Reuters: Mergers News: UPDATE 1-Burger King to incur charge on Carrols deal

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UPDATE 1-Burger King to incur charge on Carrols deal Mar 30th 2012, 21:21 March 30 | Fri Mar 30, 2012 5:21pm EDT March 30 (Reuters) - Burger King Corp said it will take an impairment charge as a result of its previously announced sale of 278 of its outlets to C a rrols Restaurant Group Inc. Last week, Carrols agreed to buy the Burger King restaurants in a cash-and-stock deal that will make it the biggest Burger King franchisee in the world. Burger King, now the third-largest U.S. hamburger chain, also said it is evaluating the accounting implications of the sale and is unable to estimate the amount or the range of amount of the charge the company might take.

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Reuters: Mergers News: Document shows red tape binds Mexico broadband plan

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Document shows red tape binds Mexico broadband plan Mar 30th 2012, 21:29 By Cyntia Barrera MEXICO CITY, March 30 | Fri Mar 30, 2012 5:29pm EDT MEXICO CITY, March 30 (Reuters) - Mexico's communications ministry never asked the financial authority to set a fee that media company MVS was supposed to pay to hold on to a big chunk of the spectrum, a think tank said on Friday, as red tape snarls an ambitious broadband plan. Consumer advisory group Observatel's findings highlight a lack of coordination between government agencies overseeing the future of one of the most ambitious broadband projects in Mexico in decades, a project that could trigger growth in the telecom market. MVS owns 190 Megahertz (MHz) of bandwidth, good to deploy a next-generation LTE (Long Term Evolution) network in Mexico. Analysts have estimated such a capacity is big enough to run three companies the size of America Movil, Mexico's leading cell phone provider owned by tycoon Carlos Slim. MVS's spectrum is the sum of 42 licenses granted by the government but some of them have expired, making it impossible for the company to build a nationwide network unless authorities renew those permits. The communications and transport ministry has already refused to renew the expired licenses and had said it appointed the finance ministry to calculate the fee that MVS would have to pay to claim back the expired licenses and keep the ones that had not come due. "According to the finance ministry, the communications ministry has not requested to set the fee for the ... spectrum," Observatel said. Its information is based on a formal response letter from the finance ministry, a copy of which was provided to Reuters. Earlier this month, MVS said the finance ministry had put a tag of up to 39 billion pesos, or about $3 billion, to let it keep the spectrum, an amount it could not possibly pay. MVS' last offer of $340 million to keep at least 140 MHz of the spectrum for an initial period of 10 years was rejected by the government. MVS and the communications ministry could not immediately comment on Observatel findings. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: Greece says 17 firms express interest in gas company sale

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Greece says 17 firms express interest in gas company sale Mar 30th 2012, 19:04 ATHENS, March 30 | Fri Mar 30, 2012 3:04pm EDT ATHENS, March 30 (Reuters) - Seventeen firms expressed initial interest in the privatisation of Greek natural gas company DEPA, one of the country's major assets to go on the block to help pay down public debt, its privatisations agency (HRADF) said on Friday. The agency did not name the interested parties but said the potential buyers came from 12 different countries, seven of which were outside the euro zone. Greece is considering either a "bundled" sale of DEPA - combining its wholesale, trading and gas supply business with its DESFA networks and liquefied natural gas arm - or an "unbundled" deal in which DESFA would be sold separately. "The Hellenic Republic Asset Development Fund will evaluate the fulfillment of legal and financial conditions of each candidate and announce which qualified parties will be invited to submit indicative offers," the agency said. DEPA owns 51 percent of local supply companies which have a monopoly until 2036 to sell natural gas to small industrial, commercial and residential customers. In 2010, the DEPA group reported sales of 1.22 billion euros and net profit of 90.8 million. It has not yet published its 2011 results.

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Reuters: Mergers News: EU mergers and takeovers (March 30)

