- Credit Suisse sells CoCo bonds. Credit Suisse (NYSE:CS) agreed to sell around 6B Swiss francs ($6.2B) of contingent convertible bonds to Qatar Holding LLC and The Olayan Group. The notes, which will be issued no earlier than October 2013, will convert into ordinary shares if Credit Suisse's reported Basel III common equity Tier 1 ratio falls below 7%. Though the Swiss government had proposed that Credit Suisse and UBS (NYSE:UBS) double the capital required by Basel III and use CoCo bonds to satisfy part of the stricter requirement, some analysts find the timing of Credit Suisse's move unusual, as guidelines for the use of the instruments haven't been finalized yet. Premarket: CS +2.3% (7:00 ET).
- EchoStar to buy Hughes Communications. EchoStar (NASDAQ:SATS) agreed to buy broadband satellite network provider Hughes Communications (NASDAQ:HUGH) for around $2B, or $60.70/share, including the assumption of debt. The deal is a 31% premium to Hughes' unaffected share price on Jan. 19, but a 1.7% discount to Hughes' closing price on Friday.
- Nokia to get billions from Microsoft. Nokia (NYSE:NOK) CEO Stephen Elop said his company will get 'billions of dollars' from Microsoft (NASDAQ:MSFT) in the early years of their partnership, with the money meant to help Nokia market and develop phones using Microsoft's Windows Phone operating system. Elop also said Nokia will see 'very substantial reductions' in operating expenses, including from layoffs, since it will need to spend less developing mobile software on its own. Shares of Nokia fell 14% on Friday on concerns the company's deal favored Microsoft and would fail to turn the company around; despite Elop's efforts at reassurance, shares are down another 3.3% premarket.
- GE buys Wood Group's well support. GE (NYSE:GE) agreed to buy the well support division of John Wood Group for around $2.8B. The acquisition gives GE's oil and gas unit entry into the fast-growing market for equipment to recover oil from mature fields, and extends the company into unconventional oil and gas production. The deal also continues a recent string of acquisitions by GE's oil and gas unit, which in December agreed to buy U.K. oil and gas services company Wellstream Holdings for $1.3B.
- P-E firm nears Emergency Medical purchase. Private-equity firm Clayton Dubilier & Rice is reportedly close to buying Emergency Medical Services (NYSE:EMS) in what could be one of the largest leveraged buyouts this year. A deal for Emergency Medical, which said in December that it was reviewing its strategic alternatives, could be announced as soon as today. Emergency Medical has a market capitalization of $3.1B. **Update, 7:05 ET: Emergency Medical Services to be acquired by Clayton Dubilier & Rice for $64/share in cash. The deal is worth $3.2B. Premarket: EMS -8.4% to $64.74. (PR)
- Japan's GDP shrinks less than expected. Japan's GDP fell an annualized 1.1% in Q4, as exports slowed and government stimulus programs faded. The contraction was less severe than the 2% drop economists had expected, and the pullback may prove to be temporary as foreign demand lifts Japan's domestic production. The contraction means that China has officially surpassed Japan as the second-largest economy after the U.S., though the economies of Japan and China combined are still smaller than the U.S.' 2010 GDP of $14.66T.
- Sanofi, Genzyme inch closer to deal. Sanofi-Aventis (NYSE:SNY) has reportedly concluded its review of Genzyme's (GENZ) financial books and operations, but still isn't ready to make the deal announcement many had expected to hear about last week. Though Sanofi didn't find any 'major issues' in its review, it may still try to adjust its offer based on details gleaned from the closer look. Sanofi's $69/share tender offer for Genzyme expires tomorrow, but might be extended for a third time. In the meantime, Sanofi is said to be studying four acquisitions in the ophthalmology sector worth around €1B ($1B) overall. Premarket: SNY -0.6% (7:00 ET).
- Siemens looking to expand power networks. Siemens (SI) is looking for large acquisitions to expand its power networks business and plant automation business. The purchases would mark a fundamental strategic shift for the company, which in recent years has been focused on restructuring, margin expansion and internal growth. Siemens says it has reached the 'management maturity' to pursue significant takeovers, and the company, like many U.S. and European peers, is looking for ways to spend the significant cash pile built in the wake of the financial crisis. Premarket: SI -0.4% (7:00 ET).
- Friday's failures. Four more bank failures bring this year's total closures to 18 so far. The failures in Florida, Michigan, Wisconsin and California will cost the FDIC's insurance fund an estimated $145M.
- In Asia, Japan +1.1% to 10726. Hong Kong +1.3% to 23121. China +2.5% to 2899. India +2.7% to 18202.
- In Europe, at midday, London -0.2%. Paris -0.2%. Frankfurt +0.2%.
- Futures at 7:00: Dow flat. S&P -0.1%. Nasdaq flat. Crude +0.1% to $85.63. Gold -0.1% to $1358.60.
Monday's Economic Calendar
10:00 NAHB Housing Market Index
10:00 Fed's Dudley: 'Household Debt and Economic Activity'
- Notable earnings before Monday's open: MFA, MGM, STEC
- Notable earnings after Monday's close: A, LLNW, MAR, MAS, WLT
The SA Currents team contributed to this post.
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