Markets live chat transcript for the chat ending at 12:04 on 1 Sep 2009. Participants in this chat were: Neil Hume, FT (NH) Miles Johnson, FT (MJ)
NH:
Good morning and welcome to Markets Live
NH:
Alphaville’s Daily Markets chat
NH:
and the start of a new era
NH:
we are Murphyless as of today
NH:
and you will note
NH:
starting 1 min earlier
NH:
of course Murph is not gone
NH:
he will be back in two weeks
NH:
as ML US is fired up
NH:
so for today’s show I am joined by our new recruit
NH:
Miles Johnson
NH:
who some of you might have met on Friday
NH:
anyway, Tracy found him stumbling around outside the FT offices this morning looking lost. Doesn’t look like he’s been home.
NH:
Heavy weekend Miles?
MJ:
Bloody hell, must have been. I have some vague memories of some bar somewhere, with some guy called Smurf, or Murph or something. But then its all a blur.
NH:
MJ:
The next thing I know, and I’m sat here being slapped by you and being told to get ready for “Markets Live”
MJ:
I also got quite a few missed calls on my mobile from this angry French fellow demanding compensation. Couldn’t for the life of me say what for
NH:
Not to worry. I’m sure it was all highly dignified. Probably was a standard night in the gentlemans club, playing backkgammon and discussing philosophy.
NH:
actually I chucked you in the back of a cab
NH:
gave the driver £20 and told him to take you home
NH:
which was more difficult than its sounds, particularly as you would not tell the driver where you lived
NH:
North London was about all we could get out of you
NH:
anyway enough of that. A big you thank you to everyone who turned up on Friday and made it such a memorable evening
NH:
a great send off for Murph
NH:
and great to meet so many of you in the flesh
NH:
that said, there are some loose ends that need to be tied up
NH:
such as how Taxloss brought the evening to the end
NH:
and the fact that some people carried on the drinking on Sat night
NH:
truly hardcore
MJ:
Any detail on the bar tab?
NH:
not as yet, still putting it together.
NH:
i think we should frame it
NH:
when it arrives
NH:
right
NH:
let’s get to the market
MJ:
A good idea
MJ:
a very good idea
11:07AM
MJ:
and after a firm start, which was really surprising in light of the big fall on the Chinese stock market
MJ:
London finally asked itself why are we up here and promptly fell 50 points
NH:
index currently 55 points lower at 4,853
NH:
with the miners doing the damage by the looks of things
Eurasian Natural Resources Corp (ENRC:LSE): Last: 821.50, down 43.5 (-5.03%), High: 858.00, Low: 806.00, Volume: 901.42k
Lonmin (LMI:LSE): Last: 1,391, down 70 (-4.79%), High: 1,458, Low: 1,375, Volume: 506.65k
Kazakhmys (KAZ:LSE): Last: 943.50, down 45 (-4.55%), High: 993.00, Low: 928.00, Volume: 1.40m
Antofagasta (ANTO:LSE): Last: 733.50, down 33 (-4.31%), High: 767.00, Low: 727.50, Volume: 1.19m
NH:
probably spooked by these reports about Chinese mining and oil companies defaulting on their hedging contracts
NH:
and this
NH:
Hearing Major real money fund sold a very large amount of EUROSTX futures, causing downmove in S+P and European bourses, suggestion is month end rebalancing, hurting risk trades. Quite normal for this type of trade to go through in early days of new mont
MJ:
Although I reckon that’s cobblers
MJ:
Or at least so vague as to be unhelpful
NH:
that’s true
11:10AM
NH:
right
NH:
some flashes coming out on CIT
NH:
RTRS-CIT GROUP SAYS PROVIDED NOTICE OF CONTINUANCE OF TRIGGER PERIOD TO HOLDERS OF SOME NOTES DUE MARCH 15, 2067
11:08 01Sep09 RTRS-CIT GROUP SAYS TRIGGER EVENT OCCURRED REQUIRING IT TO SATISFY SEPT 15, 2009 INTEREST PAYMENT – SEC FILING
11:09 01Sep09 RTRS-CIT GROUP SAYS IS NOT ABLE TO EXECUTE ALTERNATIVE PAYMENT MECHANISM, IS REQUIRED TO MANDATORILY DEFER INTEREST ON NOTES
11:09 01Sep09 RTRS-CIT GROUP SAYS PROVIDED NOTICE OF DEFERRAL FOR SEPTEMBER 15, 2009 INTEREST PAYMENT TO HOLDERS OF NOTES
11:08 01Sep09 RTRS-CIT GROUP
11:09 01Sep09 RTRS-CIT GROUP
11:09 01Sep09 RTRS-CIT GROUP
NH:
Stacy just having a look at those
NH:
and seeing what it really means
MJ:
Thanks for that
NH:
right, so what’s moving this morning?
