SBA Acquires Tower Sites, Coca-Cola Commits $3 Billion to India

Arthi Gupta
26 Jun, 2012
New York City

U.S. indexes rebounded ahead of the consumer confidence report. SBA Communications agreed to acquire tower sites from TowerCo for $1.45 billion and Coca-Cola committed additional $3 billion in India.

[R]9:00 AM New York – U.S. indexes rebounded ahead of the consumer confidence report. SBA Communications agreed to acquire tower sites from TowerCo for $1.45 billion and Coca-Cola committed additional $3 billion in India.[/R]

U.S. indexes rebounded in early trading as investors focused on the earnings season starting in two weeks and lower energy prices are expected to lift consumer spending this summer.

European markets edged lower ahead of the summit of regional leaders and stress in peripheral bond markets persisted. Spain and Italy completed debt auction but at higher borrowing costs and leaders in the region focus on deeper banking and fiscal union at the meeting this week.

Separately, Cyprus the fifth euro-zone country asked financial support from the European Financial Stability Fund to recapitalize its ailing banks. Cyprus has suffered with its heavy exposure to Greek economy as Greece struggles with shrinking economy for the third year in a row.

Germany plans to sell €71 billion in debt in the third quarter, instead of €68 billion projected in December, the debt agency said in a statement.

Italian Debt Auction

The Italian Treasury raised €2.99 billion from the sale of its zero coupon May 2014 bonds at an average yield of 4.712% compared to an average yield of 4.037% in the previous sale on May 28. The bid-to-cover ratio dipped slightly to 1.65 from 1.66.

The agency also sold €625.5 million of its 2.10 percent September 2016 inflation-linked bonds at an average yield of 5.20% compared to an average yield of 4.39% in the previous auction on May 28. The bid-to-cover was 2.22 compared to 2.29 times in the May sale.

The country also sold €289.5 million of its 3.10 percent September 2026 inflation-indexed bonds at an average yield of 5.29% and the bid-to-cover ratio was 2.43.

Asian markets closed on a mixed note on the ongoing worries in the euro-zone.

Traders in Tokyo showed little enthusiasm for the upcoming meeting of European leaders and were also concerned that political leaders may not provide the support fast enough to bolster the government finances of Spain and Italy.

A report released by the Bank of Japan showed that its corporate service price index edged up 0.1% annually in May. On a monthly basis, the index fell 0.4% in May.

News Corp. Contemplates Splitting Businesses

News Corp. is considering separating its publishing and entertainment businesses according to a Wall Street Journal report quoting people familiar with the situation.

The publishing business includes the Wall Street Journal, the Times of London, the Australian newspaper and HarperCollins book publishing.

Fox broadcast network, 20th Century Fox film studio and Fox News channel are part of the entertainment business.

Coca-Cola Increases Investment in India

Coca-Cola India announced that the Coca-Cola system will invest an additional $3 billion or approximately 165,000 million rupees in India through 2020 to capture growth opportunities in fast-growing nonalcoholic ready-to-drink beverage market.

With the new $3 billion investment, the Coca-Cola system now plans to invest $5 billion in India by the end of the decade.

The Coca-Cola system has already invested more than $2 billion in India since it re-entered the country in 1993.

SBA Communications Agrees to Acquire Tower Sites

SBA Communications Corp. reached a merger agreement with certain affiliates of TowerCo to acquire 3,252 tower sites in 47 states across the U.S. and Puerto Rico.

SBA will pay $1.2 billion in cash and 4.6 million of SBA Class A common shares, implying a total transaction value of $1.45 billion, based on SBA''s average three-day closing price of $54.48 as of June 22.

FIS to Sell Healthcare Benefit Solutions Business

Fidelity National Information Services, Inc., the provider of banking and payments technology agreed to sell its healthcare benefit solutions business to Lightyear Capital LLC, the private equity firm for $335 million. The deal is expected to close by the end of the third quarter.

Earnings Review

Apollo Group Inc. ((APOL)), the expensive online education provider said third quarter net revenue fell 8.5% to $1.13 billion from $1.24 billion in the same quarter last year. Net income in the quarter declined 37% to $134 million or $1.13 per diluted share compared to net income of $212.4 million or $1.51 per share for the year-ago quarter.

HB Fuller Co. ((FUL)), the specialty chemicals maker said second quarter net revenue, excluding the Latin America Paints business surged 43.1% to $527 million from $368.36 million in the second quarter of 2011. Net income for the quarter plunged 92% to $1.9 million or 4 cents per diluted share compared to net income of $25.1 million or 50 cents per diluted share, in last year''s second quarter.

LDK Solar Co., Ltd. ((LDK)), the manufacturer of photovoltaic products reported first quarter net sales declined 74% to $200.1 million from $766.3 million in the prior-year quarter. Net loss in the quarter swung to $169.32 million compared to net profit of $135.4 million last year. Loss per ADS was $1.46 compared to profit per ADS of $0.95 in the same quarter a year ago.

Synnex Corporation ((SNX)), the business process services company said second quarter revenues edged down 1% to $2.483 billion. Net income in the quarter rose 9.6% to $34.4 million or 90 cents per diluted share compared to net income of $31.4 million or 85 cents per share last year.

The Hershey Company ((HSY)), the producer of chocolate reaffirmed its 2012 forecast. The company is still projecting reported earnings per share between $2.82 and $2.92, adjusted earnings per share between $3.11 and $3.17 on a full-year net sales growth of 7% to 9%, including Brookside acquisition.