Movers: WaMu, Yahoo, Apple, Alcon, Borders
The Wall Street Journal reports that private-equity firm TPG and other investors are near a deal to invest $5 billion in Washington Mutual (WM) in return for stock. That could allow the U.S.'s largest thrift to meet all its capital requirements amid deep losses from the mortgage crisis, but would dilute current holders' stakes.
In response to a letter that Yahoo (YHOO) received from Microsoft (MSFT), which states that if the companies have not concluded an agreement within the next 3 weeks, Microsoft will be compelled to take its case directly to Yahoo shareholders (including the initiation of a proxy contest to elect an alternative slate of directors), Yahoo says it's open to all alternatives that maximize stockholder value, including a deal with Microsoft if it represents a price that fully recognizes the value of Yahoo on a standalone basis and to Microsoft. On Fri., ahead of publication of letters, S&P reiterated hold on YHOO.
Thomas Weisel reportedly upgrades Apple (AAPL) to overweight from marketweight.
Nestle (NSRGY) plans to sell 74 million Alcon (ACL) shares to Novartis (NVS) for $143.18 cash per share. Once consummated, NVS would own a minority stake in ACL of about 25% of ACL's outstanding shares, while NSRGY would remain ACL's majority shareholder with about 52% of ACL's outstanding shares.
Borders Group (BGP) reaches a final financing agreement with Pershing Square, its largest shareholder, that includes more advantageous terms than the original financing commitment, which is necessary to continue implementing its key initiatives.
AK Steel Holding (AKS) says it will increase spot market prices for its carbon steel products by $150 per ton for all new orders, effective immediately.
Eastman Chemical (EMN) expects first quarter EPS, excluding gains and costs related to strategic decisions, to be above the high end of the current range of analyst estimates on First Call, which is $1.30 per share. Cites continued strong sales volume and higher selling prices, which offset higher raw material and energy costs.
Temple-Inland (TIN) rises 1.47 to 14.18 after Citigroup upgrades to buy from hold.
Scansource (SCSC) sees third quarter sales of $509-$515 million. It notes disappointing sales results in two areas, with majority of shortfall in Catalyst Telecom sales unit, which can be attributed to a changed vendor program that caused delays in purchases during the third quarter. The second area of weakness was in the International POS and Bar Code business.
Merrill Lynch upgrades UBS AG (UBS) to buy from neutral.
LifeCell (LIFC) agrees to be acquired by Kinetic Concepts (KCI) in a $1.7 billion deal. Terms: $51.00 cash per LIFC share.
Discover Financial Services (DFS) inks a deal to acquire Diners Club International from Citigroup (C) for $165 million.
Alliant Techsystems (ATK) says it has received an additional $415.6 million in military small-caliber ammunition orders and modernization funding for the Lake City Army Ammunition plant. The contracts were awarded by the U.S. Army Sustainment Command, Rock Island, Ill.
Vignette (VIGN) sees first quarter revenue of $44-$45 million with license revenue of about 21%-23% of total revenue, which fell short of expectations. Expects first quarter GAAP per share results to be between $0.03 loss and $0.01 EPS, non-GAAP EPS between $0.07-$0.11.