11:11AM
MJ:
RSA
MJ:
Taken a bit of whack on this Sunday Telegraph rights issue report
MJ:
Stock off 7.4p at 123.2p at the moment
MJ:
Biggest faller in the FTSE 100
NH:
hmmm
NH:
and no comment from the company at the moment?
MJ:
radio silence
MJ:
and the story has not really been followed up on
NH:
I noticed that
NH:
still I can’t believe it is wrong. Early perhaps, but no wrong
NH:
actually I was having an email chat with our insurance correspondent Paul J Davies earlier
MJ:
oh yeah
NH:
he is back from hols and chasing the story
NH:
his view is that RSA would only need a cash call if they were working on an acquisition
MJ:
right
NH:
and the CEO Andy Haste has made no secret of the fact that he is looking to do deals
NH:
but these are smallish, bolt-on ones
NH:
of course that could of change, and perhaps they are looking at Direct Line
MJ:
that would be interesting
NH:
but he has not heard anything to that effect
MJ:
but would the regulators allow it?
NH:
no idea
NH:
in fact I am not sure it is up for sale
NH:
currently owned by RBS of course
NH:
which is having some probs with some climate protesters this morning
NH:
they have gueled themselves to the trading floor
NH:
Tracy did a post earlier
NH:
and I think there are some snaps on the piece now
NH:
showing the Boys in Blue on the trading room floor
NH:
that’s a link to Tracy’s piece
MJ:
Back to RSA
MJ:
Any comment on this?
NH:
er not much, surprisingly
NH:
not sure what the analyst have been up to this weekend
NH:
but here is the original story if you missed it over the weekend because you were in some sort of alcoholic haze
NH:
you might to have a look Miles
MJ:
actually we have got a few notes coming through now
MJ:
and they all take the line that the only reason RSA would need fresh capital is to make acquisitons
MJ:
here’s Che
MJ:
Press reports about rights issue
Weekend press reports £1bn rights issue considered
The Telegraph reports that RSA is considering a £1bn rights issue
ton finance the early retirement of £500m debt later this year and
also shore up the balance sheet. We think a rights issue is not
needed and also seems unlikely in the absence of any acquisitions.
Weekend press reports £1bn rights issue considered
The Telegraph reports that RSA is considering a £1bn rights issue
ton finance the early retirement of £500m debt later this year and
also shore up the balance sheet. We think a rights issue is not
needed and also seems unlikely in the absence of any acquisitions.
MJ:
Sorry should have been Chevreaux
MJ:
IGD surplus £1.7bn
At the end of H1 09, RSA reported an IGD surplus of £1.7bn
translating into a coverage of 2.4x, which we consider as
comfortable. Economic surplus stood at £1.7bn too and the
company in May issued a £500m subordinated bond. We therefore
see little reason to assume that the repayment of the £500m bond
due in October could see difficulty. Additionally, the £455m senior
facility was undrawn at H1.
At the end of H1 09, RSA reported an IGD surplus of £1.7bn
translating into a coverage of 2.4x, which we consider as
comfortable. Economic surplus stood at £1.7bn too and the
company in May issued a £500m subordinated bond. We therefore
see little reason to assume that the repayment of the £500m bond
due in October could see difficulty. Additionally, the £455m senior
facility was undrawn at H1.
MJ:
No need for rights issue in absence of acquisitions
With the comfortable capital position, strong non-life cash flows,
and debt already re-financed, we see little need for a capital raising
in the absence of any specific acquisitions.
With the comfortable capital position, strong non-life cash flows,
and debt already re-financed, we see little need for a capital raising
in the absence of any specific acquisitions.
MJ:
Stock weakness good buying opportunity
With the shares attractively valued and a 6% dividend yield, we
think any price weakness should be viewed as a good buying
opportunity. We reiterate our 2/OP rating.
