Editor’s Note: This is the Paw Print Rewind, a daily recap of the top news headlines.
Schlumberger buying Cameron
Schlumberger is buying oilfield gear maker Cameron in a $14.8 billion deal, which values Cameron around the market cap it had when oil prices were still $100 a barrel, marks the second big merger among energy services companies since crude prices entered a 60% slide last year.
The acquisition will allow Schlumberger to bundle its offerings, which range from surveying a site to drilling wells, with ones from Cameron including pressure valves and blowout preventers.
“The deal should allow a more complete solution to customers and should allow [Schlumberger] to grow market share. Smaller companies offering discrete products and services will likely be at a disadvantage going forward.”
-Daniel Boyd, BMO Capital Markets analyst
The combined company would’ve had pro-forma revenue of $59 billion in 2014, according to Schlumberger.
Schlumberger expects no antitrust hurdles and has no plans to divest any part of Cameron’s portfolio to get regulatory approval.
“With SLB-CAM, there is not much in the way of overlapping businesses … we do not envision an overly difficult antitrust review.”
-James Schumm, Oppenheimer analyst
Exelon-Pepco merger rejected by Washington DC regulators
Washington D.C. utilities regulators denied Exelon’s $6.8 billion bid for Pepco Holdings, dealing a major blow to a deal that would’ve create the country’s top power distributor.
Three three-member commission was the final regulatory hurdle for the deal. The four other states required to approve the deal voted in favor of the merger.
The companies have 30 days to ask the commission to reconsider its order.
If the commission rejects an application for reconsideration, the companies could then appeal the decision to the D.C. Court of Appeals or submit another application.
“Pepco would become a second-tier company in a much larger corporation whose primary interest is not in distribution, but in generation.”
-Betty Ann Kane, Washington D.C. commission chairwoman
“The proposed acquisition would have been a substantial step backwards in the District’s efforts to move toward more sustainable electricity generation and greater reliance on local, renewable energy.”
-Power DC; coalition of environmentalists, public advocacy groups
Pepco serves about two million customers in the District of Columbia, Delaware, Maryland, and New Jersey, while Exelon serves about 7.8 million customers in Maryland, Illinois, and Pennsylvania.
Monsanto drops pursuit of Syngenta
U.S. agribusiness leader Monsanto has abandoned its pursuit of Swiss rival Syngenta, which rejected a recently sweetened $47 billon offer.
Syngenta’s board unanimously rejected the offer that “significantly undervalued the company.” Monsanto, the world’s largest seed company, will focus on building its core business and meeting its long-term growth objectives.
“Our board is confident that Syngenta’s long-term prospects remain very attractive with a leading portfolio and a promising pipeline of new products and technologies. We are committed to accelerate shareholder valve creation.”
-Michel Demare, Syngenta chairman
“[Syngenta has] to justify to their shareholders that they can create the value that they have just turned down.”
-Pauline McPherson, Kames Capital global equity fund co-fund manager
Monsanto made a revised offer to Syngenta on August 18th, raising a previous offer to $489/share, valuing the company at roughly $47 billion, according to Monsanto. Monsanto also raised a reverse breakup fee to $3 billion.
The verbal proposal set a price of $254.74 in cash and a fixed ratio of 2.229 Monsanto shares per Syngenta share, according to Syngenta.
Monsanto wanted to acquire Syngenta primarily to boost its agrichemicals portfolio, which now relies mainly on its Roundup glyphosate-based herbicides, according to the company
Monsanto is known for its development of genetically altered crops, while Syngenta is the world’s largest agrichemical company and has a portfolio of insecticides, herbicides, fungicides, and seed treatments used by farmers worldwide.
“[The potential deal] is clearly not only good news for family farmers, but for economically competitive markets as well.”
-Roger Johnson, National Farmers Union (NFU) president
Monsanto was also unclear on key issues like estimated revenue synergies, according to Syngenta.
Monsanto could handle antitrust hurdles, according to the company, and would sell off Syngenta’s seeds and generic traits businesses. The deal would have brought “substantial synergies” translating to higher profits for a combined company, according to Monsanto.
“[Monsanto officials] are pretty fed up. There is a complete frustration about the whole pursuit and that is why this is the end of the Syngenta talks.”
-Brett Wong, Piper Jaffray analyst
Walmart to stop selling AR-15, other semi-automatic rifles
Walmart, the United States’ top seller of guns and ammunition, will stop selling the AR-15 and other semi-automatic rifles because of sluggish demand and focus instead on “hunting and sportsman firearms,” according to the company.
