Anadarko Petroleum: Possible Mining Giant Interest?

 

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Although the alleged idea / rumour that mining giant BHP Billiton could be interested in Anadarko Petroleum does at first appear quite fanciful, in the week or so that this information has been around, that the US group could be vulnerable to hostile speculative interest does appear credible that just idle gossip.

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Recent share price strength – with $46 being a key level which is close to being broken now. does suggest that someone is running the rule over the company after it missed Wall Street expectations last month, and the sub standard Return on Equity the group has versus its peers. This means that not only might the analysts regard Anadarko as a potential recovery play, but one which may require some active new management to turn the situation around.

Disclaimer
Zakmir.com is a purely journalistic, not for profit website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

Zayo: Reviewing Strategic Options

As suggested and suspected in the February 22 article here, Zayo has confirmed it is looking at strategic options for the company. Given the relatively strong position the group is fundamentally, and the still relatively lowly share price, there should be a decent outcome for shareholders.

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This is partly only the basis that analysts’s targets are $35 – well above where the stock is now, and that any corporate activity would have to deliver a premium to that price. Indeed, it is somewhat surprising that the shares are only up around 10%. Normally, one would have expected 20% plus. Perhaps the market has still not quite appreciated what the set up is here?

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Disclaimer
Zakmir.com is a purely journalistic, not for profit website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

Inmarsat In Orbit Again

Given the way that Inmarsat has not exactly been hitting the stratosphere in terms of its fundamental or share price performance in recent months and years, one would have thought that the company would have welcomed the $3.2bn move from Echostar last July with open arms.

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Cynics might suggest that the management of the UK group were perhaps not quite as aligned with the interests of their shareholders as they could be. We may see if anything has changed in the near term, especially given the stock price malaise that witnessed a low of 355p earlier this month. Interestingly enough, we often see a bear trap – to flush out the weak hands, a few weeks before a M&A move and this could be another example of the genre. And the rumour mill has been swirling around the stock for some days before the latest story from Reuters and others.

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Thursday’s price action saw the stock fill the December chart gap at 412p and then fall. The next time the shares clear this level could and should be the prelude to a more sustained rally, either off the back of a new Echostar move, or simply that the stock’s 40% decline from the 2018 peak is overdone. Ideally, there will not now be a break back below 370p – this week’s support zone.

Disclaimer
Zakmir.com is a purely journalistic, not for profit website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

Consort Medical (CSRT): Sector Consolidation Interest

One of the things we do know about the stock market for 2019 is that this year is likely to be a year of pharma consolidation, with the big players looking to get over issue of generic competition, price wars and over regulation. The cost of developing new drugs is also so prohibitive that the large caps tend to let the minnows do all the dirty development work, and then take them over just as the apple is set to fall from the tree.

Consort Medical (CSRT) looks to be one such company in the frame with alleged private equity interest – possibly CVC, and / or a UK based rival. Certainly, after the hit the stock took from September to December shareholders will be looking for salvation of some kind. This could come as soon as the next couple of weeks.

Even without the merits of a story, it is interesting to note from the chart that the end of last month saw the stock price gap up through its 50 day moving average, one of the better technical signals and one that suggests a decent buying event. The fact that the shares have held this gap and the 50 day moving average at 866p suggests drip feed buying is continuing. This backs the idea the stock is on the M&A runway.

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A decent price trigger for the doubters of the M&A angle here would be an end of day close for the stock above the September resistance line at 955p – today’s current high. We shall see.

Disclaimer

Zakmir.com is a purely journalistic, not for profit website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is  recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

FNAC Darty: Likely To Be Taken Private

FNAC Darty: results have beaten forecasts for the electrical goods retailer – despite the “Yellow Vests”. One of the company’s top shareholders – Ceconomy, which owns 24% currently, is looking to take the group private.

Rumours have been swirling around both France and England over the past few weeks, with the feeling being that the matter is coming to a head, and a deal done in the €90 zone. The stock has been up to €106, so €90 is an excessive number whatever happens to this situation. It also seems to be the case that the financial media sources are developing the story here.