With the shares attractively valued and a 6% dividend yield, we
think any price weakness should be viewed as a good buying
opportunity. We reiterate our 2/OP rating.
NH:
thanks for that
NH:
Paul Davies just poppped over
NH:
he reckons something deffo happening
NH:
says the flaks are being incredibly tight lipped
NH:
so perhaps
NH:
they have a big acquisitions coming
MJ:
This is all part of “rights issue fever” apparently. Well at least according to the Scotsman.
NH:
what? rights issue fever?
MJ:
RIGHTS issue fever is set to sweep the market when it reopens for business tomorrow, following weekend reports of two major cash calls.
MJ:
Insurance giant RSA was yesterday said to be considering raising up to £615 million through a rights issue to boost its financial position.
NH:
right, Miles is having some technical problems
NH:
pasting that story
MJ:
The FTSE 100 group, which changed its name from Royal & Sun Alliance last year, could announce plans to raise the cash within the next two weeks, according to a Sunday newspaper report.
MJ:
sounds like UK companies should watch out
NH:
well, we were hearing something similar last week
NH:
lots of cash calls lined up
NH:
but we thought most would be in Europe
11:23AM
NH:
Right
NH:
some questions about this Skype story
NH:
looks like it could well be true
NH:
NYT running it today
NH:
EBay plans to announce on Tuesday a deal to sell its Skype Internet calling division to a group of private investors, according to two people briefed on the company’s plans.
The investment group is likely to include Andreessen Horowitz, a new venture capital firm headed by the Netscape co-founder Marc Andreessen, these people said. One of the people added that Index Ventures, a London-based venture capital firm that was an early investor in Skype, and the private equity firm Silver Lake Partners were also involved. A price was not disclosed, but eBay has said it wants around $2 billion for Skype, which is on track to take in more than $600 million in revenue this year.
Alan Marks, an eBay spokesman, would not comment on the matter. Mr. Andreessen is on eBay’s board of directors.
EBay acquired Skype in 2005, outbidding Google and Yahoo in a deal that has come to be viewed as one of the worst technology transactions of the decade. Including payouts to Skype’s founders, the price ultimately topped $3.1 billion. EBay later wrote down $900 million of Skype’s value, after it became clear that the company was not a good fit with eBay’s main e-commerce and online payment businesses.
Although eBay has said it was planning an initial public offering for the Skype division next year, it has been talking to various companies and investment groups interested in buying the service. Skype’s founders, Niklas Zennstrom and Janus Friis, approached private equity firms earlier this year in hopes of making a bid for their old company. But they did not meet eBay’s price, and separately the parties are fighting in a British court over ownership of the core peer-to-peer technology behind the Skype service. The case is due to be heard by a British court next year.
Last month, eBay also negotiated with Google over buying Skype, according to a person briefed on those discussions. But Google ultimately walked away from a potential deal, fearing that continued litigation could leave it vulnerable to immense damages.
Google also worried that owning Skype might alienate wireless carriers, which offer their customers phones running Google’s Android software, the person said.
It is not clear if Skype’s founders are involved in the new deal and have agreed to relinquish their legal claim.
Ashlee Vance contributed reporting.
The investment group is likely to include Andreessen Horowitz, a new venture capital firm headed by the Netscape co-founder Marc Andreessen, these people said. One of the people added that Index Ventures, a London-based venture capital firm that was an early investor in Skype, and the private equity firm Silver Lake Partners were also involved. A price was not disclosed, but eBay has said it wants around $2 billion for Skype, which is on track to take in more than $600 million in revenue this year.
Alan Marks, an eBay spokesman, would not comment on the matter. Mr. Andreessen is on eBay’s board of directors.
EBay acquired Skype in 2005, outbidding Google and Yahoo in a deal that has come to be viewed as one of the worst technology transactions of the decade. Including payouts to Skype’s founders, the price ultimately topped $3.1 billion. EBay later wrote down $900 million of Skype’s value, after it became clear that the company was not a good fit with eBay’s main e-commerce and online payment businesses.
