Lionsgate slides on downgrade

Lionsgate slides as analyst cuts rating on competitive, cost concerns

Lionsgate falls on downgrade. Stockwinners.com
Lionsgate falls on downgrade.

Bernstein analyst Todd Juenger downgraded Lionsgate (LGF.B) to Market Perform this morning, putting some pressure on the shares.

The analyst argued that competitive investment from rival premium and Subscription Video On Demand, or SVOD, services has gotten much more intense, while also pointing to increased programming investment at Starz.

MOVING TO THE SIDELINES

In a research note this morning, Bernstein’s Juenger downgraded Lionsgate to Market Perform from Outperform and lowered his price target on Class B shares to $30 from $35.

The analyst told investors that he believes competitive investment from rival premium and SVOD services has gotten much more intense, and noted that increased programming investment at Starz is a necessary but recurring cost of doing business, which means the normalized growth rate for Starz has to be lower.

#Juenger added that while Lionsgate likes to tell investors they offer higher-than-average growth at lower-than-average risk, he sees, at best, average growth, with higher-than-average risk.

Further, M&A is always possible, but if discussions were on-going or imminent, the company would not choose to increase investment, lower guidance, and reinstate a dividend, the analyst contended.

NEAR-TERM UPSIDE MUTED

Last week, Barrington analyst James Goss lowered his price target for Lionsgate to $34 from $40, while reiterating an Outperform rating on the stock.

The analyst noted that with the company’s repositioning its film slate under new leadership, and increasing its investment in programming for Starz, Lionsgate sees more muted growth in 2019, with a significant ramp in 2020. While Goss expects near-term upside to be muted, he believes the Starz service will be a more attractive offering in the “shifting media landscape,” which should provide further opportunities for long-term growth.

INDUSTRY CONSOLIDATION

According to a report by CNBC earlier this month, Comcast (CMCSA) could consider topping Disney’s (DIS) bid for 21st Century Fox (FOXA) if regulators approve AT&T’s (T) acquisition of Time Warner (TWX).

While no decision has been made by Comcast, Disney is already considering responses in case Comcast makes a run at Fox, the report added.

On December 14, Disney and 21st Century Fox announced they had entered into a definitive pact under which Disney will acquire 21st Century Fox, including the company’s Film and Television studios, along with cable and international TV businesses, for approximately $52.4B in stock.

As part of the deal, Fox will spin off Fox Broadcasting network and stations, Fox News, Fox Business, FS1, FS2, and Big Ten Network to its shareholders.

PRICE ACTION

In Wednesday’s trading, Class B shares of Lionsgate had dropped over 1% to $26.90.


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Aegean Marine to acquire H.E.C. Europe for $367M

Aegean Marine to acquire H.E.C. Europe for approximately $367M

Aegean Marine to acquire H.E.C. Europe for $367M. Stockwinners.com
Aegean Marine to acquire H.E.C. Europe for $367M.

Aegean Marine (ANW) is pleased to announce that today it has entered into a definitive agreement to acquire all of the outstanding share capital of H.E.C. Europe Limited, the parent company of Hellenic Environmental Center S.A. and a group of companies that together provide global port reception facilities services, from the shareholders of H.E.C., for aggregate consideration of approximately $367M, including the assumption of certain indebtedness, which consideration is payable in the form of a combination of debt, the assignment of certain accounts receivables, cash and shares of Aegean common stock, which will represent approximately 33% of the issued and outstanding common stock of Aegean after giving effect to the issuance.

The Sellers are companies owned and controlled by Dimitris Melisanidis and certain members of his family, and members of the Agiostratitis family.

Aegean expects the acquisition, which results from several months of negotiations, to be immediately accretive to adjusted earnings per share in year one.

The acquisition was unanimously approved by the Aegean Board upon the recommendation of a special committee of independent directors. In making its recommendation, the Special Independent Committee consulted with its independent financial advisor, Clarksons Platou Securities and outside legal counsel.

The acquisition does not require the approval of Aegean’s shareholders. Aegean expects the acquisition to be immediately accretive to adjusted EPS in year one. Post-closing of the transaction, expected additional 2018E Revenues will amount to approximately $60M-$65M and 2018E EBITDA will amount to approximately $35M-$40M, which assumes timely closing of the transaction and completion of targeted acquisitions in 2018.

