Microsoft to acquire Nuance for $56.00 per share in cash, or $19.7B
Microsoft (MSFT) and Nuance Communications (NUAN) announced they have entered into a definitive agreement under which Microsoft will acquire Nuance for $56.00 per share, implying a 23% premium to the closing price of Nuance on Friday, April 9, in an all-cash transaction valued at $19.7B, inclusive of Nuance’s net debt.
Nuance sold for $19.7B
Nuance is a trusted cloud and AI software leader representing decades of accumulated healthcare and enterprise AI experience.
Mark Benjamin will remain CEO of Nuance, reporting to Scott Guthrie, executive vice president of Cloud & AI at Microsoft.
The transaction is intended to close this calendar year.
Upon closing, Microsoft expects Nuance’s financials to be reported as part of Microsoft’s Intelligent Cloud segment.
Microsoft expects the acquisition to be minimally dilutive (less than 1%) in fiscal year 2022 and to be accretive in fiscal year 2023 to non-GAAP earnings per share, based on the expected close timeframe.
Non-GAAP excludes expected impact of purchase accounting adjustments, as well as integration and transaction-related expenses.
The acquisition will not impact the completion of its existing share repurchase authorization.
Nuance Communications, Inc. provides conversational and cognitive artificial intelligence (AI) innovations that bring intelligence to everyday work and life. The company delivers solutions that understand, analyze, and respond to people – amplifying human intelligence to increase productivity and security.
B. Riley analyst Zach Cummins reiterates a Buy rating on LivePerson (LPSN) with a $77 price target after Microsoft (MSFT) acquired Nuance Communications (NUAN), a provider of conversational commerce solutions, with expertise geared toward the healthcare vertical.
The potential deal acquisition provides a “positive valuation data point” for LivePerson, a leading provider of conversational commerce solutions across the telecom, financial services, retail, and consumer verticals, Cummins tells investors in a research note.
LivePerson currently trades at an enterprise value to sales multiple of 6.5 times, below the comp group median of 9.5 times and Nuance’s implied takeout multiple of 12.5 times, says the analyst.
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.
Canadian Pacific to buy Kansas City Southern in $29B deal
Canadian Pacific Railway (CP) and Kansas City Southern (KSU) announced they have entered into a merger agreement, under which CP has agreed to acquire KCS in a stock and cash transaction representing an enterprise value of approximately $29B, which includes the assumption of $3.8B of outstanding KCS debt.
The transaction, which has the unanimous support of both boards of directors, values KCS at $275 per share, representing a 23% premium, based on the CP and KCS closing prices on March 19, 2021.
Following the closing into a voting trust, common shareholders of KCS will receive 0.489 of a CP share and $90 in cash for each KCS common share held.
Following final approval from the Surface Transportation Board, the transaction will combine the two railroads to create the first rail network connecting the U.S., Mexico, and Canada.
Canadian Pacific Rails
Joining seamlessly in Kansas City, Mo., in America’s heartland, CP and KCS together will connect customers via single-network transportation offerings between points on CP’s system throughout Canada, the U.S. Midwest, and the U.S. Northeast and points on KCS’ system throughout Mexico and the South Central U.S.
While remaining the smallest of six U.S. Class 1 railroads by revenue, the combined company will be a much larger and more competitive network, operating approximately 20,000 miles of rail, employing close to 20,000 people and generating total revenues of approximately $8.7 billion based on 2020 actual revenues.
Combined Companies Rails
The combination is expected to be accretive to CP’s adjusted diluted EPS in the first full year following CP’s acquisition of control of KCS, and is expected to generate double-digit accretion upon the full realization of synergies thereafter.
To fund the stock consideration of the merger, CP will issue 44.5 million new shares.
The cash portion will be funded through a combination of cash-on-hand and raising approximately $8.6B in debt, for which financing has been committed.
As part of the merger, CP will assume approximately $3.8B of KCS’ outstanding debt.
Following the closing into trust, CP expects that its outstanding debt will be approximately $20.2B. Pro forma for the transaction, CP estimates its leverage ratio against 2021E street consensus EBITDA to be approximately 4.0-times with the assumption of KCS debt and issuance of new acquisition-related debt.
In order to manage this leverage effectively, CP will be temporarily suspending its normal course issuer bid program, and expects to produce approximately $7B of levered free cash flow over the next three years.
CP estimates its long-term leverage target of approximately 2.5x to be achieved within 36 months after closing into trust.
