mlkr's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/47000/comments http://seekingalpha.com/article/98797-hypo-s-biggest-loser?source=feed#comment-479107 479107 Real Trouble At Hypo
Javier Espinoza, 04.09.09, 07:37 AM EDT
The German state has launched a takeover bid for troubled lender Hypo Real State.

"Troubled investment bank Hypo Real Estate was set to become the first nationalized bank in Germany since World War Two after the German government said on Thursday it had launched a takeover bid offer of 1.39 euros ($1.84) per share for 100.0% of the company, a 15.8% premium over the bank’s closing share price on Wednesday.

Shares of Hypo Real Estate ( HREHY - news - people ) rose 15.0%, or 18 euro cents (24 cents), to 1.38 euros ($1.82) in morning trading in Frankfurt.

“I am surprised that the government has offered 1.39 when it was expected to offer between 1.20 to 1.30 euros per share,” said Dirk Becker, an analyst with Kepler Capital Markets. “But [the takeover by the government] has been expected to happen for months.”

With its 100 billion euro ($132 billion) funding gap getting bigger and bigger, Hypo Real Estate was seen as too big to fail. Berlin has said it wants to take full control of the investment bank and restructure it. So far, the bank has received a total of 102 billion euros ($135.5 billion) in guarantees from the state and fellow banks but its financial condition remains uncertain.

Despite harsh opposition against nationalizing the bank, the government passed a special new law that makes this possible and could potentially expropriate Hypo shareholders if they refuse to sell their stake by June 30. It is still unclear whether U.S. private equity investor J.C. Flowers, which owns nearly a quarter of Hypo’s shares, will refuse to sell.

A spokesman for Flowers said the U.S. investor, who bought the stake last June for 22.50 euros ($29.81) per share, would study the offer and reiterated that the firm's preference was to remain a shareholder in the bank.

Angela Merkel’s government took an initial 8.7% stake in the bank in March, paying 3 euros per share ($3.9) in a capital increase, on the same day Real State Hypo posted pretax loss of 5.38 billion euros ($7.1 billion) for 2008 and said it expected to stay in the red for at least two more years.

Berlin passed the expropriation law after failing to agree a selling price with Flowers. But the idea of expropriation is highly controversial in the country because it brings back the memories of such moves by the Nazis in the 1930s and by the communists in East Germany in the postwar era.

But analysts said drastic measures were required to prevent the banking system from collapsing. “All governments would do whatever it takes to prevent the financial system from melting down,” said Kepler's Beckler.

Hypo Real Estate is not the first high-profile bank to fall victim of the global economic crisis. Last year, the Austrian government bought 99.8% of Kommunalkredit for a nominal sum and injected capital. Last September the governments of Belgium, France, Luxembourg and the Netherlands pledged 6.4 billion euros ($8.5 billion) to bail out Dexia."
]]> Mon, 27 Apr 2009 10:52:27 -0400 Real Trouble At Hypo
Javier Espinoza, 04.09.09, 07:37 AM EDT
The German state has launched a takeover bid for troubled lender Hypo Real State.

"Troubled investment bank Hypo Real Estate was set to become the first nationalized bank in Germany since World War Two after the German government said on Thursday it had launched a takeover bid offer of 1.39 euros ($1.84) per share for 100.0% of the company, a 15.8% premium over the bank’s closing share price on Wednesday.

Shares of Hypo Real Estate ( HREHY - news - people ) rose 15.0%, or 18 euro cents (24 cents), to 1.38 euros ($1.82) in morning trading in Frankfurt.

“I am surprised that the government has offered 1.39 when it was expected to offer between 1.20 to 1.30 euros per share,” said Dirk Becker, an analyst with Kepler Capital Markets. “But [the takeover by the government] has been expected to happen for months.”

With its 100 billion euro ($132 billion) funding gap getting bigger and bigger, Hypo Real Estate was seen as too big to fail. Berlin has said it wants to take full control of the investment bank and restructure it. So far, the bank has received a total of 102 billion euros ($135.5 billion) in guarantees from the state and fellow banks but its financial condition remains uncertain.