Shares of FNAC have just broken their 200 day moving average at €70 – breaking into technical bull mode. Above this the next charting resistance is at €85, not far off the mooted €90 take private level.

Disclaimer

Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is  recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

Zayo – Back In M&A Play

Zayo: Two or three rounds of bid speculation have surrounded US communications infrastructure group in the recent past. A low ball offer just above $30 has been understandably rejected by the company – especially so given the way the average analyst target at $35 and most accompanied by strong buy recommendations. In addition, activist shareholder Sachem Head Capital would not be willing to sell out cheaply.

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The bidders are however regrouping, even though private equity likes and needs to buy cheap, in this situation, with Google / Alphabet  a potential bidder this is not likely to be possible. Blackrock – said to be in the fray, will have to dig deeper into its pockets. But at least it has the funding lined up and is revising its offer to around $35. Google would likely pay more if it had to.

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The suggestion is therefore that the aforementioned $35 is likely to be the new offer for Zayo to contend with. In a competitive bid situation up to $40 could materialise, especially given the way that the company’s recent trading has been so solid.

Barring an overnight / sudden announcement (as soon as this weekend), a break of $28 – recent chart resistance would imply that this situation is once again strongly in play.

 

 

Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

Competitors Steering Towards Nokian Tyres

Nokian Tyres, a specialist in winter season tyres, is said to be in focus currently as a potential takeover target in the market.

It is number one in the world in terms of its niche business area. The parties rumoured to be interested are Pirelli, Bridgestone and Goodyear – a predictable assortment of its larger competitors. Clearly, this makes for an obvious bolt on to the larger rivals, with added synergies / efficiencies.

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The current share price of Nokian is near to €30, with a takeout price as high as €40 likely to clinch any deal that may materialise.

A recent trading update from Nokian Tyres was solid, as was the latest from Michelin. It could very well be the case that with increasingly extreme weather patterns, demand for the offering of Nokian is set to increase. Given that Pirelli was taken over by the Chinese a couple of years ago, this may provide the clue to potential M&A moves in this space.

Zakmir.com is a purely journalistic website – Zak Mir is a member of the National Union of Journalists. There is no intention here of providing financial advice. It is recommended you seek an independent professional opinion before deciding whether or not to take any action with regard to anything written here.

HB Fuller Likely To Be Involved In An Adhesives M&A Land Grab

HB Fuller (FUL)  is a $2.5bn American adhesives group being looked at by a number of parties. The company is a prime, quality player in its space, and with annual revenues up to $3bn, ROE is 15%  and growing. Therefore it makes sense for competitors to try and consolidate their position in the adhesives space by taking it over.

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In Europe we have a company called Arkema who are eyeing up HB Fuller. But there is also 3M in the US, and in Germany,  Covestro AG. The main company looking at HB Fuller is Arkema, but clearly 3M has the financial firepower as it is a much larger company. This implies the premium on the current share price could be significant, especially if a bidding battle is triggered. The take out price would likely have to be at least $65.

 

BT / Deutsche Telekom

It is good to see the way that the financial press have cottoned onto the BT / Deutsche Telekom story after it appeared here a couple of weeks back.

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This focuses on the way that the German giant is now free to make a takeover bid for its ailing British counterpart, hit by scandal and incompetance in the recent past.

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The end of the lock up to start this year means that if DT is in the mood to go for BT at a relatively low price, years of underperformance may finally be over. The technical level to break may only be above the December gap through 241.75p. Indeed, it may be worth waiting for this potential trigger point given how much badwill BT shares have attached to them in the market.

Henkel Update – Japanese Interest

After recent coverage here regarding Henkel, there has apparently been some movement. In particular, Henkel’s adhesive business is in focus, with possible interest from ThreeBond  of Japan, and American industry players. As reported before, Unilever looks to be the main contender in the frame should any M&A for the whole of Henkel materialise.

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The shares remain bombed out, and it is therefore common sense that rivals in the sector would be sniffing around. This is especially the case as the company’s own initiatives to extract shareholder value have so far received a mooted response. A takeout price towards €120 looks to be on the cards, any deals that focus on individual parts of the group notwithstanding.