The combined company will remain committed to maintaining strong investment grade credit ratings while continuing to return capital for the benefit of shareholders.
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.
Salesforce acquires Slack in cash and stock deal worth $27.7B
Salesforce (CRM) and Slack Technologies (WORK) have entered into a definitive agreement under which Salesforce will acquire Slack.
Under the terms of the agreement, Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock for each Slack share, representing an enterprise value of approximately $27.7 billion based on the closing price of Salesforce’s common stock on November 30.
The boards of each of Salesforce and Slack have approved the transaction and the Slack board recommends that Slack stockholders approve the transaction and adopt the merger agreement.
The transaction is anticipated to close in the second quarter of Salesforce’s fiscal year 2022.
Salesforce goes shopping
Salesforce has also entered into a voting agreement with certain stockholders of Slack common stock, under which each such stockholder has agreed to vote all of their Slack shares in favor of the transaction at the special meeting of Slack stockholders to be held in connection with the transaction, subject to certain terms and conditions.
The Slack shares subject to the agreement represent approximately 55% of the current outstanding voting power of the Slack common stock.
Salesforce expects to fund the cash portion of the transaction consideration with a combination of new debt and cash on Salesforce’s balance sheet.
One year chart of Slack Tech. stock price
Salesforce has obtained a commitment from Citigroup, Bank of America, and JPMorgan Chase for a $10B senior unsecured 364-day bridge loan facility.
Salesforce said, “Slack will be deeply integrated into every Salesforce Cloud.
Five year chart of Salesforce stock price
As the new interface for Salesforce Customer 360, Slack will transform how people communicate, collaborate and take action on customer information across Salesforce as well as information from all of their other business apps and systems to be more productive, make smarter, faster decisions and create connected customer experiences.”
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.
Sage Therapeutics, Biogen announce collaboration on SAGE-217, SAGE-324
Biogen (BIIB) and Sage Therapeutics (SAGE) announced that they have executed a global collaboration and license agreement to jointly develop and commercialize zuranolone for major depressive disorder, postpartum depression and other psychiatric disorders and SAGE-324 for essential tremor and other neurological disorders.
Sage receives a large investment from Biogen
Zuranolone, a potential first-in-class, two-week, once-daily oral therapy in development for the treatment of MDD and PPD, is currently in Phase 3 development as part of the LANDSCAPE and NEST clinical programs.
Zuranolone has breakthrough therapy designation from the U.S. Food and Drug Administration (FDA) for MDD and, if successfully developed and approved, has the potential to be a novel treatment paradigm in depression.
Biogen gambles on Sage’s depression drug
The vision for zuranolone in MDD and PPD is based on its potential, being evaluated in the LANDSCAPE and NEST development programs, to work rapidly and to continue providing sustained benefit beyond the period of dosing.
Together, these two features, if supported by positive clinical efficacy and safety data, could provide an alternative option to how depression is treated today based on a target profile of an “as-needed” short course of treatment for a depressive episode, with rapid and sustained efficacy and favorable tolerability.
The development of an “as-needed” treatment for depression may help ease the difficulties associated with chronic use of antidepressants and may enhance quality of life and patient adherence.
To date, two positive pivotal studies have been completed with zuranolone 30 mg, one in MDD (MDD-201) and one in PPD.
Additionally, while the Phase 3 MOUNTAIN Study of zuranolone in MDD did not meet its primary endpoint, the encouraging data from the recently announced MOUNTAIN six-month follow-up period and the topline interim SHORELINE Study analysis, suggest the potential for zuranolone, if successfully developed and approved, to be uniquely positioned as a disruptive, distinct and novel treatment approach for patients.
Biogen and Sage believe that zuranolone is clinically active in MDD based on the data compiled to date and look forward to planned data readouts in 2021.
Sage is pursuing three development pathways for zuranolone in the U.S.: PPD; acute rapid response therapy in MDD when co-initiated with new standard antidepressant therapy; and “as-needed,” or episodic, treatment of MDD.
As a result, Sage is advancing four additional pivotal studies evaluating a 50 mg dose of zuranolone: a Phase 3 study in PPD, a Phase 3 study of use as an acute RRT in patients with MDD when co-initiated with new standard antidepressant therapy , a Phase 3 study in the acute treatment of MDD and an open label Phase 3 study evaluating the long-term safety, tolerability and efficacy of “as-needed” repeat treatment. Data from these studies are expected in 2021.