The decision is unrelated to high-profile incidents involving the rifles, including the killing of 26 people at Newtown, CT’s Sandy Hook Elementary School in 2012.
“This is done solely on what customer demand was. We are instead focusing on hunting and sportsman firearms.”
-Kory Lundberg, Walmart spokesman
Walmart will stop selling the modern sporting rifle (MSR) class, which includes the AR-15. That class was sold in fewer than a third of its roughly 4,500 U.S. stores.
“It shows that the Walmart of this decade is quite different from the prior four decades.”
-Burt Flickinger, retail consultant
“Trinity Church is very pleased to hear that Walmart will no longer sell the kinds of weapons that have caused such devastation and loss in communities around our country.”
-William Lupfer, New York City-based Trinity Church rector
“Modern Sporting Rifles are extremely popular with an estimated 10 million of them in the hands of Americans since 1990. Walmart’s decision was based on what its management sees as best for their business.”
-Michael Bazinet, National Shooting Sports Foundation spokesman
Ten automakers sued in U.S. over ‘deadly’ keyless ignitions
Ten automakers were sued by U.S. consumers who claim they concealed the risks of carbon monoxide poisoning in over five million vehicles equipped with keyless ignitions, leading to 13 deaths.
According to the complaint filed in a Los Angeles federal court, carbon monoxide is emitted when drivers leave their vehicles running after taking their electronic key fobs with them, under the mistaken belief that the engines will shut off.
The 28 named plaintiffs can injure or have “deadly” results for people who inhale the colorless and odorless gas, including when vehicles are left in garages attached to homes. The defect reduces their vehicles’ resale values, according to the plaintiffs.
A keyless ignition lets drivers start a vehicle by pushing an on-off button, rather than inserting a key, once the vehicle senses the presence of an electronic fob.
The defendants include BMW, Mercedes-Benz, Fiat Chrysler, Ford, General Motors, Honda, Hyundai, Nissan, Toyota, and Volkswagen.
The lawsuit claimed that the 10 automakers have long known about the risks of keyless ignitions, which have been available in the United States since 2003, yet deceived drivers by marketing their vehicles as safe.
Airbus delays delivery of first A380 to Transaero
Airbus is delaying the delivery of Russian carrier Transaero Airlines’ first A380 superjumbo, according to a company spokeswoman, as the recession-hit Russian economy dents travel demand in the region.
“The contract is still in place. We are looking at rescheduling the delivery of the first plane, which was planned for this year.”
-An Airbus spokeswoman
Transaero ordered four A380s.
The delay will not affect Airbus’ plans to breakeven on the A380 program this year.
Prosecutor seeks to summon Murdoch in Deutsche Bank trial
Munich prosecutors have requested that 30 additional witnesses including Rupert Murdoch, publishers Friede Springer and Axel Springer, as well as CEO Mathias Doepfner be summoned in a trial against Deutsche Bank executives.
Munich prosecutors are pursuing criminal allegations against current and former Deutsche Bank executives in the wake of a civil suit brought by the heirs of deceased media magnate Leo Kirch.
Prosecutors accused the executives of misleading the court about the bank’s role in connection with the collapse of the Kirch media empire in 2002.
They want to establish whether Deutsche Bank sought a mandate to restructure and sell parts of the Kirch empire and now want to question executives at rival media companies, according to prosecutors.
Defense lawyers have until September 22nd to respond to the request, after which the court will decide whether to summon the additional witnesses.
Sarao fails to have UK extradition case postponed
Navinder Sarao, a London-based day-trader accused by the United States of market manipulation that contributed to the 2010 Wall Street “flash crash,” failed to persuade the Westminster Magistrates Court to postpone his extradition hearing.
James Lewis, Sarao’s defense lawyer, needed more time to obtain expert evidence about trading and how the market worked to help address the issue of whether Sarao made false representations through his trading activity, according to Lewis.
District Judge Quentin Purdy rejected the application because he didn’t think expert evidence would be relevant to what he had to decide, according to Purdy.
The full extradition hearing remains set for September 25th.
The 36-year-old is accused of using an automated program to “spoof” markets by generating large sell orders that pushed prices down. He then canceled those trades and bought the contracts at lower prices, reaping roughly $40 million in profits on his trading, according to U.S. authorities.
“I’ve not done anything wrong apart from being good at my job.”
-Navinder Sarao; day-trader, to the Westminster court in May