speculation

Lehman Brothers' near-deal with South Korean institutions

Jim Kim — Wed, 20 Aug 2008 17:44:14 -0400

It's not hard to conclude that Lehman Brothers is scouring the globe for capital. The latest: The firm nearly struck a deal to raise almost $5 billion from South Korean institutions, but the agreement fell apart. The news, reported by the New York Post, is yet another sign that Lehman Brothers is in serious need of capital. The conventional view as of now is that it will post another large writeoff and another loss for the third quarter. It would like to accompany that announcement with more reassuring news of additional capital, but will that be possible? It seems like CEO Richard Fuld has to do something rather dramatic. The Post reports he and COO/President Bart McDade have held numerous discussions with prospective international players. They are not exactly bargaining from strength.

For more:
- here's the article
- more speculation about Fuld's job. Article

NYSE's SPAC move: Misguided?

Tue, 20 May 2008 06:59:56 -0400

We've spoken a lot about the rise of special purpose acquisition companies, or SPACs. They were all the rage over the past few years, as more top investment banks got involved with them. They were fees to be had, of course. But the deal environment has worsened obviously, and that is making it hard for some SPACs to invest their newly raised funds. Share prices have been under pressure, and there is speculation that some SPACs may have to return funds. So it is interesting to read, in Traders Magazine, that the NYSE's marketing has paid off: A SPAC will move to the Big Board from the Amex. That would mark a first. Some might say the NYSE's marketing efforts are too late, but perhaps the time to make a push is when things are at a trough.

For more:
- here's the Traders Magazine article

Will Robert Rubin step down at Citigroup?

Mon, 28 Apr 2008 06:59:57 -0400

In the past, Robert Rubin has described himself as Citigroup's consigliere. But the credit crunch has not been kind to the big bank, and there has been persistent speculation as to whether he would resign as chairman of the executive committee. The New York Times says he's not stepping down, but one insider told the paper a change in job titles may be in order. It's fair for shareholders to ask what role Rubin played as the bank's struggles mounted. CEO Charles Prince, of course, departed in ignominy. Rubin defends his performance, noting that few could predict the perfect storm that hit banks hard. He's still a rock star in the banking world. He'll likely survive.

For more:
- here's the New York Times article

Get ready for Quattrone 2.0

Wed, 19 Mar 2008 07:59:58 -0400

Frank Quattrone spent four lonely years fighting the Justice Department, who really threw the book at him. But he prevailed after two trials; seven months ago a judge approved a request that all charges be dropped. The speculation since then has been heavy about what he'll do next. His answer: Qatalyst Group, an advisory and merchant banking outfit. It looks to be a blockbuster. His press release included quotes from, among others, Google CEO Eric Schmidt. No longer a pariah, he will not lack for business.

For more:
- here's the New York Times item

Related Articles:
Quattrone wins! No third trial. Article
Quattrone ready to take Wall Street by storm. Article
Frank Quattrone eyes a golden future. Article

JP Morgan bets big on Bear Stearns

Tue, 18 Mar 2008 07:59:56 -0400

People are still buzzing about JP Morgan Chase's deal to buy Bear Stearns. One thought from Fortune is that the deal could possibly spell the end of Jaime Dimon's career, at least at JP Morgan. Even at $2 a share, Fortune notes that no one really knows what kind of assets they are really buying. It's possible that he overpaid. Interesting thought. Dimon certainly is a canny sort of executive. My guess is that he has solid guarantees from the Fed regarding some additional support, if necessary. But not everyone is ready to call this a win for JP Morgan Chase. Of course, if the troubled securities do not tank, getting the building and the clearing operations at $2 a share will make him the hero.

For more:
- here's the article

Related Articles:
JP Morgan to buy Bear Stearns. Article
Jaime Dimon's revenge. Article
Juicy speculation: JP Morgan to buy Citigroup? Article
When Dimon gets involved, JP Morgan gets sued. Article

The Yahoo deal game: Microsoft vs. Amazon?