In addition, Aegean expects to appoint one additional independent director to the Aegean Board, effective as of the closing of the acquisition, creating an eight member Board of Directors.

ANW closed at $4.45.


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Broadcom lowers its offer for Qualcomm

Broadcom adjusts offer for Qualcomm to $79.00 per Qualcomm share 

Broadcom proposes to buy Qualcomm for $79 per share.  

Broadcom (AVGO) reaffirms its commitment to acquiring Qualcomm (QCOM), and is adjusting its offer following the Qualcomm board’s decision to transfer $4.10 per Qualcomm share (or $6.2B of value) from Qualcomm stockholders to NXP (NXPI) stockholders.

Broadcom is prepared to acquire Qualcomm for $79 per Qualcomm share, consisting of $57 in cash and $22 in Broadcom shares (premised on Qualcomm’s revised agreement to acquire NXP at $127.50 per NXP share).

In addition, Broadcom’s proposed merger agreement for Qualcomm would provide for an automatic increase of $3 in cash per Qualcomm share, or a total of $82 per Qualcomm share, consisting of $60 in cash and $22 in Broadcom shares, in the event that Qualcomm is unable to complete the NXP (NXPI) acquisition.

Broadcom’s proposed merger agreement otherwise remains unchanged, including the $8 billion regulatory reverse termination fee and 6% per annum (net of dividends) ticking fee accruing from and after the 12-month anniversary of the date of the merger agreement.

Broadcom believes that a responsible Qualcomm board could have preserved value by following ISS’s clear recommendation to work with Broadcom on the NXP transaction and negotiate the sale of Qualcomm to Broadcom.

Instead Qualcomm’s board acted against the best interests of its stockholders by unilaterally transferring excessive value to NXP’s activist stockholders.

Despite this direct value transfer, Broadcom remains committed to delivering a value-maximizing offer to Qualcomm stockholders.

Broadcom remains confident that Qualcomm’s stockholders will continue to support its proposal to acquire Qualcomm, and looks forward to concluding a transaction with this Qualcomm board of directors, or the newly elected Qualcomm board following its annual meeting on March 6, 2018.

Broadcom continues to urge Qualcomm stockholders to vote the entire BLUE proxy card “FOR” ALL SIX Broadcom nominees to show support for the Broadcom proposal.


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Positive data reported on uterine fibroids

Phase 3 ELARIS UF-I study of elagolix met primary endpoint

Phase 3 ELARIS UF-I study of elagolix met primary endpoint. Stockwinners.com
Phase 3 ELARIS UF-I study of elagolix met primary endpoint.

AbbVie (ABBV) in cooperation with Neurocrine Biosciences (NBIX), announced that the Phase 3 ELARIS UF-I study of elagolix met its primary endpoint.

Results from the first of two pivotal Phase 3 studies demonstrated at month six that elagolix, in combination with low-dose hormone (add-back) therapy, reduced heavy menstrual bleeding with 68.5 percent (pless than 0.001) of women with uterine fibroids achieving clinical response compared to placebo (8.7 percent), as measured by the alkaline hematin method.

Uterine fibroids are noncancerous growths of the uterus that often appear during childbearing years. Also called leiomyomas (lie-o-my-O-muhs) or myomas, uterine fibroids aren’t associated with an increased risk of uterine cancer and almost never develop into cancer.

Fibroids range in size from seedlings, undetectable by the human eye, to bulky masses that can distort and enlarge the uterus. You can have a single fibroid or multiple ones. In extreme cases, multiple fibroids can expand the uterus so much that it reaches the rib cage. Many women have uterine fibroids sometime during their lives. But most women don’t know they have uterine fibroids because they often cause no symptoms.

Clinical response was defined as menstrual blood loss volume of less than 80 mL during month six and a 50 percent or greater reduction in menstrual blood loss volume from baseline to month six.

The study also met all ranked secondary endpoints (pless than 0.001) at month six.

Both stocks are higher in pre-market trading.


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Fogo De Chao sold for $560 million

Fogo De Chao to be acquired by Rhone for $15.75 per share in cash

Fogo De Chao to be acquired by Rhone for $15.75 per share in cash. Stockwinners.com
Fogo De Chao to be acquired by Rhone for $15.75 per share in cash.