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EU mergers and takeovers (March 30) Mar 30th 2012, 18:08 BRUSSELS, March 30 | Fri Mar 30, 2012 2:08pm EDT BRUSSELS, March 30 (Reuters) - The following are mergers under review by the European Commission and a brief guide to the EU merger process: APPROVALS AND WITHDRAWALS -- British Airways owner IAG to acquire Lufthansa's British unit bmi (approved March 30) -- German disposal company Remondis to acquire joint control of Dutch waste management services companies Sortiva and Stam Papier Recycling (approved March 29) NEW LISTINGS -- Dutch retailer Ahold to acquire Dutch non-food online retailer Bol.com from Cyrte Investments and NPM Capital(notified March 27/deadline May 7) EXTENSIONS AND OTHER CHANGES -- Vivendi's Universal Music Group to buy British record label EMI's recorded music unit from Citigroup Inc (notified Feb. 17/deadline extended for the second time to Sept. 6 from Aug. 8) FIRST-STAGE REVIEWS BY DEADLINE APRIL 2 -- Swiss-based electronic connector maker TE Connectivity Ltd to acquire Deutsch Group SAS from French investment group Wendel (notified Feb. 27/deadline April 2) -- Danish shipping services company DFDS and Luxembourg-based terminal services operator C.Ro Ports to acquire Swedish terminal services operator Alvsborg (notified Feb. 27/deadline April 2) APRIL 4 -- Princes Ltd, a subsidiary of Japanese conglomerate Mitsubishi Corp, to acquire food producer and distributor AR Industrie Alimentari SpA (notified Feb. 29/deadline April 4) APRIL 10 -- German insurer Talanx International and Japanese insurer Meiji Yasuda Life Insurance to acquire control of Belgian banking and insurance group KBC's Polish insurance unit Waria (notified March 1/deadline April 10) APRIL 12 -- South Korean conglomerate Samsung and U.S. company Corning to set up a new OLED glass venture (notified March 5/deadline April 12/simplified) APRIL 13 -- Telefonica UK and Vodafone UK to set up a joint venture providing mobile commerce services (notified March 6/deadline April 13) APRIL 18 -- German industrial gases maker Linde to acquire the European homecare business of U.S. peer Air Products and Chemicals (notified Feb. 24/deadline extended to April 18 from March 30 after Linde offered commitments) -- Consumer goods retailer Groupe Auchan to acquire Hungarian supermarket chain Magyar Hipermarket (notified March 9/deadline April 18) -- Danish shipping group A.P. Moller-Maersk and French group Bollore to acquire joint control of Congo Terminal (notified March 9/deadline April 18/simplified) -- Hungary's state-owned National Asset Management Zrt to acquire vehicle parts maker Raba (notified March 9/deadline April 18/simplified) APRIL 19 -- A group led by Japan's Sony which includes Blackstone Group, Abu Dhabi's Mubadala Development Co., Raine Group and movie mogul David Geffen to acquire record label EMI's music publishing business (notified Feb. 27/deadline extended to April 19 from April 2 after the group offered commitments) APRIL 20 -- Goldman Sachs and private equity firm Advent International to acquire joint control of credit and information management company Transunion Corp (notified March 13/deadline April 20/simplified) APRIL 23 -- French company Bollore and shipping services company CMA CGM to acquire joint control of Terminal du Grand Quest (notified March 14/deadline April 23/simplified) APRIL 26 -- U.S. healthcare company Johnson & Johnson to acquire Swiss medical devices maker Synthes Inc (notified Sept. 27/deadline extended for the second time to April 26 from April 2 after the companies provided concessions) APRIL 30 -- CVC Capital Partners to acquire Nordic construction products and machinery distributor Ahlsell from Cinven and Goldman Sachs Capital Partners (notified March 21/deadline April 30) MAY 2 -- Infrastructure fund Global Infrastructure Partners (GIP) to acquire a stake in the Transitgas pipeline from Belgian gas transport company Fluxys (notified March 22/deadline May 2/simplified) MAY 3 -- Dutch pension fund PGGM to acquire British student housing group University Partnerships Programme from Barclays Capital (notified March 23/deadline May 3/simplified) MAY 4 -- Scholz Austria to acquire joint control of waste management company Asaler Familienholding GmbH (notified March 26/deadline May 4/simplified) -- Reitan Servicehandel to acquire Finnish kiosk operator R-Kioski, media distributors UAB Impress Teva and OU Lehepunkt (notified March 26/deadline May 4/simplified) -- Private equity firms Towerbrook, York Global Finance and Apollo VII to acquire joint control of roofing products maker Monier (notified March 26/deadline May 4/simplified) MAY 8 -- U.S. cereal company Kellogg Co to acquire Pringles potato chips from U.S. household products maker Procter & Gamble Co (notified March 28/deadline May 8/simplified) -- British packaging company DS Smith to acquire the recyclyed packaging operations of Svenska Cellulosa Aktiebolaget (SCA) (notified March 28/deadline May 8) MAY 22 -- German sugar company Suedzucker to acquire a 25 percent stake in British commodities trading company ED&F Man (notified Sept. 19/deadline extended for the third time to May 22 from April 25 after Suedzucker offered more commitments) JUNE 4 -- Compagnia Italiana di Navigazione to acquire Italian state-owned ferry group Tirrenia (notified Nov. 20/deadline extended to June 4 from Jan. 18 after the Commission opens an in-depth probe) AUG 9 -- U.S. conglomerate United Technologies Corp to acquire U.S. aircraft components maker Goodrich (notified Feb. 20/deadline extended to Aug. 9 from March 26 after the Commission opens an-depth investigation) GUIDE TO EU MERGER PROCESS DEADLINES: The European Commission has 25 working days after a deal is filed for a first-stage review. It may extend that by 10 working days to 35 working days, to consider either a company's proposed remedies or an EU member state's request to handle the case. Most mergers win approval but occasionally the Commission opens a detailed second-stage investigation for up to 90 additional working days, which it may extend to 105 working days. SIMPLIFIED: Under the simplified procedure, the Commission announces the clearance of uncontroversial first-stage mergers without giving any reason for its decision. Cases may be reclassified as non-simplified -- that is, ordinary first-stage reviews -- until they are approved. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: Canada's Flaherty says RIM to set own fate

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Canada's Flaherty says RIM to set own fate Mar 30th 2012, 18:10 TORONTO, March 30 | Fri Mar 30, 2012 2:10pm EDT TORONTO, March 30 (Reuters) - Asked if the Canadian government would accept at takeover of Research In Motion, Canadian Finance Minister Jim Flaherty said on Friday that the BlackBerry maker would set its own fate. "RIM is a private company that trades and has shareholders of course so ... they will be the masters of their own destiny. We would like RIM obviously to be successful as a Canadian company, which it has been, a very innovative successful company. We hope that that would persist," he told reporters in Toronto.

