FILE PHOTO: Outside view of the Deutsche Bank and the Commerzbank headquarters in Frankfurt, Germany, March 18, 2019. REUTERS/Ralph Orlowski/File Photo
April 5, 2019
By Arno Schuetze
FRANKFURT (Reuters) – Deutsche Bank and Commerzbank favor a straightforward merger over more complex ways to structure a deal, three people close to the matter said.
In their base case scenario, a transaction would be organized as a share offer from Deutsche Bank for Commerzbank, they said. That structure is preferred to the creation of a new holding company, which is viewed as too difficult to execute.
“The holding structure is dead,” one of the people said, referring to setting up a holding company that would buy Deutsche and Commerzbank in return for shares of the new bank.
Sources said last year that Deutsche Bank was examining creating a holding company structure amid speculation at the time that it could merge with Commerzbank.
Last month the two banks confirmed they were in talks about a merger. A preliminary decision on whether they want to go forward is expected within days.
The people cautioned that no decision has yet been taken on a potential deal structure and there is still no certainty that a deal will be struck at all.
Deutsche Bank and Commerzbank declined to comment.
Regulators in the United States, Britain and Switzerland tend to favor the bank holding company structure, in part because it can help with the winding down of a troubled bank.
There has been a push since the financial crash to make banks easier to break up, lowering the risk that the problems of a troubled investment bank, for instance, could affect ordinary savers.
About 90 percent of U.S. banks, including Citigroup and JPMorgan Chase, operate as holding companies, according to the U.S. Federal Reserve.
But converting to a holding company structure can be costly.
In Deutsche and Commerzbank’s case, defining the relative value of the two banks for a holding structure would be more complicated than simply negotiating a price for a simple takeover, the sources said.
As part of a deal, Deutsche Bank will be asked by the European Central Bank to raise fresh funds to plug capital holes resulting from asset revaluations and expected restructuring costs, a person with direct knowledge of the matter said earlier this week.
Issues around regulatory capital – and how to make use of the fact that Commerzbank trades well below book level, which can be used to boost such capital – are a talking point between the two banks.
Other issues focus on synergies, job cuts as well as legal and tax issues, people familiar with the matter have said.
(Reporting by Arno Schuetze; additional reporting by Kathrin Jones and Tom Sims; Editing by Susan Fenton and Louise Heavens)
Today’s War Room breaks exclusive news on a second child sex offender being associated with the Drag Queen Story Hour at a Houston Public Library. We also receive breaking news from Cassandra Fairbanks on a potential extradition of Julian Assange. Meanwhile, the crisis at the border continues to spiral out of control.
U.S.-backed forces in Syria discuss the progress in the campaign against the Islamic State, which is nearing its end after years of unrest in the country.
On Saturday, a commander with the Syrian Democratic Forces said the final push to retake the last territory held by ISIS is underway.
U.S.-backed Syrian Democratic Forces (SDF) fighters sit outside a building as fight against Islamic State militants continue in the village of Baghouz, Syria, Saturday, Feb. 16, 2019. (AP Photo/Felipe Dana)
The announcement follows a week of intense airstrikes as the rebel-held territory has been reduced to less than one square mile.
This marks the final stages of a four year campaign to defeat the so-called caliphate, which once held a large amount of territory in Iraq and Syria.
No reader of my previous comments on the subject would expect surprise from me about the verdict of the Mueller report. No one nominated by a major political party to the presidency of the United States would have dreamed of cooperating with any
On 19 February, the Latin American country’s regional military chief announced the closure of the Venezuelan maritime border with the Dutch Caribbean.
Venezuela will close the border with neighboring island nations, suspend air traffic and revise their diplomatic ties, its Vice President Delcy Rodriguez said Wednesday after the Caribbean island of Curacao agreed to act as a hub for relief aid shipments.
“Venezuela has decided not only to shut the border but also to revise relations with these countries. These measures will be in place until their governments start following and respecting international laws,” she said at a press conference broadcast by the state television.
The US has officially recognized Juan Guaido as the legitimate leader of Venezuela. Some have hinted at military action, but will that be necessary?
Earlier in the day, the Reuters news agency reports, citing a regional military commander that Venezuela’s government had reopened its national maritime border with the Dutch Antilles islands following its closure on Tuesday.
This comes after Venezuela’s regional military chief said on Tuesday that he had ordered the closure of the Venezuelan maritime border with the Dutch Antilles islands. The move was made amid Dutch plans to open a logistical hub for humanitarian aid on the island of Curacao, however, the exact reasons behind Caracas’ decision to close the border remain unclear.
