Tag Archives: UPDATE

UPDATE 3-Third Avenue parts with CEO soon after collapse of junk bond fund -WSJ

The collapse of Third Avenue’s Focused Credit Fund jolted Wall Street and renewed worries about the difficulty of trading securities on the U.S. bond marketplace. New York-primarily based Third Avenue is a relatively modest investment manager with fund assets that totaled $ ten billion at the beginning of the year.

A security guard at Third Avenue’s headquarters said on Sunday that Barse had been let go and was not allowed back in the creating, the Wall Street Journal reported.

A Third Avenue representative declined to comment. Barse did not respond to calls. His function e mail bounced back with the message “undeliverable”.

Third Avenue’s Focused Credit Fund was overwhelmed with heavy losses and surging investor net withdrawals, forcing Barse to abruptly liquidate the fund and block redemptions.

The redemptions and losses more than the previous year cut the size of the Third Avenue Focused Credit Fund to $ 789 million from almost $ three billion. Run by Tom Lapointe, the fund bet on distressed situations, such as the bankruptcy-related claims of Lehman Brothers. In a letter to investors last year, Lapointe, who could not immediately be reached for comment, stated distressed assets in his portfolio had been not necessarily illiquid or hard to trade.

The fund’s collapse is a blow to the reputation of Third Avenue Founder Marty Whitman, regarded the dean of American vulture investing. He hired Barse in 1991 to oversee the firm’s operations so he could spend much more time pursuing his own investment techniques.

Whitman could not be reached for comment.

The blow-up of the Focused Credit Fund was the most significant mutual fund failure considering that the economic crisis. The fund’s collapse shows the dangers of loading up on risky assets that are tough to trade even in excellent instances.

Just before Barse, 53, joined Third Avenue, he worked as a bankruptcy attorney defending the rights of creditors. He had been CEO of Third Avenue because 2003.

Whitman was a leader in a strategy that includes bets on the outcomes of businesses going via bankruptcy and other distressed conditions. The 91-year-old’s book titled “Distress Investing” distills decades of understanding about the ins and outs of bankruptcy restructuring.

In 2002, Affiliated Managers Group Inc purchased a majority equity stake in Third Avenue, with the remaining portion held by a broad group of workers that incorporated Whitman and Barse. Third Avenue, nonetheless, continued to operate autonomously from AMG, which holds stakes in a quantity of boutique asset management firms. AMG could not quickly be reached for comment.

(Reporting by Sam Forgione, Tim McLaughlin and Ross Kerber editing by Grant McCool)

UPDATE 1-Box Office: ‘In the Heart of the Sea’ Flops With $11 Million Debut

LOS ANGELES (Selection.com) – Ron Howard’s “In the Heart of the Sea” sunk at the box workplace, mustering up a measly $ 11 million after debuting in three,103 theaters.

It really is a painful flop for the director behind “A Beautiful Thoughts” and “Apollo 13.”

1 of the worst of his Oscar-winning profession. With an $ 100 million production budget, the film will likely result in a steep write down for Warner Bros., the studio behind the seafaring epic.

“In the Heart of the Sea’s” failure is the most current in a long string of missteps and disasters for the company, which is reeling from a litany of disasters that contains “The Man From U.N.C.L.E.,” “Jupiter Ascending,” and “Pan.”

The studio did catch a break more than Thanksgiving when “Creed” emerged as a sleeper hit and its monetary exposure is softened on “In the Heart of the Sea” because Village Roadshow was a economic companion.

“We stand behind Ron and his vision for the story,” mentioned Jeff Goldstein, Warner Bros. distribution executive vice president. “We believe in him. He’s a terrific filmmaker. But some films function and unfortunately some motion pictures do not.”

“In the Heart of the Sea” reunites Howard with Chris Hemsworth. The pair previously collaborated on the racing drama “Rush.” It centers on the Essex, a whaling vessel that had a violent encounter with a sperm whale. The nautical disaster inspired Herman Melville’s”Moby Dick.” Outside of the “Thor” films, Hemsworth has struggled to establish himself as a box workplace draw — “Rush” and this year’s cyber thriller “Blackhat” both fizzled.

