Seeking Alpha
  • Friday, July 3, 2015

  • 8:10 PM
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  • 5:27 PM
    • Evan Blass (a.k.a. evleaks), responsible for leaking pictures of many soon-to-be-launched phones over the years, has posted an image render of a BlackBerry (NASDAQ:BBRY) Android phone codenamed Venice.
    • Much like Samsung's Galaxy S6 Edge, the Venice has a display with curved edges. The UI and app icons point to the use of Google's version of Android. Blass also reports (though it isn't clear from the render) the phone will have a slide-out keyboard - BlackBerry announced in March it's working on a slider with a curved display - and be sold by AT&T.
    • Reuters reported on June 12 BlackBerry is thinking of launching a phone that runs on Google's version of Android, as part of its efforts to "pivot to focus on software and device management." BB10 phones support Android apps via Amazon's Appstore for Android, but don't have access to Google Play and various other Google mobile apps/services.
    • BlackBerry recognized revenue on 1.1M phone sales in FQ1 (the May quarter), down from 1.3M in FQ4 and 1.6M a year earlier.
  • 8:43 AM
    • Ant Financial, the financial services affiliate of Alibaba (NYSE:BABA), has closed a private placement of shares that values it at more than $50B, Globes reports.
    • State backing is critical for the firm because China's banking and financial services industry is dominated by government firms, some of which have tried to block private entities from entering the market.
    • The so-called Series A round of financing was led by the National Social Security Fund of China, one of the country’s biggest state funds. NSSF now has a 5% stake in Ant Financial.
    • A timetable has not yet been revealed for the company's public listing, but Jack Ma has said that any IPO would most likely take place in China's capital markets.
    • Previously: Reuters: New funding values Alibaba's Ant Financial/Alipay at ~$45B (Jun. 18 2015)
  • Thursday, July 2, 2015

  • 6:42 PM
    • An Italian regulatory filing shows that J.P. Morgan (JPM -0.9%) has a 7% stake in Telecom Italia (TI -0.9%) -- the result, for now, of an equity swap deal with Telefonica (TEF +0.4%).
    • The Spanish provider issued a €750M exchangeable bond, maturing in 2017, that converts into TI shares, and did a totl return equity swap with J.P. Morgan giving it the TI stake.
    • Telefonica will reclaim the shares from the bank, though, at maturity, and give them to the bond's investors.
  • 6:40 PM
    • Intel (NASDAQ:INTC) rose 1.2% today following news president Renee James and 3 other execs will be leaving soon as part of a management shakeup.
    • In an employee memo (.pdf), CEO Brian Krzanich stated Intel's Technology & Manufacturing Group and HR ops (previously reporting to James) will now directly report to him. The rest of James' direct reports will "transition to other organizations." Intel's PC, mobile, and server chip units began directly reporting to Krzanich back in 2013. Since then, Intel's PC CPU and Atom mobile CPU units have been merged.
    • Discussing the moves in general, Krzanich says they aim to "continue [Intel's] drive for velocity and streamlined decision-making." Apple, Microsoft, Google, and other tech giants have carried out big shakeups in recent years with similar goals in mind.
    • Bloomberg reports James "doesn’t have a new job lined up and is leaving to carry out the search." Citi's Chris Danely considers James' departure a positive given "the lack of growth and low profitability of [Intel's] software business" under her leadership.
    • Danely: "We believe Renee James was largely responsible for spearheading Intel’s confusing $7.7 billion acquisition of McAfee in 2011. The McAfee deal has been a major disappointment in our view as there are virtually no synergies between Intel’s core silicon business and McAfee security software. When Intel acquired [McAfee] it generated 2010 revenue of $2.1 billion with operating margins of roughly 11%. We estimate McAfee revenues have remained roughly flat since the company was acquired, while operating margins have declined to the mid-single digit range."
  • 6:07 PM
    • In a 13D filed after the close, Kopp Investment Advisors discloses it now has a 14.0% (2.55M-share) stake in Superconductor Technologies (NASDAQ:SCON), up from the 12.8% stake it disclosed on May 22.
    • STI has risen to $1.39 AH. Shares briefly soared yesterday on strong volume, before giving back most of their gains. Nonetheless, they're now up 70% since STI announced a superconductor wire performance milestone on June 22.
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  • 6:06 PM
    • Leon Cooperman disclosed a 9.2% bump to his stake in Loral Space & Communications (NASDAQ:LORL), and shares gained 2.6% today.
    • Cooperman's increase brings him to 1.117M shares, about 5.21% of outstanding stock.
    • Recently, Mark Rachesky's MHR Fund Management also raised its stake, to 8.145M shares; MHR is the largest known institutional investor, Benzinga notes.
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  • 5:45 PM
    • EBAY closed up 2.4% following news PayPal (Pending:PYPL) is buying top online international money transfer service XOOM for $890M. With PayPal now just 18 days away from trading separately, eBay is within $1.50 of a 52-week high of $63.30. Western Union had a less favorable reaction to the deal.
