Glencore-Xstrata, Not Quite a Done Deal

Glencore-Xstrata, Not Quite a Done Deal  |  Now that Xstrata's board has backed Glencore International's revised bid, it's up to shareholders to decide. In an effort to remove potential stumbling blocks, Xstrata's board has given shareholders three options when they vote in November: support both the merger and retention bonuses for important executives; back the deal without the bonuses; or oppose both. Some big investors had opposed the pay packages as “too extravagant,” writes DealBook. Qatar Holding, the sovereign wealth fund, holds a crucial vote â€" and has not seemed as concerned with the pay packages.

Early reviews of the plan have been less than glowing. The Wall Street Journal's Heard on the Street column takes the board to task for waiting until the deadline to make its decision, writing, “the best that can be said of its efforts is better late t han never.”

 

Will Goldman Shine?  |  Barron's makes a bullish case for Goldman Sachs in its cover story this week, predicting that the firm's stock price could rise at least 25 percent within a year. Though Goldman currently trades below its book value, Barron's says fears about new regulations and a weak market may be overblown: “The company maintains an abiding leadership position in most of its activities, and is financially sturdier and less burdened by irrational competition than it was a half-decade ago.”

Still, Goldman is not immune to the forces haunting its rivals. As The Financial Times puts it: “The banks are struggling to identify a new cash cow that grazes between the new rules. The equivalent of the junk bonds of the 1980s or the credit derivatives of the 1990s has not been discovered.”

 

Billionaires vs. Obama  |  Leon Cooperman, the billionaire founder of Omega Advisors, is among the Wall Street leaders who are disappointed with how President Obama has treated wealthy Americans. In a widely circulated letter detailed by The New Yorker, Mr. Cooperman took aim at the president's rhetoric: “To frame the debate as one of rich-and-entitled versus poor-and-dispossessed is to both miss the point and further inflame an already incendiary environment.”

Some on Wall Street are making preparations for what might happen if the president is re-elected. Given the campaign rhetoric, private equity bosses in particular are concerned that some favorable tax policies may disappear. Many firms have been “introducing general clauses into partnership agreements that would give them power to change the terms if there was any change in the tax regime,” according to The Financial Times.

 

< p>On the Agenda  |  Facebook's chief operating officer, Sheryl Sandberg, is set to appear on CNBC on Monday afternoon. Mark Zuckerberg is meeting Prime Minister Dmitri A. Medvedev of Russia. Ben S. Bernanke is at the Economic Club of Indiana at 12:30 p.m. to give a speech called, “Five Questions about the Federal Reserve and Monetary Policy.” Elizabeth Warren, the Democratic candidate for Senate, is debating her Republican opponent, Senator Scott Brown, at 7 p.m. at the University of Massachusetts, Lowell.

The Value Investing Congress, a two-day event featuring some prominent speakers, begins Monday at the Marriott Marquis in Times Square. William Ackman, Whitney Tilson and Barry Rosenstein are among those scheduled to speak on Monday. The municipal bond summit from the Securities Industry and Financial Markets Association is being held Monday at the Conrad New York hotel.

Kraft Foods plans to spin off its North American grocery division at 5 p.m. The snack foods company that will be created is being rebranded Mondelez International, a name that is supposed to refer to the words for “world” and “delicious” in various romance language.

 

The Cost of Helping Spanish Banks  |  We know how bad it is, at least for now. According to a report published on Friday, Spanish banks may need about $76.4 billion in additional capital. That number came in below the $128.8 billion in bailout money Spain had negotiated from other countries.

Not surprising, the banks' troubles will put even more strain on the government. On Saturday, the Spanish government noted that aid to banks would increase its budget deficit to about 7.4 percent of gross domestic product this year, above its target of 6.3 percent, The Wall Street Journal reports.

Still, Spain is unwilling to cut the g olden nest eggs. The New York Times writes that pensions are the biggest line item in the budget, at nearly 40 percent of public spending.

