Friday, November 27, 2015
- Germany's Supreme Court handed a victory to Deutsche Telekom (OTCQX:DTEGY +0.8%) and Telefonica (TEF +0.7%) in a rights case, but left the door open for holding Internet service providers responsible for blocking sites offering illegal music downloads.
- The court dismissed a pair of cases -- one brought by musical-rights society GEMA against Deutsche Telekom, the other brought by music companies against Telefonica's German unit O2 Deutschland -- saying the plaintiffs hadn't done enough to halt copyright violations in the first place.
- But it went on to rule: "The company that offers Internet access will only be held responsible for blocking the site when the copyright holder has first made reasonable efforts to take action against those who have themselves infringed their rights, like the website operators, or those who have enabled the infringement, like the Web hosting providers."
- This summer, a German court had ruled that YouTube was only responsible for blocking infringing videos when they had been brought to its attention, and wasn't expected to scan every video.
- NXP Semiconductors (NASDAQ:NXPI) jumped 4.6% in the short session today, and Freescale (NYSE:FSL) gained 4%, after the two won approval from China's Ministry of Commerce to finish their $40B merger -- a last major hurdle to the deal.
- The EU and U.S. FTC had signed off previously. The companies now expect to close Dec. 7, concurrent with the divestment of NXP's RF amplifier unit.
- The two have predicted $500M in eventual annual cost synergies, and have targeted $200M in cost savings in the first year after closing. NXP expects it to be accretive to EPS and free cash flow.
- Previously: NXP +6%, Freescale +5.5%; U.S. clears NXP's RF amplifier unit sale (Nov. 24 2015)
- Previously: NXP rallies following FBR Top Pick call, takes Freescale with it (Nov. 18 2015)
- In the holiday lull, Chinese game maker KongZhong (KZ -0.4%) said it's approved a sale of most of its stake in Ourgame International to Glassy Mind Holdings, for $30.9M.
- The deal involves selling 39.2M shares of Ourgame at a price of HK$6.1062 -- coming to about $30.9M with about 80% in immediate cash, and the remainder in cash on Sept. 30, 2016.
- KongZhong had held the shares since before Ourgame went public in Hong Kong in June 2014. It will retain a stake of about 2.6% (20.74M shares).
- Turkcell (TKC -2.7%) says it has launched voice and video calls on BiP, its IP-based messaging app.
- BiP has been downloaded for free more than 3.3M times (by Turkcell subscribers and otherwise) in more than 166 countries. The app also features disappearing messages a la Snapchat.
- The voice and video addition is coming along with 1 GB of free data for Turkcell's subscribers, though. The company plans to launch it in Ukraine and Belarus, in local languages with local content.
- Abertis (OTCPK:ABRTY) tower spinoff Cellnex has been widely expected to put in bids for Infrastrutture Wireless Italiane, the cell-site spinoff form Telecom Italia (TI +4.7%), but despite a formal launch to the sale, TI says it's gotten no offers.
- "The process is still in an early phase and no offer has been received by Telecom Italia at this moment," the company said.
- Price may become an issue. On Wednesday, Bloomberg reported that Cellnex (and partner F2i SGR) were near a $1.2B bid for an Inwit stake, though that could come in the second week of December.
- Telecom Italia has a 60% stake in Inwit and would likely aim to keep about 20% along with one board seat.
- VimpelCom (NASDAQ:VIP) is down 1.9% with firms coming in for price target cuts on the Russia-focused telecom.
- Barclays has reduced its price target to $4.82; ADRs closed yesterday at $3.60 and are trading at $3.53 today. Meanwhile, HSBC lowered its price target to $6.40.
- HSBC has a Buy rating on the stock, while Barclays holds an Equal Weight rating.
- The company also announced it's combining its Pakistan mobile business, Mobilink, with Global Telecom Holding's Warid Telecom in a large consolidation. Mobilink will first acquire 100% of Warid's shares in consideration for Dhabi Group shareholders acquiring about 15% of Mobilink, before the two companies are fully merged.
- The combination will serve more than 45M customers and the two companies logged combined revenue of $1.4B over the past 12 months. VimpelCom and Global Telecom expect synergies of $500M in the tie-up.
- Warren Buffett in 2008 famously made a $1M wager with hedge fund Protege Partners that the S&P 500 would outperform a basket of hedge funds (net of fees) for the 10-year period beginning on Jan. 1, 2008 - a bet The Oracle is well on his way to winning.
- A fan of Buffett (BRK.A, BRK.B) and an investor alongside him for as long as he can remember, Seeking Alpha contributor Chris DeMuth suggests the problem with the bet (at least for Protege) was fund selection. He proposes a new bet of $1M with Buffett that his Rangeley Capital outperforms the S&P 500 over the 10-year period starting on Jan. 1, 2016.
- News Corp. (NWS -1.6%, NWSA -1.3%) says its Australian unit has secured five-year rights to the National Rugby League in an $1.8B deal.
- In conjunction with Nine Entertainment and Telstra (TLSYY +0.4%), Fox Sports secured the rights to show all games ad-free in 2016, and in 2017 will launch a dedicated NRL channel.
- Fox Sports package subscribers will also have access to the games and related coverage on tablets and smartphones.
- Japan -0.30%.
- Hong Kong -1.87%.
- China -5.48%.
- India +0.65%.
- London -0.09%.
- Paris +0.13%.
- Frankfurt +0.24%.
- Brazilian President Dilma Rousseff's austerity program is in trouble again and she may face new calls for an impeachment after her point man in the Senate was arrested in a widening corruption scandal.
- "The arrest felt like a nuclear bomb here in the presidential palace," said a Rousseff aide.
- Delcidio do Amaral is the ruling Workers' Party's most senior figure in Congress, and is charged for allegedly trying to bribe Petrobras' (NYSE:PBR) former international director, Nestor Cervero.
- ETFs: EWZ, BRF, BRZU, EWZS, BRXX, BRAQ, BZQ, BRAZ, BRAF, UBR, DBBR, FBZ
- The World Trade Organization remains deeply divided over its flagship global trade pact ahead of a key conference in Nairobi next month, with some members suggesting negotiations should start from scratch.
- The Doha round of talks aimed at liberalizing trade has faced endless obstacles since the process began in 2001.
- Biggest potential winners from the WTO's 161 member-states would be the world's poorest countries, most of whom are excluded from regional trade talks going on elsewhere, such as the Trans-Pacific Partnership.
- French President Francois Hollande met Russian President Vladimir Putin in Moscow yesterday and agreed to cooperate in the fight against ISIS, although the two remained at odds over the fate of Syrian President Bashar al-Assad.
- The news comes after Russia targeted Turkey's economy with a range of sanctions - such as checks on Turkish food imports and cutting military/tourism ties - three days after Turkey shot down a Russian warplane on its border with Syria.
- However, some sanctions are still up for discussion, including closing Russian airspace and ports to Turkish companies, suspending investment agreements/joint projects, and barring cultural exchanges.
- ETFs: RSX, TUR, RUSL, RUSS, ERUS, RSXJ, RBL, TKF
- Japan's Prime Minister Shinzo Abe has ordered Cabinet ministers to prepare an extra spending package (likely over ¥3T), including cash handouts for the poorest pensioners, to boost the country's stalling recovery.
- The measures reflect a new focus for Abenomics, which has been criticized for benefiting mostly big businesses instead of the average Japanese.
- Data for October released Friday: Japan's jobless rate fell to a 20-year low of 3.1%, but household spending fell 2.4% and average incomes fell 0.9%.
- Nikkei -0.3% to 19,884.
- ETFs: DXJ, EWJ, DFJ, DBJP, NKY, JOF, EZJ, JEQ, JPNL, DXJS, EWV, SCJ, HEWJ, JSC, JPXN, JPP, QJPN, FJP, JPMV, DXJT, DXJC, DXJR, DXJH, JHDG, DXJF, HEGJ, JDG, JPN, FXJP, HGJP
- Chinese stocks dove sharply in the afternoon trading session today after authorities disclosed investigations into several major brokerages over suspected trading violations.
- The probes into Citic, Guosen, Founder and Haitong Securities followed additional souring market sentiment on Friday that revealed lackluster Chinese industrial data in October.
- The Shanghai Composite Index fell 5.5% to 3,436.30, wiping out most of its gains this month and recording its biggest one day fall since Aug. 25.
- ETFs: FXI, ASHR, EWH, CAF, YINN, KWEB, PGJ, GXC, FXP, HAO, YANG, TAO, CHIX, CHN, PEK, CHIQ, CQQQ, MCHI, TDF, QQQC, XPP, YAO, GCH, ASHS, YXI, CN, CXSE, FCA, CNXT, CHNA, CHII, CHIE, ECNS, EWHS, CHIM, KBA, KFYP, FCHI, JFC, FHK, AFTY, XINA, CHAD, ASHX, CHAU
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