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Reuters: Mergers News: Altor lines up clothing firm Helly Hansen for sale

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Altor lines up clothing firm Helly Hansen for sale Mar 30th 2012, 16:19 By Mia Shanley STOCKHOLM, March 30 | Fri Mar 30, 2012 12:19pm EDT STOCKHOLM, March 30 (Reuters) - Nordic private equity firm Altor is to put its outdoor clothing brand Helly Hansen up for sale next week, a sale likely to attract bids from a number of major retail firms, people familiar with the matter said. Global lifestyle apparel giant VF Corporation, U.S. consumer products maker Jarden Corp, French luxury and retail group PPR - owner of both Gucci and Puma - and Columbia Sportswear Co have all expressed some kind of interest in the company after a teaser was sent out earlier this year, the industry and banking sources said. "It (the information memorandum on Helly Hansen) is going out in a few days," said an industry source. A banker looking at the process said he expected retailers to be most interested, though private equity might bid too. In 2010, Japanese sporting goods company Asics Corp bought Swedish outdoor equipment maker Haglofs Holdings AB for 11.4 billion yen ($138.6 million) from Swedish investment fund Ratos AB in a bid to expand its global sales. That was equal to an EBITDA multiple in the mid-teens. The banker looking at the process reckoned Helly Hansen could get sold at an EBITDA multiple in the low to mid-teens. The firm had sales of 1.6 billion Norwegian crowns ($280.50 million) in 2011 and EBITDA of about 150 million crowns. Altor bought Helly Hansen for 800 million Norwegian crowns in 2006, the same year that the firm launched a recovery plan based on integrating production with sales, innovation and cutting underperforming staff and stores. It already earned back its investment last year when it sold Helly Hansen Pro, a subsidiary focusing on survival suits, boat canopies and textile-based products for agriculture, industry and health sectors, to Montagu Private Equity. Helly Hansen traces its roots back to a Norwegian sea captain of the same name who produced his first oilskin weather protective waterproof jacket in 1877. ABG Sundal Collier and RW Baird are advising Altor on the sale. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: TEXT-S&P puts CaixaBank hybrids 'BB+' rating on watch negative