The film is the latest adult oriented drama to collapse at the box office, joining a list that consists of “Steve Jobs,” “Our Brand is Crisis,” and “Burnt.” The opening weekend audience for “In the Heart of the Sea” skewed older. Ticket purchasers have been 54% male and 68% over the age of 35. 3D screenings accounted for 42% of receipts.

Warner Bros. hopes it can make up some ground over the holidays, noting that the B+ CinemaScore indicates word-of-mouth will be solid.

“The adult audience has been slow to come out and that’s frustrating since this is a story nicely told,” stated Goldstein.

Of course, the entire weekend was a throat clearing of sorts as the movie organization braces for the debut of “Star Wars: The Force Awakens” next week. The return to a galaxy far, far away is on pace to shatter records for a December opening and could threaten “Jurassic World’s” debut of $ 208.eight million to become the greatest launch in history.

With “In the Heart of the Sea” flailing, “Hunger Games: Mockingjay – Component 2” captured first location for the fourth straight weekend with $ 11.3 million. The science-fiction franchise capper has earned $ 244.five million domestically.

Amongst holdovers, “The Excellent Dinosaur” nabbed second place with $ 10.five million, bringing its domestic total to $ 89.7 million. “Creed” captured fourth position with $ 10.1 million. The boxing drama has earned $ 79.3 million after 3 weeks of release.

“Krampus” dropped 58% in its second weekend of release to round out the prime 5 with $ 8 million. The Christmas-themed horror film has earned $ 28.1 million stateside.

UPDATE 1-Fosun executives to meet Delek in Israel more than Phoenix deal

(Releads with Delek statement on Fosun meetings)

TEL AVIV Dec 13 Representatives of Fosun International will arrive in Israel in the coming days to discuss the procedure of its agreed deal to buy handle of Israeli insurer Phoenix Holdings from Delek Group .

Delek mentioned in a statement to the Tel Aviv Stock Exchange on Sunday that it would issue additional statements on any developments associated to the sales process.

The stock exchange on Sunday suspended trading in Delek and Phoenix due to events connected to Fosun, which mentioned on Friday its Chairman Guo Guangchang, a single of China’s very best-recognized entrepreneurs, was assisting authorities with an investigation, soon after an earlier report mentioned the group lost make contact with with its billionaire founder.

Following Delek issued its statement, the stock exchange mentioned trading in the shares would resume at 0939 GMT.

Delek, one of Israel’s major conglomerates, in June agreed to sell its 52.31 % stake in Phoenix to Fosun for 1.eight billion shekels ($ 467 million). ($ 1 = three.8545 shekels) (Reporting by Tova Cohen. Editing by Jane Merriman)

UPDATE 1-Eurozone officials rule out IMF’s exclusion from Greek bailout

ATHENS The IMF will not be excluded from Greece’s third bailout program review, Eurozone officials told Greece on Saturday after its prime minister said the global lender was not playing a constructive role.

Earlier this week Alexis Tsipras accused the IMF of making unrealistic reform demands, triggering a reaction from German Finance Minister Wolfgang Schauble, who said it was not in Greece’s interest to question the fund’s involvement.

“There is no chance that the first review will conclude without the IMF,” Eurogroup Working Group President Thomas Wieser told the Kathimerini weekly newspaper.

“This is not my personal opinion or that of EU institutions, but a reality that occurs from the parliamentary procedures in some member states,” he said.

The IMF said earlier this year it would wait to see the outcome of Greece’s debt relief talks with EU partners before agreeing to inject new cash as part of an 86 billion euro ($ 94.45 billion) third bailout program.

Athens, meanwhile, hopes to start debt relief talks in February after a successful conclusion of the latest bailout’s first review that includes a painful pension reform.

