Intel to spin off MobilEye

Intel confirms intent to take Mobileye public

The company (INTC) states: “Intel announced its intention to take Mobileye public in the United States in mid-2022 via an initial public offering of newly issued Mobileye stock.

The move will unlock the value of Mobileye for Intel shareholders by creating a separate publicly traded company and will build on Mobileye’s successful track record and serve its expanded market.

Intel will remain the majority owner of Mobileye, and the two companies will continue as strategic partners, collaborating on projects as they pursue the growth of computing in the automotive sector.

The share of semiconductors is expected to be 20% of a premium vehicle’s total bill-of-materials (BOM) by 20301.

The Mobileye executive team will remain, with Prof. Amnon Shashua continuing as the company’s CEO.

Amnon Shashua

Recently acquired Moovit as well as Intel teams working on lidar and radar development and other Mobileye projects will be aligned as part of Mobileye.

In the four years since Mobileye was acquired by Intel, Mobileye has experienced substantial revenue growth, achieved numerous technical innovations and made significant investments directed to solving the most difficult scientific and technology problems to prepare the deployment of autonomous driving at scale.

A final decision on the IPO and its conditions and ultimate timing is pending and subject to market conditions. Intel, as majority shareholder, will continue to fully consolidate Mobileye. The transaction is not expected to have an impact on Intel’s 2021 financial targets.”

INTC is up $1.34 to $52.30.

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Lee Enterprises receives take over offer

Alden Global Capital offers to acquire Lee Enterprises for $24.00 per share

Alden Global Capital sent the following letter to the Board of Directors of Lee Enterprises (LEE):

“Alden Global Capital is a significant investor in American newspapers, with platforms including MediaNews Group, Inc. and Tribune Publishing Company that are committed to ensuring communities nationwide have access to robust, independently minded local journalism.

Our goal is to provide valued news and information to local subscribers nationwide, led by a talented team of seasoned newspaper executives who have worked in journalism for an average of more than 30 years.

Our newspapers include The Chicago Tribune, The Denver Post, The Mercury News, The New York Daily News, The Orange County Register, The Boston Herald, The Baltimore Sun and other leading newspapers across the U.S.

As you are aware, an affiliated entity of ours owns approximately 6% of the issued and outstanding common stock of Lee Enterprises, Incorporated.

We believe that as a private company and part of our successful nationwide platforms, Lee would be in a stronger position to maximize its resources and realize strategic value that enhances its operations and supports its employees in their important work serving local communities.

Our interest in Lee is a reaffirmation of our substantial commitment to the newspaper industry and our desire to support local newspapers over the long term.

Accordingly, we propose to purchase Lee for $24.00 per share in cash, representing a substantial premium of approximately 30% to Lee’s closing share price of $18.49 on November 19th, 2021.

We have the ability to fully finance this all-cash proposal and the definitive merger agreement will not include a financing condition.

We have engaged an experienced team of advisors, including Moelis & Company as financial advisor as well as Akin Gump Strauss Hauer & Feld LLP and Olshan Frome Wolosky LLP as legal counsel, and have conducted a comprehensive review of publicly available information about Lee.

Based on our review of this information and in consultation with our counsel, we do not believe any material regulatory issues would inhibit the completion of this transaction in a timely manner.

The foregoing indicative terms are based solely on our review of publicly available information, are subject to completion of our due diligence and execution of definitive documentation acceptable to us and we reserve the right to withdraw or modify our proposal in any manner.

Following the review of targeted additional information pursuant to a mutually acceptable nondisclosure agreement, we expect that we would complete our work, including negotiation of definitive documentation, in approximately four weeks.

We are keenly interested in working constructively with the Lee Board of Directors, with the goal of getting to a successful transaction with value, speed and certainty.

Scale is critical for newspapers to ensure necessary staffing and in order to thrive in this challenging environment where print advertising continues to decline and back office operations and legacy public company functions remain bloated, thus depriving newsrooms of resources that are best used serving readers with relevant, trustworthy and engaging content.

We hope that the Board will work with us to maximize value and opportunities for all Lee stockholders and employees, and we look forward to receiving a response to this non-binding proposal in an expeditious manner.”

Lee Enterprises, founded in 1890, provides local news and information, and advertising services in the United States. The company offers print and digital editions of daily, weekly, and monthly newspapers and publications; and digital services, including Web hosting and content management for other content producers. Additionally, the company publishes 9 daily newspapers, and weekly newspapers and specialty publications.