Upon closing of the transaction, Biogen and Sage will collaborate to further define the development and commercialization strategy for zuranolone.
Beyond PPD and MDD, zuranolone may also have potential in other psychiatric disorders including bipolar disorder and generalized anxiety disorder. SAGE-324 is a next-generation positive allosteric modulator of GABAA receptors in Phase 2 development for essential tremor with potential in other neurological conditions such as epilepsy and PD.
Essential tremor is one of the most common movement disorders estimated to affect over six million patients in the U.S., and current standard of care may be inadequate for many.
Following encouraging results from a Phase 1 open-label study in essential tremor, Sage advanced SAGE-324 to the Phase 2a KINETIC Study, which Sage is currently conducting.
The KINETIC Study is a 28-day placebo-controlled study in patients with essential tremor expected to read out in 2021.
Upon closing of the transaction, Biogen and Sage will collaborate to further define the development and commercialization strategy for SAGE-324 in essential tremor and, as appropriate, for potential expansion into other neurological disorders.
The strategic collaboration is global in scope and under the terms of the agreement, Sage will receive $1.525 billion in cash to be comprised of an upfront payment of $875 million and a $650 million equity investment in Sage from the purchase of approximately 6.2 million newly issued shares of Sage common stock at a price of $104.14 per share, representing a premium of 40 percent over the 30-day volume-weighted average share price of $74.39 per share as of November 25, 2020.
Should the zuranolone and SAGE-324 programs achieve certain development and commercial milestones, Sage will be eligible to receive up to approximately $1.6 billion in potential milestone payments. Biogen and Sage will share responsibility and costs for development as well as profits and losses for commercialization in the U.S.. Outside the U.S., Biogen will be responsible for development and commercialization, excluding Japan, Taiwan and South Korea with respect to zuranolone, and will pay Sage tiered royalties in the high teens to low twenties. Closing of the transaction is contingent on completion of review under antitrust laws, including the Hart-Scott-Rodino Antitrust Improvements Act of 1976 in the U.S., and other customary closing conditions. The transaction is expected to close by the end of January 2021.
BIIB last traded at $241.75. SAGE last traded at $84.00.
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.
Morgan Stanley to acquire Eaton Vance for $7B in cash, stock transaction
Morgan Stanley (MS) and Eaton Vance (EV) have entered into a definitive agreement under which Morgan Stanley will acquire Eaton Vance for an equity value of approximately $7B.
Eaton Vance sold to Morgan Stanley
Morgan Stanley Investment Management, or MSIM, will be an asset manager with approximately $1.2T of AUM and over $5B of combined revenues.
The company said MSIM and Eaton Vance are highly complementary with limited overlap in investment and distribution capabilities.
Morgan Stanley buys Eaton Vance for $7B
The combination will also bring Eaton Vance’s U.S. retail distribution together with MSIM’s international distribution.
The combination will position Morgan Stanley to generate financial returns through increased scale, improved distribution, cost savings of $150M and revenue opportunities.
By financing the transaction with 50% cash, Morgan Stanley will utilize approximately 100bps of excess capital, and the firm’s common equity tier 1 ratio is expected to remain approximately 300bps above the firm’s stress capital buffer requirement of 13.2%.
Eaton Vance Corp., through its subsidiaries, engages in the creation, marketing, and management of investment funds in the United States. It also provides investment management and counseling services to institutions and individuals.ย
The transaction is expected to be breakeven to earnings per share immediately and marginally accretive thereafter, with fully phased-in cost synergies, and add approximately 100bps to return on tangible common equity.
Under the terms of the merger agreement, Eaton Vance shareholders will receive $28.25 per share in cash and 0.5833x of Morgan Stanley common stock, representing a total consideration of approximately $56.50 per share.
Based on the $56.50 per share, the aggregate consideration paid to holders of Eaton Vance’s common stock will consist of approximately 50% cash and 50% Morgan Stanley common stock.
The merger agreement also contains an election procedure allowing each Eaton Vance shareholder to seek all cash or all stock, subject to a proration and adjustment mechanism.
In addition, Eaton Vance common shareholders will receive a one-time special cash dividend of $4.25 per share to be paid pre-closing by Eaton Vance to Eaton Vance common shareholders from existing balance sheet resources.
It is anticipated that the transaction will not be taxable to Eaton Vance shareholders to the extent that they receive Morgan Stanley common stock as consideration.