Despite harsh opposition against nationalizing the bank, the government passed a special new law that makes this possible and could potentially expropriate Hypo shareholders if they refuse to sell their stake by June 30. It is still unclear whether U.S. private equity investor J.C. Flowers, which owns nearly a quarter of Hypo’s shares, will refuse to sell.

A spokesman for Flowers said the U.S. investor, who bought the stake last June for 22.50 euros ($29.81) per share, would study the offer and reiterated that the firm's preference was to remain a shareholder in the bank.

Angela Merkel’s government took an initial 8.7% stake in the bank in March, paying 3 euros per share ($3.9) in a capital increase, on the same day Real State Hypo posted pretax loss of 5.38 billion euros ($7.1 billion) for 2008 and said it expected to stay in the red for at least two more years.

Berlin passed the expropriation law after failing to agree a selling price with Flowers. But the idea of expropriation is highly controversial in the country because it brings back the memories of such moves by the Nazis in the 1930s and by the communists in East Germany in the postwar era.

But analysts said drastic measures were required to prevent the banking system from collapsing. “All governments would do whatever it takes to prevent the financial system from melting down,” said Kepler's Beckler.

Hypo Real Estate is not the first high-profile bank to fall victim of the global economic crisis. Last year, the Austrian government bought 99.8% of Kommunalkredit for a nominal sum and injected capital. Last September the governments of Belgium, France, Luxembourg and the Netherlands pledged 6.4 billion euros ($8.5 billion) to bail out Dexia."
]]> http://seekingalpha.com/article/35413-japan-best-and-worst-performing-adrs-last-week-and-ytd?source=feed#comment-383071 383071 Tue, 10 Feb 2009 19:01:08 -0500 http://seekingalpha.com/article/72476-annual-infrastructure-spending-expected-to-reach-2-trillion?source=feed#comment-382948 382948 Tue, 10 Feb 2009 17:40:45 -0500 http://seekingalpha.com/article/49078-unico-american-corporation-true-value-again-and-again?source=feed#comment-367162 367162 tia]]> Mon, 26 Jan 2009 23:29:21 -0500 tia]]> http://seekingalpha.com/article/114853-4-ways-to-profit-from-germany-country-with-the-smallest-stimulus-package?source=feed#comment-362148 362148 Wed, 21 Jan 2009 14:02:41 -0500 http://seekingalpha.com/article/114508-avoiding-satyam-like-the-plague?source=feed#comment-354470 354470 Remarkable an OHIO state university graduate could establish such IT firm and try to protect it against hostile takeover attempts of competitors..
Took a position.
]]> Tue, 13 Jan 2009 11:28:21 -0500 Remarkable an OHIO state university graduate could establish such IT firm and try to protect it against hostile takeover attempts of competitors..
Took a position.
]]> http://seekingalpha.com/article/112352-commodities-etfs-the-time-is-not-yet-ripe?source=feed#comment-339340 339340 Sat, 27 Dec 2008 12:56:37 -0500 http://seekingalpha.com/article/110036-ipo-year-end-damage-report?source=feed#comment-325733 325733 Wed, 10 Dec 2008 14:02:49 -0500 http://seekingalpha.com/article/54814-new-germany-fund-delivers-40-in-annual-gains?source=feed#comment-321169 321169 Thu, 04 Dec 2008 19:05:38 -0500 http://seekingalpha.com/article/104648-mbia-what-are-short-sellers-missing?source=feed#comment-310304 310304 Wed, 19 Nov 2008 17:24:41 -0500 http://seekingalpha.com/article/82674-turkish-shareholders-association-plans-to-sue-the-turkish-central-bank?source=feed#comment-295842 