GE Wins Alstom Business for $17 B, Oracle to Buy Micros for $5.3 B

Nichole Harper
23 Jun, 2014
New York City

Stocks on Wall Street traded lower after oil advanced on rising supplies disruptions worries in Iraq. European markets dropped on weak manufacturing data. General Electric won the bidding war for the energy business of Alstom SA. Oracle agreed to acquire Micros Systems.

[R]10:55 AM New York – Stocks on Wall Street traded lower after oil advanced on rising supplies disruptions worries in Iraq. European markets dropped on weak manufacturing data. General Electric won the bidding war for the energy business of Alstom SA. Oracle agreed to acquire Micros Systems.[/R]

Market indexes struggled and searched for direction after a barrage of deal news and a private survey showed a slight improvement in manufacturing sector but gloomy French data dragged European markets.

S&P 500 index decreased 0.2 to 1,962.69 and the Nasdaq Composite Index declined 1.75 to 4,366.31.

Oracle agreed to acquire restaurant and retail enterprises terminal operator Micros Systems, Inc for $5.3 billion, including debt. The largest purchase by Oracle since its acquisition of Sun Microsystems for $7 billion in 2010.

Wisconsin Energy agreed to acquire Integrys Energy Group for $5.7 billion in cash or $70 a share.

General Electric won the energy business of Alstom SA for $17 billion besting the rival joint bid from Siemens AG and Mitsubishi Heavy.

Oil traded higher and Brent Crude surpassed $115 a barrel after rebels seized more territory in Iraq and gained control of an airport and smaller cities near oil fields.

European Markets

European market indexes declined after the euro zone’s flash composite purchasing manager’s index decreased to 52.8 in June, tracked by Markit.

The similar survey conducted in Germany showed private sector expanded for the 14th month in a row in June but manufacturing sector index in France in the month declined to 48 from 49.3 in May.

Weak French data highlighted losing competitiveness of French firms in the global marketplace as Asian companies gain grounds.

Asian Markets

Nikkei 225 Stock Average gained as resource stocks advanced and telecom stocks declined. Casino equipment stocks fell. Mitsubishi Heavy Industries and Siemens failed to win energy business of Alstom SA.

Stocks in Tokyo closed higher and yen traded flat and investors focused on overseas markets after a latest private manufacturing survey showed improving market conditions.

The Nikkei 225 Stock Average rose 19.86 to 15,369.28 and the broader Topix index inched lower 1.44 to 1,267.48.

The yen edged up to close at 101.95 against one U.S. dollar.

The preliminary index of manufacturing in June increased to 50.8, tracked by HSBC Holdings Plc and Markit Ltd.

The private survey has a larger allocation to exporting companies and the government survey has a higher weight to state controlled larger enterprises.

The Sensex Index slipped 74.19 or 0.3% to close at 25,031.32 The CNX Nifty fell 18.10 to 7,493.35.

AstraZeneca rose after shareholders approved delisting and Essar Oil also delisted its stock from exchanges. Bharti Airtel signed a network agreement in Mumbai with Loop Mobile. Gammon Infra to raise up to $83 million. Ramky Infra net swung to a loss.

U.S. Stocks in Review

General Electric Company ((GE)) declined 23 cents to $26.74 after the company won a bidding war to acquire the energy business of Alstom SA. Siemens AG and Mitsubishi Heavy Industries also bid for the businesses.

GE’s $17 billion bid was selected by the French government controlled company after the U.S. diversified conglomerate made concessions on the jobs and overcame other regulatory hurdles.

Integrys Energy Group, Inc ((TEG)) soared 14.5% to $69.86 after the company agreed to be acquired by Wisconsin Energy for $5.7 billion in cash or for $70 a share.

Micros Systems, Inc ((MCRS)) increased 3.3% to $67.96 after the company agreed to be acquired by Oracle for $4.6 billion. Oracle is looking to revamp its hotel and restaurants software business.

Lululemon Atheltica Inc ((LULU)) increased 2.2% to $41.11 and the yoga-apparel retailer said it is planning to improve its product portfolio and create more shareholder value.