The transaction has been approved by the voting trust that holds all of the voting common stock of Eaton Vance. The acquisition is subject to customary closing conditions, and is expected to close in Q2 of 2021.
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.
NRG Energy to acquire Direct Energy from Centrica for $3.63B in cash
NRG Energy (NRG) announced it has entered into a definitive agreement with UK’s Centrica (CPYYY) under which NRG will acquire Direct Energy, a North American subsidiary of Centrica PLC for $3.63B in an all-cash transaction.
NRG Energy said in a release, “The transaction builds on NRG’s status as a growing, customer-driven integrated energy provider, adding more than three million retail customers across 50 states and Canada.
NRG goes shopping
The transaction on closing is expected to generate approximately $740M in annual run-rate Adjusted EBITDA, while enhancing free cash flow strength and stability and providing earnings diversification.
With operations in all 50 U.S. states and 6 Canadian provinces, Direct Energy is one of North America’s leading retail providers of electricity, natural gas, and home and business energy-related products and services.
Centrica sells Direct Energy
For NRG, the acquisition builds on and complements its integrated model, enabling better matching of power generation with customer demand.
It also broadens NRG’s presence into states and locales where it does not currently operate, supporting NRG’s objective to diversify its business.
The combination will deliver greater efficiencies and enable continued investment in NRG’s award-winning customer service, operational best practices and reliability.
Direct Energy fetches $3.63B
With NRG’s decades of participation in electricity markets throughout the U.S., NRG has broad insights into energy market dynamics and trends to inform innovative solutions and products for the combined company’s customers.
NRG will acquire Direct Energy for $3.63B in cash, subject to a working capital adjustment. Closing for the transaction is targeted by year end 2020.”
NRG Energy, Inc. operates as an energy company in the United States. It operates through Generation and Retail segments. The company is involved in the producing, selling, and delivering electricity and related products and services to 3.7 million residential, industrial, and commercial consumers. It generates electricity using natural gas, coal, oil, solar, nuclear, and battery storage.ย
Direct Energy LP is a North American retailer of energy and energy services. The company was founded in Toronto in 1986 and now has more than four million customers in Canada and the United States.ย
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.
Novavax sinks after White House omits as COVID vaccine finalist
The New York Times reports that Moderna (MRNA) is among the five finalists selected by the Trump administration as the most likely to produce a vaccine for the coronavirus.
Moderna (MRNA) is one of the finalists
By narrowing the field, the White House is betting it can identify the most promising vaccines at an early stage, speed along the process of determining which will work and ensure that the winner or winners can be quickly manufactured in large quanities, the Times said.
Pfizer is also one of the finalists
The announcement of the decision will be made at the White House in the next few weeks, government officials said.
AstraZeneca is one of the five companies.
Dr. Anthony S. Fauci, the federal governmentโs top epidemiologist and director of the National Institute of Allergy and Infectious Diseases, hinted at the coming action on Tuesday when he told a medical seminar that โby the beginning of 2021 we hope to have a couple of hundred million doses.โ
Johnson & Johnson is also a finalist for Covid 19 vaccine
Finalists
A White House announcement is expected in the new few weeks. In addition to Moderna, the winners are AstraZeneca (AZN), Johnson & Johnson (JNJ), Merck (MRK) and Pfizer (PFE), according the Times.
Merck is the final company on the list.
B. Riley FBR
B. Riley FBR analyst Mayank Mamtani views the selloff today in shares of Novavax on the New York Times report that the company was not selected as a finalist for the White House’s “Operation Warp Speed” as overdone.
Mamtani reiterates a Buy rating on Novavax. NVAX closed down 11% to $44.25.
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.
Esperion announces JAMA publication of results of Phase 3 study of bempedoic acid
Esperion Therapeutics (ESPR) announce that the results from the 779 patient, 52 week, Phase 3, double-blind, randomized placebo-controlled study of bempedoic acid were published in the Journal of the American Medical Association.
Esperion announces ‘positive’ results from bempedoic acid study, Stockwinners
Bempedoic acid is being developed as a, convenient, once-daily, oral therapy for the treatment of patients with elevated low-density lipoprotein cholesterol added onto maximally tolerated statin therapy.
Bempedoic acid and the bempedoic acid 180 mg + ezetimibe 10 mg fixed dose combination tablets’ new drug applications are currently under regulatory review by the U.S. Food and Drug Administration, and the marketing authorisation applications are currently under centralized review by the European Medicines Agency.
