Brazil Companies Bananas for Chiquita: Another Valeant Effort for Allergan?; Cruisin for an iBruisin’

Top banana…

Image courtesy of Aduldej/FreeDigitalPhotos.net

Image courtesy of Aduldej/FreeDigitalPhotos.net

As you were sitting at the edge of your seat waiting for weeks now to find out who would be victorious in the corporate battle to acquire Chiquita (yes – the banana people), you can now relax as a winner has emerged. Actually two of them. Brazilian companies, The Safra Group and Cutrale Group, both of which happened to be owned by two of the wealthiest men in Brazil, scooped up the fresh fruit seller to the ripe number of $681 million. But, alas, what became of Irish company Fyffes, who was also bidding on Chiquita, and which many thought would get the fresh fruit company? Well, it wasn’t the luck of the Irish but rather the votes of the shareholders who preferred the Brazilians’ offer. You see Fyffes was offering up stock in exchange for Chiquita. But with Safra/Cutrale’s offer, shareholders get to see more cash up front. And who doesn’t like a little cash up front? Besides, the inversion appeal of Fyffes wasn’t going to net Chiquita all that much to make the transaction worthwhile for Chiquita. But don’t feel too bad for Fyffes. The Irish firm stands to gain a break up fee worth as much as $23 million.

Ironing out the wrinkles…

Image courtesy of artemisphoto/FreeDigitalPhotos.net

Image courtesy of artemisphoto/FreeDigitalPhotos.net

Canadian company Valeant Pharmaceuticals still so very badly wants to takeover Irvine, California-based Allergan. And why not? Allergan makes everybody’s favorite wrinkle-smasher Botox. Allergan also happens to make Latisse, another invaluable, behind the counter, yet highly-essential beauty cosmetic, in my opinion. It also helps that Allergan reported net income of $312.5 million on $1.8 billion in revenue. The stock nearly doubled over the past year. In fact, Valeant wants Allergan so so so badly, that it is once again upping its offer from $179 per share to around $200 per share. And if it has to happen hostilely, then so be it. Which it probably will, mind you. A  “special” shareholder’s meeting is taking place on December 18 where replacing board members will be the theme of the day (in particular, the ones opposing Valeant’s offer). Besides Valeant, Bill Ackman, of Pershing Square Capital Management LP would also like to see a “few” changes made to Allergan’s board as he has a hefty stake in the Botox-making company and would be tickled pink to see Allergan gobbled up by Valeant.

Maybe it’s not you after all…

Image courtesy of sattva/FreeDigitalPhotos.net

Image courtesy of sattva/FreeDigitalPhotos.net

Technology is grand. But maybe not so much in your new car. At least according to Consumer Reports 2014 Annual Auto Reliability Survey. Turns out all those really cool super awesome electronic features that you absolutely have to have are putting a damper on the overall quality of your ride. There are 23 million of us out there who have internet “savvy” cars. By 2020, that number will hit 152 million users. But the problem now, in 2014, is that in-car electronics defects logged the most complaints in 17 categories of the survey. In fact, the problem was called, ahem, “a growing first year reliability plague.” Ouch. Drivers start to question the overall quality of their vehicles when electronic issues begin to arise. Want the most reliable car? Lexus took the number one spot. The Infiniti Q50 sedan, however, took a big hit plunking down to the number 20 spot.

 

 

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IBuMmer; Icahn/Andreesen Billionaire Smackdown; Valeant/Allergan Smackdown

 Big Blue-boo…

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Perhaps you recall IBM?  Perhaps you don’t. The once powerful company that sat at the forefront of technology is now at the forefront of…nothing as the company just released its very disappointing earnings. The once mighty maker of chips – and I don’t mean potato (though we might be seeing better earnings if the chips were indeed of the potato variety), has sold that portion of its business. Revenue was down 4% to $22.4 billion which might seem like a nice beefy number except that analysts were expecting $1 billion more than that. And the company’s revenue has been going down for a few years now.  Analysts expected  the company to at least pull in $4.32 per share. It didn’t. Instead, profits for IBM took a 10% dive earning $3.68 per share.  Oh well. There’s always next quarter.

