Blackstone, Cerberus make formal bids for Chrysler – report SEC Now Takes a Hard Look At Insiders’ ‘Regular’ Sales Citigroup pressured to raise Nikko bid Barclays spoke with Dutch regulator on ABN bid steps SEC looks at share deals ahead of First Data’s $29bn sale More headlines below
Bank of America Hits Snag in Bid To Woo the Rich Private Equity’s Bottom Line for Workers NYSE Euronext eyes US derivatives NYSE raps London for Russian listings Payment Woes Worsen On Riskiest Mortgages
Blackstone, Cerberus make formal bids for Chrysler – report – AFX via Forbes
The Blackstone Group and Cerberus Capital Management, two of the US’ largest private-equity firms, have made formal bids to buy the Chrysler Group from DaimlerChrysler AG, The Detroit News reported, citing people close to the talks.
No details were known about the size of the bids, but the offers were said to qualify both firms to compete in the next round of the Chrysler sale process.
A third prospective buyer — Canadian supplier Magna International Inc (nyse: MGA – news – people ) — also has submitted an offer that keeps it in the running to acquire the U.S. division of DaimlerChrysler (nyse: DCX – news – people ), it said….
SEC Now Takes a Hard Look At Insiders’ ‘Regular’ Sales – Wall Street Journal
The fate of Joseph Nacchio, the former Qwest Communications International Inc. chief executive on trial for insider trading, could hinge in part on a stock-sale procedure under scrutiny by regulators and used by hundreds of executives.
Mr. Nacchio earned millions of dollars under predetermined stock-selling plans in the first half of 2001, in addition to other trades in the open market. Prosecutors allege that Mr. Nacchio had inside information when he entered two of the plans.
These plans, known as "10b5-1" plans, are used by hundreds of executives. They are detailed, specific plans created with the help of a broker that are designed to let executives sell off shares at regular intervals….
Citigroup pressured to raise Nikko bid – Financial Times
Citigroup came under renewed pressure by investment funds to raise its Y1,578bn ($13.4bn) bid for Nikko Cordial after two funds said they would sell their shares in the market at a 12 per cent premium to Citigroup’s offer.
Orbis Investment Management, which has a 5.8 per cent stake in Japan’s third-largest broker, said it would immediately place an order on the Tokyo Stock Exchange to sell its entire stake at Y1,900 a share, compared with Citibank’s offer of Y1,700 a share. Nikko Cordial’s shares closed on Tuesday at Y1,686.
“After reappraising the intrinsic value of Nikko Cordial, Orbis believes that Citigroup’s offer of Y1,700 a share continues to materially undervalue the company,” Orbis said in a statement…..
Barclays spoke with Dutch regulator on ABN bid steps – Reuters
Barclays chief executive John Varley discussed bid procedures for Dutch bank ABN AMRO NV with Dutch market regulators, the chief of Dutch market regulator AFM said on Wednesday.
"We are the bid authority and we have talked about this issues and other subjects," AFM chairman Arthur Docters van Leeuwentold reporters, adding that he met with Varley on Tuesday.
ABN and Barclays entered merger talks last month after ABN came under pressure from investors, including British hedge fund TCI, to consider a sale or breakup to boost shareholder returns after several years of underperformance…..
SEC looks at share deals ahead of First Data’s $29bn sale – The Times of London
The Securities and Exchange Commission (SEC) is to investigate suspicious trading activity in the run-up to the $29 billion (£14.6 billion) sale of First Data, the American credit card processor, to Kohlberg Kravis Roberts (KKR).
The investigation, which will begin informally but could lead to a more structured inquiry, comes after a surge in trading of call options in First Data shares in the days before the deal was announced on Monday.
About 80,000 call options were sold last week, more than double the volume for the whole of February, according to Options Clearing Corporation….