Bempedoic acid in action, Stockwinners
Study 2 evaluated the long-term safety, tolerability and efficacy, of bempedoic acid 180 mg versus placebo in 779 patients with atherosclerotic cardiovascular disease and/or heterozygous familial hypercholesterolemia inadequately controlled with current lipid-modifying therapies, added-on to maximally tolerated statin therapy, which may mean no statin at all.
The JAMA publication includes results from the primary efficacy endpoint of LDL-C lowering at 12-weeks and key secondary endpoints of safety and tolerability over 52-weeks, including that bempedoic acid: significantly lowered LDL-cholesterol by 17 percent on background maximally tolerated statin therapy at 12 weeks, and the effect was durable through 52-weeks; significantly lowered high-sensitivity C-reactive protein, an important marker of the underlying inflammation associated with cardiovascular disease, by 19 percent, and the effect was durable through 52-weeks; reduced hemoglobin A1c by 0.21% vs. placebo in patients with diabetes at 12 weeks, favorable glycemic control and less worsening of diabetes persisted over the 52-week treatment period.
The study showed overall adverse event rates comparable with placebo at 52 weeks, and the proportion of patients with reported serious adverse events was similar compared with placebo at 52 weeks; and showed adjudicated 3-component major adverse cardiac event rates of 2.7% with BA and 4.7% with placebo.
โThe CLEAR Wisdom trial demonstrated that bempedoic acid provided additional LDL-cholesterol lowering in patients on background maximally tolerated statin therapy and had an overall adverse event profile that was comparable to placebo,โ said Anne C. Goldberg MD, FACP, FAHA, FNLA, Professor of Medicine, Division of Endocrinology, Metabolism and Lipid Research at Washington University, St. Louis and lead study author.
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
AMAG Pharmaceuticals (AMAG) announced that the results of the PROLONG trial were published online in the American Journal of Perinatology.
Amag Pharma shares rise ahead of FDA meeting, Stockwinners
AMAG Pharmaceuticals, Inc. (AMAG) announced that the results of PROLONG (Progestinโs Role in Optimizing Neonatal Gestation)ย were published online in theย American Journal of Perinatology.ย PROLONG was a randomized, double-blind, placebo-controlled clinical trial evaluating 17-OHPCย (17-ฮฑ-hydroxyprogesterone caproate or Makenaยฎ)ย in patients with a history of a prior spontaneous singleton preterm delivery. The PROLONG trial was conducted as part of an approval commitment under the Food & Drug Administrationโs (FDA) โSubpart Hโ accelerated approval process.ย
As previously announced, the PROLONG trial did not meet the two pre-specified co-primary endpoints of a reduction of preterm birth and a reduction in the neonatal morbidity and mortality index, in contrast to the original Meis trial results published in the New England Journal of Medicine.
PROLONG reaffirmed that the 17-OHPC safety profile is comparable to placebo, the company said.
Amag Pharma (AMAG) shares rise ahead of FDA meeting, Stockwinners
Makena is a progestin indicated to reduce the risk of preterm birth in women pregnant with a single baby who have a history of singleton spontaneous preterm birth.
Makenaย was approved by the FDA in February 2011 and was granted orphan drug exclusivity through Februaryย 3, 2018. In February of 2018, AMAG introduced the prefilled Makena auto-injector containing a short, thin, non-visible needle for subcutaneous use, offering patients and providers a new administration option.
The FDA will hold a meeting of the Bone, Reproductive and Urologic Drugs Advisory Committee on October 29 to “better understand and interpret the PROLONG trial data,” AMAG added.
Analysts’ Comments
Piper Jaffray analyst Christoper Raymond said the briefing documents posted this morning ahead of Tuesday’s advisory committee meeting to discuss Makena’s failed confirmatory PROLONG trial “leave the door open” for the continued marketing of the drug.
Draft questions propose pursuing withdrawal of Makena’s approval, leaving Makena on the market but requiring a new confirmatory trial, or leaving it on the market without a new confirmatory trial and he thinks it appears that the FDA “is leaning toward the latter two options.”
However, he also thinks that the detailed PROLONG data that have now been provided for the first time “make a strong argument for the drug’s withdrawal,” Raymond tells investors.
The analyst sees the full PROLONG data having “some chilling effect” on overall use whether the FDA pulls the drug or not and he keeps a Neutral rating on Amag Pharmaceuticals shares.