295842 Sat, 01 Nov 2008 15:45:48 -0400 http://seekingalpha.com/article/102641-does-turkey-need-imf-anchor?source=feed#comment-295839 295839 Sat, 01 Nov 2008 15:40:36 -0400 http://seekingalpha.com/article/88284-biotech-breakout-confirmed?source=feed#comment-224139 224139 Wed, 06 Aug 2008 12:39:55 -0400 http://seekingalpha.com/article/84037-bioscrip-management-board-should-be-shown-the-door?source=feed#comment-200569 200569 Tue, 08 Jul 2008 10:43:01 -0400 http://seekingalpha.com/article/83093-fifth-street-capital-s-ipo-high-risk-lender-cloaked-as-private-investment-fund?source=feed#comment-199999 199999 Mon, 07 Jul 2008 13:55:29 -0400 http://seekingalpha.com/article/61237-these-stocks-are-attractive-amidst-this-selloff?source=feed#comment-112399 112399 Wed, 23 Jan 2008 11:02:11 -0500 http://seekingalpha.com/article/55570-abb-group-dip-presents-buy-opportunity?source=feed#comment-106437 106437 Fri, 21 Dec 2007 16:12:48 -0500 http://seekingalpha.com/article/48130-two-important-lessons-to-be-learned-from-sonus?source=feed#comment-99243 99243 Sat, 20 Oct 2007 03:10:07 -0400 http://seekingalpha.com/article/49068-is-syntax-brillian-a-bargain?source=feed#comment-98042 98042 Mon, 08 Oct 2007 18:53:29 -0400 http://seekingalpha.com/article/48744-baird-slashes-syntax-brillian-target-on-lcd-panel-shortage?source=feed#comment-97871 97871 Sat, 06 Oct 2007 13:26:50 -0400 http://seekingalpha.com/article/47631-syntax-brillian-significant-downside-left?source=feed#comment-96374 96374 credit issue for suppliers will be overcome..
Consumer demand for LCD during holiday season will be up too..
18 million shares are shorted and any spike caused by short squeeze would kill mr paz's position
Mr paz should have disclosed details of his short position..]]> Wed, 19 Sep 2007 13:32:52 -0400 credit issue for suppliers will be overcome..
Consumer demand for LCD during holiday season will be up too..
18 million shares are shorted and any spike caused by short squeeze would kill mr paz's position
Mr paz should have disclosed details of his short position..]]> http://seekingalpha.com/article/40710-optimistic-forecast-for-syntax-brillian-the-rollercoaster-ride-may-be-over?source=feed#comment-96051 96051 thnx in advance]]> Sat, 15 Sep 2007 18:56:54 -0400 thnx in advance]]> http://seekingalpha.com/article/42586-wci-shares-plunge-after-no-bid-materializes?source=feed#comment-92308 92308 Fri, 27 Jul 2007 14:08:07 -0400 http://seekingalpha.com/article/42432-siga-technologies-inc-get-rich-or-die-trying?source=feed#comment-92252 92252 Thu, 26 Jul 2007 22:54:43 -0400 http://seekingalpha.com/article/41724-w-holding-company-takes-excessive-hit-on-inyx-bankruptcy?source=feed#comment-91958 91958 Mon, 23 Jul 2007 14:58:11 -0400 http://seekingalpha.com/article/41815-limc-ipo-analysis-plenty-of-room-for-growth?source=feed#comment-91955 91955 Mon, 23 Jul 2007 14:50:54 -0400 http://seekingalpha.com/article/41385-novastar-financial-the-last-refuge-of-a-corporate-scoundrel?source=feed#comment-91948 91948 Nice behind the scene piece. Always wondered as small investor/trader . My best candidate for investigative journalism award in financial sector.. Thnx]]> Mon, 23 Jul 2007 13:09:06 -0400 Nice behind the scene piece. Always wondered as small investor/trader . My best candidate for investigative journalism award in financial sector.. Thnx]]> http://seekingalpha.com/article/41755-turkcell-a-great-way-to-invest-in-turkey?source=feed#comment-91676 91676 Fri, 20 Jul 2007 10:33:14 -0400