We must still strive for orderly Brexit, Germany's Merkel says

BERLIN (Reuters) – German Chancellor Angela Merkel said on Wednesday that it was necessary to keep trying to secure an orderly Brexit but she stressed that Germany was prepared if Britain did end up exiting the European Union in a disorderly fashion.

She said she regretted that the British parliament had rejected a Brexit deal negotiated with the European Union and said British Prime Minister Theresa May needed to say how Britain would proceed.

“We think now it is up to the British side,” Merkel said. “We want to keep damage to a minimum, and there will be damage with the departure of Britain.”

“We will of course try to find an orderly solution but we are also prepared for the scenario that there may not be an orderly solution,” Merkel added.

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How your MP voted on Theresa May's Brexit deal

The results will be watched closely by party whips and MPs’ constituents as many Conservatives were expected to defy the prime minister and vote against her agreement.

This is how the votes stacked up:

To find out how your MP voted, put their name into the search field below.

If you don’t know your MP’s name, you can also search by constituency.

On Wednesday, MPs will vote in a no confidence motion in the government.

Prime Minister Theresa May has welcomed the challenge by Labour leader Jeremy Corbyn.

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Newmont to become largest gold producer with $10 billion Goldcorp buy

(Reuters) – Newmont Mining Corp said on Monday it would buy smaller rival Goldcorp Inc in a deal worth $10 billion, creating the world’s biggest gold producer in the face of dwindling easy-to-find reserves of the precious metal.

The deal, the second high-profile merger in the mining industry since Barrick Gold Corp agreed to buy Randgold Resources Ltd in September last year, comes as the industry looks for ways to cut costs and increase scale.

The company, which will be called Newmont Goldcorp, is set to overtake current leader Barrick Gold’s annual production and will have mines in Americas, Australia and Ghana.

The Denver, Colorado-based company Newmont will also sell $1 billion to $1.5 billion worth of assets over the next two years as part of the deal, mirroring a similar move by Barrick when it announced the Rangold acquisition.

After the deal the new company expects to produce 6-7 million ounces of gold annually over the next ten years and beyond. Barrick has forecast 2018 total gold production in the range of 4.5 million to 5 million ounces.

The new company will be led by Newmont Chief Executive Officer Gary Goldberg. Goldberg will retire at the end of 2019 and Tom Palmer, Newmont’s chief operating officer, will then take over as the CEO.

Newmont will offer 0.3280 of its share and $0.02 for each Goldcorp share. Based on Newmont’s Friday close, that translates to $11.46 per share, a premium of about 18 percent to Goldcorp’s Friday close on the New York Stock Exchange.

The deal is scheduled to close in the second quarter and is expected to generate up to $100 million in savings, the company said.

Vancouver-based Goldcorp’s U.S.-listed shares were up about 13 percent before the bell on Monday. Newmont Mining’s shares were down 3 percent.

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ProSieben e-commerce arm buys control of Aroundhome

FRANKFURT (Reuters) – German media group ProSiebenSat.1 Media’s (PSMGn.DE) e-commerce arm NuCom is buying control of Aroundhome, an online broker for home services and products, in a deal valued at 140 million euros ($161 million).

The investment represents a bet on taking the lead in the German-speaking region to help people searching for a company to put a solar panel on their roof, install a new kitchen or fix their central heating.

“We see a huge market potential in Europe,” Aroundhome founder and CEO Robin Behlau said in an interview, adding home spending in Germany, Austria and Switzerland was worth more than 65 billion euros a year.

Aroundhome, previously called Kaeuferportal, says it has achieved average revenue growth of 35 percent a year since 2014. It has just rebranded and launched a promotional campaign that includes advertising on ProSieben’s stable of TV channels.

The deal will ensure NuCom, an investment vehicle set up by ProSieben to boost online growth as its core advertising-funded TV business struggles, has controlling stakes in all of its 10 properties.

Shares in ProSieben are trading near seven-year lows, putting pressure on CEO Max Conze, who has been in the job for six months. Conze in November cut ProSieben’s dividend payout ratio and lowered his revenue forecast.

As part of the deal, investor General Atlantic will swap its stake in Aroundhome for an increased holding in NuCom, which will rise to 28.4 percent from the 25.1 percent when it came in as a partner last February.

“Our medium-term goal is for Aroundhome to become the clear category champion,” NuCom Co-CEO Claas van Delden told Reuters.

He said the online market for such services was, in Germany, “effectively vacant,” but growing rapidly in countries like the United States, where the partners in the deal see ANGI Home Services as a model.

ANGI, owned by IAC/InterActiveCorp (IAC.O), is valued at six times revenues whereas Aroundhome is worth two times, said van Delden: “We see great potential to add value.”

For General Atlantic, the deal simplifies its relationship with NuCom while backing Aroundhome’s promotional drive, said Principal Christian Figge.

In the Aroundhome deal, NuCom will raise its voting stake to 94 percent from 42 percent. It will acquire 42 percent from General Atlantic via a share swap, and pay cash to buy a further 10 percent from Aroundhome’s founders.