Fri, 08 Feb 2008 06:59:58 -0500

The hostile takeover game gives rise to lots of rumor and speculation. Trip Chowdhry of Global Equities Research has a very novel take on the bid. He argues that the Microsoft bid is but a ploy--a stupendously rich offer designed to thwart a possible deal between Amazon.com and Yahoo. He theorizes that Microsoft knows regulators will never allow the deal, an idea that few buy, and that Amazon.com can't possibly match it. Say what you will, this is the kind of stuff that the hostile bid game inspires. The stakes are certainly high, and Jerry Yang has reached his moment of truth.

For more:
- here's the Marketwatch article
- here's an article from the New York Times about Yang

Another deal gone bust?

Tue, 29 Jan 2008 06:59:58 -0500

What's going on with the Alliance Data Systems-Blackstone Group deal? The deal was struck back in May. But Alliance shares have been weakening recently as rumors mounted that the deal may be in trouble. Alliance denied the speculation. Now comes news from Blackstone that federal regulators have slapped some onerous conditions on the buyout of the credit card company. It seems the original deal is off, though Blackstone seems willing to renegotiate. For Alliance, this seems a little Sallie Mae-like. According to the AP, the firm disputes that the OCC's terms were overly burdensome. In this environment, any such move by a private equity firm, fairly or not, will seem like a bid to get out of the deal or to get a new price.

For more:
- here's the AP article

JPMorgan looking good, WaMu in sights?

Wed, 12 Dec 2007 06:59:56 -0500

JPMorgan Chase has been the subject of much speculation recently. Unlike some of its competitors, it has fared fairly well in this credit downturn. Major writedowns are not expected. Now that Bank One has been integrated, the notion that JPMorgan is ripe for another huge deal is gathering steam. We've noted the speculation that it might seek some sort of deal with Citigroup, which seems far fetched. Analyst Richard Bove has lots of other ideas, the AP notes. Washington Mutual could use a white knight right now and offers entree into solid markets in California and Florida. SunTrust is a perennial rumor. Another option is for JPMorgan to make a buy to reduce competition, Bove figures, naming KeyCorp, National City and Discover Financial Services as possibilities.

For more:
- here's the AP article

Related articles:
- Juicy speculation: JPMorgan to buy Citigroup
- Pain continues to spread to UBS, WaMU and Bank of America

Juicy speculation: JPMorgan to buy Citigroup

Tue, 11 Dec 2007 06:59:57 -0500

Well, you have to hand it to Jaime Dimon. He has JPMorgan Chase thriving at a time when its top competitor is struggling. Barron's has weighed in with a glowing article on the bank. The good vibes have resulted in a stronger stock, reflecting solid risk-management performance. It dodged the subprime bullets much better than others. Also, the 2004 merger of JPMorgan Chase and Bank One seems to be paying off. It just might be looking for deals. While WaMu and SunTrust are perennial rumor targets, there has been speculation from CreditSights that it could be in the market for...Citigroup. This is based largely on the fact that Dimon used to work there. But if things get bad enough, Citigroup may have to consider some sort of merger.

For more:
- here's a Seeking Alpha item

Related articles:
- Citigroup may never be the same again
- Citigroup's future on the line

Assessing O'Neal's track record

Fri, 26 Oct 2007 06:59:57 -0400

If it weren't for his unauthorized Wachovia overture, Stanley O'Neal would likely have survived the current crisis, in my opinion anyway. He still might. If he does, it will have a lot to do with the fact that he capably guided Merrill Lynch to some of its best year's ever. But then came the credit crunch and the massive write-downs that have investors angry and analysts uncertain, though many still like the stock. Not everyone agreed with me. Even before the Wachovia news was leaked, a MarketWatch columnist predicts that O'Neal will be shown the door fairly soon. Stay tuned.

For more:
- here's the MarketWatch column
- speculation on CEO candidates. Article

Related article:
- Merrill shuffles execs after mortgage snafus
- What to expect from Merrill's earnings