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Holly Thompson founded TWM Today to assist clients in reaching their life goals by providing objective financial guidance. Thompson Wealth Management is a fee-only financial advisory firm. We work solely for you and receive no commissions or compensation from any other source. This eliminates... More
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  • TWM Today: Wall Street
    Brazil's Petrobras Will Invest $224 Billion on Offshore Oil ~ Petroleo Brasileiro SA (NYSE:PBR), the Brazilian state-controlled oil company, plans to invest $224B through 2014 as it seeks to develop the Americas’ largest discovery in three decades and more than double output. About 95% of the total amount will be invested in Brazil, the Rio de Janeiro-based company said today in a regulatory filing. Petrobras, which expects to raise $58B through debt and equity sales over the five-year period, said it will spend about $118B on oil exploration and production. Petrobras is seeking to fund the development of offshore reserves in the so-called pre-salt region off Brazil’s coast, home to discoveries including Tupi, the largest find since Mexico’s Cantarell in 1976. Chief Executive Officer Jose Sergio Gabrielli plans to more than double output to 5.38 million barrels a day by 2020, compared with 2.7 million barrels now. The company said it expects oil to average about $80 a barrel through the five-year period and that refining capacity will rise to 3.2 million barrels per day by 2020, from about 1.8 million barrels a day at present. (Bloomberg)

    China's Yuan Rises to Highest Level Against Dollar in Modern Era ~ The yuan rose Monday to its strongest level against the dollar in the currency's modern era as traders bet on the likelihood of long-term appreciation despite the Chinese central bank's surprise move to keep the exchange rate flat ahead of trading. The yuan's rise led to gains in China's stock market, where hopes of a stronger local currency buoyed demand for index heavyweights such as airlines and metals firms, which would likely benefit from lower yuan-denominated prices for imports of raw materials like fuel and iron ore. Yields on Chinese government bonds and local interest-rate swaps also fell on expectations that a stronger yuan will reduce the need for an imminent interest rate hike. The yuan was quoted at 6.8015 to the dollar in China's over-the-counter market Monday afternoon, up strongly from its opening level of 6.8261 and its close on Friday at 6.8262. The 6.8015 level was the yuan's strongest against the dollar since the 1980s, before the currency was allowed to be traded as part of China's market-oriented reforms. (WSJ)

    Anadarko Petro: Breaks Silence and Blames BP for Tragic Spill ~ Oppenheimer notes Friday night, APC issued a statement accusing BP of reckless decisions that caused the rig explosion and the oil spill, which is likely to be one of the largest environmental disasters and probably the most costly ever. In doing so, APC is distancing itself from BP and setting grounds for not paying, or at least reducing, its 25% share of the cleanup costs and future liabilities. The statement came after a rating agency downgraded APC's debt to junk status; in response, BP over the weekend dismissed APC's charges and reiterated its position that according to the operating agreement, its partners, Anadarko and Mitsui, will share in all costs and future liabilities. (Oppenheimer)

    Valeant Pharmaceuticals and Biovail Agree to Merge ~ Valeant (NYSE:VRX) and Biovail (BVF) announced that both companies' Boards of Directors have unanimously approved a definitive merger agreement under which the companies would combine to generate enhanced value for stockholders. The combined company will be called Valeant Pharmaceuticals International. Valeant and Biovail believe the new Valeant's scale, financial strength and complementary product lines will enable it to pursue substantial growth opportunities. The new Valeant, on a 12-month trailing basis as of March 31, 2010, would have experienced double-digit revenue growth. Under the terms of the agreement, Valeant stockholders will receive a one-time special cash dividend of $16.77 per share immediately prior to closing of the merger and 1.7809 shares of Biovail common stock upon closing of the merger in exchange for each share of Valeant common stock they own. The transaction is intended to qualify as a tax-free reorganization for Valeant stockholders. Upon the completion of the merger, which is expected to occur before the end of the year, Biovail stockholders will own approximately 50.5 percent and Valeant stockholders will own approximately 49.5 percent of the shares of the combined company on a fully diluted basis. For Biovail stockholders, this transaction represents a 15 percent premium based on a calculation of the stock prices over the last 10 trading days. (Briefing)

    Disclosure: Long PBR, VRX
    Tags: PBR, APC, VRX, BVF
    Jun 21 10:58 AM | Link | Comment!
  • TWM Today: Wall Street
    KKR May Purchase $400 Million Stake in Texas Shale From Hilcorp ~ KKR & Co (NYSE:KKR), the buyout firm run by Henry Kravis and George Roberts, may purchase about $400 million of Texas shale assets from Hilcorp Energy Co., two people with direct knowledge of the talks said. KKR and Hilcorp, a closely held exploration and production company based in Houston, may partner to develop the formation known as Eagle Ford in the southern part of the state, which has unconventional gas deposits, according to one of the people who declined to be identified because the deal is private. KKR’s purchase of a stake may be announced as early as today, the person said.  (Bloomberg)