As if anyone thought running a country was easy, the Greek prime minister had this to say about the recent pressures in an interview with The New York Times: “This is the toughest job in the world. It's just pain.”

 

David Rubenstein Goes Back to College  |  The Carlyle Group co-founder spoke at Duke University, his alma mater, on Friday, saying:

“While a student here, I was sure that I had not adequately repaid Duke's faith in me. I was not a great academic star; a student government leader; a fraternity officer - I was never even invited to join a fraternity. And I was certainly no varsity athlete, or even an intramural athlete - I managed to be cut from an intramural basketball team with only four other players on the te am.” His comments make you wonder: So what exactly did Mr. Rubenstein do in college?

 

 

 

Mergers & Acquisitions '

Credit Agricole in Talks to Sell Greek Unit  |  The French bank Crédit Agricole said on Monday that it was in discussions to sell its struggling Greek subsidiary Emporiki to Alpha Bank of Greece for a nominal price of one euro. DealBook '

 

Australian Miner Arrium Rejects $1 Billion Bid by Noble Group and Posco  |  The Australian iron ore miner and steel maker Arrium described the takeover approach from a consortium led by the Noble Group and the South Korean steel maker Posco as opportunistic, dismissing it as undervaluing th e company. DealBook '

 

Aerospace Chiefs Make an Appeal to the Public  |  In an article to be published in European newspapers, the chief executives of EADS and BAE address what they call “myths and misconceptions” about their potential merger, Reuters reports. REUTERS

 

Politics Weighs on European M.&.A.  |  “Nobody wants to take a position when the world is riven by so much political uncertainty,” writes John Authers in a column in The Financial Times. FINANCIAL TIMES

 

Whitman's Third Act  |  Meg Whitman, the Hewlett-Packard chief executive, has had a career that took her from building eBay to running for governor of California. Now, The New York Times writes, she “is focusing her energy on H.P., the company founded by the tech legends William Hewlett and David Packard.” NEW YORK TIMES

 

INVESTMENT BANKING '

London Deal Maker Is Leaving Morgan Stanley  |  Simon Robey, Morgan Stanley's most senior deal maker in London, plans to leave in January to start his own firm, Bloomberg News reports. BLOOMBERG NEWS

 

Bank Customers in the Dark After Cyberattacks  |  After computer attacks on Bank of America, JPMorgan Chase, Citigroup, U.S. Bank, Wells Fargo and PNC, some customers “were upset because the banks had not explained clearly what was go ing on,” The New York Times writes. NEW YORK TIMES

 

JPMorgan Buys European Mortgage Bonds  |  The Financial Times writes: “JPMorgan has snapped up three-quarters of the first European commercial mortgage bond launched since the financial crisis in a deal that heralds the return of a vital source of funding for the Continent's cash-starved property market.” FINANCIAL TIMES

 

Deutsche Borse Said to Plan a Move Into Currency Futures  |  The German exchange operator is looking “to outmaneuver its largest rival,” the CME Group, The Wall Street Journal reports. WALL STREET JOURNAL

 

A Morgan Stanley Adviser Turns to Al ternative Investments  |  Kimberley Hatchett, a onetime Olympic hopeful who now oversees an eight-person team at Morgan Stanley with about 200 clients, has lately been focusing on alternative investments, as she says the stock market “has made me very, very nervous,” Barron's writes. BARRON'S

 

PRIVATE EQUITY '

K.K.R. to Buy Oil Services Firm Acteon Group  |  The private equity giant Kohlberg Kravis Roberts has agreed to buy a majority stake in the British oil and natural gas services company Acteon Group. The deal is valued at up to $1.4 billion, according to a person with direct knowledge of the matter. DealBook '

 

Are Investors Expecting Too Much?  |  David Bonderman of the private equity firm TPG Capital told The Financial Times: “If the public markets don't perform better, the benchmarks will have to change and people will have to adjust their expectations on returns.” FINANCIAL TIMES

 

