The Week That Was... In Convertibles.
July 15/ Kathy Schick
News flow is a bit light this week, with the new issue market closed, at least for the short-term, and second quarter earnings in the early stages. Speaking of which, Alcoa (AA) did kick off the earnings season on Monday. The aluminum company beat expectations on both the top and bottom-line. Management is optimistic about growth prospects in the second half and expects the separation of the aluminum mining and smelting business from the value-added automotive and aerospace business to be completed later this year. The stock was up over 7% on the news.
That was the extent of earnings news this week, but it will pick up next week as the second quarter cycle kicks into gear.
In other news this week, Alon USA Energy (ALJ) provided an update on the special committee that was formed earlier this year to review strategic alternatives for the firm. The committee is reviewing a number of alternatives including a business combination with Delek, shareholder distributions, capital investments, a sale or merger, and a possible spin-off or separation of a selected business. At this time the committee has made no decisions and has no timetable to complete the review process. So stay tuned……… Alere (ALR) provided an update on filing its 2015 10K. The company continues to investigate revenue recognition issues in Africa and China for the years ended 2013, 2014, and 2015 and expects to restate 2013 and 2014 when the 2015 10K is filed, which the company estimates will occur prior to August 31. Management is also evaluating internal controls over financial reporting as material weaknesses have been found, no surprise there……… DDR Corp (DDR) has replaced its CEO, David Oakes, who was in the position for less than two years. Thomas August was named new CEO, which became effective immediately. Mr. Oakes was also the interim CFO. Christa Vesy, the chief accounting officer, was appointed interim CFO while the company continues its search for a permanent replacement…...... Emergent BioSolutions (EBS) announced its board of directors has approved the spin-off of Aptevo Therapeutics. The record date for the transaction is July 22, 2016. In a separate announcement the company approved a $50 million share repurchase program……… j2 Global (JCOM) announced it completed six acquisitions in the second quarter. The terms were not disclosed……… Wright Medical Group (WMGI) has announced Corin Orthopaedics will be acquiring its large joints business for approximately $33 million. The transaction is expected to close later this year……… JinkoSolar (JKS) Japan signed a JPY2 billion syndicated loan agreement with a Japanese bank consortium. In a separate announcement JinkoSolar’s US subsidiary increased its credit line from $40 million to $60 million for a three-year term……… Tesla Motors (TSLA) is reported to be the focus of an SEC probe relating to an autopilot death. ……… Yahoo’s (YHOO) bidding process is coming to an end Monday, when final bids are reported to be due. While it has been a lengthy process, the final outcome can’t be too far away.
For the upcoming week, we have earnings from RMBS and YHOO on Monday; HLX and JNJ on Tuesday; MDSO, SLG, INTC, and JAKK on Wednesday; and AIMC, LUV, NEM, P, PFPT, and TRN on Thursday.
Enjoy your weekend!
News flow is a bit light this week, with the new issue market closed, at least for the short-term, and second quarter earnings in the early stages. Speaking of which, Alcoa (AA) did kick off the earnings season on Monday. The aluminum company beat expectations on both the top and bottom-line. Management is optimistic about growth prospects in the second half and expects the separation of the aluminum mining and smelting business from the value-added automotive and aerospace business to be completed later this year. The stock was up over 7% on the news.
That was the extent of earnings news this week, but it will pick up next week as the second quarter cycle kicks into gear.
In other news this week, Alon USA Energy (ALJ) provided an update on the special committee that was formed earlier this year to review strategic alternatives for the firm. The committee is reviewing a number of alternatives including a business combination with Delek, shareholder distributions, capital investments, a sale or merger, and a possible spin-off or separation of a selected business. At this time the committee has made no decisions and has no timetable to complete the review process. So stay tuned……… Alere (ALR) provided an update on filing its 2015 10K. The company continues to investigate revenue recognition issues in Africa and China for the years ended 2013, 2014, and 2015 and expects to restate 2013 and 2014 when the 2015 10K is filed, which the company estimates will occur prior to August 31. Management is also evaluating internal controls over financial reporting as material weaknesses have been found, no surprise there……… DDR Corp (DDR) has replaced its CEO, David Oakes, who was in the position for less than two years. Thomas August was named new CEO, which became effective immediately. Mr. Oakes was also the interim CFO. Christa Vesy, the chief accounting officer, was appointed interim CFO while the company continues its search for a permanent replacement…...... Emergent BioSolutions (EBS) announced its board of directors has approved the spin-off of Aptevo Therapeutics. The record date for the transaction is July 22, 2016. In a separate announcement the company approved a $50 million share repurchase program……… j2 Global (JCOM) announced it completed six acquisitions in the second quarter. The terms were not disclosed……… Wright Medical Group (WMGI) has announced Corin Orthopaedics will be acquiring its large joints business for approximately $33 million. The transaction is expected to close later this year……… JinkoSolar (JKS) Japan signed a JPY2 billion syndicated loan agreement with a Japanese bank consortium. In a separate announcement JinkoSolar’s US subsidiary increased its credit line from $40 million to $60 million for a three-year term……… Tesla Motors (TSLA) is reported to be the focus of an SEC probe relating to an autopilot death. ……… Yahoo’s (YHOO) bidding process is coming to an end Monday, when final bids are reported to be due. While it has been a lengthy process, the final outcome can’t be too far away.
For the upcoming week, we have earnings from RMBS and YHOO on Monday; HLX and JNJ on Tuesday; MDSO, SLG, INTC, and JAKK on Wednesday; and AIMC, LUV, NEM, P, PFPT, and TRN on Thursday.
Enjoy your weekend!
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