LEE last traded at $22.92, up $4.47 on the day.

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GE to split into three companies

General Electric to form three public companies

GE announced its plan to form three industry-leading, global public companies focused on the growth sectors of aviation, healthcare, and energy, by: Pursuing a tax-free spin-off of GE Healthcare, creating a pure-play company at the center of precision health in early 2023, in which GE expects to retain a stake of 19.9 percent; and Combining GE Renewable Energy, GE Power, and GE Digital into one business, positioned to lead the energy transition, and then pursuing a tax-free spin-off of this business in early 2024.

GE to split into three

Following these transactions, GE will be an aviation-focused company shaping the future of flight.

As independently run companies, the businesses will be better positioned to deliver long-term growth and create value for customers, investors, and employees, with each benefitting from: Deeper operational focus, accountability, and agility to meet customer needs; Tailored capital allocation decisions in line with distinct strategies and industry-specific dynamics; Strategic and financial flexibility to pursue growth opportunities; Dedicated boards of directors with deep domain expertise; Business- and industry-oriented career opportunities and incentives for employees; and Distinct and compelling investment profiles appealing to broader, deeper investor bases.

GE Chairman and CEO H. Lawrence Culp, Jr. said, “At GE we have always taken immense pride in our purpose of building a world that works. The world demands-and deserves-we bring our best to solve the biggest challenges in flight, healthcare, and energy.

By creating three industry-leading, global public companies, each can benefit from greater focus, tailored capital allocation, and strategic flexibility to drive long-term growth and value for customers, investors, and employees. We are putting our technology expertise, leadership, and global reach to work to better serve our customers.”

Culp will serve as non-executive chairman of the GE healthcare company upon its spin-off.

He will continue to serve as chairman and CEO of GE until the second spin-off, at which point, he will lead the GE aviation-focused company going forward.

Peter Arduini will assume the role of president and CEO of GE Healthcare effective January 1, 2022.

Peter Arduin

Scott Strazik will be the CEO of the combined Renewable Energy, Power, and Digital business while John Slattery continues as CEO of Aviation.

Scott Strazik

GE intends to execute the spin-offs of Healthcare in early 2023 and of the Renewable Energy and Power business in early 2024.

John Slattery

The respective capital structures, brands, and leadership teams for each independent company will be determined and announced later.

Where required to do so, GE will consult with employee representatives in line with its legal obligations before any final decisions are taken.

Through the transition, GE will be able to monetize its stakes in AerCap and Baker Hughes, prioritizing further debt reduction.

Each of the three resulting independent companies will be well capitalized with investment-grade ratings.

Following the spin-off transactions, GE will retain other assets and liabilities of GE today, including run-off insurance operations.

Upon closing the Healthcare transaction, GE expects to retain a stake of 19.9 percent in the healthcare company to provide capital allocation flexibility.

GE also intends that Healthcare will issue debt securities, the proceeds of which will be used to pay down outstanding GE debt.

The transactions are not subject to bondholder consent.

The company expects to incur one-time separation, transition, and operational costs of approximately $2 billion and tax costs of less than $0.5 billion, which will depend on specifics of the transaction.

The proposed spin-offs of Healthcare and the Renewable Energy and Power business are intended to be tax-free for GE and GE shareholders for U.S. federal income tax purposes.

The transactions are subject to the satisfaction of customary conditions, including final approvals by GE’s Board of Directors, private letter rulings from the Internal Revenue Service and/or tax opinions from counsel, the filing and effectiveness of Form 10 registration statements with the U.S. Securities and Exchange Commission, and satisfactory completion of financing.

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NeoPhotonics sold for $918M

 Lumentum to acquire NeoPhotonics for $16 per share in cash

Lumentum (LITE) and NeoPhotonics (NPTN) announced that they have entered into a definitive agreement under which Lumentum will acquire NeoPhotonics for $16.00 per share in cash, which represents a total equity value of approximately $918M.

NeoPhotonics Corporation develops, manufactures, and sells optoelectronic products that transmit and receive high speed digital optical signals for cloud and hyperscale data center internet content provider and telecom networks worldwide.