    • Street reactions to the purchase have been largely positive. SunTrust's Bob Peck: "We see synergies/opportunity between Xoom and [mobile payments platform] Venmo inside the PayPal ecosystem enabling lower cost (ACH, or debit worse-case) wallet funding (PayPal, Paydiant) and in-market and cross-border [consumer-to-consumer] and [consumer-to-business] transactions. This could serve to sustain relevance on the consumer side and (interrelated) preserve/lower funding cost and strengthen the value proposition on the merchant side."
    • Baird's Colin Sebastian: "Both PayPal and Xoom have competitive advantages from fraud-detection technology underlying their respective products. While Xoom’s engine was initially built using concepts borrowed from PayPal, they have since extended the functionality to peer-to-peer international remittance..."
    • Keefe, Bruyette & Woods' Sanjay Sakhrani: "[I]nternational money transmittance is a highly adjacent business to P2P payments and digital wallets, which is PayPal's core business…Despite a fairly rich valuation, XOOM is growing quickly and brings to the table a scalable, bolt-on platform to help offer additional value-add..." Morgan Stanley's Brian Nowak sees an opportunity to significantly expand Xoom's op. margin (4% in 2014).
    • Xoom closed at $25.05, slightly above PayPal's $25/share buyout price. SunTrust's Andrew Jeffrey thinks Western Union and/or Internet companies could make a rival bid. Baird's Sebastian: "Higher bid from traditional money transfer company still plausible given a PayPal-Xoom combination presents a much greater (and better-capitalized) competitive threat."
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  • 5:35 PM
    • Rogers Communications (RCI +0.2%) has wrapped up its acquisition of Mobilicity, as well as its deal to buy AWS wireless spectrum from Shaw Communications (NYSE:SJR).
    • The company had agreed to pay C$440M (about $350.8M today) for the mobile provider, and C$100M additional (about $79.7M) to close on Shaw's airwaves. Rogers had previously paid $250M for a purchase option on the spectrum.
    • With the deal complete, Rogers will gain access to new capacity in key markets in British Columbia, Alberta and Ontario.
    • Previously: Rogers-Mobilicity deal: Getting airwaves from Shaw, selling to Wind (Jun. 24 2015)
    • Previously: Rogers to buy bankrupt Mobilicity for $378M (Jun. 24 2015)
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  • 5:27 PM
    • Newly spun off from Graham Holdings (NYSE:GHC), Cable One (CABO +0.2%) is going to continue a focus on non-metro markets and on steadily increasing the download speeds it provides.
    • The Phoenix company offers Internet, phone and cable to Arizona and 91 other states largely in the western U.S., with more than 75% of customers in Mississippi, Idaho, Oklahoma, Texas and Arizona.
    • At last year's end, it had 686,671 residential and business customers, and more than 40% of revenue coming from residential video service.
    • Despite a rural focus, Cable One's baseline broadband offering starts at 50 Mbps downloads, with a premium option of 70 Mbps. It plans to keep adding speed to its premium tier and hopes to raise that speed to 100 Mbps by 2015's end.
    • The stock had a largely stable day today after its regular-way debut yesterday, debuting at $450.48 before closing down at $399.01.
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  • 5:12 PM
    • In an 8-K filing, Crossroads (NASDAQ:CRDS) states an infringement and breach of contract suit filed by storage OEM Dot Hill (NASDAQ:HILL) "could result in Crossroads not having all of the patent rights necessary to conduct its business." The company promises to "defend its interests vigorously in this matter."
    • Dot Hill recently sued Crossroads for infringing a patent (USPTO filing) covering access control tech for storage adapter cards. The move followed a 2013 suit by Crossroads against Dot Hill and a slew of other enterprise hardware OEMs.
    • Crossroads recently received a favorable Markman ruling in the latter dispute. However, the suit has been stayed pending final USPTO decisions on inter partes reviews of asserted Crossroads patents.
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  • 4:55 PM
    • IDI (IDI -1%) says in a business update that it has discontinued its China ad services business, in order to focus on "growth within the data fusion market."
    • That means attention to the $13.6B risk management and marketing industries, it says.
    • "Focusing all of our strategic efforts and resources on our information solutions business allows the company to continue its advancement within the high-growth data-fusion market with a clean balance sheet and strong financial position," says co-CEO Derek Dubner.
    • The company also named Aaron Solomon interim CFO of U.S. Data Fusion Operations, and named its former CFO Jacky Wang as chief accounting officer.
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  • 4:30 PM
    • FactSet (FDS -0.8%) notes in an 8-K filing that CEO Philip Hadley has stepped down from that post to become chairman of the board.
    • Hadley has been replaced by Philip Snow, who's been the company's president since last July 1, and joined FactSet as a consultant in 1996.
    • As part of his CEO appointment, Snow receives 120,000 stock options that vest 11.11% each year of employment.
