French Company Goes Organic for U.S. Acquisition; U.S. Airlines Gear Up for Cuba; U.S. Banks Bond Over Brexit

Let them eat organic cake!

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Dannon Yogurt’s parent company, Danone (said with a French accent) is looking to pick up  a major U.S company that will effectively double its size. That’s assuming all goes according to plan. Danone wants to offer organic food provider, WhiteWave, purveyor of favorites like Silk Almond and Soy Milk, Horizon Milk and Earthbound Farms, $10.4 billion in cash for the fiscal pleasure of its company. That’s a 24% premium over WhiteWave’s thirty day average closing price and comes out to about to $56.25 per share. But for Danone, whose looking to make itself a bigger presence in the United States, it’s well worth it, since WhiteWave’s offerings tend to attract wealthier consumers. WhiteWave generates annual sales of about $4 billion and with this acquisition, Danone expects to see a $300 million boost in operating profit. Danone has also been struggling in other parts of the world and this acquisition would ease the burden of some of those lesser-performing markets. FYI, when companies offer to buy other companies, their offers tend be at least at a 30% premium. Because this offer was not, it theoretically means that the bidding door is still open to other offers from companies like Coca Cola, PepsiCo and Kellogg Co, to name but a few. In a regulatory filing, though, WhiteWave did graciously say that it wouldn’t solicit other offers. However, there are exceptions. Should WhiteWave go with another offer, Danone still wins because it will get a $310 million break-up fee.

Bienvenido…

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Image courtesy of Tuomas_Lehtinen/FreeDigitalPhotos.net

Believe it or not, Hillary Clinton wasn’t the only topic of conversation today coming out of Washington DC. President Obama announced a proposal to allow eight U.S. airlines to provide nonstop service between Cuba and ten U.S. cities, beginning this fall. This will mark the first time in 50 years that travel of this kind will be available. And all this just one year after diplomatic relations were re-established. The city and airline selections were made by the Department of Transportation and the lucky airline winners are: Alaska Airlines, American Airlines, Delta Airlines, Frontier Airlines, JetBlue Airways, Southwest Airlines, Spirit Airlines and United Airlines. American Airlines is actually no stranger to the island nation, as it has been offering charter services there since 1991. Just last year the airline made over one thousand chartered flights to Cuba, while JetBlue made over 200 chartered trips. That’s awfully welcome news for an industry that took a fiscal beating lately. The cities that can look forward to the new service had to have have substantial Cuban-American populations already in place. Hence, Florida finds itself the recipient of 14 out of the 20 daily nonstop flights, since it boasts the largest Cuban-American population. The cities include: Atlanta, Charlotte, Fort Lauderdale, Houston, Los Angeles, Miami,  Newark, New York City, Orlando and Tampa. According to Cuban officials, the number of American travelers to Cuba is up 84%, compared to last year, in just the first half of the year.  But there is still a trade embargo in place, which does include a travel ban. However, there are twelve convenient categories of reasons to fly to Cuba that you can check off should you decide to make your way to Havana any time soon.

Come together…

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It’s a fiscal kumbaya as four U.S. banks offered up their sincerest support for London following the Brexit vote. The gracious supporters include, JPMorgan, Goldman Sachs, Bank of America Merrill Lynch and Morgan Stanley. The banks agreed to help British Finance Minister George Osborne find ways to ensure that the U.K. remains the prominent financial player that it always was, pre-Brexit. And of course they all will try and find new and exciting ways to lure and retain big banking to London so that the consequences of the Brexit don’t do the country in completely. While that sentiment no doubt warmed the hearts of investors all over the world, the investment banks could not offer up as much optimism as far as the jobs situation is concerned. After all, “no one in their right mind would currently invest in Britain.” Keeping those jobs there might might be the biggest challenge of all and no one wants to make any promises on that. Especially Jamie Dimon, who had previously mentioned that around 4,000 jobs could make their way out of London. In the meantime, the French wasted no time – I mean NONE! – in announcing to the world that it would make its tax regime as enticing as possible, in a not at all subtle attempt to grab some pricey banking business from London.

American Apparel Just Can’t Seem to Get it Together; Lululemon’s Un-zen-like Projections; Population Popularity

Overpaid…

Image courtesy of jesadaphorn/FreeDigitalPhotos.net

Image courtesy of jesadaphorn/FreeDigitalPhotos.net

Looks like American Apparel has some legal troubles, yet again. Only this time it’s not because of ex-CEO and founder, Dov Charney (sort of), who is apparently still trying to get his job back. The SEC launched an internal investigation into the apparel company over a very pricey review of the ousting of  Mr. Charney and all the unpleasant accusations against him, including several sexual misconduct allegations. However, to be fair, Mr. Charney’s lawyer called the allegations…don’t laugh now…”baseless.” So just how pricey was this review? Like $10.4 million pricey. Which seems expensive  considering the company’s stock was precipitously tanking, is hard up for $27.6 million with unpaid long-term loans, and has just about $8 million in cash. The price tag certainly got the SEC wondering if this major expense helped send the company into debt. The SEC wants to determine if any laws were broken during the review. But don’t hold your breath for any juicy details as the investigation is “non-public.”

Namaste…

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Things are looking sort of zen at Lululemon Athletica as it announced its earnings with some decent numbers reported. The fitness apparel company took in profits of $111 million at 78 cents per share when analysts only predicted 73 cents a share. Last year the yoga apparel maker took in $109.7 million and 75 cents a share. But here’s where things aren’t so zen: Lululemon’s profit projections for the year are $1.85 – $1.90 – much less impressive than what analysts would prefer to see: $2.07 per share. It is kind of odd that Lululemon’s projections would be so much lower than analysts’ predictions considering the retailer has all these big revamping and expansion plans. So, it kind of got Wall Street wondering how much growth can they really expect to see from Lululemon following its successful holiday season. Hence, shares went down over 3%.

Booms and bummers…

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Image courtesy of Craftyjoe/FreeDigitalPhotos.net

Florida is where it’s at. At least according to the latest stats from the U.S. Census Bureau. Florida becomes the third most populous state, knocking New York off that perch. But a lot of that growth is coming from a place called The Village, Florida, ranked as the fastest growing city with a 5.4% population increase last year to 114,000 people. And with a name like that, of course tons of people are setting up house over there. Wish I was. But that was just one of the many cities experiencing major growth in the Sunshine State. Interestingly enough, and even a bit macabre, is the fact that these new residents helped offset the number of deaths of the many retirees who migrate to the state for their golden years, propelling Florida to a population of of 19.9 million people. New York only has 19.7 million. But California is the number one most populous state with 38.8 million folks.  Some of the other big winners, or rather gainers, were Williams County and Stark County, both in North Dakota, which earned the top spots for fastest growing counties. Of course, the booming oil industry and surplus of jobs can be thanked for that. A big loser? Wayne County, Michigan which took a population loss of about 11,000 people.