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TEXT-S&P puts CaixaBank hybrids 'BB+' rating on watch negative Mar 30th 2012, 16:38 Fri Mar 30, 2012 12:38pm EDT March 30 - Overview -- On March 26, 2012, Spain's CaixaBank S.A. announced it has reached a preliminary merger agreement with Spanish bank Banca Civica S.A. -- We are placing our 'BB+' issue ratings on CaixaBank's hybrid instruments on CreditWatch negative. -- The CreditWatch reflects the potentially negative effect of the merger with Banca Civica on our assessment of CaixaBank's capital and earnings, and consequently of its stand-alone credit profile (SACP). -- We are also affirming our 'BBB+/A-2' long- and short-term ratings on CaixaBank and our 'BBB-/A-3' long and short-term ratings on parent holding company Caja de Ahorros y Pensiones de Barcelona (la Caixa). The outlooks on the long-term ratings are stable. -- The stable outlooks reflect that our long- and short-term ratings on CaixaBank and la Caixa would remain unchanged at 'BBB+' and 'BBB-' respectively, all other things being equal, even if we lowered our assessment of CaixaBank's SACP to 'bbb'. Rating Action On March 30, 2012, Standard & Poor's Ratings Services placed its 'BB+' issue ratings on Spain-based CaixaBank S.A.'s (CaixaBank) hybrid instruments on CreditWatch with negative implications. At the same time, we affirmed our 'BBB+/A-2' long- and short-term counterparty credit ratings on CaixaBank and our 'BBB-/A-3' long- and short-term ratings on its parent company Caja de Ahorros y Pensiones de Barcelona (la Caixa). The outlooks are stable. Rationale The rating actions follow the announcement that the boards of directors of la Caixa and CaixaBank have reached a preliminary merger agreement with the boards of Banca Civica S.A. (BBB-/Watch Pos/A-3) and of each of the savings banks integrated in it (see also "Spain-Based Banca Civica 'BBB-/A-3' Put On Watch Positive Following Announced Potential Integration Into CaixaBank," published today on RatingsDirect on the Global Credit Portal). ). We understand that under the agreement terms, CaixaBank will absorb Banca Civica. The actions reflect our belief that if the transaction goes through and based on the preliminary agreement terms, it would likely have a negative impact on CaixaBank's consolidated capital position, and lead us to revise our assessment of its capital and earnings to "moderate" from "adequate" currently. This would lead us to revise our stand-alone credit profile (SACP) on CaixaBank to 'bbb' from 'bbb+' currently. We would also lower the ratings on CaixaBank's hybrids, which we rate by notching down from the SACP, in accordance with our criteria. At present, we believe that the other features of CaixaBank post merger would likely remain consistent with our current assessment of CaixaBank's financial and business positions. Under our methodology, even if we lowered CaixaBank's SACP by one notch to 'bbb' following the absorption of Banca Civica, the long-term rating on CaixaBank would remain unchanged at 'BBB+' because we would incorporate one notch of uplift for potential extraordinary government support. We analyze CaixaBank and its controlling holding company, la Caixa, on a consolidated basis, using la Caixa's consolidated financial information, in accordance with our criteria. We consider CaixaBank to be the group's core operating entity. We rate la Caixa two notches below CaixaBank's long-term rating to reflect the structural subordination of la Caixa's creditors to those of CaixaBank. Consequently, our affirmation of the ratings on la Caixa follows the same action on CaixaBank. In our opinion, the potential acquisition of Banca Civica would likely have a negative impact on CaixaBank's capital position and on the risk-adjusted capital (RAC) ratio we calculate to measure its capital. We believe that CaixaBank's pro forma consolidated RAC ratio as of year-end 2011, after integrating Banca Civica's Standard & Poor's estimated risk-weighted assets, would stand between 5.5% and 6%. Although we believe that CaixaBank's organic capital generation should enable it to progressively enhance its solvency over the rating horizon, we don't anticipate, at this stage, that this would be sufficient to restore its RAC ratio before diversification to an "adequate" level according to our criteria. Consequently, we project that the RAC ratio before diversification for the combined entity for 2012 would likely remain in the 5%-7% bucket, compared with the 7.1% we currently estimate for CaixaBank. The potentially lower RAC ratio would lead us to revise our assessment of Caixabank's capital and earnings to "moderate" from "adequate." Despite low business volumes and high funding costs in coming quarters, CaixaBank's earnings capacity should benefit, however, from the potential cost synergies that we think it can extract from the integration and that would enhance its operating profitability. We also believe that the potential impact of consolidating Banca Civica on CaixaBank's credit risk position would be manageable, although Banca Civica's asset quality has deteriorated more than that of CaixaBank. We expect that Banca Civica would accumulate a higher level of problematic assets. In our view, CaixaBank's consolidated loan portfolio post merger would continue outperforming the banking system in terms of delinquencies in each of the main credit segments, and consequently would still be consistent with our "strong" assessment of the risk position. This is due to the overall modest size of most of the problematic assets acquired from Banca Civica, relative to the overall size of those of CaixaBank. Moreover, we believe that the additional extraordinary provisions that CaixaBank would be taking on the acquired portfolio at the moment of the acquisition would provide it with a strong cushion to absorb potential credit losses. We would likely continue to assess CaixaBank's funding position post merger as "average" and its liquidity as "adequate," because retail customer deposits would represent the main source of financing. CaixaBank's loan-to-core-customer-deposits ratio after the merger, excluding wholesale instruments and repurchase agreements with retail customers, would be in the 130% to 140% range, which is better than the system average. CaixaBank typically maintains adequate liquidity cushions on its balance sheet in case of need. Finally, although the potential acquisition of Banca Civica would enable CaixaBank to enhance its overall domestic market position and to rank as the largest bank in the Spanish financial system, we have already factored into our current ratings on CaixaBank's assessment of a "strong" business position. This assessment takes into account that CaixaBank runs one of Spain's strongest domestic retail banking franchises. CreditWatch We aim to resolve the CreditWatch placement on CaixaBank's hybrid instruments after the merger closes, which is likely by the end of the third quarter of 2012. If, as a result of the acquisition of Banca Civica, we were to lower our SACP assessment on CaixaBank to 'bbb' from 'bbb+', we would lower our issue rating on the hybrid instruments by one notch to 'BB' from 'BB+'. Conversely, we would affirm the issue rating on the hybrids if CaixaBank managed to cushion the impact of acquired risk-weighted assets on its capital and we were to leave our SACP on the bank unchanged. Outlook The outlook on the long-term rating on CaixaBank is stable. All other things being equal, our long- and short-term ratings on CaixaBank would remain unchanged at 'BBB+', even if we lowered our assessment of CaixaBank's SACP to 'bbb'. This is because we would start factoring into the ratings one notch of uplift for potential extraordinary government support, in accordance with our criteria. Following a lowering of the SACP and a change in uplift for government support, and upon completion of the transaction, however, we would likely revise the outlooks to negative, mirroring the outlook on the Kingdom of Spain (A/Negative/A-1). We could then consider negative rating actions if we: -- Lowered the SACP to 'bbb-', contrary to our current base-case scenario. This could occur if, in addition to assessing CaixaBank's capital and earnings as "moderate," we believed that CaixaBank's asset quality performance were likely to deteriorate in line with the banking sector average, which we currently do not anticipate. Weakening asset quality along these lines would lead us to reassess CaixaBank's risk position as "adequate" under our criteria; or -- Downgraded Spain to 'A-', which would mean that we would not incorporate government support into CaixaBank's long-term rating under our criteria, given the lower long-term rating on the sovereign. In our view, a positive rating action is unlikely over the next 15 to 18 months. The stable outlook on La Caixa mirrors that on its operating company CaixaBank. Given our approach to rate la Caixa two notches down from CaixaBank's long-term rating, a downgrade of CaixaBank would likely lead to a downgrade of la Caixa. Ratings Score Snapshot Long-Term Issuer Credit Rating BBB+ Holding Company Rating BBB- SACP bbb+ Anchor bbb- Business Position Strong (+1) Capital and Earnings Adequate (0) Risk Position Strong (+1) Funding and Liquidity Average and Adequate (0) Support 0 GRE Support 0 Group Support 0 Sovereign Support 0 Additional Factors 0 Related Criteria And Research -- Banks: Rating Methodology And Assumptions, Nov. 9, 2011 -- Banking Industry Country Risk Assessment Methodology And Assumptions, Nov. 9, 2011 -- Group Rating Methodology And Assumptions, Nov. 9, 2011 -- Bank Hybrid Capital Methodology And Assumptions, Nov. 1, 2011 -- Bank Capital Methodology And Assumptions, Dec. 6, 2010 -- Use Of CreditWatch And Outlooks, Sept. 14, 2009 -- Spain-Based Banca Civica 'BBB-/A-3' Put On Watch Positive Following Announced Potential Integration Into CaixaBank, March 30, 2012 Ratings List Ratings Affirmed CaixaBank S.A. Counterparty Credit Rating BBB+/Stable/A-2 Senior Unsecured BBB+ Caja de Ahorros y Pensiones de Barcelona Counterparty Credit Rating BBB-/Stable/A-3 Certificate Of Deposit BBB- Subordinated BB+ Commercial Paper A-3 Ratings Affirmed; CreditWatch Action To From CaixaBank S.A. Caixa Preference Ltd. Preferred Stock BB+/Watch Neg BB+ Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: UPDATE 1-Brazil's Camargo prepares to launch Cimpor bid-sources

