Wall Street Breakfast: Must-Know News

by: Rachael Granby
Rachael Granby
Seeking Alpha's flagship daily business news summary, gives you a rapid overview of the day's key financial news. It is published before 7:00 AM ET every market day and delivered to over 900,000 email subscribers.

  • BJ's may face hostile bid. BJ's Wholesale (NYSE:BJ) may face a hostile takeover bid if an auction isn't initiated in the coming weeks, as sources say buyout firm Leonard Green & Partners is keenly interested in acquiring the warehouse club operator. BJ's board and management have reportedly promised to initiate an auction after the holidays, but if nothing happens by mid-January, Leonard Green may move forward with a hostile bid. Leonard Green had previously expressed interest in BJ's, but some analysts thought the buyout firm would give up on a bid and focus on its other recent acquisitions, including a $1.6B buy of Jo-Ann Stores (NYSE:JAS) and a partnered buyout of J. Crew (JCG) for $3B.
  • SAP owes Oracle reduced interest payment. A federal judge agreed with Oracle (NASDAQ:ORCL) that SAP (NYSE:SAP) needs to pay interest on a $1.3B award it owes to Oracle following a November copyright-infringement case. However, the judge rejected Oracle's method for calculating the total interest and its claim for $211.7M in 'prejudgment interest.' The judge didn't specify the interest-payment amount, but SAP said it will result in a payment of approximately $16.5M.
  • Tech giants face renewed patent suit. Interval Licensing, a company controlled by Microsoft (NASDAQ:MSFT) co-founder Paul Allen, has revised a high-profile patent lawsuit against several technology giants, including Apple (NASDAQ:AAPL), Google (NASDAQ:GOOG), and Yahoo (NASDAQ:YHOO). A federal judge had dismissed the initial suit earlier this month, saying its allegations weren't specific enough. The revised lawsuit includes a list of specific products and services offered by each of the defendants that allegedly violate Interval's patents. The other defendants are AOL (NYSE:AOL), eBay (NASDAQ:EBAY), Facebook, Netflix (NASDAQ:NFLX), OfficeMax (NYSE:OMX) and Staples (NASDAQ:SPLS).
  • SEC probes private trading. The SEC is reportedly investigating the increasingly popular trading of shares in privately-held companies like Facebook and Twitter, apparently focusing on funds that have been set up to allow investors access to these privately-held shares. The SEC is trying to determine how the funds are able to value shares of private companies which don't publicly disclose their financial information, and whether the funds are circumventing an SEC rule requiring private companies to disclose certain information if they have more than 500 shareholders.
  • BofA sued for fraud. Allstate (NYSE:ALL) filed suit against Bank of America (NYSE:BAC) and its Countrywide unit for fraud, claiming $700M of residential mortgage-backed securities it bought were misrepresented. Allstate said the defendants knew the securities "were a toxic mix of loans given to borrowers that could not afford the properties, and thus were highly likely to default." Former Countrywide executive, including former CEO Angelo Mozilo, are also among the defendants. Allstate is seeking unspecified damages.
  • Confident Groupon looks to raise funds. Privately-held Groupon, flush with confidence after rejecting a reported $6B acquisition offer by Google (GOOG), has filed to raise over $950M in private funds by issuing as many as 30.1M preferred shares for $31.59 each. If all the shares are issued, Groupon's valuation could be as high as $7.8B. The heady valuation underscores growing interest in e-commerce targeted at local markets, and earlier this month Amazon (NASDAQ:AMZN) led a $175M investment into Groupon competitor LivingSocial. Listed peers include ReachLocal (NASDAQ:RLOC) and Local.com (NASDAQ:LOCM).
  • BlackRock to launch trading platform. BlackRock (NYSE:BLK) plans to launch an in-house trading platform next year, helping its clients trade amongst each other without having to go through a Wall Street bank. BlackRock is in the process of hiring programmers and other high-tech workers to build the platform.
  • Blackstone bids for Centro Properties. Blackstone (NYSE:BX) has reportedly joined the bidding war for Centro Properties Group, and has made an indicative bid of unknown size for the Australian shopping-center owner. Sources said Blackstone is primarily interested in Centro's 600 properties in the U.S., consisting of strip malls and neighborhood shopping centers, which were valued at $9.5B as of June 30. Centro is likely to be the center of one of the largest property takeover battles of 2011, and at least one rival bid has already been placed in the range of $16B.
  • Motorola unit sale delayed. Nokia Siemens Network (NOK, SI) said its acquisition of most of Motorola's (MOT) network equipment business will be delayed because Chinese regulators haven't finished reviewing the deal yet. The deal, which has already been approved in the U.S., EU and Japan, will likely close in Q1 2011 instead of in Q4 2010.
  • Icahn approved for Dynegy buy. The Federal Trade Commission cleared Carl Icahn's proposed $665M takeover of Dynegy (NYSE:DYN). The $5.50/share bid must still be approved by the Federal Energy Regulatory Commission.

Today's Markets

  • In Asia, Japan +0.5% to 10345. Hong Kong +1.5% to 22969. China +0.7% to 2752. India +1.1% to 20256.
  • In Europe, at midday, London -0.2%. Paris +0.9%. Frankfurt +0.5%.
  • Futures at 7:00: Dow +0.2%. S&P +0.2%. Nasdaq +0.3%. Crude -0.5% to $91.07. Gold -0.1% to $1404.50.

Wednesday's Economic Calendar

The SA Currents team contributed to this post.

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