Fogo de Chao (FOGO) announced an agreement to be acquired by investment entities affiliated with Rhone Capital.

Under the terms of the agreement, Rhone will acquire the Company in an all cash transaction valued at $560M.

The Company’s stockholders will receive $15.75 per share, representing a 25.5% premium to the closing share price of the Company’s shares on February 16, 2018.

The transaction is the result of a comprehensive strategic alternatives review process taken by the Company’s Board of Directors.

The transaction has been unanimously approved by Fogo’s Board of Directors. Funds affiliated with Thomas H. Lee Partners, L.P. and certain of Fogo’s directors and executive officers, which collectively hold more than 60 percent of Fogo’s shares, have approved the transaction by written consent.

The acquisition is expected to be completed during the second calendar quarter of 2018, subject to regulatory approvals and other customary closing conditions.


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MiMedx tumbles on questionable “sales practices”

MiMedx sinks after announcing internal investigation into sales practices

MiMedx tumbles on questionable "sales practices". Stockwinners.com
MiMedx tumbles on questionable “sales practices”

Shares of MiMedx (MDXG) are sinking after the company delayed its Q4 results to conduct an internal investigation.

The biopharmaceutical company said earlier that its Audit Committee has engaged independent legal and accounting advisors to conduct an internal investigation into current and prior-period matters relating to allegations regarding certain sales and distribution practices.

Company executives are also reviewing, among other items, the accounting treatment of certain distributor contracts.

MiMedx believes, however, that based on information available to date, the “outcome of such investigation should not have a material impact on revenue guidance for 2018.”

The company’s CEO Pete Petit stated, “”Our Board of Directors and executives believe it is in the best interests of our Company and shareholders for our Audit Committee to address these allegations in an internal investigation with the support of independent legal and accounting advisors. We look forward to releasing our 2017 financial results as soon as this process is complete.

MiMedx has been experiencing rapid growth over the last few years as our product portfolio continues to meet significant, unmet needs in the marketplace. We are literally saving lives by saving limbs, and we expect to continue to deliver operational and clinical success in the months and years to come.”

MDXG closed at $14.47. It last traded at $11.50.


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Adamas Pharmaceuticals hit by patent challenge

Adamas Pharmaceuticals announces declaratory judgment action filed by Osmotica

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Adamas Pharmaceuticals announces declaratory judgment action filed by Osmotica

Adamas Pharmaceuticals (ADMS) announced that it has learned that Osmotica Pharmaceuticals LLC and Vertical Pharmaceuticals LLC filed an action in Delaware federal court on February 16, 2018 requesting a declaratory judgment that Osmotica’s newly-approved product OSMOLEX ER extended-release tablets does not infringe certain of Adamas’ patents.

Adamas has not received service of a summons and complaint.

The complaint does not allege patent infringement against Adamas or otherwise pertain to Adamas’ product GOCOVRI extended release capsules.

OSMOLEX ER was approved by the FDA on February 16, 2018 for the treatment of Parkinson’s disease and drug-induced extrapyramidal reactions in adult patients, indications approved for immediate release amantadine in 1972.

As Osmotica states in the complaint, drug-induced extrapyramidal reaction is a separate and distinct disorder from dyskinesia in Parkinson’s disease patients.

According to the package insert attached to the complaint, the approval was based on three bioavailability studies comparing OSMOLEX ER to immediate release amantadine syrup in healthy volunteers.

The package insert does not include any new clinical safety or efficacy data specific to OSMOLEX ER to support its use in the approved indications. Osmotica alleges that OSMOLEX ER does not infringe certain of Adamas’ patents covering compositions and uses of amantadine.

Adamas is evaluating Osmotica’s non-infringement assertions based on the limited information in the complaint.

Adamas’ approved product GOCOVRI is the first and only FDA-approved medicine for the treatment of dyskinesia in Parkinson’s disease patients on levodopa-based therapy, with or without concomitant dopaminergic medicines.

GOCOVRI is taken at bedtime with a pharmacokinetic (PK) profile that delivers low concentrations of amantadine in nighttime, slowly rising to high concentrations (1,500 ng/ml) before awakening, and throughout the day.

Use of GOCOVRI in this Parkinson’s disease patient population is supported by robust efficacy and safety data, required by the FDA for approval, that demonstrate statistically significant and clinically meaningful reductions in dyskinesia and OFF time in three controlled clinical studies and an ongoing two-year, open-label safety study.