Venezuelan President Nicolas Maduro refused to accept US aid that is currently waiting in Colombia, blasting it as a ploy to topple his government.
Venezuela is in the midst of a political crisis, which escalated in late January when Venezuelan opposition parliamentary speaker Juan Guaido declared himself interim president, disputing last year’s re-election of Maduro.
Guaido was recognized by the United States and a number of other countries. At the same time, Russia, China, Mexico, Turkey and Uruguay were among those that voiced their support for Maduro as the country’s legitimately elected president.
FILE PHOTO: Singapore's Finance Minister Heng Swee Keat speaks at a UBS client conference in Singapore, January 14, 2019. REUTERS/Feline Lim/File Photo
February 18, 2019
By John Geddie and Fathin Ungku
(Reuters) – Singapore unveiled an expansionary budget for the next financial year on Monday, setting aside S$6.1 billion for the welfare of its elderly in a generous package before an election expected as soon as this year.
Finance Minister Heng Swee Keat also announced a S$1.1 billion bonus package for all Singaporeans to mark 200 years since the former British colony’s founding, that includes vouchers, a cash bonus for lower income workers and income tax rebates for the middle class.
The government finance for the 2019 fiscal year that begins April 1 is expected to turn to a deficit of S$3.5 billion, after a predicted surplus of S$2.1 billion for the 2018 fiscal year.
The budget proposal comes after data showed Singapore’s economy grew at its slowest pace in more than two years in the fourth quarter, and its trade ministry warned that manufacturing is likely to face significant moderation this year.
Analysts have said stronger fiscal impulse will also be needed to tackle heightened external pressure on the economy, including from the U.S.-Sino trade war and Britain’s imminent departure from the European Union.
Singapore must hold its next general election by early 2021, but Prime Minister Lee Hsien Loong, eyeing retirement, has suggested it could be this year.
“The Merdeka Generation Package is a gesture of our nation’s gratitude for their contributions and a way to show care for them in their silver years,” said Heng, who been tapped to be the next leader of the People’s Action Party which has ruled the city-state for over half a century without interruption.
The so-called Merdeka, or “independence” generation refers to those born in the 1950s, near the end of British colonial rule. With the second-fastest aging population in the world after South Korea, and as pressure grows on more of the elderly to stay in the workforce beyond retirement age, the low-tax finance hub is facing rising social angst over the welfare of its aged.
Heng said about 30 percent of Singapore’s total budgeted expenditure for the 2019 fiscal year will support defense, security and diplomacy efforts and the quota for foreign workers in the services sector will be reduced in coming years.
Among other budget highlights was a hike in excise duty for diesel to 20 Singapore cents per liter from 10 cents with immediate effect. For all the highlights, click.
(Reporting by John Geddie and Fathin Ungku; Editing by Shri Navaratnam)
Dolly Parton arrives for the West End debut of Dolly Parton's '9TO5 The Musical' at the Savoy Theatre, in London, Britain February 17, 2019. REUTERS/Peter Nicholls
February 18, 2019
LONDON (Reuters) – Nearly 40 years after playing a secretary who takes revenge on her sexist boss in “9 to 5”, Dolly Parton again beat the drum for gender equality at the West End premiere of a musical version of her hit 1980 movie.
The country superstar joined the cast of “9 to 5 The Musical” for the curtain call at the end of Sunday’s official opening performance in London.
She hoped the show would help shine a light on sexual misconduct and gender inequality which, as the #MeToo and #TimesUp movements have shown, remain issues of concern in entertainment and other industries.
“It (the film) really paved the way and things did change but there’s still a lot more to be done,” she told Reuters on the red carpet ahead of the show. “With … people drawing attention again to equal pay, equal work, harassment in the workplace, this is just another good way for us to shine a light on some things that need to be lit up a little.”
The multiple Grammy winner also confirmed there will be a “9 to 5” movie sequel, starring the original cast – herself, Jane Fonda and Lily Tomlin – alongside some “new young girls”.
Bookings for the musical at London’s Savoy Theatre are being taken through to August.