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  • 4:18 PM
    • A federal appeals court has ruled a Texas district court erred last year in including lost profits in a $123.8M final judgment against Ion Geophysical (NYSE:IO) for an infringement suit filed by Schlumberger's WesternGeco unit.
    • Ion notes lost profits accounted for $93.4M of the 2014 judgment, and pre-judgment interest $10.9M. CEO Brian Hanson: "We are confident that when the mandate of the Federal Circuit issues, ION will have a substantial reduction of the May 2014 judgment, leaving an estimated judgment of only $20-24 million."
    • WesternGeco originally sued Ion in 2009, alleging the company's lateral streamer control system infringed its patents for marine seismic streamer steering hardware. A Texas jury ruled against Ion in 2012.
    • Shares spiked on the afternoon news, and closed at $1.34. They made a new 52-week low of $1.01 yesterday amid a selloff in oil prices, before rebounding to $1.21.
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  • 2:59 PM
    • IDC estimates Barracuda (CUDA -0.3%) had 40.7% of the market for integrated purpose-built storage backup appliances (PBBAs) in Q1. Barracuda notes it has led the integrated PBBA segment for 13 straight quarters, via its Barracuda Backup appliances.
    • Though better-known by some for its security appliances, storage hardware has been a strong point for Barracuda: The company mentioned on its FQ4 CC (transcript) storage billings rose over 30% Y/Y in FY15 (ended in March), surpassing total billings growth of 18%.
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  • 2:19 PM
    • TEGNA (Pending:TGNA), the broadcast result of the Gannett spinoff, is now off 3.5% today in a delayed reaction to a downgrade by Jefferies Group.
    • The analyst firm lowered its rating on TEGNA to Hold, after initiating coverage of the company at Buy on Monday. Since opening on Monday in regular-way trading at $30.94, though, shares of TEGNA are still up 2.8%.
    • Shares of Gannett (NYSE:GCI) -- the "new Gannett" print operation -- are off 7.7% today, to $12.30. Since opening regular-way trading Monday morning at $14.37, the stock has lost more than 14% of value.
    • Previously: Gannett completes split into print, broadcast firms (Jun. 29 2015)
    • Previously: Gannett sets post-spinoff strategy, will pursue strategic M&A (Jun. 22 2015)
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  • 2:05 PM
    • As expected, NXP (NXPI -0.1%) and Freescale (FSL +0.2%) shareholders have signed off on the companies' cash/stock merger. In addition, NXP has added Glen Capital Partners' Greg Summe and Permira Advisers partner Peter Smitham to the board, effective as of the merger's closing.
    • NXP/Freescale still expect the deal to close in 2H15. As previously announced, Freescale shareholders will receive $6.25 in cash and 0.35 NXP shares for each share they own - at current levels, that spells a payout of $40.58/share.
    • In May, NXP reached a $1.8B deal to sell its RF Power unit to China's JAC Capital, thus appeasing regulators worried about NXP/Freescale's combined base station power amplifier share.
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  • 1:50 PM
    • Alcatel-Lucent (ALU -0.8%) has struck an RMB4.53B ($729M) deal with China Mobile, and an RMB3.59B ($578M) deal with China Unicom, to supply 4G infrastructure, wireline broadband, IP routing, and optical networking hardware, as well as VoLTE, software-defined networking (SDN), and network functions virtualization (NFV) software.
    • Alcatel, already a major mobile infrastructure supplier to China Mobile/Unicom, says the deals will help the carriers meet their commitment related to a government goal of providing broadband coverage throughout China by 2020.
    • Much like an agreement between STMicroelectronics and Huawei, the deals were inked during a visit to France by Chinese premier Li Keqiang.
  • 1:17 PM
    • Along with Univision's announcement of an IPO filing today, Grupo Televisa (TV +0.9%) -- which has a longstanding working relationship with Univision -- says the two companies have extended their program licensing agreement until at least 2030.
    • The move is subject to Univision completing its IPO with no change of control. It also changes the royalty rate on Univision's Spanish-language revenue to 11.84%, from 11.91%, and increasing to 16.13% on Jan. 1, 2018, with further increases baked in.
    • Univision has exclusive U.S. broadcast and digital rights to Televisa content. Televisa has about a 36% economic interest in Univision, and Univision says that Televisa will hold about 22% of voting rights to Univision common stock.
    • Televisa got $313.7M in royalties from Univision in 2014.
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  • 12:59 PM
    • Bloomberg reports YELP CEO Jeremy Stoppelman has decided against seeking a sale for the time being. Shares have tumbled below $38, making new 52-week lows in the process.
    • Bloomberg's sources state Yelp "had several interested suitors but isn’t pursuing a transaction in the immediate future." The local reviews leader could resume its sale efforts if Stoppelman changes his mind.
    • Shares soared in May after Bloomberg and the WSJ reported Yelp had hired banks - Bloomberg reported Goldman - to help find a buyer. They had already given back a large chunk of their gains going into today.
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