CEO Behlau will retain a 6 percent stake and continue to run the company.

NuCom expects to achieve revenues of 1 billion euros this year and 2 billion by 2023. Van Delden said it targeted annual organic revenue growth of 10-15 percent, rising to 20 percent including acquisitions.

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Israel UAV maker Aeronautics gets 850 million shekel buyout offer

JERUSALEM (Reuters) – Israeli unmanned aerial vehicle maker Aeronautics (ARCS.TA) said on Sunday it received an offer to be acquired by state-owned Rafael Advanced Defense Systems and businessman Avihai Stolero for 850 million shekels ($232 million).

Aeronautics, which has a market value of 507 million shekels, said the offer for all its shares would be done as a reverse merger executed through a company jointly owned by Rafael and Stolero.

Aeronautics would become private and its shares delisted from the Tel Aviv Stock Exchange.

Negotiations will take place until Feb. 15. In the meantime, Rafael will conduct its due diligence.

Last August, Aeronautics rejected a 430 million shekel acquisition from Rafael and Stolero.

Earlier this month, state-owned Israel Aerospace Industries [ISRAI.UL] said it was in early talks to invest in Aeronautics.

Aeronautics manufactures unmanned aerial vehicles for military surveillance and defense purposes, as well as for the commercial sector.

($1 = 3.6699 shekels)

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Stobart's former CEO buys 10 percent stake in Flybe: Sky News

(Reuters) – The former chief executive officer of Stobart Group Ltd. (STOB.L), Andrew Tinkler, bought about 10 percent of British airline Flybe Group Ltd (FLYB.L) on Friday, Sky News reported.

Stobart is part of a consortium led by Virgin Atlantic Airways and including Cyrus Capital Partners that said on Friday it will buy Flybe for $2.8 million, aiming to rebrand the struggling regional carrier.

Tinkler has been involved in a lengthy legal battle with Stobart after he was ousted from the infrastructure and support services group last year for alleged breach of contract and breach of fiduciary duty.

It was unclear how much he paid for the Flybe stake, who he had acquired it from and whether he planned to make any further purchases, according to the Sky News report bit.ly/2RmzHYh.

But a source close to Tinkler told Sky News he is not seeking to disrupt the proposed takeover.

The purchase is expected to be disclosed to the London Stock Exchange on Monday, Sky News said.

Both Stobart and Flybe declined to comment on the report. Cyrus Capital and Virgin Atlantic were not immediately available for comment outside regular business hours.

Flybe operates routes from about 25 British airports, including domestic connections to London’s Heathrow.

Announcing the takeover earlier in the day, Virgin said Flybe would feed customers to its long-haul flights.

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German utility EWE to offer minority stake next month: sources

FRANKFURT (Reuters) – German regional utility EWE [LANDWE.UL] will offer investors a minority stake next month, three people familiar with the matter said, in a deal that could value the whole group at up to 6.2 billion euros ($7.2 billion).

After advertising the offer of the 26 percent stake, probably in late February, prospective buyers would have four weeks to indicate their interest, one of the people said.

EWE, which also has a telecoms business, has said it wants to find a new strategic partner in 2019 to raise fresh funds for investments, including building glass-fiber networks with Deutsche Telekom (DTEGn.DE).

Potential buyers included a group made up of infrastructure investor Macquarie (MQG.AX) and German insurer Allianz (ALVG.DE), the people said, as well as Canadian pension fund OMERS, Australian infrastructure fund IFM and Dutch pension fund PGGM.

Chinese firms might also show interest, one of the sources said, adding that they might channel any investment through a Western infrastructure fund rather than directly taking part in the auction due to Germany’s opposition to Chinese suitors.

Germany tightened rules last year to fend off unwanted takeovers by Chinese investors in strategic assets.

EWE’s 26 percent stake would be worth about 1.5 billion to 1.6 billion euros, the sources said, a value that would likely make it one of the biggest German utility deals in 2019.

Due to the size of the stake and limited influence that comes with it, the most likely bidders will be pension and infrastructure funds, which target low but stable returns.

“IRR (internal rate of return) expectations of some bidders are below 7 percent”, one of the sources said.

“EWE has a stable and defensive model,” another source said, adding any investor would need to be comfortable with EWE’s regional ownership and its long-term decision-making process.

Most of unlisted EWE, which has annual sales of 8.25 billion euros and an operating margin of 6.1 percent, is owned by cities and municipalities in northwest Germany. Peer EnBW (EBKG.DE) has a 6 percent, which it will relinquish as part of the 26 percent stake sale.

A spokesman for EWE said the sale has been agreed by the firm’s management, supervisory board and municipal owners. The transaction adviser was Citibank Group (C.N), he said.

Allianz, OMERS and PGGM declined to comment. IFM and Macquarie were not immediately available for comment.

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Alibaba buys German data analysis start-up: Handelsblatt

BERLIN (Reuters) – Chinese e-commerce giant Alibaba Group Holding (BABA.N) has acquired German data analysis start-up data Artisans for about 90 million euros ($103.1 million), German business daily Handelsblatt reported in its Wednesday edition.