Another European official, European Stability Mechanism (ESM) chief Klaus Regling, said on Saturday the IMF would participate in Greece’s bailout with a small contribution, adding in an interview to weekly newspaper To Vima that this was agreed in July.

The ESM chief said the organization aimed to re-profile Greece’s debt and smoothen servicing payments to make it viable and attract investors.

“We will aim to smoothen the profile of the debt… If we manage to extend a little more the period of the already very low repayments, then we will attract investors,” he said.

Earlier this month Greek finance minister Tsakalotos told Reuters he saw a 50-50 chance of Greece tapping capital markets by the end of 2016 – the first time it would do so since it was excluded from them in 2010.

(Reporting by Lefteris Karagiannopoulos; Editing by Clelia Oziel)

UPDATE 1-India to get Japan’s bullet train, deepens defence and nuclear ties

NEW DELHI Japan will provide $ 12 billion of soft loans to construct India’s first bullet train, the two nations announced during a go to by Japanese Prime Minister Shinzo Abe that also yielded deeper defence ties and a strategy for civil nuclear cooperation.

Relations have strengthened in between Asia’s second and third largest economies as Abe and Indian counterpart Narendra Modi seek to balance China’s rise as the dominant Asian power. Both males are nationalists who take pleasure in a individual friendship.

The deal to develop a high-speed train line amongst the monetary hub of Mumbai and the city of Ahmedabad offers Japan an early lead more than China, which is conducting feasibility research for higher speed trains on other components of India’s dilapidated rail network.

“This enterprise will launch a revolution in Indian railways and speed up India’s journey into the future. It will become an engine of economic transformation in India,” Modi mentioned in a speech.

Japan has presented a “very concessional loan” at an interest rate of .1 % price with repayment over 50 years and a moratorium for 15 years, Indian Foreign Secretary S. Jaishankar told a news conference.

India will be acquiring a Japanese higher-speed train technique, successfully with an export credit of $ 12 billion.

Under defence bargains announced on Saturday, the two sides will share technologies, equipment and military information, but the extended-awaited sale of Japanese aircraft in a deal worth about $ 1.1 billion was not concluded.

Similarly, although they agreed to operate towards cooperation in civil-nuclear technologies, they stopped short of signing an agreement, citing outstanding technical and legal variations.

Jaishankar did not cite a timeline for signing the final agreement with Japan.

Japan, the only country to have suffered a nuclear attack, has been demanding added non-proliferation guarantees from India prior to it exports nuclear reactors.

India and Japan have been negotiating a nuclear energy deal because Japan’s ally, the United States, opened the way for nuclear commerce with India despite its atomic bomb programme and shunning of the international Non-Proliferation Treaty (NPT).

A final deal with Japan would also benefit U.S. firms. India has already offered land for nuclear plants to GE-Hitachi – which is an alliance amongst the U.S. and Japanese firms – and to Toshiba’s Westinghouse Electric Business.

“The memorandum we signed on civil nuclear power cooperation is much more than just an agreement for commerce and clean energy, it is a shining symbol of a new level of mutual confidence and strategic partnership in the lead to of peaceful and secure planet,” Modi mentioned.

“I know the significance of this selection for Japan and I assure you that India deeply respects that selection and will honour our shared commitment,” Modi added.

In a joint statement the two prime ministers pointed out the South China Sea and “called upon all states to avoid unilateral actions that could lead to tensions in the region”.

China claims most of the South China Sea, through which more than $ five trillion in global trade passes each and every year. Vietnam, Malaysia, Brunei, the Philippines and Taiwan have rival claims.

New Delhi and Tokyo, each of which have territorial disputes with Beijing, have no claims in the waterway but be concerned about China’s growing military reach into sea lanes by way of which much of Japan’s shipborne trade passes. Abe and Modi named for freedom of navigation in international waters.

India and Japan have been holding talks for two years on the buy by India of US-2 amphibious aircraft created by ShinMaywa Industries, which would be 1 of Japan’s initial arms sales given that Abe lifted a 50-year ban on weapon exports.

