Seeking Alpha
  • Friday, May 22, 2015

  • 4:00 PM
    • Citigroup's (NYSE:C) consumer-banking units in Costa Rica and Panama could go for about $1.1B, according to a Bloomberg source.
    • A sale - and Scotiabank (NYSE:BNS) is still conducting due diligence - would be the second such deal between the two lenders in six months. Scotiabank agreed in December to buy Citi's Peru operations (it closed this month).
    • Citi and Spain's Banco Popular earlier this year broke off talks for a sale of all of Citi's Central American retail businesses.
    • Scotiabank operates in more than 55 countries in LatAm, the Caribbean, and Asia, and has targeted spots like Mexico, Colombia, Chile, and Peru as those offering the best opportunities for growth.
    • Source: Bloomberg
  • 3:19 PM
    • FXCM (FXCM -6.9%) will assume the vast majority of margin forex accounts of CitiFX Pro, which traded over $30B on average per month in 2014. The transfer will take place after the close of trade on June 26.
    • The stock's sharp decline today looks to be the continuation of a trend rather than having anything to do with this news (FXCM likely got a pretty decent deal).
    • SEC Form 8-K
  • 12:47 PM
    • Blackstone (NYSE:BX) Senior Managing Director Doug Ostrover was one of three co-founders of GSO, the company's alternative credit platform which Blackstone bought in 2008 and which now has AUM of $75B. He will remain as a senior advisor, but is also starting a family office to manage his considerable wealth.
    • The FT notes investor fears of a series of top management exits from Blackstone as a number faced lock-up periods of up to eight years after the IPO and June 2015 marks eight years. "“There has been so much wealth generated for a whole generation,” says one partner.
    • Source: Press Release
  • 12:10 PM
    • Welcome back my friends to the show that never ends ...The New York Department of Financial Services is probing more abuse of forex markets by the banks - this time by the use of automated trades driven by computer algorithms, reports the FT.
    • Findings could indicate more widespread abuse than what U.S. and U.K. authorities disclosed on Wednesday (along with nearly $6B in fines and a number of guilty pleas). Sources remind that this week's charges related to manipulation performed by bank employees, but this probe covers electronic trading, which accounts for the majority of forex transactions.
    • Trading platforms under the scope include those from Barclays (NYSE:BCS) and Deutsche Bank (NYSE:DB), and information has been subpoenaed from BNP Paribas (OTCPK:BNPQF), Credit Suisse (NYSE:CS), Goldman Sachs (NYSE:GS), and SocGen (OTCPK:SCGLY).
    • The investigation into Barclays is the most advanced, but DFS has initially reached similar nefarious conclusions about the goings-on at Deutsche too. The probes of the other lenders are at even earlier stages.
    • Previously: Lawsky stepping down as New York's top bank regulator (May 20)
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  • 10:31 AM
    • Strategic Hotels (NYSE:BEE) and its JV partner sell the Hyatt Regency La Jolla for $118M. BEE's interest in the property was 53.5%. The JV retired $89.2M of debt secured by the hotel at closing.
    • BEE will use the proceeds to pay down its revolver.
    • Source: Press Release
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  • 10:10 AM
    • Deutshce Bank downgrades J.G. Wentworth (JGW -5.3%) to Hold from Buy with price target cut to $11 from $13. Noted by the bank are rising long-term interest rates as cutting into margins, and the idea that investors will stay on the sidelines until earnings growth emerges.
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  • 9:19 AM
    • HC2 (NYSEMKT:HCHC) reminds its offer of $5.25 per share for MCG Capital (NASDAQ:MCGC) consists of $4.75 in common stock of HC2 (amount of shares depends on the price) and $0.50 in cash. This stands against PennantPark Floating Rate Capital's (NASDAQ:PFLT) offer of $4.75 in cash.
    • As for the breakup fee should MCG jilt PFLT, HC2 says it would not eat into either the stock or cash component of its deal.
    • For its part, the MCG board says it's studying HC2's offer, but for now continues to support the bid from PFLT.
    • Phil Falcone: "HC2 is disappointed in this outcome thus far ... HC2's offer provides superior and more certain value as compared to PennantPark's offer."
    • Source: Press Release
    • HC2 shot higher in the final few minutes of trade yesterday, though no news was apparent. The company is holding a conference call today, but it's with bondholders as required by its bond indenture.
    • Previously: HC2 boosts bid for MCG Capital (May 19)
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  • 8:44 AM
    • The Puerto Rico House last night passed a bill to balance the budget by hiking sales taxes 450 basis points to 11.5% before a transition to a VAT in nine months. The margin was small, but at least some had expected the law to be voted down. Next up is the Senate which is expected to pass the bill today.