Neither OSMOLEX ER nor any other therapy has been approved for the treatment of dyskinesia in Parkinson’s disease patients on levodopa-based therapy.

ADMS closed at $33.77. It last  traded  at $30.75.


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Albertsons and Rite Aid to merge

Rite Aid CEO to become CEO of combined Rite Aid, Albertsons

Albertsons and Rite Aid to merge

Albertsons Companies and Rite Aid Corporation (RAD) announced a definitive merger agreement under which privately held Albertsons Companies will merge with publicly traded Rite Aid.

Under the terms of the agreement, in exchange for every 10 shares of Rite Aid common stock, Rite Aid shareholders will have the right to elect to receive either (i) one share of Albertsons Companies common stock plus approximately $1.83 in cash or (ii) 1.079 shares of Albertsons Companies stock.

Depending upon the results of cash elections, upon closing of the merger, shareholders of Rite Aid will own a 28.0 percent to 29.6 percent stake in the combined company, and current Albertsons Companies shareholders will own a 70.4 percent to 72.0 percent stake in the combined company on a fully diluted basis.

Immediately following completion of the merger and assuming that all Rite Aid shareholders elect to receive shares plus cash, Albertsons Companies will have approximately 392.9 million shares outstanding on a pro forma and fully diluted basis.

Following the close of the transaction and the share exchange, Albertsons Companies’ shares are expected to trade on the New York Stock Exchange.

Albertsons Companies is backed by an investment consortium led by Cerberus Capital Management, L.P., which also includes Kimco Realty Corporation (KIM), Klaff Realty LP, Lubert-Adler Partners LP, and Schottenstein Stores Corporation.

Current Rite Aid Chairman and Chief Executive Officer John Standley will become CEO of the combined company, with current Albertsons Companies Chairman and CEO Bob Miller serving as Chairman.

The combined company is expected to be comprised of leadership from both companies and will be dual headquartered in Boise, Idaho, and Camp Hill, Pennsylvania.

The name of the combined company will be determined by transaction close.

The integrated company will operate approximately 4,900 locations, 4,350 pharmacy counters, and 320 clinics across 38 states and Washington, D.C., serving 40+ million customers per week.

Most Albertsons Companies pharmacies will be rebranded as Rite Aid, and the company will continue to operate Rite Aid stand-alone pharmacies.

The combined company expects to deliver annual run-rate cost synergies of $375 million in approximately three years and access potential annual revenue opportunities of $3.6 billion.

Over 60 percent of the cost synergies are expected to be realized within the first two years post-close. Identified revenue opportunities primarily include partnering with payors, including Rite Aid’s PBM, EnvisionRx, through preferred networks to drive additional high-value customers, connecting Rite Aid’s reliable pharmacy customer base to Albertsons Companies through loyalty programs and targeted marketing, leveraging Albertsons Companies’ grocery capabilities and Rite Aid’s pharmacy expertise to enhance the customer offering, and driving traffic through the omni-channel experience.

Cost synergies will be achieved primarily through procurement savings, leveraging efficiencies realized by a combined supply chain, combined distribution and fulfillment channels, and leveraging manufacturing capabilities.

The board of directors will be comprised of nine directors, four of whom will be named by Albertsons Companies, four of whom will be named by Rite Aid (including John Standley), and one of whom will be a jointly selected director. A majority of the Board will be independent. Lenard Tessler will serve as Lead Director.

Kimco Realty Corp (KIM) confirms its participation as an investor in connection with today’s announced execution of a definitive agreement under which Albertsons Companies will acquire all outstanding shares of Rite Aid Corporation (RAD).

RAD closed at $2.13. It last traded at $2.68.


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Aimmune Therapeutics reports positive peanut energy

Phase 3 Palisade trial of AR101 met primary endpoint in peanut allergy

 

Aimmune Therapeutics reports positive peanut energy. Stockwinners.com
Aimmune Therapeutics reports positive peanut energy.

Aimmune Therapeutics (AIMT) announced that its pivotal Phase 3 PALISADE efficacy trial of AR101 met the primary endpoint.

In the United States, AR101 has U.S. Food and Drug Administration Breakthrough Therapy Designation for peanut-allergic patients ages 4-17.

