Wall Street News
Verizon, AT&T eye $245B break-up bid for Vodafone - FT. Verizon Communications (VZ) and AT&T (T) have reportedly been working on a $245B bid for Vodafone (VOD) whereby Verizon would realize its long-held dream of gaining full control of Verizon Wireless and AT&T would obtain Vodafone's non U.S. assets. "Usually reliable people" tell the FT that Verizon and AT&T could offer 260 pence a share in what would be the biggest takeover in history. Vodafone shares were +4.6% at 195 pence at midday in London.
AstraZeneca suffers patent blow. A New Jersey district court has ruled that a patent protecting AstraZeneca's (AZN) billion-dollar Pulmicort Repsules asthma treatment is invalid, opening the way for Actavis (ACT) to launch a generic version. The ruling won't affect AstraZeneca's 2013 revenue guidance, but it will hurt royalties that the company receives from Teva's (TEVA) version of Pulmicort. It's a further blow for AstraZeneca as it restructures while trying to cope with a patent cliff.
Eurozone PMI contraction deepens. Eurozone manufacturing PMI dropped to a three-month low of 46.8 (flash 46.6) in March from 47.9 in February, as a fall in output and new orders gathered pace and brought further job losses. Eurozone countries either experienced sharper rates of decline or – in the cases of Germany and Ireland – slid back into contraction.
Top Stock News
Health insurers rally on Medicare rate ruling. The Centers for Medicare & Medicaid Services plans to increase Medicare Advantage payments to health insurers by 3.3% in 2014 rather than cut the rate by 2.3%, as originally announced. The reversal follows intense lobbying by companies and members of Congress, and helped boost the share prices of Humana (HUM), Aetna (AET), UnitedHealth (UNH) and other insurers.
Icahn buys 9.3% in voice-recognition firm Nuance. Nuance (NUAN) shares jumped 6.8% in post-market trading following news that Carl Icahn has amassed a 9.3% stake in the voice-recognition company, whose technology is reportedly behind Apple's (AAPL) Siri feature. Nuance has a market cap of $6.38B. The disclosure of Icahn's holding came two weeks after Warburg Pincus revealed a 14.6% stake, and has prompted the inevitable speculation that Icahn will look to make an activist push.
Judge questions $590M Citigroup settlement. A Manhattan judge has questioned the fairness of Citigroup's (C) proposed $590M settlement of a shareholder lawsuit that alleges that the bank hid tens of billions of dollars of toxic mortgage assets. At issue is whether former Citi executives should be absolved from participating in the payout. Those escaping responsibility include ex-CEO Charles Prince and former senior adviser Robert Rubin.
Dell pays Blackstone $25M to make bid. The NYT's Andrew Ross Sorkin has dug around in Dell's (DELL) long proxy statement about its buyout process and has come up with the nugget that the company is paying Blackstone (BX) $25M to cover the private-equity firm's expenses. To keep things fair, Dell is also paying Silver Lake's costs. The revelation raises the question about how confident, or serious, Blackstone is in its bid for Dell.
Top Economic & Other News
Japan's Abe lowers inflation hopes. Japanese Prime Minister Shinzo Abe has scaled back expectations about the Bank of Japan's ability to meet its 2% inflation target within two years. "We are not calling on the BOJ to act recklessly," Abe said. "Since the economy has a life of its own and nobody can predict what will happen in the future, there may be cases" in which the bank can't achieve its goal.
Stockton cleared for bankruptcy protection. In a blow to municipal bondholders, a judge has ruled that Stockton in California is eligible for bankruptcy protection. The decision allows the city to keep its pensions intact while imposing losses on those holding its paper. Jefferson County in Alabama and San Bernardino in California - along with other municipalities - are watching closely. Bond insurer Assured Guaranty (AGO) closed down 3.3% following the news.
Eurozone unemployment stays at record high. As forecast, eurozone unemployment remained unchanged on the month in February at 12%, although that's somewhat greater than the 10.9% rate a year earlier. As you'd expect, the highest jobless levels were in Greece (26.4%) and Spain (26.3%) respectively, while Austria (4.8%) and Germany (5.4%) enjoyed the lowest unemployment.