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
Callon Petroleum to acquire Carrizo Oil & Gas in all-stock deal valued at $3.2B
Carrizo sold for $3.2 billion, Stockwinners
Callon Petroleum (CPE) and Carrizo Oil & Gas (CRZO) announced that their Boards of Directors have unanimously approved a definitive agreement under which Callon will acquire Carrizo in an all-stock transaction valued at $3.2B.
This highly complementary combination will create a leading oil and gas company with scaled development operations across a portfolio of core oil-weighted assets in both the Permian Basin and Eagle Ford Shale.
Callon Petroleum buys Carrizo for $3.2B, Stockwinners
Under the terms of the agreement, Carrizo shareholders will receive a fixed exchange ratio of 2.05 Callon shares for each share of Carrizo common stock they own.
This represents $13.12 per Carrizo share based on Callon’s closing common stock price on July 12 and a premium of 18% to Carrizo’s trailing 60-day volume weighted average price.
Following the close of the transaction, Callon shareholders will own approximately 54% of the combined company, and Carrizo shareholders will own approximately 46%, on a fully diluted basis.
The all-stock transaction is intended to be tax-free to Carrizo shareholders.
The transaction has been unanimously approved by the Boards of Directors at both Callon and Carrizo.
In addition, each of the Carrizo directors has committed to vote his or her shares in favor of the transaction.
Upon closing, the Board of Directors of the combined company will consist of 11 members, including Callon’s eight current Board members and three to be appointed from the Board of Carrizo.
The combined company will be led by Callon’s executive management team and will remain headquartered in Houston, Texas.
The transaction, which is expected to close during the fourth quarter, is subject to customary closing conditions and regulatory approvals, including the approval of shareholders of both companies.
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.
Investor group outlines strategic plan for Bed Bath & Beyond
Investor group outlines strategic plan for Bed Bath & Beyond , Stockwinners
Legion Partners Holdings, Macellum Advisors GP and Ancora Advisors released a presentation outlining the Investor Group’s Strategic Plan for Bed Bath & Beyond (BBBY).
The group said, “The plan outlines the path forward to modernizing Bed Bath’s retail practices and delivering a significant earnings per share improvement which could drive $5.00 per share of annual earnings – a level that Bed Bath achieved just a few short years ago.
The Investor Group’s Strategic Plan includes the following highlights: Revamp executive management – recruiting a top-flight CEO to lead Bed Bath going forward and instill a world-class winning culture.
We plan to launch a search in the near term to address this key position. Reverse sales weakness – fixing the merchandise over-assortment problem through a detailed SKU rationalization process as well as developing a merchandise architecture that will better resonate with customers.
Making the in-store experience something that drives traffic to the stores will be a major priority.
Turn around Company culture – increase focus on employee training and education to improve motivation; empower employees to better use technology and improve customer experience.
Significantly expand gross margins – improve vendor relations and drive profits by establishing a direct sourcing strategy and private label program as well as fixing mix issues created by the Company’s shift to commoditized and lower margin products.
Implement cost cutting – conducting an extensive reassessment of the increases in expenses over the last five years, including the explosion of the Company’s advertising budget, seemingly endless array of initiatives that have failed to produce meaningful results and extensive use of consultants.
Improve inventory – increasing inventory turns which would result in a substantial release of cash tied up in slow moving goods. Fix capital allocation – reviewing all non-core businesses and assessing their value as part of the business or their potential value to other parties.
Excess cash created could be applied to share or debt repurchases, both of which are significantly accretive given discounted trading levels.
Lastly, the increase in capital expenditures will be addressed. Above all, the Investor Group’s director nominees have the relevant experience and commitment to execute on these priorities and hold management accountable for delivering results.”
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.
Verizon discloses pricing for first 5G mobile service
Verizon brings 5G service to Chicago and Minneapolis, Stockwinners
Verizon (VZ) earlier said it will launch its 5G Ultra Wideband Network in Chicago and Minneapolis on April 11.
To coincide with this launch, Verizon is offering the new 5G moto mod, which is exclusive to Verizon. Beginning March 14, customers anywhere in the U.S. can pre-order the 5G moto mod.
Verizon said: “Select areas of Chicago and Minneapolis will be the first to experience Verizon’s 5G Ultra Wideband mobile service, and the company has plans to rapidly expand the coverage area.