Lumentum Holdings Inc. manufactures and sells optical and photonic products in the Americas, the Asia-Pacific, Europe, the Middle East, and Africa. The company operates in two segments, Optical Communications (OpComms) and Commercial Lasers (Lasers). 

Laser chips made by Lumentum

The transaction has been unanimously approved by the boards of directors of both companies.

The purchase price represents a premium of approximately 39% to NeoPhotonics’ closing stock price on November 3, 2021.

Laser chips made by NeoPhotonics

Lumentum intends to finance the transaction through cash from the combined company’s balance sheet.

Related to the transaction, Lumentum will provide up to $50M in term loans to NeoPhotonics to fund anticipated growth, which may require increased working capital and manufacturing capacity.

The transaction is expected to close in the second half of calendar year 2022, subject to approval by NeoPhotonics’ stockholders, receipt of regulatory approvals, and other customary closing conditions.

“With NeoPhotonics, we’re making another important investment in better serving our customers and expanding our photonics capabilities at a time when photonics are at the forefront of favorable long-term market trends. At the center of our strategy is a relentless focus on developing a differentiated portfolio with the most innovative products and technology in our industry so that we can help our customers compete and win in their respective markets.

Adding NeoPhotonics’ differentiated products and technology and innovative R&D team is consistent with this strategy and together, we will better meet the growing need for next generation optical networking solutions. We are confident this transaction will make us an even better partner to our customers, while enabling our team to deliver significant, long-term value to our stockholders. We look forward to welcoming NeoPhotonics’ talented team of employees to Lumentum,” said Alan Lowe, Lumentum President and CEO.

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AbbVie’s antidepressant achieves positive results

AbbVie’s cariprazine met primary endpoint in Phase 3 study

AbbVie (ABBV) announced top-line results from two Phase 3 clinical trials, Study 3111-301-001 and Study 3111-302-001, evaluating the efficacy and safety of cariprazine as an adjunctive treatment for patients with major depressive disorder.

Cariprazine, sold under the brand names Vraylar in the United States and Reagila in the European Union, is an atypical antipsychotic which is used in the treatment of schizophrenia, bipolar mania, and bipolar depression.

Drug pipeline looks very promising for Abbvie

In Study 3111-301-001, cariprazine showed a statistically significant change from baseline to week six in the Montgomery-Asberg Depression Rating Scale total score compared with placebo.

The Montgomery–Asberg Depression Rating Scale (MADRS) is a ten-item diagnostic questionnaire which psychiatrists use to measure the severity of depressive episodes in patients with mood disorders. 

Patients treated with cariprazine at 1.5 mg/day achieved improved MADRS total score at week six compared to placebo.

Patients treated with cariprazine at 3.0 mg/day demonstrated improvement in MADRS total score at week six over placebo but did not meet statistical significance.

In Study 3111-302-001, cariprazine demonstrated numerical improvement in depressive symptoms from baseline to week six in MADRS total score compared with placebo but did not meet its primary endpoint for either the 1.5 mg/day or 3.0 mg/day dose.

In a previously published Phase 2/3 registration-enabling study, RGH-MD-75, patients treated with cariprazine flexible doses of 2.0-4.5 mg/day in addition to ongoing antidepressant therapy met the primary endpoint and achieved improved MADRS total scores at week eight compared to placebo.

Based on the positive results of studies 3111-301-001 and RGH-MD-75, and the totality of data reported, AbbVie intends to submit a supplemental New Drug Application with the U.S. FDA for the expanded use of cariprazine for the adjunctive treatment of MDD.

Separately, AbbVie reported Q3 Global Humira sales of $5.425B up 5.6% on reported basis.

In Q3, Global net revenues from the immunology portfolio were $6.674 billion, an increase of 15.3 percent on a reported basis, or 14.9 percent on an operational basis.

Global Humira net revenues of $5.425 billion increased 5.6 percent on a reported basis, or 5.2 percent on an operational basis.

U.S. Humira net revenues were $4.613 billion, an increase of 10.1 percent.

Internationally, Humira net revenues were $812 million, a decrease of 14.6 percent on a reported basis, or 16.7 percent on an operational basis, due to biosimilar competition.

Treatment for Psoriasis

Global Skyrizi net revenues were $796 million. Global Rinvoq net revenues were $453 million.

Treatment for moderate to severe rheumatoid arthritis

ABBV is up $5 to $114.70.