Although eBay has said it was planning an initial public offering for the Skype division next year, it has been talking to various companies and investment groups interested in buying the service. Skype’s founders, Niklas Zennstrom and Janus Friis, approached private equity firms earlier this year in hopes of making a bid for their old company. But they did not meet eBay’s price, and separately the parties are fighting in a British court over ownership of the core peer-to-peer technology behind the Skype service. The case is due to be heard by a British court next year.
Last month, eBay also negotiated with Google over buying Skype, according to a person briefed on those discussions. But Google ultimately walked away from a potential deal, fearing that continued litigation could leave it vulnerable to immense damages.
Google also worried that owning Skype might alienate wireless carriers, which offer their customers phones running Google’s Android software, the person said.
It is not clear if Skype’s founders are involved in the new deal and have agreed to relinquish their legal claim.
Ashlee Vance contributed reporting.
11:24AM
NH:
Just glancing at the market
NH:
it does seems as if they big defensive stocks are back in demand this morning
NH:
good moves from Diageo, AstraZeneca,
NH:
BATS, Reckitt
NH:
of course, there is a reason for the move in Astra
NH:
some good news on one of their drugs
MJ:
Astra up on news of that Brilinta drug
NH:
it is
NH:
up 44.5p at £28.84
NH:
and this note from UBS
NH:
should explain why it is good news
NH:
Better estimation of ACS market size to lift Brilinta estimates
On Sunday, Brilinta produced what we see as near-best-case results in the PLATO trial in ACS patients. We raised our peak sales forecast from $1.95bn to $3.0bn (20% market share, up from 13%-14%). Much of the divergence in our estimate vs. consensus is based on our assumption of ACS being 40%-50% of Plavix sales, vs. a 25%-30% consensus view. We present evidence the share is at least 40%-50%, and perhaps as high as 60%+. Consensus has a worst-case view on Brilinta’s opportunity, and a move to our view could lead to a doubling of many estimates.
On Sunday, Brilinta produced what we see as near-best-case results in the PLATO trial in ACS patients. We raised our peak sales forecast from $1.95bn to $3.0bn (20% market share, up from 13%-14%). Much of the divergence in our estimate vs. consensus is based on our assumption of ACS being 40%-50% of Plavix sales, vs. a 25%-30% consensus view. We present evidence the share is at least 40%-50%, and perhaps as high as 60%+. Consensus has a worst-case view on Brilinta’s opportunity, and a move to our view could lead to a doubling of many estimates.
NH:
High doctor support for Brilinta to increase market confidence in Brilinta
The president of ACC summed up the PLATO data: “I think it’s the best result we’ve seen since aspirin. It could not have come out better. [Brilinta is] going to surpass [Plavix] and pass [Effient].” We see a number of other examples of such highly positive commentary and note we could not find a doctor at ESC who was disappointed by the PLATO data. Upcoming conferences should support forecasts.
The president of ACC summed up the PLATO data: “I think it’s the best result we’ve seen since aspirin. It could not have come out better. [Brilinta is] going to surpass [Plavix] and pass [Effient].” We see a number of other examples of such highly positive commentary and note we could not find a doctor at ESC who was disappointed by the PLATO data. Upcoming conferences should support forecasts.
NH:
Less doctor concern for North American result to also increase confidence
The North American (NA) result (inconsistent with other data) is the biggest risk. We believe the NA patient size makes chance a likely culprit and expect FDA to be comforted by: (1) the mortality data, (2) the high consistency in other subgroups. We are reassured by lack of NA commentary from the NEJM editorial, the PLATO discussant, doctors at “Meet the Trialists”, and HeartWire and other doctor reports
The North American (NA) result (inconsistent with other data) is the biggest risk. We believe the NA patient size makes chance a likely culprit and expect FDA to be comforted by: (1) the mortality data, (2) the high consistency in other subgroups. We are reassured by lack of NA commentary from the NEJM editorial, the PLATO discussant, doctors at “Meet the Trialists”, and HeartWire and other doctor reports
11:27AM
NH:
Okay
NH:
readers, please stick with us for a moment
NH:
Miles is having to reboot
NH:
he is working of some ancient laptop
NH:
because he has not got a PC at his new desk
NH:
and won’t till Weds, which is installation day apparently
NH:
I think he is back in
MJ:
Hi back in now
MJ:
Im using a tiny Dell laptop from the late 90′s.