Last month, Verizon announced that it intends to launch its 5G Ultra Wideband network in more than 30 U.S. cities in 2019.”
It added, “For a limited time, preorder the 5G moto mod for just $50 ($349.99 retail).
5G Antennas are the size of a large pizza, Stockwinners
Verizon postpaid customers with any Verizon unlimited plan, including Go Unlimited, Beyond Unlimited or Above Unlimited, get unlimited 5G data for $10 per month (with the first three months free).
To buy a 5G moto mod, customers must either have an active moto z3 on their account or purchase a moto z3 at the same time as the 5G moto mod.”
What is 5G?
Like the earlier generationย 2G,ย 3G, andย 4Gย mobile networks, 5G networks areย digitalย cellular networks, in which the service area covered by providers is divided into a mosaic of small geographical areas calledย cells.
ย Analog signalsย representing sounds and images are digitized in the phone, converted by anย analog to digital converted transmitted as a stream ofย bits.
All the 5G wireless devices in a cell communicate by radio waves with a localย antennaย array and low power automatedย transceiver(transmitterย andย receiver) in the cell, over frequency channels assigned by the transceiver from a common pool of frequencies, which are reused in geographically separated cells.
The local antennas are connected with theย telephone networkย and theย Internetย by a high bandwidthย optical fiberย or wireless backhaul connection. Like existing cellphones, when a user crosses from one cell to another, their mobile device is automatically “handed off” seamlessly to the antenna in the new cell.
Their major advantage is that 5G networks achieve much higherย data ratesย than previous cellular networks, up to 10ย Gbit/s; which is faster than currentย cable internet, and 100 times faster than the previous cellular technology,ย 4G LTE.
ย Another advantage is lowerย network latencyย (faster response time), below 1ย ms (millisecond), compared with 30 – 70ย ms for 4G.[ย Because of the higher data rates, 5G networks will serve not just cellphones but are also envisioned as a general home and office networking provider, competing with wiredย internet providersย likeย cable. Previous cellular networks provided low data rate internet access suitable for cellphones, but a cell tower could not economically provide enough bandwidth to serve as a general internet provider for home computers.
5G networks achieve these higher data rates by using higher frequency radio waves, in or near the millimeter wave band from 30 to 300 GHz, whereas previous cellular networks used frequencies in the microwave band between 700 MHz and 3 GHz.
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.
Exxon Mobil to increase Permian output to 1M barrels per day by 2024
ExxonMobil to increase its Permian Basin output, Stockwinners
ExxonMobil (XOM) said it has revised its Permian Basin growth plans to produce more than 1 million oil-equivalent barrels per day by as early as 2024 – an increase of nearly 80 percent and a significant acceleration of value.
ExxonMobil expects to make 10% return on its Permian Basin fields at $35 per barrel oil, Stockwinners
The size of the company’s resource base in the Permian is approximately 10 billion oil-equivalent barrels and is likely to grow further as analysis and development activities continue.
ExxonMobil’s investments in the Permian Basin are expected to produce double-digit returns, even at low oil prices.
At a $35 per barrel oil price, for example, Permian production will have an average return of more than 10 percent.
The anticipated increase in production will be supported by further evaluation of ExxonMobil’s Delaware Basin’s increased resource size, infrastructure development plans, and secured capacity to transport oil and gas to ExxonMobil’s Gulf Coast refineries and petrochemical operations through the Wink-to-Webster, Permian Highway and Double E pipelines.
Among the company’s key advantages in the Permian, is its acreage position.
The company has large, contiguous acreage that enables multi-well pads in large development corridors connecting to efficient gathering systems, reducing development costs and accelerating production growth.
ExxonMobil’s scale, financial capacity and technical capabilities enable the company to maximize the value of the resource. ExxonMobil is actively building infrastructure to support volume growth.
Plans include construction at 30 sites to enhance oil and gas processing, water handling and ensure takeaway capacity from the basin. Construction activities include central delivery facilities designed to handle up to 600,000 barrels of oil and 1 billion cubic feet of gas per day and enhanced water-handling capacity through 350 miles of already-constructed pipeline.
The investment plans will also bring great benefits to the local area. ExxonMobil’s expansion in the region will benefit communities in West Texas and southeast New Mexico through billions in property tax revenue, economic development and the creation of high-paying jobs.
ExxonMobil remains one of the most active operators in the Permian Basin and has 48 drilling rigs currently in operation and plans to increase its rig count to approximately 55 by the end of the year.