    • It's good news for MBIA (NYSE:MBI) and Assured Guaranty (NYSE:AGO), says analyst Mark Palmer, as a balanced budget for FY16 (beginning July 1) has been seen as a precondition for the issuance of $2.9B in bonds by PRIFA, part of the proceeds of which will shore up the island's finances and give some more time to address larger financing challenges.
    • The main reason both stocks trade at such substantial discounts to book value, says Palmer, is their nearly $5B in exposure (each) to Puerto Rico. To the extent the vote last night provides some (positive) clarity, expect both to respond.
    • MBI is rated a Buy at BTIG, with $13 price target, and AGO a Buy with $41 PT.
    | 1 Comment
  • 8:31 AM
    • James R. Weir Insurance Agency was founded in 1967 and is a retail insurance broker for mid-to-large market clients throughout the Midwest. They also specialize in insurance coverages for the religious, construction, healthcare and food service industries.
    • Terms of AJG's purchase were not available.
    • Source: Press Release
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  • 8:28 AM
    • Powerhouse Dynamics is a provider of enterprise management systems for portfolios of small commercial facilities. The company will use the $2.5M venture loan from HRZN for working capital.
    • Source: Press Release
    | 1 Comment
  • 8:03 AM
    • The newly-constructed Class A multifamily community is part of a master planned community.
    • APTS acquired the asset through a wholly-owned subsidiary and financed the deal with a $30.8M mortgage maturing in 2022, and bearing an interest rate of 3.55%.
    • Source: Press Release
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  • 7:59 AM
    • The LaPlaya Beach Resort is a 189-room, waterfront, luxury resort, and the LaPlaya Beach Club a private members club located at the resort.
    • In 2014, LaPlaya operated at 77% occupancy, with an ADR of $337 and RevPAR of $261. Over the next year, it's forecast to generate EBITDA of $14.3M-$15.3M and NOI of $12.5M-$13.5M.
    • PEB's full-year FFO per share guidance is lifted by $0.02 at both ends to $2.46-$2.54. Q2 is at $0.66-$0.69.
    • Source: Press Release
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  • 7:53 AM
    • Brandywine Realty Trust's (NYSE:BDN) new $600M credit line replaces the old one for the same amount which was set to mature next February. The borrowing rate for the new revolver is currently Libor + 120 basis points, a 30 bp improvement over the previous one.
    • The covenants, terms and conditions "reflect current conventions and generall provide enhanced flexibility for the company."
    • Source: Press Release
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  • 7:50 AM
    • Affirming EQC's unsecured debt rating of Baa3, Moody's revises the outlook to stable from negative, reflecting reduced leverage as well as progress on the company's large-scale repositioning plan that will improve portfolio quality.
    • Since taking control in mid-2014, EQC's new management team has significantly improved the REIT's credit profile, says Moody's.
    • Source: Press Release
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  • 7:44 AM
    • HSBC CEO Stuart Gulliver in February said the bank's four problem businesses - Brazil, Mexico, Turkey, and the U.S. - needed to be improved or sold, thus setting the stage for the rumors.
    • Reuters reports sales processes are underway in Brazil and Turkey, but the U.S. and Mexican operations are likely to be kept. Both are sizable businesses, but not among the top five lenders in either country.
    • A preferred bidder for the Brazil unit could come next month as CEO Gulliver takes part in a strategy day on June 9.
    • Source: Reuters
    • Previously: Santander Brasil mulls purchase of HSBC's Brazil unit (May 19)
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  • 7:37 AM
    • Based in Needham, MA, privately-held Firestone Financial is a commercial specialty finance company providing secured installment loan equipment financing.
    • As of March 21, Firestone had about $190M in loans spread across multiple industries and market areas. The weighted average yield on the portfolio is 9.8%.
    • BHLB is buying for 130% of adjusted tangible book value, for a total deal value of $53M, with 75% to be paid in common stock and 25% in cash.
    • The purchase is expected to be accretive to EPS and generate a ROE north of 15%. It is expected to be $0.08 dilutive to tangible book value.
    • The deal should close in Q3.
    • Source: Press Release
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  • 7:32 AM
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  • 7:28 AM
    • EXOR is willing to have discussions with PartnerRe (NYSE:PRE), but only if the PRE board first declares the EXOR bid of $137.50 per share in cash as superior to that of AXIS Capital's (NYSE:AXS) lower (at least on its face) bid.
    • The PRE board is not willing to do this, and will not proceed with obtaining shareholder approval of the AXIS proposal.
    • Source: Press Release
    | 1 Comment
  • 6:51 AM
    • BNY Mellon (NYSE:BK) will pay $180M to settle a foreign exchange-related putative class action lawsuit, and expects to record a pretax charge of $50M in Q2 as a result.
    • The settlement will release the bank from all foreign exchange-related securities law claims brought against it or its affiliates in the suit.
    • SEC Form 8-K
    | Comment!
  • 6:45 AM
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