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Hydrogen Fuel Cell Gets a boost from S. Korea

SK Ecoplant to invest $500M in Bloom Energy through expanded partnership

Bloom Energy (BE) and SK Ecoplant, an affiliate of South Korean conglomerate SK Group (SKM), announced the companies are expanding their existing partnership.

The partnership includes purchasing a minimum of 500 megawatts, or MW, from Bloom Energy, representing a $4.5B revenue commitment; co-creating two hydrogen innovation centers; and targeting an equity investment of approximately $500M.

Since the start of their strategic partnership three years ago, Bloom Energy and SK ecoplant have transacted nearly 200 MW of projects together totaling more than $1.8B of equipment and expected service revenue.

Fuel Cells powered solely by Hydrogen

Over the next three years the companies will expand this existing business with contracts for at least an additional 500 MW of power between 2022 and 2025, representing approximately $4.5B in equipment and future service revenue.

Bloom Energy and SK ecoplant agreed to create Hydrogen Innovation Centers in the United States and South Korea.

The intent is to accelerate the global market expansion for Bloom Energy’s hydrogen fuel cell and hydrogen electrolyzer products.

The agreement also reflects both Bloom Energy and SK ecoplant’s enhanced commitment to a zero-carbon future and the further implementation of environmental, social and governance practices.

In addition, Bloom Energy and SK ecoplant agreed to strengthen their alliance through expanding business cooperation in global markets, which may include exclusive distribution rights in select new markets.

SK ecoplant will invest $255M in Bloom Energy by acquiring 10M shares of zero coupon, non-voting redeemable convertible preferred stock at a price of $25.50 per share.

SK ecoplant has the option to acquire a minimum of an additional 11M shares of Class A common stock at a 15% premium to the prevailing stock price at the time, which must be no later than November 30, 2023 and is subject to a maximum ownership of 15%.

Upon completion of SK ecoplant’s purchase of its second tranche, SK ecoplant will add a member to the Bloom Energy board of directors. SK will give an irrevocable proxy to vote its shares to Bloom Energy.

The investment is subject to customary closing conditions and regulatory approvals and is expected to close within 45 days.

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Flying Prescriptions Are Coming!

Walgreens to deploy Wing drone deliveries in Dallas-Fort Worth area

In a blog post by Alphabet’s (GOOG, GOOGL) Wing, the company said, ” Today we’re unveiling a new model for drone delivery that will allow us to expand into densely-populated metropolitan areas in the United States.

Wing will stage delivery drones at retail locations; ready to fly directly to customers.

The aircraft will arrive in small containers that serve as tiny hangars, allowing each store to quickly and easily deploy a small, dedicated fleet from its parking lot, on its roof, or in small spaces adjacent to the building.

When this model launches, Walgreens (WBA) will be the first U.S. retailer to use this new approach.

Walgreens team members will process orders and load packages onto the delivery drones, and Wing will oversee operation of the delivery service.

Our first lightweight, co-located operation will be set up at a Dallas-Fort Worth area Walgreens store in its parking lot, serving parts of the city of Frisco and town of Little Elm.

In addition to the Walgreens store, Wing has teamed up with Hillwood to prepare a separate drone delivery facility within Frisco Station, an urban, mixed-used development located in Frisco.

Hillwood has a long track record supporting forward-thinking, innovative transportation initiatives across the region, most notably at its Alliance Texas development and its designated Mobility Innovation Zone.

We look forward to working with Hillwood as we deploy a facility at Frisco Station that has all the usual delivery capabilities, but will be dedicated to exploring new use cases, community demonstrations, school field trips and public tours…

In preparation for this launch, we’ve been conducting test flights since June at Hillwood’s AllianceTexas Flight Test Center, a drone testing facility in Fort Worth.

We’ll begin a small number of practice flights next week in Frisco and Little Elm, and hope to set up delivery demonstrations to get feedback from the community in the coming weeks.

In the coming months, we expect to launch a commercial service there that would be the first of its kind in a major U.S. metro.”

Google Wing delivers a package

Wing is a subsidiary of Alphabet Inc. that develops technology of drone-based delivery of freight. The company completed their first real-world deliveries in 2014. The company has operations in Australia, the United States, and Finland. 

