Under The Radar News - Friday

by: SA Eli Hoffmann
  • Smooth sailing from here - Goodhart. Global central banks have managed to avert the worst of the fallout from a freeze-up in credit markets, former BoE policy maker Charles Goodhart says. He thinks the most likely scenario over the coming months is that confidence and risk-appetite will return.
  • Blu-ray Xbox on the way? Chinese language media reports Microsoft (NASDAQ:MSFT) has ordered Xbox 360s equipped with Blu-ray Disc drives. Shipments are expected to begin in Q3.
  • Instant replay. Major movie studios (VIA, LGF, MGM) are following Disney's (NYSE:DIS) lead, and will allow Apple's (NASDAQ:AAPL) iTunes to sell downloaded versions of movies the same day new DVDs are released. Not great news for movie rental companies (NASDAQ:NFLX) (BBI).
  • TPG may go after RBS insurance arm. Private-equity firm TPG is taking a look at Royal Bank of Scotland's (NYSE:RBS) £8B insurance unit. The move would be another indication that a lack of funds for leveraged buyouts is slackening.
  • CIT tries to stave off derailment. In its mad dash to replenish its balance sheet, CIT Group (NYSE:CIT) is shopping its railcar leasing business. GATX (GMT), which leases railcars, is said to be interested.
  • House advise on Sirius/XM merger. Senior House Democrats say XM (XMSR) and Sirius (NASDAQ:SIRI) must agree to certain conditions to protect consumers if the FCC is to approve their merger: 1) The merged company must adhere to at least the pricing conditions they have already pledged to (duh!). 2) They must allow device makers to develop receivers that deliver the company's signal.
  • Is Dolan shooting Cablevision in the foot? Some cynics think Cablevision Systems's (NYSE:CVC) CEO James Dolan's courtship of Newsday is aimed at punishing shareholders for rejecting the family's buyout offer. They say the Dolans want to deflate share prices until their offer looks attractive, or perhaps even come in with a lower bid. "All jokes aside, Cablevision buying Newsday would have the bad smell of empire building and far outweigh any strategic benefits to Cablevision," Pali Capital's Rich Greenfield says.
  • Argentine bonds, down 19% since December, indicate the market thinks country will default for the second time this decade. Funds impacted could include Templeton Emerging Markets Income Fund (NYSE:TEI), Morgan Stanley Emerging Market (NYSE:EDD), and Morgan Stanley Emerging Market (NYSE:MSD), which hold 9.68%, 5% and just under 2% in Argentina.
  • Tennis anyone? Westin (HOT) and Nintendo (OTCPK:NTDOY) are teaming up to offer a special-edition Wii console in at least ten U.S. Westin Hotels. The partnership represents a clever and unique new way for Nintendo to snag U.S. customers.
  • Can Axle and UAW strike deal? Sources say a deal between sidelined car parts supplier American Axle & Manufacturing (NYSE:AXL) and the UAW is starting to take shape. The strike has cost GM (NYSE:GM) $800M.
  • iPhone move over. Garmin (NASDAQ:GRMN) asked customers in a survey if they would be inclined to purchase a Nuvifone offered by AT&T (NYSE:T) for a 2-year subsidized price of $499, with a $20/month data fee that includes unlimited browsing and GPS navigation.
  • Top-five handset vendors' profits shrinking. "Their income actually shrank" even as market share grew, analyst Tom Kang says. "An internal focus of cost-cutting and growing scale has drained off resources that should have been channeled into competitive assets for use in the new market landscape. It is no surprise that these same vendors are now struggling to find a viable strategy in this new market paradigm. RIM (RIMM), on the other hand, has only 1% of the volume market, but was able to earn 6% of the industry profits, which raises them up to the number four spot."
  • DRAM chicken game: only victims. Market-leader Samsung's high-stakes game of chicken, as it continues to boost its DRAM production, is killing its competitors, and itself. iSuppli feels the DRAM market has bottomed. (MU, QI).