Today - Sunday, March 16, 2014
- The Commerce Department plans to give up oversight of the Internet Corporation for Assigned Names & Numbers (ICANN), the organization that manages Web names and address, when a contract expires between the government and ICANN in September 2015.
- The decision comes amid increasing suspicion about the U.S. amid the uproar caused by NSA spying revelations.
- ICANN plans to open up discussions later this month about a new oversight structure.
- A federal judge has left the annual rate at which Pandora (P) must pay songwriters for the use of their material at 1.85% of its revenue for 2011-2015.
- The American Society of Composers, Authors & Publishers (Ascap) wanted the figure to gradually rise while Pandora wanted it to drop to 1.7%, the rate for most commercial radio stations.
- The decision "further demonstrates the need to review the entire regulatory structure," said Ascap CEO John LoFrumento.
- Pandora faces a similar case against Broadcast Music Inc that is due to start later this year.
- Alibaba has confirmed reports that it intends to carry out an IPO in New York - and not in Hong Kong - as it looks to become a "more global" and transparent company.
- The Internet giant could reportedly raise over $15B in the offering, which would make it biggest U.S. IPO ever by a Chinese company. Analysts reckon that the firm's market cap could top $130B.
- Alibaba hasn't decided which exchange it will lost on, nor on a date.
- Credit Suisse, Deutsche Bank, Goldman Sachs and JPMorgan will play major roles in the IPO, while Citigroup will have a smaller part.
- Alibaba said that it might consider listing its shares in China in the future, although it didn't provide details.
- Alibaba investors Yahoo (YHOO) and Softbank (SFTBF) should be in line for a healthy bonanza from the IPO.
- The WSJ provides a primer on Alibaba's busines model, calling the company a "a mix of Amazon, eBay and PayPal with a dash of Google thrown in." Alibaba also has "some uniquely Chinese characteristics."
- ETF: IPO (PR)
- Chinese micro-blogging service Weibo has filed to raise $500M in an IPO in the U.S.
- The company had 129M users at the end of last year vs Twitter's 241M, while 2013 revenue almost tripled to $188M. However, the firm made losses of $38M and warned of uncertainty due to Chinese regulation (read censorship).
- Weibo's filing comes ahead of an expected IPO submission from Internet giant Alibaba, which owns a 19% stake in Weibo. Sina (SINA) owns 78%.
- ETF: IPO
Friday, March 14, 2014
- GoDaddy Group is gearing up for an IPO and is preparing to interview underwriters in the coming weeks, WSJ reports.
- An IPO for GoDaddy would be the latest in a rush of such deals as stock indexes trade near record highs and investors clamor for shares in newly listed companies; the first two months of 2014 marked the busiest start to a year for IPOs since 2007.
- A competitor in the website hosting business, Endurance International (EIGI), went public in October; its shares have gained 26% since then.
- Nokia (NOK -0.4%) says it is considering its options after India's Supreme Court rejected its appeal against a demand for a multimillion-dollar payment before it transfers a mobile phone plant and other assets in the country to Microsoft (MSFT -0.2%).
- The ruling upholds a lower court verdict ordering NOK to pay a 35B rupee ($572.5M) guarantee after local authorities blocked the factory's transfer in a tax dispute; as a result, the factory - a critical part of the smartphone business MSFT is purchasing - remains shut.
- If the Indian manufacturing plant is not transferred to MSFT, it could mean less money for NOK from the deal; NOK could run it as a contractor to MSFT but not for long, the company has said in court hearings.
- Alibaba (ABABA) reportedly is preparing for a U.S. IPO as soon as next month, in an offer that could rival the size of Facebook.
- The deal under consideration would raise more than $15B, with Yahoo (YHOO +0.9%) and other pre-IPO investors as the selling shareholders, sources say; FB's 2012 deal raised $16B.
- Alibaba is opting for a U.S. listing as it struggles to persuade Hong Kong regulators to approve a proposed governance structure.
- "Among GSV's (GSVC -9.6%) portfolio of about 50 companies, we think that 2U (S-1 filed), Dropbox, Gilt Group, Spotify, SugarCRM, and TruCar could go public in 2014," says analyst Jeff Houston, reiterating his Outperform rating and $20 price target.
- Taking a look at GSV's public holdings, all except ePals have had big moves to the upside, and GSV's stock now trades at a sizable discount to NAV.
- Retail sales of videogame software dropped 11% to $328M last month, according to a release late yesterday from research firm NPD, despite a 42% rise in console gaming hardware with the introduction of Microsoft’s (MSFT) Xbox One and Sony’s (SNE) PlayStation 4.
- An NPD analyst echoed a theory among videogame executives and analysts that sales of software for the new hardware is not enough yet to offset sales of the older-hardware titles.
- Market analysts don’t expect the console games industry to grow significantly over the next several years, and so far the sales data appears to be following that trend; but the sales cycle is still early, executives say, considering that Xbox One and PlayStation 4 were only recently released.
