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Regional Banks Drop; InBev and Santander Deals
Jul 14, 5:55 PM EDT |
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| Merrill Lynch is seeking to sell its 20% stake in Bloomber LP, financial information provider at more than $5 billion. |
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| The rescue plan proposed for two troubled lenders by the U.S. Treasury and Fed underwhelmed investors. The bail out plan is expected to excude shareholders. Fearful investors sold regional and large bank stocks. Of the S&P 500 index stocks, top fifteen decliners were banks with a los between 36% and 11%. Citigroup, AIG, Merrill Lynch and Wachovia were among the leading decliners. Washington Mutual, the worst decliner in the S&P 500 index said after the close it has $40 billion liquidity. |
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InBev and Anheuser Agree to $52 B Offer
Jul 14, 3:27 PM EDT |
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| Anheuser-Busch reversed its earlier opposition to the deal after key shareholders in the family controlled brewer agreed to a revised offer. |
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| Anheuser-Busch, the century old family controlled beer brewer agreed to a hostile offer of $70 per share or $52 billion from InBev NV. The newly merged company will not only have the largest market share in the U.S. but also will have largest worldwide revenue, surpassing SABMiller sales. The all-cash offer was agreed on Sunday and investment stake controlled by Warren Buffet expects to make $770 million in capital gains. |
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Banks, Lehman, Citi, Merrill Drop 5%
Jul 14, 2:10 PM EDT |
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| Banks and brokers fell more than 5% after the U.S. Treasury plan to rescue Fannie and Freddie rattled investors. |
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| U.S. stocks traded lower as financial stocks declined. Zions Bancorp, SunTrust, Bank of America and Comercia fell after Goldman Sachs lowered the outlook for the banks. Lehman Brothers, Merrill Lynch and Citigroup fell more than 5% after Fannie and Freddie rescue plan failed to impress investors. Yahoo dropped after it rejected another overture from Carl Ichan and Microsoft. Apple gained after it sold more than one million iPhone 3G version in the first three days of launch. |
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Santander Resuces A&L for £1.26 B
Jul 14, 1:58 PM EDT |
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| Santander, the largest euro zone bank offeres £1.26 billion to the troubled UK lender Alliance & Leicester. |
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| The largest euro zone bank Santander offered to purchase Alliance & Leicester for 317 pence per share. The deal values the company at 1.26 billion pounds and includes an interim dividend of 18 pence to shareholders. Santander returned to purchase the troubled UK lender at a lower price after three months as credit market weakness have persisted and A&L trades at nearly 50% lower price. The deal is fraught with risks at UK economy slows down and credit market remain jittery. |
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Confidence Crisis at Fannie and Freddie
Jul 14, 10:53 AM EDT |
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| The U.S. Treasury Secretary Paulson asked Congress permission to increase its lending limit and buy stake in the two troubled lenders. |
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| U.S. Treasury Secretary Paulson asked Congress an authority to take a stake in the two troubled mortgage lending agencies Fannie Mae and Freddie Mac. The Secretary also wants to increase lending limits of two agencies and the Fed will open its discount window to lenders. Freddie Mac sold $3 billion in short term debt with higher than average interest from investors. The stocks of two companies remain volatile and investors fear a further decline in their values in the near future. |
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