In July 2018, Project Wing graduated from Google X to become an independent Alphabet company. As of January 2019, Wing began delivering take-out food and beverages out of its test facility in Bonython, Australia as part of a pilot program. In April 2019 Wing became the first drone delivery company to receive an Air operator’s certificate from the Federal Aviation Administration to allow it to operate as an airline in the USA.

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Rig Counts Rise Again!

Baker Hughes reports U.S. rig count up 10 to 543 rigs

Baker Hughes (BKR) reports that the U.S. rig count is up 10 from last week to 543 with oil rigs up 12 to 445, gas rigs down 1 to 98, and miscellaneous rigs down 1 to 0.

https://stockwinners.com
Rig Counts Rise – See Stockwinners.com Market Radar to read more

The U.S. Rig Count is up 261 rigs from last year’s count of 282, with oil rigs up 240 gas rigs up 24 and miscellaneous rigs down 3.

The U.S. Offshore Rig Count is up 1 to 12, down 2 year-over-year.

The international offshore rig count for April 2018 was 194. Stockwinners
The international offshore rig count is up

The Canada Rig Count is up 1 from last week to 168, with oil rigs up 3 to 98, gas rigs down 2 to 70.

The Canada Rig Count is up 88 rigs from last year’s count of 80, with oil rigs up 58, gas rigs up 30.

The Baker Hughes rig counts are counts of the number of drilling rigs actively exploring for or developing oil or natural gas in the U.S., Canada and international markets.

The Company has issued the rig counts as a service to the petroleum industry since 1944, when Hughes Tool Company began weekly counts of the U.S. and Canadian drilling activity. The monthly international rig count was initiated in 1975.

West Texas Intermediate (WTI) is up $0.88 to $82.19 per barrel. Brent crude is up $0.75 to $84.75 per barrel. Gasoline last traded at $2.475 per gallon up 4 cents on the day.

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FDA Approved Vapes are coming!

FDA announces ‘first authorization’ for marketing of e-cigarette products

The U.S. Food and Drug Administration announced it has authorized the marketing of three new tobacco products, which it noted marks “the first set of electronic nicotine delivery system products ever to be authorized by the FDA through the Premarket Tobacco Product Application – PMTA – pathway.”

The FDA issued marketing granted orders to R.J. Reynolds Vapor Company, a subsidiary of British American Tobacco, for its Vuse Solo closed ENDS device and accompanying tobacco-flavored e-liquid pods, specifically, Vuse Solo Power Unit, Vuse Replacement Cartridge Original 4.8% G1, and Vuse Replacement Cartridge Original 4.8% G2.

“As the RJR Vapor Company submitted data to the FDA that demonstrated that marketing of these products is appropriate for the protection of public health, today’s authorization allows these products to be legally sold in the U.S.,” the FDA stated.

Solar Powered Vuse

Today, the FDA also issued 10 marketing denial orders for flavored ENDS products submitted under the Vuse Solo brand by RJR.

“Due to potential confidential commercial information issues, the FDA is not publicly disclosing the specific flavored products. These products subject to an MDO for a premarket application may not be introduced or delivered for introduction into interstate commerce. Should any of them already be on the market, they must be removed from the market or risk enforcement. Retailers should contact RJR with any questions about products in their inventory.

The agency is still evaluating the company’s application for menthol-flavored products under the Vuse Solo brand,” the FDA stated.

“Today’s authorizations are an important step toward ensuring all new tobacco products undergo the FDA’s robust, scientific premarket evaluation. The manufacturer’s data demonstrates its tobacco-flavored products could benefit addicted adult smokers who switch to these products – either completely or with a significant reduction in cigarette consumption – by reducing their exposure to harmful chemicals. We must remain vigilant with this authorization and we will monitor the marketing of the products, including whether the company fails to comply with any regulatory requirements or if credible evidence emerges of significant use by individuals who did not previously use a tobacco product, including youth. We will take action as appropriate, including withdrawing the authorization,” said Mitch Zeller, J.D., director of the FDA’s Center for Tobacco Products.

Mitch Zeller, J.D., director of the FDA’s Center for Tobacco Products

Shares to watch: BTI, MO, PM.

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Exxon gets into plastic recycling!

 Exxon Mobil announces plans to build plastic waste recycling facility

Exxon Mobil (XOM) plans to build its first, large-scale plastic waste advanced recycling facility in Baytown, Texas, and is expected to start operations by year-end 2022.

