World Markets Focused on Libya, Bahrain; HP Slides

Arthi Gupta
23 Feb, 2011
New York City

World markets edged lower as protests continue in Libya and Bahrain. Gaddafi vowed to stay in power. Libya supplies 1.5 million barrels a day of oil to Europe and y one third to Italy. Forest Labs agreed to buy Clinical Data for $1.2 billion. Hewlett Packard falls on lower than expected outlook.

[R]8:00 AM New York – World markets edged lower as protests continue in Libya and Bahrain. Gaddafi vowed to stay in power. Libya supplies 1.5 million barrels a day of oil to Europe and y one third to Italy. Forest Labs agreed to buy Clinical Data for $1.2 billion. Hewlett Packard falls on lower than expected outlook.[/R]

Libyan leader Colonel Muammar Gaddafi rejected calls for his resignation in a defiant speech on state television. In a televised speech last night, Colonel Muammar el-Gaddafi threatened to track down and kill protesters ""house by house.""

Gaddafi has been in power for 41 years and has retaliated with exceptional force to the massive protests demanding that he step down, however, his grip on power has slipped and all the symbols of regime in the Eastern Libya are in tatters.

Police and local bureaucrats have deserted Gaddafi in the East, but he continues to control Tripoli. Nearly 300 protesters are believed to have died in clashes with pro-government forces.

Forest Labs Acquires Clinical Data

Forest Laboratories, Inc. and Clinical Data, Inc. announced on Tuesday that they have entered into a merger agreement by which Forest will acquire the specialty pharmaceutical company for $1.2 billion. Forest expects the deal to leverage its existing presence in the antidepressant category by the addition of Clinical Data''s Viibryd.

Icahn Offers To Buy Mentor Graphics

Carl Icahn said on Tuesday that he offered to buy chip-design software company Mentor Graphics Corp. for $17 per share in cash, which represents a 40% premium to Mentor''s stock price at the beginning of January 2011.

Nasdaq Ponders on Bid for NYSE

Nasdaq OMX Group, Inc. is looking to make a competing offer for New York Stock Exchange parent NYSE Euronext, Inc., according to the Wall Street Journal on Tuesday. The reported move comes a week after NYSE agreed to merge with Germany''s Deutsche Boerse AG to create the world''s biggest stock and derivatives exchange operator.

J. Crew Justifies Acquisition

J.Crew Group commented on the report issued by Institutional Shareholder Services Inc. on the company''s proposed acquisition by TPG Capital and Leonard Green & Partners, L.P.

Contrary to the ISS report, which the company called ""deeply flawed in its analysis and conclusions,"" the proposed transaction offers a full and fair price for J.Crew''s shareholders.

As previously announced, under the terms of the $3 billion merger agreement, J.Crew stockholders will receive $43.50 per share in cash.

Lockheed Martin Sells PAE Unit

Lockheed Martin Corp. agreed to sell its Pacific Architects and Engineers Inc. business to private equity firm Lindsay Goldberg, LLC. Terms of the transaction were not disclosed. The unit offers services in peacekeeping and disaster-relief services.

Duncan Energy Gets Buyout Offer

Duncan Energy Partners LP said that it received a proposal from Enterprise Products Partners L.P. whereby Enterprise and certain affiliates would acquire all of the outstanding publicly-held common units of Duncan Energy Partners through a unit-for-unit exchange.

Earnings Review

Bruker Corporation ((BRKR)), the manufacturer of scientific instruments reported fourth quarter revenues grew 14% to $416.1 million from $366.4 million in the prior-year quarter. Net income in the quarter declined 33% to $29.3 million or 18 cents per diluted share compared to net income of $43.5 million or 26 cents per share last year.

Chesapeake Energy Corporation ((CHK)), the natural gas producer said fourth quarter revenue decreased 11% to $1.98 billion from $2.22 billion in the same quarter last year. Net income generated in the quarter was $180 million or 28 cents per diluted share compared to a loss of $530 million or 84 cents per share in the prior-year quarter.

Annual revenues increased 22% to $9.37 billion from $7.70 billion in the year-ago. For the full-year 2010, net income was $1.66 billion or $2.51 per share compared to a net loss of $5.85 billion or $9.57 per share in the previous year.

General Mills, Inc. ((GIS)), the packaged food supplier said that it is on-track to achieve the sales and earnings growth targets it set for 2011. The company said it continues to anticipate low single-digit growth in net sales, a mid single-digit increase in segment operating profit, and adjusted earnings between $2.46 and $2.48 per share.

Hertz Global Holdings, Inc. ((HTZ)), the car and equipment rental company reported fourth quarter total revenues increased 5.5% to $1.83 billion from $1.74 billion last year. Net loss in the quarter narrowed 5.5% to $29.2 million or 7 cents per diluted share compared to a loss of $30.9 million or 8 cents per share in the previous year, primarily reflecting higher car rental revenues on an increase in the number of transactions.

Hewlett-Packard Company ((HPQ)), the computer and printer maker said first quarter net revenue rose 4% to $32.30 billion from $31.18 billion in the same quarter last year. Net income in the quarter increased 16% to $2.6 billion or $1.17 per share compared to net income of $2.3 billion or 93 cents per share for the year-ago quarter amid strong demand from commercial customers.

Lowe''s Companies, Inc. ((LOW)), the home improvement retailer stated fourth quarter sales increased 3.1% to $10.48 billion from $10.17 billion in the fourth quarter of 2009 on comparable store sales rise of 1.1%. Net earnings in the quarter grew 39% to $285 million or 21 cents per diluted share compared to net income of $205 million or 14 cents per share last year.

Toll Brothers, Inc. ((TOL)), the luxury home builder reported first quarter revenues increased 2.3% to $334.12 million from $326.70 million in the comparable period. Net income generated in the quarter was $3.42 million or 2 cents per diluted share compared with a loss of $40.75 million or 25 cents per share last year.