Jaishankar mentioned a purchase of US-two was discussed in Saturday’s meeting and the “matter remains beneath consideration”.

(Editing by Frank Jack Daniel and Mark Heinrich)

UPDATE 1-China launches new yuan index to sway markets away from yuan-dlr concentrate

BEIJING China has begun issuing a yuan exchange price against a basket of currencies in a move to discourage investors from exclusively tracking the yuan’s fluctuations against the U.S. dollar.

The yuan has been weakening against the dollar in recent months, mainly pressured by industry jitters about slowing development in China and an expected interest rate rise in the United States.

The China Foreign Exchange Trade Technique (CFETS) announced late on Friday that it had launched a new trade-weighted yuan exchange rate index, which was at 102.93 on November 30, a rise of two.93 % from the finish of 2014. In that very same period, the yuan has fallen three % against the dollar.

The move is intended to “facilitate the market to observe the modify of RMB powerful exchange price from distinct perspectives”, the CFETS, China’s interbank foreign exchange industry, said in a statement.

“It is more desirable to refer to both the bilateral RMB-USD exchange price and exchange rate primarily based on a basket of currencies,” stated a commentary on the site of the official foreign exchange market place, which was also published on the central bank’s website.

Chinese officials have urged investors to gauge the yuan’s adjustments against a basket of currencies, rather than just the dollar, in a bid to ease market issues about the yuan’s weakness. Signaling to markets that the yuan’s weakness wasn’t unusual, the officials have noted the dollar’s gains against significant currencies.

Some analysts think the move signaled the central bank’s intention to progressively shift towards a basket system for the yuan, but other individuals disagreed.

“It ought to not be regarded as a formal policy shift by the PBOC to a certain exchange rate targeting regime that, the Monetary Authority of Singapore makes use of, for instance,” analysts at HSBC mentioned in a note.

On Friday, the yuan fell to its weakest in four-1/two years and posted its longest weekly losing streak in a decade, following the People’s Bank of China set its every day guidance rate at its weakest level given that August 2011.

The extended decline has prompted traders to wonder how a lot Beijing is prepared to let the currency to fall.

(Reporting by Beijing bureau Editing by Hugh Lawson & Shri Navaratnam)

UPDATE 1-Bridgestone raises offer for U.S. auto components retailer Pep Boys

5108.T) on Friday raised its provide for U.S. auto parts retailer Pep Boys – Manny, Moe & Jack (PBY.N) by 50 cents a share to $ 15.50 per share.

The new offer by Bridgestone Retail Operations LLC, a wholly owned subsidiary of Bridgestone, raises the deal value by $ 28 million to $ 863 million for Pep Boys, the firms said.

The new offer comes following Pep Boys said on Wednesday that it planned to terminate its deal with Bridgestone as its board regarded as Carl Icahn’s supply as a “superior proposal.”

Carl Icahn’s Icahn Enterprises LP (IEP.O) had provided to acquire Pep Boys for $ 15.50 per share.

Bridgestone was given 3 days on Dec. 8 by Pep Boys to make a new offer.

Pep Boys stated on Friday that its board no longer deems Icahn’s supply as superior, and advised that Pep Boys shareholders accept Bridgestone’s provide.

J.P. Morgan Securities LLC was the economic adviser to Bridgestone, while Rothschild advised Pep Boys.

Jones Day is Bridgestone’s legal adviser, whilst Morgan, Lewis & Bockius LLP is Pep Boys’ legal adviser.

(Reporting by Shubhankar Chakravorty in Bengaluru Editing by Sandra Maler and Lisa Shumaker)

UPDATE 3-Argentina, Wall Street banks in talks on financing line

(Adds finance minister, market analyst)

By Jorge Otaola and Nicolás Misculin

BUENOS AIRES Dec 11 Argentina’s new government is negotiating with a group of Wall Street banks for a credit line worth up to $ 7 billion to bolster its low foreign reserves and assist it lift capital controls, a banking source stated on Friday.