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UPDATE 1-Brazil's Camargo prepares to launch Cimpor bid-sources Mar 30th 2012, 16:38 Fri Mar 30, 2012 12:38pm EDT LISBON, March 30 (Reuters) - Brazil's Camargo Correa is preparing to launch a bid for the rest of Portuguese cement maker Cimpor, two sources close to the situation said on Friday. They said Camargo was finalising the details of the bid, which could come as soon as Friday. Camargo already owns 32.9 percent of Cimpor. A spokesman at Cimpor said the company would not comment. There were rumours at the end of last year that Camargo and Brazil's Votorantim were preparing to buy all of Cimpor. Votorantim holds 21 percent of the Portuguese company. The two Brazilian companies bought their stakes in Cimpor in 2010, attracted by Cimpor's international interests, including in Brazil. Shares in Cimpor closed on Friday 1.44 percent higher at 5 euros per share.

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Reuters: Mergers News: UPDATE 1-ConocoPhillips, India's ONGC in pact for shale gas exploration

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UPDATE 1-ConocoPhillips, India's ONGC in pact for shale gas exploration Mar 30th 2012, 14:45 Fri Mar 30, 2012 10:45am EDT * ONGC, ConocoPhillips may jointly bid for overseas shale gas assets * India seen launching first shale gas licensing round by end-2013 MUMBAI, March 30 (Reuters) - India's Oil and Natural Gas Corp and U.S. oil company ConocoPhillips signed a pact on Friday to explore and develop shale gas assets and look for opportunities in deepwater exploration. The agreement is for sharing technical expertise on shale gas explorations, but ONGC and ConocoPhillips could also jointly bid for shale gas assets overseas, the leading Indian oil and gas producer's chairman Sudhir Vasudeva told reporters. India may launch the first shale gas licensing round by the end of next year, Prime Minister Manmohan Singh said last week, after the government pushed back plans to unveil a policy on exploration of unconventional gas resources trapped in rocks. "India has a lot of potential in shale gas. We want to exploit that with the technical expertise of ConocoPhillips," ONGC's Vasudeva said, adding the two companies will also explore opportunities in the U.S. and other countries. ONGC does not see any financial benefit from the agreement in the near future, he said. A lack of a policy framework and resource estimates have led to Indian companies turning their focus to shale gas assets overseas. Another Indian oil and gas producer, Oil India Ltd is in talks with U.S.-based companies, including ConocoPhillips, to buy stake in shale gas assets in the U.S, the Indian state-run company's finance chief said in January. Global energy majors have also been pushing to grab a slice of India's oil and gas reserves and gain exposure to surging demand in Asia's third-largest economy. BP paid $7.2 billion last year to acquire 30 percent stake in 23 oil and gas blocks owned by India's Reliance Industries. UK-listed miner Vedanta Resources has also bought a controlling stake in explorer Cairn India in a deal valued around $6 billion. India, the world's fourth-largest oil importer, meets about 80 percent of its crude needs through overseas purchases. It is scouting for oil and gas assets abroad to meet demand in a fast-growing economy, and to feed its expanding refining capacity. ONGC, which has been investing heavily to maintain output from its old fields, has said it aims to raise its crude oil production by 15 percent to 28 million tonnes, or 560,000 barrels per day (bpd), by March 2014. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: TEXT-S&P revises Vantage Drilling outlook to positive