(Reporting by Emily Roe; Editing by John Stonestreet and Peter Graff)
LinkSpace’s reusable rocket RLV-T5, also known as NewLine Baby, is carried to a vacant plot of land for a test launch in Longkou, Shandong province, China, April 19, 2019. REUTERS/Jason Lee
April 26, 2019
By Ryan Woo
LONGKOU, China (Reuters) – During initial tests of their 8.1-metre (27-foot) tall reusable rocket, Chinese engineers from LinkSpace, a start-up led by China’s youngest space entrepreneur, used a Kevlar tether to ensure its safe return. Just in case.
But when the Beijing-based company’s prototype, called NewLine Baby, successfully took off and landed last week for the second time in two months, no tether was needed.
The 1.5-tonne rocket hovered 40 meters above the ground before descending back to its concrete launch pad after 30 seconds, to the relief of 26-year-old chief executive Hu Zhenyu and his engineers – one of whom cartwheeled his way to the launch pad in delight.
LinkSpace, one of China’s 15-plus private rocket manufacturers, sees these short hops as the first steps towards a new business model: sending tiny, inexpensive satellites into orbit at affordable prices.
Demand for these so-called nanosatellites – which weigh less than 10 kilograms (22 pounds) and are in some cases as small as a shoebox – is expected to explode in the next few years. And China’s rocket entrepreneurs reckon there is no better place to develop inexpensive launch vehicles than their home country.
“For suborbital clients, their focus will be on scientific research and some commercial uses. After entering orbit, the near-term focus (of clients) will certainly be on satellites,” Hu said.
In the near term, China envisions massive constellations of commercial satellites that can offer services ranging from high-speed internet for aircraft to tracking coal shipments. Universities conducting experiments and companies looking to offer remote-sensing and communication services are among the potential domestic customers for nanosatellites.
A handful of U.S. small-rocket companies are also developing launchers ahead of the expected boom. One of the biggest, Rocket Lab, has already put 25 satellites in orbit.
No private company in China has done that yet. Since October, two – LandSpace and OneSpace – have tried but failed, illustrating the difficulties facing space start-ups everywhere.
The Chinese companies are approaching inexpensive launches in different ways. Some, like OneSpace, are designing cheap, disposable boosters. LinkSpace’s Hu aspires to build reusable rockets that return to Earth after delivering their payload, much like the Falcon 9 rockets of Elon Musk’s SpaceX.
“If you’re a small company and you can only build a very, very small rocket because that’s all you have money for, then your profit margins are going to be narrower,” said Macro Caceres, analyst at U.S. aerospace consultancy Teal Group.
“But if you can take that small rocket and make it reusable, and you can launch it once a week, four times a month, 50 times a year, then with more volume, your profit increases,” Caceres added.
Eventually LinkSpace hopes to charge no more than 30 million yuan ($4.48 million) per launch, Hu told Reuters.
That is a fraction of the $25 million to $30 million needed for a launch on a Northrop Grumman Innovation Systems Pegasus, a commonly used small rocket. The Pegasus is launched from a high-flying aircraft and is not reusable.
(Click https://reut.rs/2UVBjKs to see a picture package of China’s rocket start-ups. Click https://tmsnrt.rs/2GIy9Bc for an interactive look at the nascent industry.)
NEED FOR CASH
LinkSpace plans to conduct suborbital launch tests using a bigger recoverable rocket in the first half of 2020, reaching altitudes of at least 100 kilometers, then an orbital launch in 2021, Hu told Reuters.
The company is in its third round of fundraising and wants to raise up to 100 million yuan, Hu said. It had secured tens of millions of yuan in previous rounds.
After a surge in fresh funding in 2018, firms like LinkSpace are pushing out prototypes, planning more tests and even proposing operational launches this year.
Last year, equity investment in China’s space start-ups reached 3.57 billion yuan ($533 million), a report by Beijing-based investor FutureAerospace shows, with a burst of financing in late 2018.
That accounted for about 18 percent of global space start-up investments in 2018, a historic high, according to Reuters calculations based on a global estimate by Space Angels. The New York-based venture capital firm said global space start-up investments totaled $2.97 billion last year.
“Costs for rocket companies are relatively high, but as to how much funding they need, be it in the hundreds of millions, or tens of millions, or even just a few million yuan, depends on the company’s stage of development,” said Niu Min, founder of FutureAerospace.
FutureAerospace has invested tens of millions of yuan in LandSpace, based in Beijing.
Like space-launch startups elsewhere in the world, the immediate challenge for Chinese entrepreneurs is developing a safe and reliable rocket.
Proven talent to develop such hardware can be found in China’s state research institutes or the military; the government directly supports private firms by allowing them to launch from military-controlled facilities.
