Today - Tuesday, March 31, 2015
- Media General (NYSE:MEG) says its secondary offering of 6.8M shares has been priced at $16/share by the selling stockholder.
- Underwriters also got an option to purchase up to an additional 1.02M shares. The company won't receive any proceeds.
- The offering's expected to close April 7.
- Today: MEG -1.8% to $16.49.
- Rock-Tenn (NYSE:RKT) -5.1% AH after issuing downside Q2 EPS guidance of $0.70-$0.75, reduced from its previous outlook for $0.80-$0.90 and below $0.88 analyst consensus estimate.
- RKT says strong corrugated packaging business has been more than offset by the effects of winter weather including natural gas curtailment and challenging logistics execution which hit EPS by ~$0.06; a substantial electrical failure at the Panama City mill that resulted in lost production and increased maintenance costs of ~$0.04/share; and lower promotional activity that reduced sales in its merchandising displays business below the year-ago quarter.
- The Vicks VapoSteam U.S. liquid inhalant business had 2014 revenue of $10M. Helen of Troy (NASDAQ:HELE) has acquired it from Procter & Gamble (NYSE:PG) for an undisclosed sum. The acquisition is expected to be paid for via HELE's revolving credit facility, and to be accretive in FY16 (ends Feb. '16).
- As part of the deal, HELE has "acquired a fully paid-up license of P&Gs Vicks VapoPad trademarks for scent pads in the United States." The company notes "the vast majority of Vicks VapoSteam and VapoPads are used in Vicks humidifiers, vaporizers and other health care devices already marketed by Helen of Troy."
- Discovery Communications (NASDAQ:DISCA) has closed on its deal to buy Eurosport France, moving to 51% control from its previous minority stake.
- The move brings some completion to the network's deal last year to take control of Eurosport International, which didn't include the French operation.
- With consolidation complete, Discovery CEO David Zaslav says he expects the Eurosport group to reach 1M subscribers in the next two years (from its current 200K), to the tune of an extra $100M in revenues.
- It's another sports move for Discovery, which has been moving further into international sports in search of growth "as things taper here in the U.S.," Zaslav says. Eurosport International operates six all-sports pay channels.
- In the nick of time before all-out liquidation, RadioShack (OTCPK:RSHCQ) has won court approval for Standard General's rescue deal that will permit it to save 1,743 stores and 7,500 jobs.
- Despite objections from competing lender Salus Capital Partners, Judge Brendan Shannon said Standard General offered more money (about $160M) and was the only bidder with the “added and terribly important benefit of saving more than 7,000 jobs and preserving a century-old American retailing icon."
- The 1,743 stores represent a substantial slimming from the Shack's overwhelming 4,000 stores; Standard General intends to operate the remaining stores along with Sprint (NYSE:S).
- Salus has first claim on RadioShack's IP, including trademark, patents and customer lists.
- The sale will likely leave nothing (or very little) for any unsecured creditors. The firm is estimated to owe them about $500M.
- Online craft marketplace Etsy (Pending:ETSY) will kick off its IPO roadshow tomorrow as it files to sells 16.67M shares (13.33M shares with 3.33M additional coming from selling stockholders) and expects a range of $14-$16/share.
- At the top end of that range, the firm would raise almost $267M.
- While Etsy was previously valued at nearly $700M, its revenue numbers suggest a current valuation that may be north of $1B.
- Previously: Etsy files for IPO, reports strong revenue growth (Mar. 04 2015)
- Previously: Bloomberg: Etsy working with banks on IPO (Jan. 13 2015)
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- Nasty Gal opens its second brick-and-mortar store with an outlet in Santa Momica, California.
- The online fashion concept mixes vintage clothes with hip lines.
- Nasty Gal brought in a new round of Series C funding last month and continues to be closely watched for M&A or IPO developments.
- The presence of Ron Johnson as a backer also keeps it in the spotlight.
- Previously: Funding and some Ron Johnson wisdom for Nasty Gal (Feb. 27)
- Airline stocks are on watch this week and next with the new round of monthly traffic and sales reports due out.
- UBS and Credit Suisse both think passenger revenue per available seat mile fell during Q1.
- Fares have been strong for the early part of the year, but capacity gains in some key markets is chipping away at efficiency.
- JetBlue (NASDAQ:JBLU), Alaska Airlines (NYSE:ALK), and Southwest Airlines (NYSE:LUV) have added the most capacity on a percentage basis of the major carriers.
- American Airlines Group (NASDAQ:AAL) has held capacity level.
- Previously: U.S. airlines fares rise in February (Mar. 24 2015)
- Charter Communications (NASDAQ:CHTR) is up 6.2% and has touched a record-high $199 in the wake of its deal to acquire Bright House Networks, which would make it the country's No. 2 cable operator (Charter is now No. 4; Bright House is No. 6).
- The deal's dependent on Comcast's (NASDAQ:CMCSA) successful pursuit of Time Warner Cable (NYSE:TWC) -- Charter's own bid for TWC fell apart, and Charter could step back in if Comcast's plan falters -- and if Comcast takes such a clear lead, Charter may not stop at Bright House in trying to catch up.
- Mediacom, CableOne and Suddenlink could be the next targets. "I think it is inevitable most of the rest of the cable industry not owned by Comcast is sold to Charter," Pivotal Research Group analyst Jeff Wlodarczak tells Reuters.
- As for John Malone, his Liberty Broadband (NASDAQ:LBRDA) -- Charter's biggest shareholder -- has agreed to purchase $700M of shares in the Charter/Bright House combo, in transactions that would leave it with voting power of about 25%.
- Charter bonds picked up on the news as well.
- "We think HBO Now is something of a millennial missile," says HBO (NYSE:TWX) CEO Richard Plepler to CNBC, pointing to their target: 10M broadband-only U.S. homes that are "largely a millennial audience."
- To reach that audience and push the $14.99/month direct streaming service, he says HBO will definitely target social media ("29M people watched the Game of Thrones trailer alone on Facebook"), and it's a long-term play ("We're not looking at this as a 2015 revenue expansion; we're looking at this as focusing on our future").
- Plepler again fended off worries about threats to existing partnerships: "We see this as an expansion of the pie, not cannibalistic at all of our current business."
- Cablevision is the only pay-TV partner to re-sell HBO Now so far, but other partners will get on board, Plepler predicts, because it's good for business: "Nobody's doing us any favors selling HBO. They're selling HBO because it expands their businesses and they're selling HBO because it's a great product."
- He noted that in picking Apple as the key launch partner, the company looked at HBO Go, its provider-tethered offering, and saw 60% of usage on Apple devices.
- Previously: Cablevision becomes new launch partner for HBO Now (Mar. 16 2015)
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