Love doesn’t live here anymore…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

It’s official. Marc Andreesen and Carl Icahn are not friends. And I don’t think they ever can be. At least not anymore after Mr. Icahn said in an interview that Andreessen is “what’s wrong with corporate America” and Andreesen telling CNBC that Carl Icahn lies and “makes stuff up.” Where is the love gentlemen? In any case, the latest episode in the Icahn/Andreessen saga is that Marc Andreesen has bid a not-so-fond farewell to the board over at EBay. It seems the extremely prescient Silicon Valley billionaire, Andreesen, and activist investor, Icahn,  got themselves tangled in yet another kerfuffle which has probably something to do with the kerfuffle they had earlier where Mr. Icahn accused Mr. Andreesen and fellow board member, Scott Cook, of having conflicts of interests where PayPal and EBay are concerned. I shall spare you the lurid details. Mr. Andreesen and Mr. Cook vehemently disagreed with Mr. Icahn’s accusation. But alas, it matters not as PayPal is no longer one with EBay. As for hopes of Mr. Andreesen and Mr. Icahn burying the corporate hatchet (or whatever it is that insanely wealthy executives do), don’t hold your breath.

A wrinkle in plans…

Image courtesy of patpitchaya/FreeDigitalPhotos.net

Image courtesy of patpitchaya/FreeDigitalPhotos.net

Perhaps you may recall pharmaceutical giant Valeant? Perhaps you recall how this pharmaceutical giant wanted to take over another pharmaceutical giant by the name of Allergan, notable for perennial fan fave Botox? And perhaps you recall that Allergan would prefer if Valeant would just go away? Well, it looks like that’s not going to happen anytime soon as Valeant just released some very impressive earnings, easily trumping analysts’ expectations. Except that Valeant also had good earnings. But no matter because Valeant really wants very badly to scoop up Allergan even though Allergan very badly does not want that to happen. Activist investor Bill Ackman, and his Pershing Square Capital Management LP, who is gunning for an Allergan takeover, just might make that even likelier and hostile-r because of Valeant’s newly announced, financially robust numbers, since numbers like those will allow him, together with Valeant, to up the ante to buy out the fabulous Botox maker.

 

Not Paying Dues at the IRS, Wrinkle Free Buyout? and No Home Run This Month

Taxing behavior…

Image courtesy of sdmania/FreeDigitalPhotos.net

Image courtesy of sdmania/FreeDigitalPhotos.net

If you don’t feel like complying with Federal tax policies then be prepared to face the penalties. Except if you work for the IRS, in which case, expect a bonus and some time off. A just released report from the Treasury Inspector General for Tax Administration (TIGTA) is going to shatter all those boring, monotonous ideas you had about the IRS nor give you any comfort as you just sent in your tax forms. From Oct. 1, 2010 to Dec. 31, 2012 IRS employees – about 2,800 of them –  were getting big bonuses and other nifty perks even though they were written up for tax and misconduct issues. Apparently their bad behavior was no impediment to $2.8m in cash compensation and 27,000 hours in extra time off. I guess the tax code isn’t the only thing in need of a major overhaul at the IRS.

Botox this!

Image courtesy of patpitchaya/FreeDigitalPhotos.net

Image courtesy of patpitchaya/FreeDigitalPhotos.net

Activist investor Bill Ackman, CEO of Pershing Square Capital,  just teamed up with J. Michael Pearson, CEO of Valeant Pharmaceuticals and what went down is the stuff that HBO original movies are made of. Sort of. Following his partnership with Pearson, Ackman goes and buys a 9.7 % stake in another pharmaceutical company. But not just any pharmaceutical company. Why buy into just any pharmaceutical company when you can buy into Allergan, the pharmaceutical company that makes everybody’s favorite wrinkle remedy, Botox! That’s what I’m talking about. Then Mr. Ackman and Mr. Pearson decided they wanted to purchase Allergan for  $46 billion. Of course, not everybody on Wall Street agrees that this does not violate securities law. But what’re you going to do? Anyways, Allergan doesn’t necessarily want a new boss, even if it is for $46 billion. So they adopted a “poison pill” aka a shareholder rights plan because they don’t want Ackman buying any more Allergan stock and with this “poison pill” they can buy themselves some time to decide how they’d like to proceed  A little convoluted, but that’s what makes a Wall Street drama so riveting.

Home not so sweet home…

Image courtesy of cooldesign/FreeDigitalPhotos.net

Image courtesy of cooldesign/FreeDigitalPhotos.net

What do high mortgage rates, home shortages and bad weather have in common? If you guessed a 14.5% sales plunge (which, no offense, but I’m guessing you didn’t) then you are 100% correct. New single family home sales haven’t been this low in eight months. Experts originally predicted (and hoped) for an estimate of 440,000 home sales. But alas, that number only reached 384,000. Spring was supposed to bring with it tulips, daffodils and higher sales, but so far, just the flowers are the only things that have given us growth. The notable exception was in the Northeast where sales were up by 12.6%. Go figure. With that, median home prices rose to $290,000 from March of last year. Good news for the seller, I suspect.