But it’s still a high-risk business, and one unsuccessful launch might kill a company.
“The biggest problem facing all commercial space companies, especially early-stage entrepreneurs, is failure” of an attempted flight, Liang Jianjun, chief executive of rocket company Space Trek, told Reuters. That can affect financing, research, manufacturing and the team’s morale, he added.
Space Trek is planning its first suborbital launch by the end of June and an orbital launch next year, said Liang, who founded the company in late 2017 with three other former military technical officers.
Despite LandSpace’s failed Zhuque-1 orbital launch in October, the Beijing-based firm secured 300 million yuan in additional funding for the development of its Zhuque-2 rocket a month later.
In December, the company started operating China’s first private rocket production facility in Zhejiang province, in anticipation of large-scale manufacturing of its Zhuque-2, which it expects to unveil next year.
STATE COMPETITION
China’s state defense contractors are also trying to get into the low-cost market.
In December, the China Aerospace Science and Industry Corp (CASIC) successfully launched a low-orbit communication satellite, the first of 156 that CASIC aims to deploy by 2022 to provide more stable broadband connectivity to rural China and eventually developing countries.
The satellite, Hongyun-1, was launched on a rocket supplied by the China Aerospace Science and Technology Corp (CASC), the nation’s main space contractor.
In early April, the China Academy of Launch Vehicle Technology (CALVT), a subsidiary of CASC, completed engine tests for its Dragon, China’s first rocket meant solely for commercial use, clearing the path for a maiden flight before July.
The Dragon, much bigger than the rockets being developed by private firms, is designed to carry multiple commercial satellites.
At least 35 private Chinese companies are working to produce more satellites.
Spacety, a satellite maker based in southern Hunan province, plans to put 20 satellites in orbit this year, including its first for a foreign client, chief executive Yang Feng told Reuters.
The company has only launched 12 on state-produced rockets since the company started operating in early 2016.
“When it comes to rocket launches, what we care about would be cost, reliability and time,” Yang said.
(Reporting by Ryan Woo; Additional reporting by Beijing newsroom; Editing by Gerry Doyle)
Werner Baumann, CEO of German pharmaceutical and chemical maker Bayer AG, attends the annual general shareholders meeting in Bonn, Germany, April 26, 2019. REUTERS/Wolfgang Rattay
April 26, 2019
By Patricia Weiss and Ludwig Burger
BONN (Reuters) – Bayer shareholders vented their anger over its stock price slump on Friday as litigation risks mount from the German drugmaker’s $63 billion takeover of seed maker Monsanto.
Several large investors said they will not support aspirin investor Bayer’s management in a key vote scheduled for the end of its annual general meeting.
Bayer’s management, led by chief executive Werner Baumann, could see an embarrassing plunge in approval ratings, down from 97 percent at last year’s AGM, which was held shortly before the Monsanto takeover closed in June.
A vote to ratify the board’s actions features prominently at every German AGM. Although it has no bearing on management’s liability, it is seen as a key gauge of shareholder sentiment.
“Due to the continued negative development at Bayer, high legal risks and a massive share price slump, we refuse to ratify the management board and supervisory board’s actions during the business year,” Janne Werning, representing Germany’s Union Investment, a top-20 shareholder, said in prepared remarks.
About 30 billion euros ($34 billion) have been wiped off Bayer’s market value since August, when a U.S. jury found the pesticide and drugs group liable because Monsanto had not warned of alleged cancer risks linked to its weedkiller Roundup.
Bayer suffered a similar defeat last month and more than 13,000 plaintiffs are claiming damages.
Bayer is appealing or plans to appeal the verdicts.
Deutsche Bank’s asset managing arm DWS said shareholders should have been consulted before the takeover, which was agreed in 2016 and closed in June last year.
“You are pointing out that the lawsuits have not been lost yet. We and our customers, however, have already lost something – money and trust,” Nicolas Huber, head of corporate governance at DWS, said in prepared remarks for the AGM.
He said DWS would abstain from the shareholder vote of confidence in the executive and non-executive boards.
Two people familiar with the situation told Reuters this week that Bayer’s largest shareholder, BlackRock, plans to either abstain from or vote against ratifying the management board’s actions.
Asset management firm Deka, among Bayer’s largest German investors, has also said it would cast a no vote.
Baumann said Bayer’s true value was not reflected in the current share price.