Bank of America Hits Snag in Bid To Woo the Rich – Wall Street Journal
The top executive at U.S. Trust, a private-banking operation being acquired for $3.3 billion by Bank of America Corp., has decided to quit this summer, dealing a setback to the big bank’s ambitious push to become the leader in the lucrative business of managing rich people’s money.
Peter K. Scaturro, the 47-year-old chief executive officer of U.S. Trust, was supposed to continue leading the private bank and oversee Bank of America’s existing private-bank unit once the deal is completed later this year. But following a series of disagreements over how the combined operation should be run, Mr. Scaturro has decided to step down this summer, people familiar with the situation said.
The disputes that prompted Mr. Scaturro’s exit range from which computer system to use to whether Bank of America should begin charging some of U.S. Trust’s ultrarich clients to use automated teller machines. But while the problems aren’t seen as dire enough to derail the takeover, they underscore the difficulty financial supermarkets like Bank of America are having in adapting their mass-market philosophies to rich people with different standards of service than everyday customers…..
Private Equity’s Bottom Line for Workers – Washington Post
Sam Zell and Andy Stern each have an idea for making sure that when companies are taken private, employees get some of the benefits if things go well.
Zell’s idea is to use about $8 billion of borrowed money to buy Tribune Co., a badly run media company in a declining industry, which he would then recapitalize and restructure into an employee stock-ownership plan. When his financial alchemy is completed, employees will control 60 percent of the stock in the new, privately held Tribune, while Zell will control 40 percent.
If Sam Zell’s buyout of the Chicago Tribune’s parent company goes through, employees will own 60 percent of the company. But they won’t control the board.
Now it may strike you, as it did me, as a little strange that somebody could propose one of the largest-ever employee ownership schemes without talking to a single employee. The financing plan would require that the contributions Tribune makes to its employee pensions in the future be used, in effect, to buy Tribune stock, which isn’t exactly the kind of portfolio diversification that pension advisers recommend. Moreover, it turns out that while employees, through their trust, would "control" a majority of the stock, they wouldn’t control the board or decide how the place is run. Those powers would remain with the minority shareholder, Zell…..
NYSE Euronext eyes US derivatives – Financial Times
The newly merged NYSE Euronext exchange group will make expansion in the fast-growing derivatives sector in the US its next priority, senior executives said on Tuesday.
While John Thain, the chief executive, said he did not expect a major acquisition “in the near term”, he refused to rule out participating in the current round of deal-making among the Chicago-based derivatives exchanges. ”I’m not ruling it out but that doesn’t mean I’m going to do it either.”
He made his comments whi
le also signalling that he expects the new group to present a major new threat to the London Stock Exchange, and that he is to move the international listing business from New York to Paris to bolster the challenge to the UK exchange….
NYSE raps London for Russian listings - Daily Telegraph
The head of the New York Stock Exchange has launched a thinly veiled attack on the London Stock Exchange over its willingness to allow Russian companies to list.
John Thain, chief executive of the NYSE, has warned fellow exchanges against accepting international listings from countries from the former Soviet Union because of the lack of adherence to corporate governance rules.
Although he did not make reference to an exchange in particular, the comments will be seen as a direct hit on the LSE, which has been a haven for Russian listings, the largest to date being that of Rosneft, the oil company that co-listed in London last summer to much controversy.The comments come just three months after Mr Thain hit out at the LSE’s junior Aim market, calling into question the quality of the companies that list on it….
Payment Woes Worsen On Riskiest Mortgages – Wall Street Journal
The number of borrowers in the U.S. falling behind on the riskier types of home mortgages continues to grow, according to new data from First American Loan Performance, a research firm in San Francisco.
The rapid rise in overdue payments and defaults has forced dozens of lenders out of business or into bankruptcy protection in recent months and darkened the outlook for the U.S. housing market.
Yesterday, the National Association of Realtors reported that its index of pending U.S. home sales in February stood at 109.3, down 8.5% from a year earlier but up 0.7% from January. The index, which equates the 2001 sales level to 100, is based on home-purchase agreements that haven’t yet been completed…..