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TEXT-S&P revises Vantage Drilling outlook to positive Mar 30th 2012, 15:19 Fri Mar 30, 2012 11:19am EDT March 30 - Overview -- U.S.-based Vantage Drilling has acquired the Dragonquest drillship, which is scheduled to begin an eight-year contract with Petrobras later this year. -- Vantage is issuing $775 million of add-on notes through its wholly owned subsidiary Offshore Group Investment Ltd. to fund this acquisition. -- We are revising our outlook on Vantage to positive from stable and affirming our 'B-' corporate credit and senior secured debt ratings. -- The positive outlook reflects our expectation that the Dragonquest contract will improve cash flow visibility and buffer any unexpected downtime associated with its other vessels. Rating Action On March 30, 2012, Standard & Poor's Ratings Services revised its outlook on Vantage Drilling Co. (Vantage) to positive from stable. We affirmed the 'B-' corporate credit rating on the company. The issue-level rating on the senior secured notes will remain 'B-' (the same as the corporate credit rating) following the proposed $775 million tack-on to its existing $1.225 billion 11.5% notes due 2015. The recovery rating is '3' indicating our expectation of meaningful (50% to 70%) recovery in the event of a payment default. The notes will be issued by Offshore Group Investment Ltd., which is a wholly owned subsidiary of Vantage (Vantage guarantees the notes). Vantage is using the add-on notes to fund the purchase and remaining constructing payments associated with the Dragonquest drillship, which will be delivered in April and is likely to start its eight-year contract with Petrobras by September 2012. Rationale The outlook revision reflects our view that the addition of the Dragonquest drillship will improve Vantage's credit risk profile because the eight-year contract provides good cash flow visibility. It also buffers downtime risk associated with its other drillship, the Platinum Explorer, which currently contributes a majority of earnings and cash flows to service debt. We are also revising the outlook because we expect that Vantage's performance will benefit from strengthening contract renewal day rates for high-specification drillships and jackup rigs. Bid rates have improved, to the mid-$500,000 to low-$600,000 range for new and highly sophisticated drillships and to approximately $160,000 for high spec jackups. This bodes well for the Tungsten Explorer drillship, which is currently being constructed and scheduled to begin operations in mid-2013 (we expect a contract announcement later this year). Most of its jackup fleet is contracted through 2012, meaning that 2013 contracts should benefit from the improving day rate trend. The ratings on Houston-based offshore drilling company Vantage Drilling Co. (Vantage) reflect the company's aggressive debt leverage, less-than-adequate liquidity, and participation in the highly cyclical and competitive offshore contract drilling industry. The ratings also reflect Vantage's relatively young and technologically sophisticated fleet and its decent backlog, especially from its drillships. We consider Vantage's financial risk to be "highly leveraged". Pro forma debt as of Dec. 31, 2011 was very high at $2.1 billion (including Standard & Poor's adjustments for operating leases and accrued interest), resulting in aggressive pro forma leverage of more than 6x assuming a full-year of operation from the Dragonquest. To forecast its credit protection measures, we have used relatively conservative assumptions, including a $550,000 day rate for the Tungsten Explorer drillship and jackup day rates that average approximately $145,000. We have also assumed 90% utilization on its vessels and operating and maintenance expense on its drillship and jackups that average 40% and 55% of revenues, respectively. The Dragonquest is scheduled to begin operating for Petrobras in September at a day rate of approximately $550,000 inclusive of bonuses. At this rate, and assuming at least 95% utilization and a 60% to 70% EBITDA margin, we project that the Dragonquest could contribute between $130 million and $150 million of EBITDA annually. Under these assumptions, we project that Vantage will generate more than $400 million of annual EBITDA, corresponding to adjusted leverage in the mid to high 5x area. We project that free operating cash flow could average in the low $100 million range, assuming $15 million of maintenance capital spending and approximately $270 million of cash interest (including projected financing on the Tungsten Explorer). Vantage's vulnerable business risk profile incorporates its limited operating diversity. It competes against some of the largest drillers in the industry, and its small fleet size and scale leaves it vulnerable to competitive pressures including relatively weaker day rates. We expect Vantage to continue to operate in what we consider to be politically unstable regions (it currently operates in West Africa and Malaysia), and we foresee that it will remain vulnerable to geopolitical unrest. Liquidity Vantage's liquidity profile is "less than adequate", incorporating the following expectations and assumptions: -- As of Dec. 31, 2011, Vantage had $110 million in cash and equivalents. The company does not maintain a revolving credit facility. -- Fixed expenses are substantial, with about $225 million of projected cash interest expense per year pro forma for the add-on notes. -- Capital spending is minimal, approximately $15 million per year. -- We envision FFO of approximately $130 million, with free cash flow in the low $100 million area assuming a full year contribution from the Dragonquest and Tungsten Explorer. -- We do not believe that Vantage has the ability to absorb a high-impact, low-probability event without the need for refinancing. Recovery analysis The issue-level rating on Vantage's senior secured debt is 'B-' (the same as the corporate credit rating) and the recovery rating is '3', which indicates our expectation for meaningful (50% to 70%) recovery in the event of a payment default. For the full recovery analysis, please see Standard & Poor's recovery report on Vantage Drilling Co. to be published on RatingsDirect on the Global Credit Portal following the release of this report. Outlook The positive outlook reflects our expectation that we could upgrade the corporate credit rating to 'B' later this year. An upgrade is likely if the Dragonquest begins operating for Petrobras by September. An upgrade to 'B' assumes that demand for Vantage's high-specification jackups and Tungsten Explorer drillship will continue to be strong, with full year pro forma leverage in the mid to high 5x area. A revision of the outlook to stable could occur if the Dragonquest experiences significant mobilization issues that delay the start date with Petrobras or if Vantage encounters material unplanned downtime on its Platinum Explorer drillship. Related Criteria And Research -- Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011. -- Criteria Guidelines For Recovery Ratings, Aug. 10, 2009. Ratings List Ratings Affirmed; Outlook Revised To From Vantage Drilling Co. Corporate Credit Rating B-/Positive/-- B-/Stable/-- Ratings Affirmed Offshore Group Investment Ltd. Senior Secured B- Recovery Rating 3 Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: UPDATE 2-Eros Int'l files for $250 mln US IPO, to delist from AIM

