The price is right? Or will the market not be satisfied with the offer of 15 euros per share, a price already exceeded on Friday? This is the question that will dominate the attention of the financial market this morning, pending the 7,4 billion takeover bid on Pirelli (+3,2% on Friday) which, once the necessary authorizations have been obtained in Italy and China (time 2 -3 months) will be launched by the newco controlled by the state company Chem National China, together with the Italian consortium led by Marco Tronchetti Provera and Rosneft.
This morning the site of the Chinese giant publishes the news of thepurchase of 26,2% of Pirelli from Camfin for 1,85 billion and confirm theOffer coming soon. Chem China reads, "will support the growth and production" of Pirelli. Marco Tronchetti Povera declared that "it is a great opportunity" which will guarantee "the development and stability of the company".
CHINESE PRESIDENT AT BICOCCA, TRONCHETTI REMAINS CEO
This morning, therefore, the operation that will lead Pirelli to thefarewell to Piazza Affari. In the event that the company, as expected, returns to the stock exchange in four years, the reference list will in fact be London, perhaps combined with Shanghai.
In the meantime, after a weekend of meetings with lawyers, the purchase offer of the majority consortium Chemical China arrives. After the purchase of the Camfin share, the package is expected to flow into the newco which will then launch the takeover bid on the rest of Pirelli at a value of 15 euros per share. In the new company ChemChina will put 2,2 billion of equity, while the former Camfin partners will contribute with 1,1 billion, or a large part of the proceeds collected from the sale to the Chinese group (1,4 billion net of debts).
Assuming that the takeover bid reaches 100%, China Chem will acquire 65% of Pirelli, the Italians ex Camfin (ie Tronchetti Provera, Unicredit and Intesa as well as the families linked to the number one of Bicocca) will have the 22,65%, the Russian Rosneft, in retreat, will settle for the 12,4%.
If the takeover bid does not hit the 100% target, the majority will in any case head to the newco where Chem China will have at least 50,9% (if the Italians and Rosneft exercise the share by the summer). The delisting will in any case be achieved if at least 67% of the capital is raised. In this case, the merger with the Newco will take place. The prospectus should confirm that the group's headquarters, as well as R&D activities remain in Italy, unless the Chinese acquire more than 90% of the capital.
THE RENMIMBI GROWS HIGH, TOKYO NEARS 20 THOUSAND
Meanwhile, the excellent start to the week can be recorded for Chinese lists: Shanghai +1% on the wave of growing trade (80% more than the average of the last month), strong growth in the renminbi. With the Pirelli takeover bid, Italy rises to fifth place (second in Europe) in the ranking of Chinese investments.
The other Asian stock markets also rose, despite the weakness of the dollar (1,078). Tokyo (+1,1%) is one step away from the barrier of 20 points. Positive ground for the other lists in the Asia Pacific area. Singapore mourns after the death, at the age of 91, of Lee Kuan Yew, the father of the country.
THE OTHER MARKET MOVERS: BTP, POSTE MEDIASET AND STM
Piazza Affari risks losing Pirelli, but an exceptional freshman is looming on the horizon. Today the Board of Poste Italiane will examine the 2014 financial statements which will be distinguished from the cleaning of the accounts, with write-downs in the order of one billion, a preliminary step in view of the IPO.
Treasury auctions are back. Thursday will be the turn of Ctz and Btpei (the amount of the offer will be communicated during the day), while on Friday we will continue with the 6-month Bots. During the week, the amount of medium/long-term bonds at auction on Monday 31 will be communicated. Today the auction of German 12-month government bonds will be held.
Among the corporate events, Mediaset's Board of Directors dedicated to the 25 accounts stands out on Tuesday 2014th. Terna will be on Thursday. This morning STM detaches the quarterly coupon (0,10 dollars). In Piazza Affari, Rai Way enters the Ftse Mib Mid Cap index.
GREECE, DRAGONS AND THE FED
Today Alexis Tsipras will travel to Berlin at the invitation/command of Angela Merkel. From the outcome of the meeting it will be understood how many chances there are, after the bridging loan on Friday, to avoid Grexit.
To support the euro, however, comes the braking of Marine Le Pen to the French administrative, opposed by Nicolas Sarkozy. And in Spain Podemos!, the Iberian version of Syriza, is advancing but not breaking through.
Central bank interventions will take center stage during the week. In the afternoon Mario Draghi will inaugurate the week with a long-awaited hearing in the European Parliament. It is the first opportunity to take stock of the trend of Tltro loans and Qe.