A smaller, temporary facility, is already operational and producing commercial volumes of certified circular polymers that will be marketed by the end of this year to meet growing demand.

The new facility follows validation of Exxon Mobil’s initial trial of its proprietary process for converting plastic waste into raw materials.

“We’ve proven our proprietary advanced recycling technology in Baytown, and we’re scaling up operations to supply certified circular polymers by year-end,” said Karen McKee, president of ExxonMobil Chemical Company. “Availability of reliable advanced recycling capacity will play an important role in helping address plastic waste in the environment, and we are evaluating wide-scale deployment in other locations around the world.”

To date, the trial has successfully recycled more than 1,000 metric tons of plastic waste, the equivalent of 200M grocery bags, and has demonstrated the capability of processing 50 metric tons per day.

Upon completion of the large-scale facility, the operation in Baytown will be among North America’s largest plastic waste recycling facilities and will have an initial planned capacity to recycle 30,000 metric tons of plastic waste per year.

Operational capacity could be expanded quickly if effective policy and regulations that recognize the lifecycle benefits of advanced recycling are implemented for residential and industrial plastic waste collection and sorting systems.

ExxonMobil is developing plans to build approximately 500,000 metric tons of advanced recycling capacity globally over the next five years.

In Europe, the company is collaborating with Plastic Energy on an advanced recycling plant in Notre Dame de Gravenchon, France, which is expected to process 25,000 metric tons of plastic waste per year when it starts up in 2023, with the potential for further expansion to 33,000 metric tons of annual capacity.

The company is also assessing sites in the Netherlands, the U.S. Gulf Coast, Canada, and Singapore.

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Auto Industry to lose $210B in revenue this year

Chip shortages will cost auto industry $210B in 2021

Global consulting firm AlixPartners released its latest forecast regarding how much the ongoing semiconductor shortage is costing the worldwide automotive industry.

The firm’s updated estimate is that the shortage will cost the industry globally $210B in lost revenues this year, up markedly from its estimate in May of $110B.

In terms of vehicles, AlixPartners is now forecasting that production of 7.7M units will be lost in 2021, up from 3.9M in its May forecast.

“Of course, everyone had hoped that the chip crisis would have abated more by now, but unfortunate events such as the COVID-19 lockdowns in Malaysia and continued problems elsewhere have exacerbated things,” said Mark Wakefield, global co-leader of the automotive and industrial practice at AlixPartners.

“Also, chips are just one of a multitude of extraordinary disruptions the industry is facing-including everything from resin and steel shortages to labor shortages. There’s no room for error for automakers and suppliers right now; they need to calculate every alternative and make sure they’re undertaking only the best options.”

Dan Hearsch, a managing director in AlixPartners’ automotive and industrial practice, added, “There really are no ‘shock absorbers’ left in the industry right now when it comes to production or obtaining material. Virtually any shortage or production interruption in any part of the world affects companies around the globe, and the impacts are now amplified due to all the other shortages. That’s why it’s critical that companies be armed with good information and analysis to begin with, and that they follow through with flawless, determined execution.”

https://www.wsj.com/7b2cd07c-1ca0-4a4b-a6d0-b086323dcad9

Publicly traded companies in the space include Daimler AG (DDAIF), Ford (F), General Motors (GM), Honda (HMC), Nissan (NSANY), Stellantis (STLA), Tesla (TSLA), Toyota (TM) and Volkswagen (VWAGY).

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When It rains, It pours!

Workhorse Group suspends deliveries of C-1000 vehicles, recalls 41 that it had delivered

Workhorse Group Inc. (WKHS) shares plunged on Wednesday to their lowest in fifteen months after the beleaguered electric-vehicle maker said it will suspend deliveries of its vans and recall units it has already delivered.

Workhorse Group (WKHS) provided an update to its ongoing review of the Company’s business and go-forward operating and commercial plans to transition from an advanced technology start-up to an efficient manufacturing company.

The electric van, called the C-1000, would require additional testing and modifications to existing vehicles in order to certify them under federal motor vehicle safety standards, the company said in a statement.

The Company stopped delivery of its C-1000

The Company has identified a number of enhancements in the production process and design of the C-1000 to address customer feedback, primarily related to vehicle dynamics to increase the vehicles’ payload capacity.