Bain Capital Executive Says Political Attacks Are ‘Hyperbole'  | 
CNN

 

Private Equity Firms Said to Consider I.P.O. Exits  |  The Blackstone Group, K.K.R. and Advent International are among firms that are “lining up initial public offerings of their larger European assets over the next six months, according to three bankers close to the deals,” Financial News reports. FINANCIAL NEWS

 

HEDGE FUNDS '

Falcone Said to Seek Dismissal of Fraud Charges  |  Lawyers for Philip Falcone and Harbinger Capital Partners sent a letter to a judge on Friday saying they planned to seek dismissal of the charges filed against them by the Securities and Exchange Commission, The Wall Street Journal reports, citing unidentified people familiar with the case. WALL STREET JOURNAL

 

Centerbridge Partners to Return $500 Million to Investors  |  The move by the $20 billion investment firm is “an illustration of the double-edged effect that easy money policies are having on the debt market,” The Financial Times writes. FINANCIAL TIMES

 

Brevan Howard Attracts More Investors  |  Despite little gain for the first half of the year, the London-based hedge fund Brevan Howard has won new business from pension funds and other institutions, Pensions & Investments writes. PENSIONS & INVESTMENTS

 

I.P.O./OFFERINGS '

Fender Tries to Keep the Music Alive  |  Fender Musical Instruments, which recently withdrew plans to go public, is struggling to increase sales. “Times have changed, and so has music,” The New York Times writes. NEW YORK TIMES

 

Moleskine Files to Go Public  |  The notebook maker filed for an I.P.O. in Milan. MARKETWATCH

 

I.P.O. Investors Remain Skittish  | 
WALL STREET JOURNAL

 

Coming Week Is Busy for I.P.O.'s  |  Among the companies set to go public this week is Dave & Buster's Entertainment, a Dallas-based restaurant chain. WALL STREET JOURNAL

 

VENTURE CAPITAL '

Entrepreneurs Aim to Shake Up Philanthropy  |  Several start-ups are looking to measure the effect of charitable donations, writes Paul Sullivan in his column in The New York Times. One company, GiveWell, was founded by two people who met at the hedge fund Bridgewater Associates. NEW YORK TIMES

 

Driving Tesla's New Sedan  |  The New York Times gave the new Model S a glowing review. NEW YORK TIMES

 

Putting the Business Model First  |  Niklas Zennstrom, a venture capitalist who is also the founder of Skype and Kazaa, told Bloomberg News: “It's extremely hard to build a company with a product that everyone loves, is free and has no business model, and then to innovate a business model.” BLOOMBERG NEWS

 

LEGAL/REGULATORY '

Former SAC Analyst Pleads Guilty in Insider Trading Conspiracy  |  Jon Horvath, a former technology industry analyst, is the fourth former SAC employee to admit to illegal trading while employed at the fund. DealBook '

 

Judge Strikes Down a Dodd-Frank Trading Rule  |  Wall Street posted another victory in the battle over regulation, as a federal judge on Friday struck down the so-called position limits rule, a central piece of the Dodd-Frank financial overhaul. DealBook '

 

For Bank of America, More Trouble From Merrill Lynch Merger  |  The $2.43 billion that Bank of America will pay in the Merrill Lynch case ranks as one of the 10 large st settlements in a securities class-action lawsuit, behind the settlement over the disastrous AOL-Time Warner merger, write Peter J. Henning and Steven M. Davidoff. DealBook '

 

How a Lawyer Thwarted Icahn  |  Susheel Kirpalani, a 42-year-old lawyer who was the examiner in the bankruptcy case of Dynegy Holdings, successfully opposed a plan by Carl C. Icahn to force losses on bondholders, The Wall Street Journal writes. WALL STREET JOURNAL

 

Forgiving a Debt That Doesn't Exist  |  Some homeowners have received letters from banks erasing “phantom debts,” writes Gretchen Morgenson in her column in The New York Times. NEW YORK TIMES