Reuters: Mergers News Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

UPDATE 2-Eros Int'l files for $250 mln US IPO, to delist from AIM Mar 30th 2012, 14:00 Fri Mar 30, 2012 10:00am EDT * Says U.S. market offers more liquidity * Intends to list on the NYSE under the symbol "EROS" March 30 (Reuters) - Film entertainment company Eros International PLC filed for a U.S. initial public offering of up to $250 million and said it intends to delist from London's junior AIM market. It decided to make the switch as the U.S. capital markets provide a more relevant peer group, broader analyst coverage, increased liquidity and access to additional capital on more favourable terms, Eros, which produces and distributes Indian film content, said. Eros International is known for the distribution of films like "Zindagi Na Milegi Dobara" (You Only Live Once) and "RA.One", starring Bollywood actors Shahrukh Khan and Kareena Kapoor. The company claims a distribution network that covers more than 50 countries and has offices in India, the UK, the United States, Dubai, Australia, Fiji, Isle of Man and Singapore. Eros' Indian unit, Eros International Media Ltd, was listed on India's Bombay Stock Exchange and National Stock Exchange in 2010. Several Indian media companies have tied up with their U.S. peers in recent years. Last month, Walt Disney Co took over UTV Software Communications Ltd, which produces television content in India. In 2009, Indian billionaire Anil Ambani invested $325 million in Steven Spielberg's DreamWorks Studios . For the nine months ended December 2011, Eros earned $45.5 million on a revenue of $166.2 million, according to its regulatory filing. Eros named Deutsche Bank Securities, BofA Merrill Lynch, Citigroup and UBS Securities as the underwriters to the offering. The company intends to list its common stock on the New York Stock Exchange under the symbol "EROS." The amount of money a company says it plans to raise in its first IPO filings is used to calculate registration fees. The final size of the IPO can be different. Eros shares were up 2 percent at 242 pence at 1355 GMT on Friday on the London Stock Exchange. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: UPDATE 1-Atlantia says interest strong in Chilean sale

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UPDATE 1-Atlantia says interest strong in Chilean sale Mar 30th 2012, 12:44 Fri Mar 30, 2012 8:44am EDT CERNOBBIO, Italy, March 30 (Reuters) - Italian road operator Atlantia said on Friday its plan to sell a stake of up to 49 percent in its Chilean unit Grupo Costanera has attracted strong interest but no formal bids as yet. Earlier Atlantia's chairman Fabio Cerchiai said Grupo Costanera had received more than 10 offers. "The company confirms there is a strong spontaneous interest from several institutional investors for those assets but at the moment this has not translated into any formal offer," the Rome-based company said in a statement. In February, Atlantia agreed to buy the remaining 54.2 percent of the Grupo Costanera holding company for 670 million euros ($890 million). In other comments on Friday, Cerchiai said he expected traffic on the group's Italian road toll network to have fallen 10 percent in the first quarter, in line with the first two months of 2011, dragged down by exceptionally bad weather. At 1210 GMT Atlantia shares were up 1.6 percent while the Italian blue-chip index was up 0.77 percent.