    AT&T Blames iPad Incident on 'Malicious' Hackers ~ AT&T Inc. (NYSE:T), reaching out to iPad users Sunday to explain why their email addresses were released last week, blamed the incident on "computer hackers" who "maliciously exploited" an attempt by the carrier to speed the process of logging in to its website. The comments were the harshest yet by the carrier, which apologized for the security lapse and said it would cooperate with any efforts to investigate or prosecute the breach."AT&T takes your privacy seriously and does not tolerate unauthorized access to its customers' information or company websites," the company said. group of computer experts calling itself Goatse Security uncovered the flaw and then turned the results over to Gawker Media LLC to be made public last week. Escher Auernheimer, a member of the group, said in a blog post overnight that it acted to protect users and chided AT&T for taking several days to inform customers after becoming aware of the security breach. (WSJ)

    Cablevision to Buy Bresnan for $1.3 Billion ~ Cablevision Systems (NYSE:CVC) plans to buy Bresnan Communications, majority-owned by private equity firm Providence Equity Partners, for about $1.3 billion, a source familiar with the situation said on Sunday.  The deal is expected to announced on Monday, said the source, who declined to be identified because they were not  authorized to speak with the media. Bresnan, Cablevision and Providence could not be immediately reached for a comment. Bresnan, which was founded in 1984, provides communications services such as high-speed Internet access, high-definition television, video on demand, and digital telephone service to residential and business customers. Bresnan serves more than 320,000 customers in Colorado, Montana, Wyoming and Utah, according to its website. The company's auction follows last year's death of founder William Bresnan. Cablevision beat out a competitive field of suitors that included six other bidders in the final round last week, the source said. Other suitors included Suddenlink Communications and media mogul John Malone, said the source.  (NASDAQ:CNBC)

    U.S. Identifies Vast Riches of Minerals in Afghanistan ~ The United States has discovered nearly $1 trillion in untapped mineral deposits in Afghanistan, far beyond any previously known reserves and enough to fundamentally alter the Afghan economy and perhaps the Afghan war itself, according to senior American government officials.  The previously unknown deposits — including huge veins of iron, copper, cobalt, gold and critical industrial metals like lithium — are so big and include so many minerals that are essential to modern industry that Afghanistan could eventually be transformed into one of the most important mining centers in the world, the United States officials believe. An internal Pentagon memo, for example, states that Afghanistan could become the “Saudi Arabia of lithium,” a key raw material in the manufacture of batteries for laptops and BlackBerrys. The vast scale of Afghanistan’s mineral wealth was discovered by a small team of Pentagon officials and American geologists. The Afghan government and President Hamid Karzai were recently briefed, American officials said.While it could take many years to develop a mining industry, the potential is so great that officials and executives in the industry believe it could attract heavy investment even before mines are profitable, providing the possibility of jobs that could distract from generations of war. (NYSE:NYT)

    Disclosure: No Positions
    Tags: KKR, T, CVC
    Jun 14 11:06 AM | Link | Comment!
  • TWM Today: Wall Street
    Beige Book: US Economy Continues to Improve Modestly  ~ U.S. economic activity improved nationwide last month, but worries about Europe's debt crisis dented confidence, the Federal Reserve said in its Beige Book collection of anecdotal reports.  "Economic activity continued to improve since the last report across all twelve Federal Reserve districts, although many districts described the pace of growth as 'modest,'" the central bank said. The report, compiled by the Chicago Fed based on information collected through May 28, showed consumer and business spending picking up and the job market improving slightly, while inflation remained in check.  (NASDAQ:CNBC)

    Caremark to Stop Reimbursing for Walgreen Prescriptions ~ The CVS Caremark Corporation (NYSE:CVS), the pharmacy benefits manager and drugstore chain, said on Wednesday that it would will end the participation of a rival, Walgreen (WAG), in its retail pharmacy network starting in a month.  The move means that people whose prescription drug benefits are handled by Caremark will not be reimbursed for prescriptions filled at Walgreen pharmacies. Walgreen said in a statement that it expected essentially all of its more than 7,000 stores to be out of Caremark’s commercial network in 30 days. Caremark, which is based in Woonsocket, R.I., said it would also end Walgreen’s participation in its Medicare Part D retail pharmacy network on Jan. 1. Walgreen, based in Deerfield, Ill., is the country’s largest drugstore chain based on locations and revenue, slightly ahead of CVS Caremark. Caremark is one of the largest pharmacy benefits management networks. It negotiates contracts with employers and handles the drug benefit part of their health plans, paying pharmacies to fill prescriptions. It saves money by negotiating volume discounts. Walgreen wants to be paid more for filling prescriptions, while Caremark makes money by reducing costs for plan members and sponsors. The companies had been in negotiations for months, although CVS now says Walgreen refused to negotiate in good faith.  (NYSE:NYT)

    Target Corp. Raises Dividend ~ Target Corp. (NYSE:TGT) raised its quarterly dividend 47% to 25 cents a share, saying its cash generation is far more than needed "for optimal reinvestment in our core business."  (WSJ)

    Bernanke: Europe's Debt Crisis Won't Derail U.S. Recovery ~ The European debt crisis is likely to have only a "modest" impact on the U.S. economic recovery as long as Wall Street stabilizes, Federal Reserve Chairman Ben Bernanke told Congress on Wednesday. Testifying before the House Budget Committee, Bernanke struck a more confident tone that the recovery will remain intact despite problems in Europe as well stubbornly high unemployment and a fragile housing market here at home. "The economy ... appears to be on track to continue to expand through this year and next," Bernanke said. (IBD)

    Disclosure: Long TGT
    Tags: CVS, WBA, TGT
    Jun 09 4:59 PM | Link | Comment!
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