“This is a strategic acquisition,” founders of the Berlin-based company, Kostas Tzoumas and Stephen Ewen, were quoted as saying.

Alibaba this week announced it was deepening its partnership with data Artisans and collaborating to build up a software to process large amounts of data.

($1 = 0.8728 euros)

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Sika offers to buy French firm Parex for enterprise value of $2.6 billion

(Reuters) – Swiss chemicals company Sika AG (SIKA.S) on Tuesday offered to buy smaller French rival Parex for an enterprise value of 2.5 billion Swiss francs ($2.55 billion) from a fund owned by CVC Capital Partners, and said its full-year sales beat its target.

The acquisition is expected to generate annual synergies of 80-100 million francs, Sika said.

Sika, whose additives are used to waterproof and strengthen cement, said the deal is expected to add to its earnings per share starting the first full year post closing.

The Swiss company reported higher full-year sales of 7.09 billion Swiss francs for 2018, beating its target of achieving 7 billion francs for the first time.

Sika, which settled its long-running takeover battle with France’s Saint-Gobain (SGOB.PA) last year, said its local currency sales rose 13.7 percent from 6.25 billion francs a year earlier.

For this year, Sika expects sales growth of 6-8 percent, in line with its strategic targets, fuelled by new factories and acquisitions. It expects an “over-proportional” rise in profit.

Depending on the closing date of the Parex deal, Sika said it expected sales to exceed 8 billion Swiss francs.

The company, which is due to report its full-year earnings on Feb. 22, said it expected 2018 operating profit in the range of 940-960 million francs.

The company has invested in its supply chain in the past year, with 11 new factories, another national subsidiary and four acquisitions, Chief Executive Paul Schuler said.

In October, CVC engaged investment bank Lazard to find a buyer for Parex, attracting interest from Chinese and Western construction materials groups.

Sika said it secured a bridge loan facility from UBS and Citi to fund the Parex deal.

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UAE bank bailout signals sector restructuring, mergers

DUBAI (Reuters) – Smaller banks in the United Arab Emirates are facing regulatory pressure to merge after the fallout from a property downturn forced the state to lead a bailout of Invest Bank INVB.AD last month.

UAE has 50 commercial banks including 22 local lenders, a number seen as too high in a country of about 9.5 million people. Saudi Arabia, which has a population of 32 million, has 12 banks and is set to lose two of those if announced mergers are successfully concluded.

After two of the UAE’s biggest lenders, First Gulf Bank and National Bank of Abu Dhabi, merged in 2017 to become First Abu Dhabi Bank FAB.AD, three more lenders are in talks to combine, led by Abu Dhabi Commercial Bank ADCB.AD.

Analysts expect mergers in the sector to accelerate given a slowing economy, slide in house prices, robust accounting standards and tougher competition.

“There will be pressure on the bigger banks to absorb smaller lenders,” said Sabah al-Binali, CEO of Abu Dhabi-based investment firm Universal Strategy.

“People were expecting mergers from an economic point of view, but what you are seeing now is perhaps a greater regulatory push to strengthen balance sheets.”

Smaller banks in the UAE, which are mostly family owned, have lost market share to the top four lenders, which now control around 65 percent of banking sector loans, according to Fitch. Despite that, their owners have resisted mergers, partly due to differences over who would control the combined entity.

But one banker, who has been advising banks on M&A, said there are more merger conversations happening in a sign that owners are becoming more open to consolidation.

“We are party to a number of such conversations and instigating a number of those,” the banker said.


In 2009 the UAE rescued its largest banks with billions of dollars of fresh equity without forcing losses on shareholders.

Nine years on, with those lenders well capitalized, authorities are tightening the screws on smaller banks, but without the generosity shown to the larger players.

The Sharjah government proposed to buy Invest Bank shares for just 0.70 dirhams ($0.19) each, against the last traded price of 2.40 dirhams, after the central bank ordered it to take losses that wiped out its capital base.

“The central bank has become much more involved with all of the banks in ensuring (they) have a sustainable business model and the risks they are taking can withstand downside shocks,” said the banker.

A second banker said the central bank had been closely scrutinizing distressed assets and challenging banks on their classification assumptions for such assets, especially in the real estate sector.

The central bank did not respond to a Reuters request for comment.


Mik Kabeya, assistant vice president at rating agency Moody’s, said smaller banks tended to have higher exposure to small and mid-sized corporates, which have been disproportionately affected by the relatively soft economy.

He added that there was a need for scale to meet sizeable investment requirements related to compliance, digitalization and new accounting standards.

The central bank is becoming increasingly strict with the banks in terms of maintaining minimum capital, liquidity and loan loss reserve levels, said Redmond Ramsdale, senior director, financial institutions at Fitch Ratings. “Real estate and contracting sectors are a large sectorial exposure across all UAE banks. This is putting pressure on asset quality metrics for all banks.”

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