NH:
wow
NH:
museum piece
NH:
can’t believe it still works
MJ:
High tech stuff we have here
NH:
cutting edge
MJ:
Worried it might blow up
NH:
11:30AM
MJ:
so, do we have any RAW?
RAW is market chatter – information that has not been formally tested through traditional journalistic channels (PRs etc). The story might be complete rubbish, but if we believe there is some substance to it we will say so. Either way, Reader Beware.
NH:
not really, it is taking the City time to get going after the long holiday weekend
NH:
only one story traders are really talking about
NH:
and that’s Sinochem bidding for Gulfsands Petroleum
Gulfsands Petroleum (GPX:LSE): Last: 252.00, up 22 (+9.57%), High: 265.50, Low: 248.25, Volume: 1.09m
MJ:
the backstory here is that, Sinochem recently announced a deal to buy Emerald Energy
MJ:
and Emerald is Gulfsand’s silent partner in Syria
MJ:
and the thinking ever since that deal was announced, was that Sinochem would come back and mop up Gulfsands
NH:
yep
NH:
and then this appeared in the Sunday press at the weekend
NH:
China’s Sinochem Group is in talks to buy oil and gas producer Gulfsands Petroleum PLC (GPX.LN) for up to GBP400 million, U.K. newspaper the Mail reported Sunday, citing an unnamed person close to the situation.
A firm bid for Gulfsands, which operates mainly in the Middle East, should be tabled within weeks, the Mail cited the person as saying.
Gulfsands has a joint venture in Syria with Emerald Energy PLC (EEN.LN), which earlier this month agreed to be acquired by Sinochem for GBP532.1 million.
Sinochem could make an offer for Gulfsands, which also has assets in the U.S. Gulf of Mexico, at a 42% premium to Friday’s closing share price of 230p, the Mail said.
MJ:
that’s very precise
MJ:
A 42% premium
MJ:
what’s that 326p?
NH:
around that
NH:
the rumour in the market last week was that Gulfsands had knocked back 285p
MJ:
indeed
MJ:
and in spite of the speculation
MJ:
So far no statement
NH:
no
NH:
but there is this
NH:
apparently Sinochem looking to raise cash
NH:
SHANGHAI (Dow Jones)–China National Chemicals Import & Export Corp.,
Or Sinochem Corp., plans to sell $1 billion worth of dollar-denominated
bonds in the fourth quarter to finance its overseas expansion, a person familiar
with the situation said Tuesday.
Or Sinochem Corp., plans to sell $1 billion worth of dollar-denominated
bonds in the fourth quarter to finance its overseas expansion, a person familiar
with the situation said Tuesday.
The issue will be the second foreign-currency bond sale by a
non-financial company in China after China National Petroleum Corp., the country’s
largest oil company by assets, sold $1 billion worth of dollar-denominated bonds
in May and could spur the development of the country’s foreign-currency debt
market.
Prior to CNPC’s bond sale, only China Development Bank Corp. and
Export-Import Bank of China had issued dollar-denominated bonds on the
Local bond market. Outstanding dollar-denominated bonds in China totaled only
$6.23 billion at the end of July.
NH:
The maturity of Sinochem’s bonds, which will be sold on the interbank
market, has yet to be decided, said the person, who declined to be named.
market, has yet to be decided, said the person, who declined to be named.
Agricultural Bank of China will be the underwriter of the sale, he
said. Sinochem, China’s fourth-largest oil firm by assets, has applied to
the National Association of Financial Market Institutional Investors for the
issue, he said.
The National Association of Financial Market Institutional Investors
is an industry group overseen by the People’s Bank of China and is in charge
of corporate debt issues on the interbank market.
Sinochem plans to use the proceeds to finance its aggressive overseas
acquisition plans, the person said.
NH:
The company said in August it will take over U.K. oil and gas explorer
Emerald Energy PLC (EEN.LN) for GBP532.1 million.
Sinochem is also in talks about a possible bid for Australian
Agricultural chemicals group Nufarm Ltd. (NUF.AU).
Emerald Energy PLC (EEN.LN) for GBP532.1 million.
Sinochem is also in talks about a possible bid for Australian
Agricultural chemicals group Nufarm Ltd. (NUF.AU).
MJ:
interesting
MJ:
But does Sinochem really need cash to buy Gulfsands?