Increased use of technology, including enhanced subsurface characterization, subsurface modeling and advanced data analytics to support optimization and automation, will help the company reduce costs, improve its development plan and increase resource recovery.
Crude oil is up 5 cents to $56.64 per barrel. XOM last traded at $80.22.
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.
Verrica Pharmaceuticals presents results from Phase 3 clinical trials of VP-102
Verrica Pharmaceuticals reports positive data on its molluscum contagiosum drug, Stockwinners
Verrica Pharmaceuticals (VRCA) presented data from the company’s pivotal Phase 3 CAMP-1 and CAMP-2 trials of lead product candidate, VP-102, at the American Academy of Dermatology annual meeting being held in Washington, DC from March 1-5.
Both trials of VP-102 in patients with molluscum contagiosum successfully met their primary endpoints.
In each trial, a clinically and statistically significant proportion of patients treated with VP-102 demonstrated complete clearance of all treatable molluscum lesions in 12 weeks.
On average, molluscum can take approximately 13 months to resolve without treatment, and in some cases can remain unresolved for several years.
The two randomized, double-blind, multicenter, placebo-controlled trials evaluated the efficacy of dermal application of VP-102 compared to placebo in subjects with molluscum.
In total, the trials enrolled 528 subjects two years of age and older with molluscum at 31 centers in the U.S. Subjects were treated once every 21 days with topical solution of 0.7% cantharidin for up to four applications.
Complete clearance of molluscum lesions was evaluated by assessment of the number of lesions at study visits over 12 weeks. Results from CAMP-1 and CAMP-2 showed 46% and 54% of subjects treated with VP-102, respectively, achieved complete clearance of all treatable molluscum lesions at the end of the trials versus 18% and 13% of subjects in the placebo groups.
By Day 84, VP-102 treated subjects had a 69% and 83% mean reduction in the number of molluscum lesions, a pre-specified endpoint, in CAMP-1 and CAMP-2 respectively, compared to a 20% increase and a 19% reduction for subjects on placebo. VP-102 was well-tolerated in both trials, with no serious adverse events reported in VP-102 treated subjects.
The most frequently reported adverse events were application site reactions that are well-known, reversible side effects related to the mechanism of action of cantharidin, a blistering agent, which is the active ingredient in VP-102.
There were no treatment-related serious adverse events reported in CAMP-1 or CAMP-2. Verrica previously announced topline results from both trials on January 3, 2019.
Based on the positive results, the company plans to submit a New Drug Application for VP-102 in the second half of 2019. If approved, VP-102 would be the first FDA-approved treatment for molluscum contagiosum.
Molluscum contagiosum is a relatively common viral infection of the skin, mainly in children, Stockwinners.com
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.
Apptio to be acquired by Vista Equity Partners for $38 per shareย
Apptio sold for $1.94 billion, Stockwinners
Apptio (APTI) announced that it has entered into a definitive agreement to be acquired by an affiliate of Vista Equity Partners.
Apptio, Inc. provides cloud-based technology business management (TBM) solutions to enterprises. Its cloud-based platform and SaaS applications enable IT leaders to analyze, optimize, and plan technology investments, as well as to benchmark financial and operational performance against peers.
Under the terms of the agreement, Vista will acquire all outstanding shares of Apptio common stock for a total value of approximately $1.94B.
Apptio shareholders will receive $38.00 in cash per share, representing a 53% premium to the unaffected closing price as of November 9, 2018.
Apptio’s board unanimously approved the deal and recommended that stockholders vote their shares in favor of the transaction.
Apptio’s headquarters will remain in Bellevue, with regional offices across the U.S., EMEA and APAC.
Closing of the deal is subject to customary closing conditions, including the approval of Apptio shareholders and antitrust approval in the United States.
The transaction is expected to close in Q1 2019 and is not subject to a financing condition.
The merger agreement includes a 30 day “go-shop” period, which permits Apptio’s Board and advisors to actively initiate, solicit, encourage, and potentially enter negotiations with parties that make alternative acquisition proposals.
Apptio will have the right to terminate the merger agreement to enter into a superior proposal subject to the terms and conditions of the merger agreement.
There can be no assurance that this 30 day “go-shop” will result in a superior proposal, and Apptio does not intend to disclose developments with respect to the solicitation process unless and until the Board makes a determination requiring further disclosure.
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.