Center-right President Mauricio Macri, who took office on Thursday, desires to move speedily to get rid of currency controls that restrict access to U.S. dollars but is stymied by the central bank’s precariously low tough currency reserves.

The industrial banking source stated Argentina was in talks with HSBC, JPMorgan Chase & Co., Goldman Sachs , Deutsche Bank and Citigroup Inc.

But he stated there remained obstacles to an agreement and that no quick deal was probably.

“The banks are functioning on a deal. It would be difficult for anything to come about immediately. There are some crucial specifics needed to close this out that are missing,” said the supply, without having providing much more details.

Finance Minister Alfonso Prat-Gay declined to confirm Macri’s government was in talks with the banks.

“We’re negotiating different financing options so that the dollars that ought to never ever have left the nation come back as speedily as feasible,” Prat-Gay told reporters soon after unveiling his team.

CREDIT Danger

The U.S. dollar crunch stems from a festering legal battle with U.S. investment firms more than unpaid debt that tipped Argentina back into default in July final year and prolonged the country’s banishment from international debt markets.

A second supply in the central bank confirmed the talks were taking spot but could not confirm the amount being discussed.

“They’re operating to reduce Argentina’s credit danger offered the fact that it is in default and keeping in mind the new government is working to resolve that predicament,” the commercial bank supply stated.

Citi declined to comment.

Argentina’s daily La Nacion reported that beyond the feasible $ 7 billion being sought through the group of 5 banks, a additional $ 1 billion could be secured by way of a financing agreement with Spanish banks Banco Santander and BBVA Bancomer.

Argentina’s central bank counts its total reserves at $ 25 billion, but some private economists estimate net reserves are a fraction of that.

“I expect the new government to be able to get liquidity help from the markets” mentioned Sebastian Vargas, emerging markets analyst at Barclays bank in New York. “It would be a liquidity bridge for the central bank, not financing for the Treasury.” (Further reporting by Hugh Bronstein Writing by Richard Lough Editing by Chizu Nomiyama and Meredith Mazzilli)

UPDATE five-South African rand hits record low, bank stocks dive after minister’s sacking

JOHANNESBURG South Africa’s rand weakened to a record low on Friday, slumping far more than 3 % in the wake of this week’s sacking of the finance minister, whilst banks led stocks reduce.

President Jacob Zuma sacked Nhlanhla Nene late on Wednesday in favor of a reasonably unknown lawmaker, David van Rooyen, unnerving investors in an ailing economy whose investment grade status is already at threat.

The sacking of Nene, a veteran civil servant in the ministry who was keen to rein in government spending in Africa’s most industrialized economy, has also sparked a sell-off in bank stocks, which have dropped practically 20 % because Thursday.

“Government will not abandon the fiscal path that we have selected in the last couple of years,” Zuma mentioned in a statement. “Keeping a prudent fiscal position remains 1 of government’s top priorities.”

Zuma said Nene was removed from his role as finance minister beneath brief notice so that he could be nominated as the head of the African Regional Centre of the New Improvement Bank/BRICS Bank, to be based in Johannesburg.

“It’s a lame purpose. They are fishing for an excuse. They are attempting to locate a position that is senior adequate for Nene to give a valid cause for why he was sacked,” Dawie Roodt, the chief economist at monetary services firm Effective Group mentioned. “I’ve got extremely small doubt that markets will be skeptical also.”

In a separate statement, Zuma denied nearby media reports that a wider cabinet reshuffle was in the offing, in what analysts saw as an attempt to calm jittery markets.

Several economists have questioned van Rooyen’s ability to steady an economy hammered by falling costs for commodity exports that variety from coal to gold.

“Markets never like uncertainty,” Cratos Capital equity analyst Greg Davies. “You have taken a minister that had a lot of credibility with the market place … and put somebody in his spot that does not appear to have any sort of encounter like the prior minister.”

By 1700 GMT the rand had recovered slightly, trading 1.98 % reduce to the dollar at 15.78150 ZAR=D3, from the psychologically vital 16.00 level it hit earlier in the day.