PALISADE enrolled 499 patients ages 4-17, 496 of whom received treatment.

After approximately one year of treatment, patients completed an exit double-blind, placebo-controlled food challenge. In the primary analysis of 496 patients ages 4-17, 67.2% of AR101 patients tolerated a single highest dose of at least 600 mg of peanut protein with no more than mild symptoms in the exit DBPCFC, compared to 4.0% of placebo patients.

The corresponding difference in response rates was 63.2%, and, at 53%, the lower bound of the 95% confidence interval greatly exceeded the pre-specified success criterion, which was 15%.

Additionally, 50.3% of AR101 patients tolerated a single highest dose of 1000 mg of peanut protein, compared to 2.4% of placebo patients.

In order to minimize the risk of assessment bias, the primary endpoint evaluations were conducted by independent, blinded assessors, who were not involved in patients’ ongoing care in the trial and who were blinded to treatment assignment and the sequence of the DBPCFCs.

AIMT closed at $37.20. It last traded at $43.49. Shares of DBV Technologies (DBVT) are down 10%, or $2.64, to $23.22. The latter has a competing drug.


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Qualcomm raises NXP Semiconductors offer to $127.50 a share

Qualcomm agrees with NXP Semiconductors to increase purchase price to $127.50/sh 

Qualcomm agrees with NXP Semiconductors to increase purchase price to $127.50/sh. Stockwinners.com
Qualcomm raises NXP Semiconductors offer  to $127.50/sh 

Qualcomm (QCOM) announced that Qualcomm River Holdings, an indirect wholly owned subsidiary of Qualcomm, has reached an agreement with NXP Semiconductors N.V. (NXPI) to increase to $127.50 per share its previously announced cash tender offer to purchase all outstanding shares of NXP.

The amended agreement, which was approved by the Qualcomm and NXP Boards of Directors, also lowers the minimum tender condition from 80% of NXP’s outstanding shares to 70%.

Qualcomm also announced that Qualcomm River Holdings B.V. has entered into binding agreements with nine NXP stockholders who collectively own more than 28% of NXP’s outstanding shares (excluding additional economic interests through derivatives) to tender their shares at $127.50 per share.

These stockholders include funds affiliated with Elliott Advisors Limited and Soroban Capital Partners LP. Under the terms of the revised agreement, the currently pending tender offer of Qualcomm River Holdings B.V. to acquire all of the issued and outstanding shares of NXP will be amended as described above and the expiration time for the offer will be extended to the end of day, one minute after 11:59 p.m. New York City time, on March 5, 2018.

Qualcomm intends to fund the additional consideration with cash on hand and new debt. The amended tender offer is not subject to any financing condition.

The offer is conditioned on at least 70% of the outstanding ordinary shares of NXP being validly tendered and not withdrawn prior to the expiration of the offer.

Qualcomm’s acquisition of NXP has received antitrust clearance from eight of the nine required government regulatory bodies around the world. The transaction remains contingent on clearance from the Ministry of Commerce in China. Qualcomm is optimistic it will receive MOFCOM clearance in the near term.


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Barron’s in bullish on Citi, bearish on GE

Barron’s, the weekly publication owned by the Wall Street Journal, in its latest issue mentions several names:

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin
Stockwinners offers Barron’s review of stocks to buy, stocks to watch

BULLISH   MENTIONS: 

Hovnanian (HOV) stock too cheap to ignore- Hovnanian Enterprises offers an interesting speculative bet, because more than a decade’s worth of problems are reflected in the price, Brett Arends writes in this week’s edition of Barron’s. A successful resolution of its legal issues, a corporate turnaround, a takeover, or a continued recovery in the U.S. real estate market are all potential catalysts, he adds.

JPMorgan, Walmart cash flow yields exceed dividend yields – The cash flow yields of JPMorgan (JPM), Johnson & Johnson (JNJ), Walmart (WMT), Pfizer (PFE), Cisco (CSCO), AbbVie (ABBV), PepsiCo (PEP), 3M (MMM), Bristol-Myers (BMY), United Technologies (UTX), Texas Instruments (TXN) and Abbott Laboratories (ABT) exceed their dividend yields, a good signal for dividend coverage and growth, Lawrence Strauss writes in this week’s edition of Barron’s.

Alphabet, Citi well positioned for later stages of market rally – It is time for investors to think about how and when bull markets end, Jack Hough writes in this week’s edition of Barron’s. Groups to favor now include financials, which benefit from rising interest rates, and industrials, he notes, adding that technology still looks attractive. Alphabet (GOOG; GOOGL), Lam Research (LRCX), Citigroup (C), and Cummins (CMI) are all well positioned for the later stages of a long market rally, Hough contends.

Bears, bulls battle over Under Armour – In a follow-up story, Barron’s says that Under Armour (UA) reported fourth quarter revenue that beat Wall Street’s estimate, but is difficult to tell whether the revenue upside represents a turning point for the business. Bulls and bears both found something to support their arguments, as revenue increased but gross margin declined while inventories swelled and store count rose 22%, the report notes.

BEARISH  MENTION:

General Electric stock could drop another 10% – General Electric (GE) lost $6B in 2017 after a series of charges and impairments, cut its dividend by 50%, and its accounting is under investigation by the Securities and Exchange Commission, but lately it has been attracting fresh attention from value-oriented investors, Andrew Bary writes in this week’s edition of Barron’s. Nonetheless, the stock is not a bargain and could drop another 10% or more, he contends


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Intel says 32 lawsuits have been filed against company

Intel says 32 lawsuits have been filed against company over security flaws

Intel says 32 lawsuits have been filed against company. Stockwinners.com
Intel says 32 lawsuits have been filed against company
In a regulatory filing, Intel (INTC) said that “On January 3, 2018, information on the security vulnerabilities was publicly reported, before software and firmware updates to address the vulnerabilities were made widely available.
Numerous lawsuits have been filed against Intel and, in certain cases, our executives and directors, in U.S. federal and state courts and in certain courts in other countries relating to the Spectre and Meltdown security vulnerabilities.
As of February 15, 2018, 30 customer class action lawsuits and two securities class action lawsuits have been filed.
The customer class action plaintiffs, who purport to represent various classes of end users of our products, generally claim to have been harmed by Intel’s actions and/or omissions in connection with the security vulnerabilities and assert a variety of common law and statutory claims seeking monetary damages and equitable relief.
The securities class action plaintiffs, who purport to represent classes of acquirers of Intel stock between July 27, 2017 and January 4, 2018, generally allege that Intel and certain officers violated securities laws by making statements about Intel’s products and internal controls that were revealed to be false or misleading by the disclosure of the security vulnerabilities.
Additional lawsuits and claims may be asserted on behalf of customers and shareholders seeking monetary damages or other related relief. We dispute the claims described above and intend to defend the lawsuits vigorously.
Given the procedural posture and the nature of these cases, including that the proceedings are in the early stages, that alleged damages have not been specified, that uncertainty exists as to the likelihood of a class or classes being certified or the ultimate size of any class or classes if certified, and that there are significant factual and legal issues to be resolved, we are unable to make a reasonable estimate of the potential loss or range of losses, if any, that might arise from these matters.
In addition to these lawsuits, in January 2018, Joseph Tola, Joanne Bicknese, and Michael Kellogg each filed a shareholder derivative action in the Superior Court of the State of California in San Mateo County against certain members of our Board of Directors and certain officers.
The complaints allege that the defendants breached their duties to Intel in connection with the disclosure of the security vulnerabilities and the failure to take action in relation to alleged insider trading.
The complaints seek to recover damages from the defendants on behalf of Intel.”


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Qualcomm calls Broadcom proposal unacceptable

Qualcomm: Current Broadcom proposal ‘unacceptable’ 

Qualcomm calls Broadcom proposal unacceptable

The Board of Directors of Qualcomm (QCOM) sent a letter to Broadcom (AVGO) regarding its February 14 meeting with Broadcom representatives.

Broadcom said “In our February 14 meeting, Broadcom reiterated that $82.00 per share is its best and final proposal. The Board remains unanimously of the view that this proposal materially undervalues Qualcomm and has an unacceptably high level of risk, and therefore is not in the best interests of Qualcomm stockholders.

That said, our Board found the meeting to be constructive in that the Broadcom representatives expressed a willingness to agree to certain potential antitrust-related divestitures beyond those contained in your publicly filed merger agreement.

At the same time, Broadcom continued to resist agreeing to other commitments that could be expected to be required by the FTC, the European Commission, MOFCOM and other government regulatory bodies.

Broadcom also declined to respond to any questions about its intentions for the future of Qualcomm’s licensing business, which makes it very difficult to predict the antitrust-related remedies that might be required.

In addition, Broadcom insists on controlling all material decisions regarding our valuable licensing business during the extended period between signing and a potential closing, which would be problematic and not permitted under antitrust laws.

Our Board is highly cognizant of the need to protect Qualcomm’s stockholders from the considerable risks of agreeing to a transaction that does not close.

A breakup fee in the range proposed by Broadcom does not come close to compensating for those risks.

While the current Broadcom proposal is unacceptable, our Board is intensely focused on maximizing value for Qualcomm stockholders, whether through executing on its growth strategy or by selling the Company.

Our Board is open to further discussions with Broadcom to see if a proposal that appropriately reflects the true value of Qualcomm shares, and ensures an appropriate level of deal certainty, can be obtained. If such a proposal cannot be obtained from Broadcom, our Board is highly confident in Qualcomm’s ability to deliver superior near- and long-term value to its stockholders by continuing to execute its growth strategy.”


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A. Schulman sold for $2.25B

LyondellBasell to acquire A. Schulman for $2.25B

LyondellBasell to acquire A. Schulman for $2.25B. Stockwinners.com
LyondellBasell to acquire A. Schulman for $2.25B.

LyondellBasell (LYB) and A. Schulman (SHLM) announced that they have entered into a definitive agreement under which LyondellBasell will acquire A. Schulman for a total consideration of $2.25B.

The acquisition builds upon LyondellBasell’s existing platform in this space to create a premier Advanced Polymer Solutions business with broad geographic reach, leading technologies and a diverse product portfolio.

Under the terms of the agreement, LyondellBasell will acquire A. Schulman for a total consideration of $2.25B.

LyondellBasell will purchase 100% of A. Schulman common stock for $42 per share in cash and one contingent value right per share and assume outstanding debt and certain other obligations.

In addition, the contingent value rights generally will provide a holder with an opportunity to receive certain net proceeds, if any are recovered, from certain ongoing litigation and government investigations relating to A. Schulman’s Citadel and Lucent acquisitions. LyondellBasell is using cash-on-hand to finance the acquisition.

LyondellBasell expects to achieve $150M in run-rate cost synergies within two years, primarily by leveraging its well-established approach to cost discipline and productivity, as well as its culture of operational, business and commercial excellence.

Further, the acquisition is expected to be accretive to earnings within the first full year following close.

The combined businesses had revenues of $4.6B and adjusted EBITDA of $446M over the last 12 months.

The proposed acquisition, which has been unanimously approved by the respective boards of LyondellBasell and A. Schulman, is subject to customary closing conditions, including regulatory approvals and approval by A. Schulman shareholders.

The acquisition is expected to close in the second half of 2018.


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Wyndham sells its European vacation business rental for $1.3B

Wyndham to sell European vacation rental business to Platinum Equity for $1.3B

 

Wyndham sells its European vacation rental for $1.3B. Stockwinners.com
Wyndham sells its European vacation rental for $1.3B

Wyndham (WYN) announced that it has entered into a definitive agreement for the sale of its European vacation rental business to Platinum Equity for approximately $1.3B.

In conjunction with the sale, the European vacation rental business has entered into a 20-year agreement under which it will pay a royalty fee of 1% of net revenue to Wyndham’s hotel business for the right to use the by Wyndham Vacation Rentals endorser brand.

The European vacation rentals operations will also participate as a redemption partner in the award-winning Wyndham Rewards loyalty program.

Wyndham’s industry-leading European vacation rental business is the largest manager of holiday rentals in Europe, with more than 110,000 units in over 600 destinations in more than 25 countries.

The business operates more than two dozen local brands, including cottages.com, James Villa Holidays, Landal GreenParks, Novasol and Hoseasons.

It generates approximately $750 million in annual revenue and approximately $130 million of EBITDA, including allocated costs.

Wyndham Worldwide originally announced its intent to explore strategic alternatives for its European rental brands in August 2017, in conjunction with the Company’s announcement of the planned separation of its hotel business from its vacation ownership and timeshare exchange businesses.

The transaction is expected to close in the second quarter of 2018, subject to customary closing conditions including works council consultation.


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