As Workhorse has identified these enhancements and continued its review and redesign of the C-1000, the Company has decided to suspend deliveries of C-1000 vehicles and recall 41 vehicles it has already delivered.

As part of these efforts, the new leadership team has determined that additional testing and modifications to existing vehicles are required to certify the C-1000 vehicles under Federal Motor Vehicle Safety Standard.

The Company expects to complete testing in the fourth quarter of 2021.

Workhorse intends to provide an update on its operating and commercial plans on its upcoming third quarter 2021 earnings call.

The Company has filed a report with the National Highway Traffic Safety Administration regarding the need for additional testing and vehicle modifications to certify its C-1000 vehicles under FMVSS, and intends to fully coordinate with NHTSA.

The Company has not received any customer reports of safety issues related to this matter in any of the C-1000 vehicles previously delivered by Workhorse.

Additional details will be available in the Company’s filing with NHTSA.

Accordingly, the Company’s previous statements related to the C-1000’s compliance with NHTSA standards cannot be relied upon and the Company has so notified the Securities and Exchange Commission.

#Cowen analyst Jeffrey #Osborne lowered his price target on the company to $7.50 from $8.50, and also reduced his estimates for 2021 and 2022 after the announcement, saying a “turnaround appears more challenging.” The analyst also expects working capital to likely be challenged due to prepayments for batteries and other critical materials.

According to some reports, the company is being investigated by the U.S. Securities and Exchange Commission, as well as disappointment related to losing out on a U.S. Postal Service contract that many had expected Workhorse to win.

WKHS closed at $7.41. Shares have a 52-week high of $42.96.

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Rig Counts Continue to Rise!

Baker Hughes reports U.S. rig count up 6 to 503 rigs

Baker Hughes (BKR) reports that the U.S. rig count is up 6 from last week to 503 with oil rigs up 7 to 401, gas rigs down 1 to 101, and miscellaneous rigs unchanged at 1.

Oil Rigs, See Stockwinners.com Market Radar to read the latest on oil and rig count
Oil Rigs, See Stockwinners.com Market Radar to read the latest on oil and rig count

The U.S. Rig Count is up 249 rigs from last year’s count of 254, with oil rigs up 221 gas rigs up 30 and miscellaneous rigs down 2 to 1.

The international offshore rig count for April 2018 was 194. Stockwinners

The U.S. Offshore Rig Count is up 4 to 6, down 9 year-over-year.

The Canada Rig Count is down 9 from last week to 143, with oil rigs down 5 to 87, gas rigs down 4 to 56.

The Canada Rig Count is up 91 rigs from last year’s count of 52, with oil rigs up 68, gas rigs up 23.

The Baker Hughes rig counts are counts of the number of drilling rigs actively exploring for or developing oil or natural gas in the U.S., Canada and international markets.

The Company has issued the rig counts as a service to the petroleum industry since 1944, when Hughes Tool Company began weekly counts of the U.S. and Canadian drilling activity. The monthly international rig count was initiated in 1975.

West Texas Intermediate (WTI) is up $1.61 to $69.75 per barrel. Brent crude is up $1.51 to $72.96 per barrel. Gasoline last traded at $2.15 per gallon up 5.3 cents on the day.

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Spectrum Brands shares soar on sale of it’s division

Spectrum Brands agrees to sell Hardware & Home Improvement segment for $4.3B

Spectrum Brands Holdings (SPB) announced it has entered into a definitive agreement to sell its HHI segment to ASSA ABLOY (ASAZY) for $4.3B in cash, which it said represents over 14 times HHI’s expected FY21 Adjusted EBITDA.

Upon closing of the transaction, Spectrum Brands expects to receive approximately $3.5B in net proceeds, subject to final tax calculations and purchase price adjustments.

Spectrum Brands expects to use the proceeds from this transaction to repay debt and reduce its gross leverage ratio to approximately 2.5x times in the near term.

Excess proceeds are expected to be allocated to invest for organic growth, fund complementary acquisitions and return capital to shareholders.

The company expects to maintain its quarterly cash dividend of 42c per common share, which will be subject to the company’s continued review from time to time.

The sale of HHI is expected to close following the receipt of certain regulatory approvals and customary closing conditions.

The results of operations of HHI will be reported as discontinued operations beginning in the fourth quarter of 2021. David Maura, CEO of Spectrum Brands, said, “I am exceedingly proud of the fact that our Hardware & Home Improvement business nearly doubled its EBITDA under Spectrum Brands’ ownership.