The central bank told Reuters it would hold its monetary policy committee meeting in January as scheduled. It raised the benchmark lending price for the second time in 2015 last month to six.25 percent.

Analysts had speculated that the bank might get in touch with an earlier meeting to boost interest prices to defend the rand.

Yields on local and dollar-denominated debt soared as the likelihood of a downgrade to junk spooked investors. Demand levels in local bond auctions have been weak on the day, reflecting the subdued interest in local debt.

On the bourse, the banking index .JBANK dropped more than 10 percent in early bargains prior to recouping some of the losses to close five.eight % decrease as worries grew that pressure on South Africa’s sovereign credit ratings would hit profits and drive up bad debts among the nation’s banks.

Barclays Africa (BGAJ.J) plummeted as considerably as 12 %, ending 3 % reduce at 127,84 rand, whilst FirstRand (FSRJ.J) lost eight.three percent to 35.57 rand and Normal Bank (SBKJ.J) fell four.2 % to 101.39 rand.

The blue-chip JSE Leading-40 index .JTOPI dropped 1.24 % to 43,701 points, whilst the broader All-share index was off 1.56 percent at 48,219 points.

DOWNGRADE

“This nation would be far much better off without this man as our president, and I say that with a excellent deal of sadness,” former wellness minister and anti-apartheid activist Barbara Hogan told Talk Radio 702, referring to Zuma.

Credit ratings agency Fitch, which downgraded South Africa last Friday to just one particular notch above “junk” status, said Nene’s firing “raised far more unfavorable than constructive queries”.

Downgrades jack up South Africa’s borrowing fees and flow via to the banking method.

The yield on the benchmark government bond due in 2026 ZAR186= has added practically 200 basis points, or 2 %, in the last two days to levels last seen during the 2009 recession.

Overseas investors also shunned local dollar-denominated debt, with the typical yield premium to hold South African debt compared to U.S. Treasuries surging to six-1/two year highs.

(Writing by James Macharia and Tiisetso Motsoeneng Editing by Ruth Pitchford)

UPDATE 1-Canada finance minister sets announcement, housing attainable subject

(Recasts, adds feasible measures to cool housing industry)

By Randall Palmer and David Ljunggren

OTTAWA Dec 10 Canadian Finance Minister Bill Morneau has scheduled an announcement for Friday morning, and while no topic was offered, the government is facing a crucial choice on how to cool a heated housing market.

Canadian household debt as a percentage of income is at an all-time higher, in big component because of huge mortgages taken on as housing rates rise, particularly in the main cities of Vancouver and Toronto.

Canada avoided the housing crash of 2007 that hit the United States and triggered the worldwide monetary crisis. But a post-recession housing boom, fueled by record-low borrowing fees, has prompted some analysts to warn a bubble may possibly be in the functions.

Finance Division officials have for two or 3 years been recommending some form of action to attempt to avoid economic difficulty, 1 business supply said.

The Conservatives, who lost power to the Liberals in the Oct. 19 election, had been contemplating action if they won, the source said.

A second nicely-placed supply stated a lead alternative getting deemed was to increase the percentage down payment essential for insured mortgages over a particular dollar quantity, beyond the existing 5 %.

Such a tiered program, with a greater percentage essential the larger the mortgage, has the benefit of attempting to target the hotter markets with no shaking places exactly where rates are considerably reduce.

The drawback is that it could add to the woes of markets in cities like Calgary, which still have high-priced housing because of past resource booms but are now suffering since of slumping oil and commodity costs.

Below Finance Minister Jim Flaherty, the former Conservative government stepped in four times from 2008 to 2012 to tighten mortgage lending guidelines. His successor, Joe Oliver, displayed much less concern.

A spokesman for Morneau declined to comment. His announcement will be at 9:30 a.m. (1430 GMT) on Friday. (Reporting by Randall Palmer and David Ljunggren Editing by David Gregorio and Peter Cooney)