- "In light of a weaker ruble and softening macro," analyst Lloyd Walmsley cuts his PT on Yandex (YNDX +0.6%) to $38 from $44. He does, however, maintain his Buy rating: "We continue to view Yandex as well-positioned to benefit from share gains in online advertising in Russia, driven by algorithmic and back-end ad tech improvements."
- KirE Builders and SolarCity (SCTY) partner to offer solar power for all homes in KirE's Black Canyon Estates opening this weekend, and Vista Sereno Estates opening this summer. Solar will be standard Black Canyon and as an option in Vista Sereno.
- "At KirE Builders, we have a twist on the American dream - to own a home with clean, affordable solar power," says the builder's president, Josh Santa.
- Cisco Systems (CSCO) says it has started a bribery related investigation into its operations in Russia and neighboring countries at the request of the Securities and Exchange Commission and the Department of Justice.
- CSCO disclosed the probes in a Feb. 20 SEC filing, which said the company or its resellers may have violated the U.S. Foreign Corrupt Practices Act.
- CSCO does not believe the results will have a material effect on its finances.
- French Industry minister Arnaud Montebourg believes that Vivendi (VIVHY, VIVEF) prefers Numericable's bid for its SFR mobile unit over an offer from conglomerate Bouygues (BOUYY).
- However, there are concerns about a potential Numericable victory, Montebourg says, including the small size of the company relative to SFR, its debt, and its offshore ownership structure. Numericable's ulitmate owner, billionaire Patrick Drahi, controls the company via Luxembourg-based Altice.
- Montebourg prefers the Bouygues offer, as the company has pledged not to cut jobs.
- Vivendi's board was due to meet today to discuss the rival offers, which both value SFR at over $20B.
- Liberty Global (LBTYA) has held talks about acquiring Daisy Group for at least £500M, the U.K.'s Times newspaper reports.
- However, the discussions have hit a stumbling block over price, writes the Times' tech editor Nic Fildes, with the U.K. provider of Internet and telecom service wanting 220 pence a share, or almost £600M. The stock is -0.5% at 187 pence for a market cap of £499.23M.
- A deal could strengthen the business operations of Liberty unit Virgin Media, which has "struggled for growth over the past two years."
- Vodafone (VOD) is close to an agreement to acquire Grupo Corporativo ONO for €7.2B ($10B) including debt, Reuters reports, adding that while Ono's shareholders yesterday approved an IPO for the Spanish cable operator, they were holding out for a deal with the U.K. carrier.
- The sides are negotiating the final terms and could even reach a preliminary agreement today.
Thursday, March 13, 2014
- ChannelAdvisor (ECOM) clients saw a 23% Y/Y increase in their Amazon (AMZN) same-store sales in February. That's up from January's 14% clip, albeit down from the growth seen over much of 2013. ChannelAdvisor thinks improving weather contributed to the M/M growth pickup.
- Clients saw a 15% EBAY same-store sales increase, up from 12.7% in January. Auctions fell 8.5% Y/Y, but fixed-price and Motors sales respectively rose 15.5% and 22.3%.
- Search ad-driven same-store sales, dominated by traffic from Google (GOOG) AdWords placements, rose only 4.3%, down from January's 10.3%. Clicks fell 9% and cost per click (pressured by lower smartphone ad prices) 7%, while click rates rose 4%.
- On the other hand, same-store sales driven by Google's increasingly popular product listing ads (PLAs) rose 48% Y/Y. That figure is down from January's 62.8%, but it's worth noting PLAs were only launched in late 2012. Average order value fell 8%, but click rates rose 17%.
- AMZN +0.9% AH. Shares managed to buck a market selloff in regular trading on account of the company's Prime price hike.
- Lithography equipment giant ASML has "paused" the development of hardware meant to work with next-gen 450mm wafers, which offer 125% more wafer space (and thus better economies of scale) than current-gen 300mm wafers. Likewise, Applied Materials (AMAT) CEO Gary Dickerson says the 450mm migration "has definitely been pushed out from a timing standpoint."
- Due to ASML's move, Intel (INTC), which agreed in 2012 to pour $4.1B into the company to help finance investments in 450mm wafers and EUV lithography, has "adjusted" the pace of its payments to ASML.
- Last year, Intel began constructing a $2B Oregon development fab meant to be its first 450mm facility. But it's reevaluating its timetable amid soft PC demand and concerns about its share of the bill. Spokesman Chuck Mulloy: "We still believe 450 is the right thing to do ... But we have been clear: we will not do it ourselves."
- EUV, considered necessary to maintain Moore's Law long-term, has also seen delays. ASML CEO Peter Wennink recently predicted EUV will reach the stability levels required by chip manufacturers by the 2H16 or 2017.
- Other chip equipment makers: KLAC, LRCX, RTEC, NVMI, UTEK, TOELF