I am pleased to know that HHI has found a new home with a great partner, and I am confident that ASSA ABLOY will take it to its highest potential, bringing great value and innovation to consumers for generations to come.

We believe this transaction demonstrates the tremendous value of Spectrum Brands as an owner and steward of our businesses and places the Company in a strong position for the future by allowing us to further reduce our leverage levels, and enhance our capital allocation strategy.

Our remaining business will be more focused, allowing us to prioritize innovation to accelerate organic growth and pursue synergistic acquisitions to further drive value creation in Global Pet Care and Home & Garden, while continuing to look for strategic and organic ways to enhance the value of Home and Personal Care.

After the closing, we will become a more pure play consumer staples company with higher growth rates and strong margins.”

The company added: “Spectrum Brands will be a simplified business consisting of three focused business units with leading market share, strong growth opportunities and consistent performance.

The pro forma business generated $3.0B in net sales and $386 million in Adjusted EBITDA representing a 13.0% margin for the LTM period ended July 4, 2021.

Spectrum Brands will report its fourth quarter 2021 results in mid-November and expects to provide Fiscal 2022 Earnings Framework at that time.”

ASSA ABLOY AB is a Swedish company that provides door opening products, solutions, and services for the institutional, commercial, and residential markets in Europe, the Middle East, Africa, North and South America, Asia, and Oceania.  In addition, the company offers entrance automation products, services, and components, such as automatic swing, sliding, and revolving doors; industrial doors; garage doors; high-performance doors; docking solutions; hangar doors; gate automation products; components for overhead sectional doors and sensors; and high security fencings and gates. The company provides its products primarily under the ASSA ABLOY, Yale, and HID brands.

Spectrum’s Hardware & Home Improvement segment offers hardware products under the National Hardware and FANAL brands; locksets and door hardware under the Kwikset, Weiser, Baldwin, EZSET, and Tell Manufacturing brands; and plumbing products under the Pfister brand. Its Home and Personal Care segment provides home appliances under the Black & Decker, Russell Hobbs, George Foreman, Toastmaster, Juiceman, Farberware, and Breadman brands; and personal care products under the Remington and LumaBella brands.

The company’s Global Pet Care segment provides rawhide chewing, dog and cat clean-up and food, training, health and grooming, small animal food and care, and rawhide-free products under the 8IN1 (8-in-1), Dingo, Nature’s Miracle, Wild Harvest, Littermaid, Jungle, Excel, FURminator, IAMS, Eukanuba, Healthy-Hide, DreamBone, SmartBones, ProSense, Perfect Coat, eCOTRITION, Birdola, and Digest-eeze brands.

ASAZY is down 38 cents to $15.53 per share while SPB is up $15 to $94.

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Rig Counts Rise!

Baker Hughes reports U.S. rig count up 3 to 491 rigs

Baker Hughes (BKR) reports that the U.S. rig count is up 3 from last week to 491 with oil rigs up 2 to 387, gas rigs unchanged at 103, and miscellaneous rigs up 1 to 1.

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The U.S. Rig Count is up 244 rigs from last year’s count of 247, with oil rigs up 211 gas rigs up 34 and miscellaneous rigs down 1.

The U.S. Offshore Rig Count is unchanged at 14, up 2 year-over-year.

The Canada Rig Count is up 3 from last week to 156, with oil rigs up 2 to 95, gas rigs up 1 to 60 and miscellaneous unchanged at 1.

The Canada Rig Count is up 109 rigs from last year’s count of 47, with oil rigs up 82, gas rigs up 26 and miscellaneous unchanged 1.

The international offshore rig count for April 2018 was 194. Stockwinners

The Baker Hughes rig counts are counts of the number of drilling rigs actively exploring for or developing oil or natural gas in the U.S., Canada and international markets.

The Company has issued the rig counts as a service to the petroleum industry since 1944, when Hughes Tool Company began weekly counts of the U.S. and Canadian drilling activity. The monthly international rig count was initiated in 1975.

West Texas Intermediate (WTI) is down 54 cents to $68.55 per barrel. Brent crude is down $0.51 to $70.96 per barrel. Gasoline last traded at $2.28 per gallon down 2 cents on the day and down 10 cents for the week.

STOCKWINNERS

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This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility.