Categories: Transactions

Morning MoneyBeat: Alibaba’s Confidence-Fueling Debut

Wall Street Journal MoneyBeat - 3 hours 38 min ago

Morning MoneyBeat is the Journal’s pre-market primer packed with market updates, insights and must-read news links. Send us tips, suggestions and complaints: steven.russolillo@wsj.com

Click here to receive this morning newsletter via email

MARKET SNAP: At 6:05 a.m. ET, S&P 500 futures down 0.5%. 10-Year Treasury yield lower at 2.56%. Nymex down 41 cents at $92.00. Gold 0.2% lower $1214.60. In Europe, FTSE 100 down 0.8%, DAX down 0.3% and CAC 40 down 0.2%. In Asia, Nikkei 225 down 0.7% and Hang Seng down 1.4%.

WATCH FOR: August Existing Home Sales (10:00 a.m. Eastern Time): seen up 1.0% to 5.2 million; previously +2.4% to 5.15 million. AutoZone, Alco Stores and Ascena Retail are among companies scheduled to report quarterly results.

THE BREAKFAST BRIEFING

The bull market’s message to Alibaba Group Holding Ltd: thank you.

The Chinese e-commerce giant’s trading debut on Friday went off without a hitch, as shares surged 38% on heavy volume. The offering was a positive development for other companies looking to tap into the public markets and a good sign for investor confidence as the stock market’s rally keeps rolling along.

So far this year initial public offerings on U.S. exchanges have raised about $69 billion, compared to $62 billion for all of last year, according to Dealogic. The record was set in 2000, when IPOs garnered $105 billion.

A successful IPO market offers yet another reason for investors to pile into stocks and fresh fuel for the bull market. With more than 100 deals in the pipeline in the weeks ahead, traders say they see increased demand for stocks from fund managers who once again are struggling to catch up to the rally.

Some 75% of U.S. stock mutual funds are trailing their benchmarks, according to Morningstar. To juice performance, these fund managers could flock to IPOs because their first-day pops can add to returns not captured by the big market benchmarks. The average first-day pop this year for U.S.-listed companies is 13%, according to Dealogic.

In addition to performance chasing, the backdrop for stocks still looks optimistic. The Federal Reserve last week eased investor concerns over when it would raise interest rates. The economy continues to improve and corporate profits have been strong.

The S&P 500 is up 8.8% this year and the Dow Jones Industrial Average closed Friday at yet another record high.

As always, concerns remain. Geopolitical tensions around the globe still present major risks to markets. U.S. stocks are considered expensive by most valuation measures. And the Fed is poised next month to conclude its signature bond-buying program, a prominent pillar of the bull market.

But for now, the successful Alibaba debut only stokes more optimism about the IPO market. And that should only bode well for stocks in the weeks and months ahead.

Morning MoneyBeat Daily Factoid: On this date in 1862, President Abraham Lincoln issued a preliminary Emancipation Proclamation. He called for the freedom of more than 3 million slaves in the U.S. by the new year, recasting the Civil War as a fight against slavery.

-By Steven Russolillo; follow him on Twitter @srussolillo.

STOCKS TO WATCH

Alibaba lived up to expectations Friday and surged 38% to close at $93.89 on its first day of trading in the U.S. market.

Analyst Youssef Squali at Cantor Fitzgerald initiated coverage of the stock at a buy with a price target of $90.

“We believe that a differentiated pricing model, strong brand, and unmatched scale give Alibaba an unfair competitive advantage relative to peers both in and outside China,” Mr. Squali wrote in a note.

AutoZone is expected to report fourth-quarter earnings of $11.25 a share, according to a consensus survey by FactSet.

Ascena Retail Group is projected to post fourth-quarter earnings of 18 cents a share.

MUST READS (LINKS)

Alibaba IPO Signals Strength in U.S. Stocks: “The record initial public offering by Alibaba Group Holding Ltd. underscores financial markets’ appetite for new listings, giving fresh fuel to the rally in stocks.”

Can Alibaba Keep Growing?: “The real success of Alibaba’s IPO will depend on whether the e-commerce company can keep growing without sacrificing its high profit margins of more than 40%.”

Alibaba Success May Be Mixed Blessing to the Street: “That such a large and complex global IPO went off with such relative success may be seen as a great win not only for Alibaba, but also for Wall Street. But it also could be a mixed blessing for the Street.”

Markets’ Best Friend: Miscalculation: “Investors like to debate whether the bull market is unloved, but one thing is clear: It has been misunderstood.”

Heard on the Street: Fed Tightens Taps on Rates-Market Plumbing: “A decision to cap use of the Federal Reserve’s reverse-repurchases facility could cause problems in rate markets later this month and highlight the facility’s usefulness.”

EMC Weighs Merger, Other Options: “Data-storage giant EMC, under pressure from a shareholder activist and faced with the expected retirement of longtime CEO Joe Tucci, is considering options that could include a merger deal with a rival.”

Financial Elite’s Offspring Start Their Own Hedge Funds: “The scions of a number of wealthy families, including the sons of prominent Wall Street figures Howard Marks and Ken Moelis, have either recently launched hedge funds or plan to do so soon, according to people familiar with the matter.”

Should Mortgage Lending Standards Ease?: “As officials flag worries about a soft housing recovery, they face a hard question: Is the drag on housing due mainly to tight lending standards? Or is the real culprit weak demand?”

Heard on the Street: China Keeps Qualcomm on Hold: “Gains for Qualcomm’s chipset business with the new iPhone can’t offset worries about its licensing business in China.”

Jason Gay: Can I Survive a Weekend Without Football?: ”After a week of troubling news throughout the football world, Jason Gay tries to take a timeout from our national sports obsession.”

Categories: Transactions

Merck of Germany to Acquire Sigma-Aldrich for $17 Billion

New York Times DealBook - 3 hours 39 min ago
The deal is expected to increase Merck KGaA ’s presence in North America and give it added exposure to markets in Asia. It represents a 37 percent premium to Sigma-Aldrich's closing price on Friday.
Categories: Transactions

Emerging Markets Shouldn’t Fear Fed, Says Amundi Executive

Wall Street Journal MoneyBeat - 3 hours 50 min ago
The board of governors’ seal on a lectern at the U.S. Federal Reserve in Washington, D.C. on Sept. 17.
Agence France-Presse/Getty Images

Fears that interest rate rises in the U.S. will trigger a selloff in emerging markets are overblown and misguided, says the chief investment officer of one of the world’s largest asset managers.

Several investors and analysts warn that emerging markets could lose their appeal as higher interest rates make safer U.S. assets such as 10-year Treasury bonds more attractive. Many emerging markets are among the world’s top performers this year. India’s benchmark stock index, for example, is up 28%, while those in Thailand, the Philippines and Indonesia have all risen more than 20%.

“The U.S. interest rate factor will not be the key factor driving emerging markets,” Pascal Blanqué, CIO and deputy chief executive of Amundi Group, said in Singapore. “Fears are overdone.” Amundi manages around $1 trillion globally.

Although the U.S. Federal Reserve isn’t expected to raise interest rates until the middle of next year, many investors are showing signs of caution and have scaled back holdings in some emerging market assets.

“Southeast Asia is a region that is typically sensitive to U.S. rates. When the U.S. starts raising rates, the next quarter is typically when Southeast Asian markets underperform,” said Wim-Hein Pals, head of emerging market investing at Robeco, which manages around $10 billion. “We have taken money out of Southeast Asia earlier this year,” he added.

Policymakers are also cautious. Indonesian Finance Minister Chatib Basri said earlier in September that a rates-related market shock could be worse than the turmoil triggered in May 2013 on fears that the U.S. Federal Reserve would scale back its bond-buying program.

Last year, Indonesia was particularly badly hit by outflows and it was singled out by economists and investors as being vulnerable to interest rate rises in the U.S. Its benchmark stock index fell more than 23% between May and August 2013. But the JSX has regained ground and is up 22% this year.

Mr. Blanqué says the selloff has been and gone and investor confidence is shifting instead to the strength of countries’ economic fundamentals. “There is some kind of a bet placed on the markets on the ability of the authorities to deliver lower inflation and a current-account rebalancing,” he said.

Mr. Blanqué added that assets such as U.S. Treasurys and German Bunds are well owned following last year’s rush to safe havens, partly because banks needed to meet tougher regulatory standards. “One reason why interest rates will remain low in the U.S. is that many investors have to hold safe assets,” he said.

Categories: Transactions

About Face

Wall Street Journal MoneyBeat - 3 hours 56 min ago

Is it a bad sign when management looks manly?