“There’s no way to make this look good. The lawsuits and the first verdicts weigh heavily on our company and it’s a concern for many people,” he said, adding it was the right decision to buy Monsanto and that Bayer was vigorously defending itself.
This month, shareholder advisory firms Institutional Shareholder Services (ISS) and Glass Lewis recommended investors not to give the executive board their seal of approval.
(Reporting by Patricia Weiss and Ludwig Burger; Editing by Alexander Smith)
KHARTOUM, Sudan – Sudan’s military, which ousted President Omar al-Bashir after months of protests against his 30-year rule, says it intends to keep the upper hand during the country’s transitional period to civilian rule.
The announcement is expected to raise tensions with the protesters, who demand immediate handover of power.
The Sudanese Professionals Association, which is spearheading the protests, said Friday the crowds will stay in the streets until all their demands are met.
Shams al-Deen al-Kabashi, the spokesman for the military council, said late Thursday that the military will “maintain sovereign powers” while the Cabinet would be in the hands of civilians.
The protesters insist the country should be led by a “civilian sovereign” council with “limited military representation” during the transitional period.
The army toppled and arrested al-Bashir on April 11.
FILE PHOTO: Small toy figures are seen in front of a displayed Huawei and 5G network logo in this illustration picture, March 30, 2019. REUTERS/Dado Ruvic
April 26, 2019
By Charlotte Greenfield
WELLINGTON (Reuters) – China’s Huawei Technologies said Britain’s decision to allow the firm a restricted role in building parts of its next-generation telecoms network was the kind of solution it was hoping for in New Zealand, where it has been blocked from 5G plans.
Britain will ban Huawei from all core parts of 5G network but give it some access to non-core parts, sources have told Reuters, as it seeks a middle way in a bitter U.S.-China dispute stemming from American allegations that Huawei’s equipment could be used by Beijing for espionage.
Washington has also urged its allies to ban Huawei from building 5G networks, even as the Chinese company, the world’s top producer of telecoms equipment, has repeatedly said the spying concerns are unfounded.
In New Zealand, a member of the Five Eyes intelligence sharing network that includes the United States, the Government Communications Security Bureau (GCSB) in November turned down an initial request from local telecommunication firm Spark to include Huawei equipment in its 5G network, but later gave the operator options to mitigate national security concerns.
“The proposed solution in the UK to restrict Huawei from bidding for the core is exactly the type of solution we have been looking at in New Zealand,” Andrew Bowater, deputy CEO of Huawei’s New Zealand arm, said in an emailed statement.
Spark said it has noted the developments in Britain and would raise it with the GCSB.
The reports “suggest the UK is following other European jurisdictions in taking a considered and balanced approach to managing supplier-related security risks in 5G”, Andrew Pirie, Spark’s corporate relations lead, said in an email.
“Our discussions with the GCSB are ongoing and we expect that the UK developments will be a further item of discussion between us,” Pirie added.
New Zealand’s minister for intelligence services, Andrew Little, did not immediately respond to a request for comment.
British culture minister Jeremy Wright said on Thursday that he would report to parliament the conclusions of a government review of the 5G supply chain once they had been taken.
He added that the disclosure of confidential discussions on the role of Huawei was “unacceptable” and that he could not rule out a criminal investigation into the leak.
The decisions by Britain and Germany to use Huawei gear in non-core parts of 5G network makes it harder to prove Huawei should be kept out of New Zealand telecommunication networks, said Syed Faraz Hasan, an expert in communication engineering and networks at New Zealand’s Massey University
He pointed out Huawei gear was already part of the non-core 4G networks that 5G infrastructure would be built on.
“Unless there is a convincing argument against the Huawei devices … it is difficult to keep them away,” Hasan said.
(Reporting by Charlotte Greenfield; Editing by Himani Sarkar)
FILE PHOTO: The logo of commodities trader Glencore is pictured in front of the company’s headquarters in Baar, Switzerland, July 18, 2017. REUTERS/Arnd Wiegmann
April 26, 2019
(Reuters) – Glencore shares plunged the most in nearly four months on Friday after news overnight that U.S. regulators were investigating whether the miner broke some rules through “corrupt practices”.
Shares of the FTSE 100 company fell as much as 4.2 percent in early deals, and were down 3.5 percent at 310.25 pence by 0728 GMT.
On Thursday, Glencore said the U.S. Commodity Futures Trading Commission is investigating whether the company and its units have violated some provisions of the Commodity ExchangeAct and/or CFTC Regulations.
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