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Reuters: Mergers News: India's ONGC to sign gas exploration pact with ConocoPhillips

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India's ONGC to sign gas exploration pact with ConocoPhillips Mar 30th 2012, 11:50 MUMBAI, March 30 | Fri Mar 30, 2012 7:50am EDT MUMBAI, March 30 (Reuters) - India's Oil and Natural Gas Corp and U.S. oil company ConocoPhillips will sign a pact on Friday to explore and develop shale gas and look for opportunities in deepwater exploration, the Indian state-run explorer said in a statement. Details about the partnership, aimed at increasing oil and gas exploration opportunities between the two companies, will be announced at a news conference later on Friday. Global energy majors have been pushing to grab a slice of India's oil and gas reserves and gain exposure to surging demand in Asia's third-largest economy. BP paid $7.2 billion last year to acquire 30 percent stake in 23 oil and gas blocks owned by India's Reliance Industries. UK-listed miner Vedanta Resources has also bought controlling stake in explorer Cairn India in a deal valued around $6 billion. India, the world's fourth-largest oil importer, meets about 80 percent of its crude needs through overseas purchases. It is scouting for oil and gas assets abroad to meet demand in a fast-growing economy, and to feed its expanding refining capacity. ONGC, which has been investing heavily to maintain output from its old fields, has said it aims to raise its crude oil production by 15 percent to 28 million tonnes, or 560,000 barrels per day (bpd), by March 2014. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: UPDATE 3-SK hynix in initial Elpida bid; Micron, Toshiba circling

Reuters: Mergers News Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

UPDATE 3-SK hynix in initial Elpida bid; Micron, Toshiba circling Mar 30th 2012, 10:23 Fri Mar 30, 2012 6:23am EDT * SK hynix says puts in initial bid interest * Micron to bid, Goldman acting as adviser - sources * hynix shares fall 4.1 pct on Nikkei report of Toshiba interest * Toshiba reluctant to take on all Elpida assets-sources By Maki Shiraki and Miyoung Kim TOKYO/SEOUL, March 30 (Reuters) - South Korea's SK hynix said on Friday it has made a preliminary bid for Japan's Elpida Memory, while sources said U.S.-based Micron Technology also plans to enter the fray for taking over the bankrupt memory chipmaker. With sources saying Toshiba Corp too is considering bidding for Elpida, a three-way contest is looming for the Japanese company which last month made the nation's biggest ever bankruptcy filing by a manufacturer after failing to secure a rescue from other chipmakers. SK hynix said it had submitted its initial interest for the bid on Friday, the first deadline for a bid proposal, adding it would decide whether to make a formal bid after conducting due diligence. Several sources with knowledge of the matter told Reuters that Toshiba was considering joining the bidding to take on Samsung Electronics Co, the world's top maker of DRAMs, but that it was reluctant to take on all of Elpida's assets. Toshiba may consider a joint bid with another company, they said, in a move that would make it easier to gain government-backed funding and help cushion the risk. Toshiba wants to avoid exposing itself further to the fluctuations and capital spending requirements of the chip market. Meanwhile, sources told Reuters that Micron plans to submit a bid, and that Goldman Sachs is acting as its financial adviser. Japan's Nikkei daily had initially reported that Toshiba had decided to join the bidding. Toshiba declined to confirm the report, while Micron could not be immediately reached for comment. Toshiba believes that adding Elpida's cell-phone-use DRAMs to its offerings is crucial for its survival in the chip industry, and may seek financial assistance from the government-backed Enterprise Turnaround Initiative Corp of Japan, the Nikkei said. TOSHIBA EDGE SEEN SK hynix's shares ended down 4.1 percent on Friday in a flat Korean market before its announcement. "I think news that Toshiba is in the bidding was adding more pressure to falling shares in Hynix," said Daewoo Securities analyst James Song. "If Hynix takes over Elpida on the cheap, nothing will be better than this because it takes out a potential competitor." Song added, however, that he believed Toshiba was more likely to win because the government is said to prefer a Japanese company to be Elpida's sponsor. Elpida filed for protection from creditors last month with 448 billion yen ($5.45 billion) in debt. It will soon stop accepting applications for the first round of bidding, the Nikkei newspaper said. After the second round at the end of April, a single sponsor will be selected in early May, the paper added. Though other firms such as Intel Corp and Taiwan's Formosa Plastics Group - the parent of Nanya Technology Corp - may join the fray, Toshiba and Micron are likely to become leading contenders, the business daily said. The Korean company's move comes just after it officially launched as SK hynix this week following a takeover of a majority stake in Hynix by cash-rich SK Telecom Co. Hynix's chief executive said earlier this month the company was not interested in Elpida. Toshiba shares ended down 1.9 percent, underperforming a 0.4 percent decline in the broader Tokyo market. Link this Share this Digg this Email Reprints

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Reuters: Mergers News: Micron to bid for Elpida, adviser is Goldman-sources

Reuters: Mergers News Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

Micron to bid for Elpida, adviser is Goldman-sources Mar 30th 2012, 09:22 TOKYO, March 30 | Fri Mar 30, 2012 5:22am EDT TOKYO, March 30 (Reuters) - U.S.-based Micron Technology plans to bid for Japan's Elpida Memory, sources said, likely joining a three-way contest with South Korea's SK hynix and Toshiba Corp to take over the bankrupt memory chipmaker. Goldman Sachs is acting as Micron's financial adviser, the sources said.

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