In the USA, after the Fed's decision to condition the rate increase on data arriving from the economy, expectations are growing for the week's numbers: inflation (Tuesday), real estate market performance (Wednesday), PMI (Wednesday) .
There is keen anticipation for tonight's speech by Stanley Fischer, vice president of the Fed. During the week, the leader of the hawks, James Bullard of the Saint Louis Fed, and of the doves, John Williams, of the San Francisco Fed, will also speak. Finally, on Friday it will be Janet Yellen's turn.
EU EXCHANGES AT THE TOP, THE UNKNOWN IS THE DOLLAR
The Stoxx 600 index, which measures the performance of stock markets in the Old Continent, exceeded 400 points on Friday, the highest since the year 18. Since the beginning of the year, the increase is XNUMX%.
Milan has recorded a 2% increase in the last five sessions. The FtseMib index surpassed 23.000 points and touched a closing high since February 17, 2011, when it reached 23.178, according to data from the Italian stock exchange. Since the beginning of the year, the performance is positive by 21%. The German Stock Exchange did even better: +23%.
The Athens Stock Exchange has also reversed course: +3% on Friday after the recovery with the EU partners. The inflow of capital into equity funds contributes to supporting the rally, which has recorded a positive balance for 10 weeks: +41,2 billion since the beginning of the year.
On the Emerging Markets front, Brazil's GDP data is eagerly awaited: economists are increasing a contraction of 0,7%, a chilling figure for a country shaken by the Petrobras scandal and sensitive to the investment push for the Olympics.
DOLLAR AND OIL, TWO UNKNOWN ON WALL STREET
Wall Street stock markets also closed in positive territory, driven by the failure to raise interest rates. The S&P 500 Index recorded a rise of 2,7%. However, the hypothesis of the euro/dollar relationship weighs on the stock exchanges. The US currency fell to 1,10 (-2,5%) on Wednesday before recovering to 1,06 (+2%) the following day and closing at 1,08 for the week.
This volatility risks creating imbalances on the bond markets, as demonstrated by the fall in yields on T-bonds and conditioning the next quarterly campaign.
The strength of the dollar is the main explanation for the negative forecasts on corporate belts: for every company that could announce earnings increases, the Thomson Reuters survey lists 5,5 down. Oil products (approximately 8% of the market) are affected by the effect of the drop in prices.
MALACALZA IN CARIGE (WITH PIRELLI MONEY)
The events of Bicocca indirectly reflect on Carige. Vittorio Malacalza is one of the most important shareholders of the Genoese bank, on the eve of the capital increase of 850 million which will be carried out next July with a 10,7% stake.
Malacalza, who still owns 6,98% of Pirelli charged at 6,7 euros, after the split with Marco Tronchetti Provera, can now decide whether to: 1) sell the stake at the tender offer, with a capital gain of around 300 millions; 2) invest part of the proceeds, around 500 million, to increase the stake in the bank on the occasion of the increase, while remaining below 25%; 3) put its share at the service of a possible counter-offer, which could be launched by a big player in the sector (Michelin, Continental, Bridgestone) at a price higher than the 15 euro offered by Chem China.
STOP THE OIL, MAJOR MANEUVERS ON A2A
A difficult start is looming ahead for oil stocks, which was very evident on Friday, after the fall in crude oil prices: Brent trades at 54,86 dollars, US Light at 46,02. Yet another slide is motivated by the statements of Al Naimi, the Saudi energy minister: Riyadh will not reduce production until the non-OPEC countries do the same.
"After various discussions with the interested parties - he said to Naimi - we have taken note that we continue to expect that only OPEC, which controls 30% of production, will cut". In Al Naimi's sights are Russia and the United States, where the production of shale oil is holding up, despite the drop in prices.
Eni rose by 3,4% on Friday, also highlighted by Saipem. After the withdrawal from Pirelli, the Russians of Rosneft could focus their attention on the oil equipment company of the six-legged dog.
Spotlight on utilities: after the excellent reception of Enel's business plan by the market, A2A rises to the fore, which could conclude an alliance with Sorgenia on combined cycle power plants.
CONCRETE, TELECOM AND MANAGED
The cement and construction sector was also highlighted after the French Lafarge (+2,5%) and the Swiss Holcim (+0,3%) signed a new agreement on Friday to proceed with a 40 billion euro mega-merger.
In asset management, interest in Azimut after the announcement of a corporate reorganization which will give the group cash availability of over 550 million to be used for acquisitions, buy-back plans and dividends.
Spotlights also on Telecom Italia stable after the success of the 2 billion convertible. A new round of meetings with the CDP on the future of broadband is looming. Meanwhile, the activist funds are ready to battle Vincent Bolloré in Vivendi.