MJ:
after all it is not the biggest company in the world
MJ:
even after this morning’s rise it is only valued at £300m
NH:
hang on a mo
NH:
been waiting for this
NH:
some feedback on the story
NH:
looks like Gulfsands will not be making a statement on this approach
NH:
and the colour I am gettinig is that Sinochem
NH:
is happy with its interest in Syria
NH:
it really does not want to operator this field, it just wants a financial interest and a presence in the country
NH:
and through Emerald it has that
MJ:
buying Emerald is an expensive way to get a presence
MJ:
but I guess it makes sense, particularly if Gulfsands other fields prove to be a success
NH:
true
11:35AM
MJ:
any more on the Minerva bid story?
NH:
nothing
NH:
and the stock under a bit of pressure this morning
MJ:
Yes, down 4.25p at 28.5p
NH:
ah, that could be on the back of this Nomura deal
NH:
have you seen the terms of it??
MJ:
What, for their new city HQ?
NH:
that’s the one, jut across the river from us
MJ:
yeah, something like 6-years rent free
NH:
that’s it
NH:
what a deal for Nomura
NH:
if not the property companies involved
MJ:
which were?
NH:
can’t remember
NH:
let me dig out Dan Thomas’ scoop from FT.com
NH:
Nomura lands six-year London rent break
By Daniel Thomas in London
Published: August 31 2009 23:39 | Last updated: August 31 2009 23:39
Nomura, the Japanese investment bank, will not pay any rent for almost six years on its new headquarters building in the City of London under the terms of a deal to be announced on Tuesday.
The bank will confirm plans to move its UK business, including the staff taken on as part of the Lehman Brothers acquisition, into a new office development on the Thames.
Up to 4,000 banking staff will move into the 12-storey Watermark Place next year, many relocating from the former Lehman Brothers building in Canary Wharf.
By Daniel Thomas in London
Published: August 31 2009 23:39 | Last updated: August 31 2009 23:39
Nomura, the Japanese investment bank, will not pay any rent for almost six years on its new headquarters building in the City of London under the terms of a deal to be announced on Tuesday.
The bank will confirm plans to move its UK business, including the staff taken on as part of the Lehman Brothers acquisition, into a new office development on the Thames.
Up to 4,000 banking staff will move into the 12-storey Watermark Place next year, many relocating from the former Lehman Brothers building in Canary Wharf.
NH:
The Financial Times has learnt that the bank has secured one of the most attractive rental packages seen in the Square Mile in recent years, reflecting how much the commercial property market has changed since its peak just two years ago.
Mark Lethbridge, partner at Drivers Jonas and adviser to Nomura, said the transaction was the largest deal to date on a new office building in London. “We’ve secured this on terms I’m unlikely to see again in my career,” he added.
Mark Lethbridge, partner at Drivers Jonas and adviser to Nomura, said the transaction was the largest deal to date on a new office building in London. “We’ve secured this on terms I’m unlikely to see again in my career,” he added.
NH:
and one final thing on Minerva
NH:
we are hearing a deal to let some more space at their St Boltophs development
MJ:
Really, that is interesting
NH:
indeed
11:38AM
NH:
right
NH:
a bit more RAW
NH:
at the end of last week we were picking up some vague rumours about Sprint Nextel
MJ:
The US mobile phone company right?
NH:
yes, that’s the one
NH:
all very vague
NH:
talk of something coprorate
NH:
and now we are picking up talk of some deal with Deutsche Telekom
NH:
a merger with their US division possibly
NH:
of course this deal has been rumoured before
NH:
about a year ago
NH:
this is from the WSJ
NH:
Sources have told the Wall Street Journal that Deutsche Telekom is looking into either a merger or buyout of the third-largest US wireless provider.
With the addition of Sprint’s customer base, T-Mobile would become the largest cellular provider in the US, serving nearly 83 million customers. The news appears to be a repackaging of earlier rumors that first surfaced in March.
NH:
At that time, investment bank Merrill Lynch first suggested that the company may be forced to merge with Sprint after the company rolled out new unlimited voice and data plans.
The company said the move could trigger a price war, which in turn could end up hurting T-Mobile financially. The US arm prides itself in providing its customers with plans with the most value, and these new plans from Sprint threaten that.
NH:
but I stress
NH:
that is all very vague
NH:
and needs further work
11:40AM
MJ:
Just on Gulf Keystone
MJ:
That was a company spokesman denying
NH:
not an RNS then
MJ:
Nope, a felt collared source
NH:
shares coming off
NH:
now up just 15.5p at 245.5p
MJ:
Here is thestory
MJ:
LONDON, Aug 30 (Reuters) – London-listed oil and gas explorer Gulfsands Petroleum is in takeover talks with China’s state-owned Sinochem, according to a report in the Mail on Sunday.
The newspaper, citing a source close to the situation, said a firm bid could be tabled within weeks.
Sinochem is offering up to 400 million pounds ($651.4 million) for Gulfsands, or a 42 percent premium to Friday’s closing share price of 230 pence, it said.
Gulfsands’ share price has risen from 130 pence at the start of the year, boosted by positive news from its activities in the Khurbet East oil field in Syria.
Earlier this month, Sinochem agreed a 532 million pounds takeover of Emerald Energy, Gulfsands’ joint venture partner in Syria
The newspaper, citing a source close to the situation, said a firm bid could be tabled within weeks.
Sinochem is offering up to 400 million pounds ($651.4 million) for Gulfsands, or a 42 percent premium to Friday’s closing share price of 230 pence, it said.
Gulfsands’ share price has risen from 130 pence at the start of the year, boosted by positive news from its activities in the Khurbet East oil field in Syria.
Earlier this month, Sinochem agreed a 532 million pounds takeover of Emerald Energy
NH:
sorry
NH:
that’s the wrong one
MJ:
Here we go
MJ:
Right one this tiime
MJ:
LONDON, Sept 1 (Reuters) – Gulfsands Petroleum plc : * Spokesman says no bid approach from sinochem * Spokesman says no bid approaches from other parties
NH:
and this is Gulfsands not Gulf Keystone
NH:
one day
NH:
big deals will return
NH:
and we won’t have to look at stuff like this
11:44AM
NH:
Okay
NH:
just glancing over to the panel on the right
NH:
and a few names missing today
NH:
no Taxloss
NH:
Shrewdette
NH:
Lorcan
NH:
are they OK
NH:
and only one comment from Monkey
NH:
did they all get home safely
NH:
ah, good morning Taxloss
NH:
how did the cricket go?
MJ:
@HB have a look in the Long Room
MJ:
I think there might even be a recording of Mr Lionel’s speech
NH:
What Taxloss. A no show?
NH:
that’s dreadful
NH:
Beefy would never have done that
11:48AM
NH:
Right
NH:
market update
MJ:
we are down 63 points at 4845.89
NH:
hmmm
NH:
Murph’s short might be back in the money
NH:
right
NH:
we have an email from RBS
NH:
an internal memo
NH:
about the climate change/glue protest
NH:
Earlier today a small number of Climate Camp protesters managed to get into the trading floor in 250 Bishopsgate and chain themselves in. We are currently working with the relevant authorities to remove these demonstrators and to ensure the safety of our employees and minimum inconvenience to our business operations. Protesters are also outside 250 Bishopsgate and we expect additional protests throughout the day. There is a heavy police presence onsite and additional security is in place to ensure the safety of our staff and visitors.
NH:
Until further notice all staff should remain in 250 Bishopsgate and staff from other buildings should not try to gain access. If you have any client meetings arranged in 250 Bishopsgate today please make alternative arrangements. The main entrance of 135 Bishopsgate is now closed as an extra precaution.
All staff are advised to remain vigilant at all times and follow the guidance issued last week regarding personal security during the Climate Camp protests. Please ensure that you display your security pass when you are in any RBS building and you do not allow access to anyone without an authorised security or visitors pass.
We will continue to keep you updated.
NH:
Mark Thresher
Head of GBM Business Continuity
Head of GBM Business Continuity
MJ:
Great job title he has there
MJ:
“Head of GBM Business Continuity”
NH:
yep
NH:
charged with keeping the good ship RBS running
NH:
but on to more important stuff
NH:
we all want to know how the evening ended for Taxloss
NH:
there is talk on the right of violence
NH:
can anyone provide some background
NH:
I had gone by then?
NH:
(Lemmy, they dressed up as contractors to get in)
11:53AM
MJ:
Where to now?
NH:
er not sure. there really is very little happening this morning
NH:
(Lemmy – building contractors)
NH:
very, very quiet
NH:
was looking at BG earlier
MJ:
stock has been a weak over the past couple of weeks
MJ:
falling from near £11 to £10
MJ:
concerns about its Brazilian prospects and whether the Brazilian govt was going to demand a greater share
NH:
that and a disappointing update from Brazil
MJ:
anyway, there was some good news from Brazil over the weekend
MJ:
while the govt is going to introduce new Production Sharing Agreements and a state oil company to manage its reserves
MJ:
existing concession are going to be unaffected by the change
NH:
right
NH:
that should ease some fears, then
NH:
although the stock still off this morning
BG Group (BG:LSE): Last: 999, down 17.5 (-1.72%), High: 1,034, Low: 995.00, Volume: 5.04m
MJ:
actually got a quick note from Oriel on this
MJ:
Brazil yesterday announced disclosed new rules governing its potentially huge oil
reserves. The president submitted new legislation to Congress which would: introduce a Production Sharing regime to replace the current concessions-based system; create a
state oil company, Petrosal, to manage the reserves; set up a fund to manage the
government’s revenues from the reserves and direct them towards social spending on
areas such as poverty relief, education and infrastructure; and allow a US$50bn issue of new capital in Petrobras.
reserves. The president submitted new legislation to Congress which would: introduce a Production Sharing regime to replace the current concessions-based system; create a
state oil company, Petrosal, to manage the reserves; set up a fund to manage the
government’s revenues from the reserves and direct them towards social spending on
areas such as poverty relief, education and infrastructure; and allow a US$50bn issue of new capital in Petrobras.
MJ:
Petrobras shares fell more than 5% on Monday.
As expected, it appears that existing concessions (including BG’s) will not be changed.
The announcement should reduce one risk over-hanging the shares. Attention will now turn to how Petrobras will prioritise its investment opportunities in its new, significantly larger role
NH:
thanks for that
11:57AM
NH:
Praxis
NH:
not heard anything on DSG
NH:
have you got any details?
11:59AM
NH:
before we go
NH:
a couple of things to look at
NH:
sterling
NH:
a bit weaker this morning
NH:
PMI data looks to be disappointing
NH:
down in August
MJ:
Down? Where are the green shoots there?
NH:
none
NH:
hang on here’s a bit of comment
NH:
from Howard Archer
NH:
at IHS Global Insight
NH:
The relapse in the manufacturing purchasing managers’ index in August and the downward revision to the July reading is disappointing on the face of it, but there are still several relatively encouraging features in the August survey and the sector is still looking a lot healthier than a few months ago. Indeed, the survey showed output expanding at the fastest rate since the end of 2007 and new orders expanding for a third month running, albeit at a reduced rate compared to July. Meanwhile, stock of finished goods fell sharply again, which will help the sector going forward. Indeed, the orders to inventories ratio rose to a five-and-a-half year high. Furthermore, employment contracted in the sector at the slowest rate since June 2008, although the decline was still substantial.
NH:
Meanwhile, the survey showed still relatively muted inflationary pressures. Output prices fell for a seventh successive month while input prices were down for a 10th month, although in both cases the declines were less than in July.
Despite the fall in the headline figure, the August manufacturing purchasing mangers survey does little to dilute hopes that the UK economy will achieve expansion ion the third quarter for the first time since the first quarter of 2008. The manufacturing sector is currently benefiting markedly from the substantial stock adjustment that has taken place, while the more competitive pound is helping the sector by making UK manufacturers more competitive in their domestic markets as well as through helping exporters. On top of this, demand is showing signs of picking up at least temporarily in important overseas markets as well as at home. Nevertheless, manufacturers still face an uncertain future as serious doubts remain about the strength of demand over the medium term.
NH:
cable rate is $1.62
NH:
while against the euro
NH:
we are at 0.88p
MJ:
Where did the PMI come in at?
NH:
came in at 49.7
NH:
and a downward revision to 50.2 in July
NH:
right
NH:
that is it for today
NH:
sorry that it was such a mess
NH:
and Miles could not contribute
NH:
due to this ancient Dell laptop
NH:
hopefully that should be fixed tomorrow
NH:
or Weds
NH:
and a normal ish service will resume
NH:
until tomorrow
NH:
cya
MJ:
Bye everyone
NH:
goodbye