Groupon IPOs with market cap of $12.65B. The frenzy for Internet IPOs will compete with the frenzy surrounding Greece in market trading today as Groupon (NASDAQ:GRPN) makes its Nasdaq debut after selling shares for $20 each, a steep mark-up from a range of $16-$18 earlier this week. The price gives the loss-making daily deals site a value of $12.65B, above Xerox (NYSE:XRX), for example. As with LinkedIn (NYSE:LNKD), Groupon stoked demand by only offering a small percentage of its shares. And despite increasing that yesterday, the company is selling just 6.3%, which will net it up to $805M.
G20 may let IMF print money to help solve EU debt crisis. The G20 is considering allowing the IMF to print up to $250B more of its special currency to help resolve the eurozone crisis, The Wall Street Journal reports. However, for the IMF to issue the Special Drawing Rights, which are IOUs that countries can exchange for cash, the EU has to finalize a credible strategy to solve its problems. The SDRs would theoretically help assure investors that countries such as Italy had a pool of reserves it can tap in an emergency, and so lead to lower borrowing costs. The IMF would become a lender of last resort, a role the ECB is conspicuously refusing to take on.
Greek PM bullied into dropping referendum plan. The latest cliff-hanger in the Greek debt soap opera is due to take place today with a vote of confidence in parliament. The vote comes after huge international and domestic pressure forced Prime Minister George Papandreou to drop his plan for a referendum over Greece's eurozone membership and bailout. Meanwhile, Italy's transfiguration into Greece has taken another step, with Reuters reporting that Italy will allow the IMF and EU to monitor its progress in meeting pension, labor and structural reform goals. "We need to make sure there is credibility with Italy's targets," an EU source says. Just like they did with Greece.
Diamonds aren't forever for Oppenheimers. Anglo American (OTCPK:AAUKF) has agreed to buy the Oppenheimer family's 40% stake in De Beers for $5.1B, thereby increasing its stake to 85% in the diamond miner. However, the Botswana government has a pre-emption right over the Oppenheimer holding that would lift its stake to 25% and limit Anglo American to 75%. The sale will end the Oppenheimers' 80-year association with De Beers.
Net hiring expected to have slowed in October. October non-farm payroll data is due out this morning, with economists estimating that the net hiring rate slowed to 95,000 from 103,000 in September, leaving unemployment at 9.1% for the fourth month in a row. One reason for the decline, as a Commerce Department blog shows, is that state and local governments are shedding jobs at the same pace the private sector is adding them.
EU investigates J&J's purchase of Synthes. The EU Commission has opened an in-depth antitrust probe into Johnson & Johnson's (NYSE:JNJ) $21.3B purchase of Synthes. "The proposed acquisition would remove a competitor from some markets which are already concentrated. The Commission needs to make sure that effective competition is preserved," Commisioner Joaquin Almunia said. The regulator has until March to make a final decsion.
SEC probes possible insider trading at MF Global. The SEC is reviewing trades in MF Global's (OTC:MFGLQ) convertible bonds to determine whether some investors sold the debt based on insider information before the firm collapsed, Bloomberg reports. Investigators are partly focusing on trades made ahead of announcements that MF’s credit rating had been downgraded. Meanwhile, the Commodity Futures Trading Commission has subpoenaed MF auditor PWC for information on the segregation of client assets as the regulator continues to hunt for $633M missing from customer accounts.
Delphi to raise $550M in IPO. In Groupon's (GRPN) rear-view mirror is Delphi Automotive, which plans to raise $550M in its IPO, although this is down from an initial goal of over $1B, Bloomberg reports. GM's (NYSE:GM) former parts unit will set terms today and start pitching to investors next week with the aim of pricing the float on Nov. 16. Trading under the "DLPH" ticker would start a day later.
BofA mulls u-turn on stock issue. Despite asserting for months that it wouldn't need to issue new shares, Bank of America (NYSE:BAC) yesterday said it may swap preferred securities for a total of $6B in common stock and debt. BofA would issue up to 400M common shares and $3B of senior notes to exploit the lower prices for its existing securities. The move would save money on interest payments on the preferred shares, but Rochdale analyst Richard Bove was unimpressed with the prospective u-turn. "They said they wouldn’t issue stock, and this may be one too many statements to investors that didn’t turn out true," Bove said.
Schultz bullish as Starbucks continues to grow. Starbucks (NASDAQ:SBUX) again brushed off the weak economy and higher costs in FQ4 as EPS rose to $0.37 from $0.32 while sales climbed 7% to $3B, with both metrics topping analyst forecasts. New drinks and food products, an expanded loyalty program, and a 20% increase in its consumer products business helped boost earnings, Starbucks said. CEO Howard Schultz was bullish about the future, saying that Starbucks "has never been stronger or better positioned for sustained, profitable growth than it is today." Investors bought Schultz's spiel and shares rose 3.1% post-market.
AIG net loss widens to $4.1B. Declining equity markets and interest rates helped AIG's Q3 net loss to increase more than expected to $4.1B from $2.52B a year earlier. The loss was AIG's biggest since 2009, with the earnings also hampered by fair-value losses for AIA and Maiden Lane III, disaster payments, and a significant charge on the company's fleet of older aircraft.
Japan gives TEPCO ¥1T. TEPCO (OTCPK:TKECF) has received a ¥1T ($12.8B) financial assistance package from Japan's government aimed at preventing a cash crunch at the beleaguered company. The money will help the utility pay compensation to people and businesses affected by the nuclear disaster triggered by the March 11 earthquake and tsunami.
In Asia, Japan +1.9% to 8801.4. Hong Kong +3.1% to 19843. China +0.8% to 2528. India +0.5% to 17563.
In Europe, at midday, London +0.7%. Paris -0.1%. Frankfurt -0.3%.
Futures at 7:00: Dow -0.1%. S&P -0.2%. Nasdaq -0.3%. Crude +0.7% to $94.76. Gold -0.3% to $1760.10.
Friday's economic calendar:
Monster Employment Index
8:30 Nonfarm Payrolls
Earnings Results: Companies that beat EPS expectations last night and today include CBS (CBS), Chesapeake Energy (CHK), LinkedIn (LNKD), InterMune (ITMN), Genworth Financial (GNW), Seattle Genetics (SGEN), Starbucks (SBUX), SunPower (SPWRA).