Research has shown that, by nature or nurture, facial masculinity is associated with a slew of behaviors in men that range from increased aggression to a penchant for risk taking. Some economists decided to see what having a masculine-looking man at the helm of a company might mean.

Yuping Jia at the Frankfurt School of Finance & Management, with Laurence van Lent and Yachang Zeng at Tilburg University, collected pictures of 1,136 male chief executives at companies in the S&P 1500, and used a facial-structure metric to gauge how masculine each one’s face was. Tracing employment histories from 1996 to 2010, they found the risk of financial misreporting was substantially higher for executives with more masculine faces. Greater facial masculinity was also associated with more enforcement actions, and higher incidences of insider trading and stock-option backdating.

But given all the things that play a role in human behavior, judging talent or demeanor by how someone looks hardly seems right. Investors looking for chicanery would be better off looking at financial statements than trying to put a face on it.

Categories: Transactions

Asian Investors Come Up Short In Alibaba IPO

Wall Street Journal MoneyBeat - 4 hours 19 min ago

The low expectations of many investors in Asia for getting in on Alibaba Group Holding Ltd.’s $25 billion U.S. initial public offering were cemented late Friday when investors in the region learned how few—if any—shares they got in the deal.

A majority of the Chinese e-commerce company’s shares were sold to U.S. investors, the Wall Street Journal reported Friday, citing people involved in the deal. Despite frustration and disappointment in Asia, one investor said the tilt toward large, long-term U.S. investors was consistent with the warnings that bankers were giving to Asian investors at meetings in Hong Kong and Singapore last week.

Jack Ma, center, founder of Alibaba, raises a ceremonial mallet before striking a bell during the company’s IPO at the New York Stock Exchange, Friday, Sept. 19, 2014 in New York.
Associated Press

Alibaba shares surged 38% in their debut on the New York Stock Exchange Friday, an eye-popping start for an offering of its size, which is now the largest-ever after underwriters exercised an option to sell more shares. The company earlier this year decided to list in New York rather than Hong Kong, a source of much disappointment in the Asian financial hub.

Hong Kong hedge-fund firm Central Asset Investments beat the odds and received shares in the IPO, according to portfolio manager Armand Yeung, who said the firm would be watching to buy more shares now that Alibaba is trading publicly. “Chinese consumption is a secular trend and they are obviously the leader,” Mr. Yeung said. The firm declined to disclose how many shares it received.

Not everyone is feeling left out. Sydney-based investment firm Platinum Asset Management, which manages roughly US$21 billion, was asked by bankers on the deal for its level of interest but didn’t seek shares, according to chief investment officer Andrew Clifford.

“This business is well and truly matured in terms of its level of profitability,” Mr. Clifford said. “There are a lot of other companies in the Internet space that are a lot more appealing.” He cited U.S.-listed Chinese search engine operator Baidu Inc. and Chinese online video company Youku Tudou Inc. as two stocks the firm owns and prefers over Alibaba currently.

US firms had a “first-mover advantage” in getting a place in the listing compared to investors based in Asia, because they have better links with Wall Street brokers and investment banks, said Alan Xi Wang, a Hong Kong-based portfolio manager and head of greater China equity at Principal Global Investors. The US-based asset manager participated in the IPO in the US and obtained shares – though not as many as it had hoped for, Mr Wang said, without elaborating.

Retail investors in Hong Kong also have some misgivings about the stock now that it’s trading and they are broadly able to buy it, according to Kenny Wen, a wealth management strategist for Sun Hung Kai Financial. Retail investors in the city that wanted to buy into the Alibaba IPO would have had to meet steep minimum investment requirements in a deal that ultimately was contained to big, institutional buyers. Retail investors received about 10% of the shares sold in the IPO, the Wall Street Journal reported Friday, with the majority reserved for friends, family and employees designated by Alibaba, according to people familiar with the deal.

“Now that they can buy it, the price isn’t attractive anymore,” Mr. Wen said. “The market consensus is now that Alibaba is quite expensive compared to its peers.”

–Corrie Driebusch and Juro Osawa contributed to this post.

Categories: Transactions

Upstart Bank Aldermore to List Shares in London

New York Times DealBook - 5 hours 41 sec ago
The online lender is the latest so-called challenger bank to Britain’s traditional financial powers to seek an initial public offering in London.
Categories: Transactions

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