Wall Street in Early Rebound, Salesforce to Buy Buddy Media

Arthi Gupta
04 Jun, 2012
New York City

Stocks on Wall Street rose in early trading but global markets worries persisted as European leaders look for tighter fiscal integration. Salesforce.com agreed to buy Buddy Media for approximately $689 million Vanguard agreed to acquire natural gas assets for $445 million from Antero Resources.

[R]9:40 AM New York – Stocks on Wall Street rose in early trading but global markets worries persisted as European leaders look for tighter fiscal integration. Salesforce.com agreed to buy Buddy Media for approximately $689 million Vanguard agreed to acquire natural gas assets for $445 million from Antero Resources.[/R]

Stocks in early trading in New York rebounded but global markets worries persisted and two small merger deals were announced.

Market indexes in Europe were in a holding pattern and commodities prices eased in New York trading as copper, gold and crude oil were on the decline in New York.

General Motors May auto sales increased 10.9% and Ford sales soared 12.6%. Chrysler Group LLC sales surged 30% and Japanese automaker Toyota Motor Corp. reported an 87.3% jump in U.S. vehicle sales after supply chain problems eased and shipments recover from a year ago earthquake in Japan and flooding in Thailand.

Chesapeake Energy said it will replace four of the nine boards with candidates proposed by two largest shareholders, hostile investor Carl Ichan and Southeastern Management Company.

Chesapeake has been struggling with falling natural gas prices and corporate governance issues and the stock has declined to eight-year low.

European markets were in a holding pattern after the latest wholesale inflation was steady, commodities prices eased and investors look ahead to Spanish bond auction this week and the meeting of central banks in Europe and UK.

Portuguese government said it will inject up to 6.56 billion euros into three of its largest lenders to strengthen banking sector as loan losses rise rapidly in the last three months.

Vanguard Natural to Acquire Assets in Arkoma Basin

Vanguard Natural Resources, LLC agreed to acquire natural gas and liquids assets in the Woodford Shale and Fayetteville Shale of the Arkoma Basin for $445 million from Colorado-based oil and gas company Antero Resources.

With this acquisition, the company aims to establish a new operating area that has potential for future growth.

WellPoint to Buy 1-800 CONTACTS

WellPoint, Inc. agreed to acquire 1-800 CONTACTS, Inc., the largest direct-to-consumer retailer of contact lenses in the U.S. from a leverage buyout firm Fenway Partners.

The companies did not disclose the terms of the transaction but sources close to the company said that the deal valued the company for $900 million. Fenway acquired the direct retailer for $340 million in 2007.

WellPoint said in a statement that it will fund the purchase with the help of cash on hand and 2012 earnings will be cut by 4 cents a share on the integration cost and earnings per share in the year will be at least $7.80.

Salesforce.com Agrees To Buy Buddy Media

Salesforce.com agreed to buy Buddy Media, the social media marketing platform, for approximately $689 million in cash and stock.

The transaction is expected to be completed during salesforce.com’s fiscal third quarter ending October.

Earnings Review

Charming Shoppes Inc. ((CHRS)), the specialty apparel retailer reported first quarter net sales fell 4.6% to $481.3 million compared to $504.4 million for the prior year period.

Net income in the quarter declined 32% to $17.8 million or 15 cents per diluted share compared to net income of $26.0 million or 22 cents per share in the first quarter of the prior year.