U.K.'s Amec to buy Foster Wheeler for $3.1B. U.K. engineering company Amec (OTC:AMCBF) has provisionally agreed to acquire Swiss peer Foster Wheeler (FWLT) for £1.9B ($3.13B) in cash and stock. The latter's shareholders will receive 23% in Amec, which will seek a U.S. listing. The transaction will position Amec "to serve across the whole oil and gas value chain," the company said, "adding mid and downstream capabilities to Amec's existing upstream focus and bringing new customer relationships."
GM close to reinstating dividend. General Motors (NYSE:GM) is "the closest it has been" to issuing its first dividend since the financial crisis, CFO Dan Ammann said yesterday, ahead of today's official start of the Detroit Auto Show. "It's clear to us that investors are anticipating a dividend," said Ammann, who was speaking at the unveiling of the GMC Canyon mid-sized pick-up truck. GM hopes that the vehicle will pull sales from Ford's (NYSE:F) F-150, Chrysler's (FIATY) Ram 1500 and Toyota's (NYSE:TM) Tacoma, the market leader.
Top Stock News
VW to pump $7B into North America. Volkswagen (OTCPK:VLKAF) intends to invest $7B over five years in North America, including using the money to build a new factory, although it hasn't yet decided on a location. VW also intends to design a seven-seater sport utility vehicle specifically for the region as it looks to increase overall U.S. sales to 1M units from 600,000 in 2013. The VW brand has enjoyed fast growth in the U.S. in recent years, although sales fell in 2013.
Regulators ease Basel leverage ratio requirements. The Basel Committee for Banking Supervision has eased the way banks will have to report leverage ratios, or the amount of capital they will have to hold against their loans and other assets. The regulations will not now force banks to count 100% of their off-balance-sheet assets, such as much of their exposure to derivatives, guarantees and letters of credit. The news helped boost bank stocks in Europe, with the Stoxx Europe 600 Banks index +1.4% at the time of writing.
Hackers attacked a number of retailers, not just Target. Major retailers other than Target (NYSE:TGT) were the victims of cyber-attacks on customer credit-card data during the holiday season, with Reuters reporting that hackers breached at least three well-known chains using methods similar to those used on Target. The assaults are in addition to one on Neiman Marcus, which said on Friday that it is looking into the theft of data from customer payment cards.
Men's Wearhouse boosted in merger battle with Jos. A. Bank. Eminence Capital, which is Men's Wearhouse's (MW) largest shareholder with a stake of almost 10% and which owns nearly 5% in Jos. A. Bank Clothiers (NASDAQ:JOSB), reportedly intends to back Men's Wearhouse's hostile $1.6B offer for the smaller clothing retailer. Eminence's move will make it more difficult for Jos. A. Bank to defend itself and to succeed with its own bid for Men's Warehouse.
Sony's American Hustle enjoys good night at Golden Globes. Sony's (NYSE:SNE) "American Hustle" has picked up three Golden Globes, the most for any film this year, while Fox's (NASDAQ:FOXA) "12 Years a Slave" won the coveted award for best drama. The achievements set both films up nicely for the Oscars - the nominations for which are due out on Thursday - and should help boost their box office receipts. The awards for "American Hustle" come as Sony's film unit operates under intense scrutiny, particularly from Dan Loeb.
Discovery ends talks to buy Scripps. Discovery Communications (NASDAQ:DISCA) has reportedly ended negotiations to acquire Scripps Networks Interactive (NYSE:SNI), with the family that controls the latter apparently not ready to sell. Discovery will now return its focus to expanding overseas, including increasing its 20% stake in Eurosport. A deal would have combined Discovery's stable of "lifestyle-driven" channels with Scripps' Food Network, HGTV and the Travel Channel.
Sanofi moves deeper into genetic diseases with $700M deal. Sanofi (NYSE:SNY) has agreed to acquire a 12% holding in Alnylam Pharmaceuticals (NASDAQ:ALNY) for $700M in a deal that will also deepen the companies' co-operation in the development of therapies for rare genetic diseases. Part of the agreement includes Sanofi and Alnylam expanding their partnership involving Patisiran, a development-stage treatment for a rare life-threatening nervous-system disease. The deal comes after Sanofi suffered a patent cliff in which it lost IP protection on nine drugs in three years.
BP to fight on despite Gulf compensation setback. BP (NYSE:BP) will continue its battle against "inflated, exaggerated or wholly fictitious" compensation claims related to the 2010 Deepwater Horizon disaster, the oil company said. BP's comments come after the 5th U.S. Circuit Court of Appeals on Friday upheld Judge Carl Barbier's approval of a multibillion-dollar settlement agreement over the company's objections. BP is fighting Barbier's ruling that it has to pay businesses that weren't directly affected by the disaster.
Top Economic & Other News
Iran-P5+1 nuclear agreement to come into force next week. The six-month agreement by which Iran will scale back its nuclear program in return for $6-7B worth of sanctions relief will start being implemented on January 20. Shortly afterwards, Iran and the P5+1 world powers will begin talks over a final deal. Plenty of stumbling blocks exist, including an Iranian parliamentary bill that calls for the country to enrich uranium up to 60%. Crude oil was lower at the time of writing.
Top Idea Stock Movers and Great Calls
1) On Thursday, Value Advisors called IXYS Corporation (NASDAQ:IXYS) a buy, as the introduction of new products and increased demand for legacy offerings helped drive the bull-case for the power management semiconductor company. The stock is +8.4% since. Read article »
2) On June 4, Tim Travis argued that an equity issuance could fuel Fiesta Restaurant Group's (NASDAQ:FRGI) next leg of growth. The company has followed that plan and shares are +38% to date. Read article »
Top Idea Stocks To Watch
1) Energy expert Richard Zeits says SandRidge Energy's (NYSE:SD) recent asset sale reinforces the case for possible downside and multiple contraction. Read article »
2) TechTarget (NASDAQ:TTGT) has slipped under the radar compared with Big Data peers, but its primary business is set to return to growth and drive upside. Read article »
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In Asia, Japan +0.2% to 15912. Hong Kong +0.2% to 22889. China -0.2% to 2010. India +1.8% to 21134.
In Europe, at midday, London flat. Paris +0.1%. Frankfurt +0.2%.
Futures at 6:20: Dow -0.1%. S&P -0.3%. Nasdaq -0.3%. Crude -0.7% to $92.11. Gold -0.1% to $1245.60.
Ten-year Treasury Yield flat at 2.85%.
Today's economic calendar:
2:00 PM Treasury Budget
Notable earnings before today's open: XRTX
Notable earnings after today's close: DRWI
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