News Archive


U.S. consumer mood brightens, but home price gains slow


NEW YORK (Reuters) – U.S. consumers’ mood improved as 2013 drew to a close, with many optimistic about their future job prospects, while home prices rose again in October, though the pace of gains slowed.

The data releases provided more evidence of strength in the U.S. economy, which appears to have overcome headwinds caused by an autumn government shutdown, higher taxes and rising mortgage rates.

“Things still look pretty solid at the end of 2013. We had better GDP growth even though interest rates have gone up with the Fed,” said Gus Faucher, senior economist at PNC Financial Services, adding “2014 will be a better year with less fiscal drag.”

The rise in the Conference Board’s index of consumer attitudes to 78.1 in December brought it to within reach of levels last seen before a standoff in Congress over fiscal policy caused the government to shut down in October.

Consumers were optimistic about the present – the present situation index hit its highest level since April, 2008 – and the future, particularly the job outlook.

“Despite the many challenges throughout 2013, consumers are in better spirits today than when the year began,” Lynn Franco, director of economic indicators at The Conference Board, said in a statement.

A separate report showed the SP/Case Shiller composite index of home prices in 20 metropolitan areas increased 13.6 percent in October from a year ago, the strongest gain since February 2006.

Price gains on a monthly basis, however, slowed to 0.2 percent from 0.7 percent in September, suggesting higher mortgage rates have slowed home-buying activity.

Borrowing costs are expected to rise again next year as the Federal Reserve winds down its monthly asset purchases, which have helped suppress long-term interest rates since the program began 15 months ago.

“From a policy standpoint, the rebound in home prices has been a real win for the Fed,” said Mark Vitner, senior economist at Wells Fargo Securities.

But next year, “the housing market will likely have to stand on its own more. We might see slower price appreciation in 2014,” he said.

Even with higher borrowing costs, however, demand for accommodation is likely to keep supporting residential construction as it recovers from multi-decade lows.

A separate report Tuesday showed that business activity in the U.S. Midwest slowed in December for a second straight month, a sign that manufacturing activity in the region was cooling off. Employment in the sector retreated to its lowest since April.

Nationwide, manufacturing has recovered strongly over the second half of the year after contracting briefly in May.

(Additional reporting by Richard Leong; Editing by Chris Reese)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/JaMbvC4fB-Y/story01.htm

Chinese recycling tycoon says he wants to buy New York Times


BEIJING (Reuters) – An eccentric Chinese recycling magnate said on Tuesday he was preparing to open negotiations to buy the New York Times Co.

Chen Guangbiao, a well-known philanthropist, is something of a celebrity in China. During a particularly murky bout of pollution in January, the ebullient and tireless self-promoter handed out free cans of “fresh air.

But Chen says he is perfectly serious in his bid to buy the Times, something that he said he had been contemplating for more than two years. He said he expected to discuss the matter on January 5, when he is due to meet a “leading shareholder” in New York.

“There’s nothing that can’t be bought for the right price,” Chen said.

As one of the most prestigious newspapers in the world, the Times is an occasional target among the wealthy — some with unsteady aims.

Donald Trump, the real estate magnate who sells Trump-branded bottled spring water, was trying to figure out a way to buy the Times earlier this year, according to a report in New York magazine, which said that details of Trump’s plans were “scant.”

It is unlikely that the Times, which has long been controlled by the Ochs-Sulzberger family, would sell to Chen.

A spokeswoman for the Times said the company did not comment on rumors.

The company’s chairman, Arthur Sulzberger, Jr., said recently that the Times was not for sale.

Chen believes the Times is worth $1 billion, but said he would be willing to negotiate. The Times current market value is $2.4 billion.

“If we act in sincerity and good faith, I believe the Times chairman will change his way of thinking,” he said.

Chen said if he was unable to buy the New York Times, he would settle for becoming a controlling stakeholder, and failing that, would simply buy a stake.

The New York Times Co, which once was a sprawling media outfit with TV stations, U.S. regional newspapers and ownership stakes in sports ventures like the Boston Red Sox baseball team and the Liverpool football club, is now down to its namesake newspaper.

Shares of the New York Times were down 1 percent at $15.93 at midday on Tuesday, after earlier hitting a 5-1/2-year high of $16.14.

IDEALS

The Ochs-Sulzberger family has owned the Times for more than 100 years and controls the company through a trust of Class B shares with special voting rights.

“It’s not true that everything is for sale,” said Ken Doctor, an analyst with Outsell Research. “That is the reason why the New York Times has a two-class share system.”

Hurun’s Rich List of China’s super-wealthy put Chen’s wealth at about $740 million in 2012. Chen said he would not hesitate to sell off most of his assets if it enabled him to buy the Times.

But Chen said that because his funds were limited, he had persuaded an unnamed Hong Kong tycoon to put in $600 million while he would pay the rest.

Chen said his aim was not to push any political agenda, but rather his personal ideals of “peace on earth, protecting the environment and philanthropy.”

He attracted attention in August 2012 when he bought a half-page advertisement in the Times stating that an island chain at the center of a dispute with Japan had belonged to China since antiquity.

“After that, I realized that the Times’ influence all over the world is incredibly vast,” he said. “Every government and embassy, all around the world, pays attention to The New York Times.”

The Times earned the ire of the Chinese government in 2012 with a report about the wealth of former Premier Wen Jiabao. The Times website has been blocked there since then.

Chen said it was natural for the government to block the site because the report on Wen “contained biased and negative things that were not verified.”

“If I acquire the Times, the paper will only report the truth and must verify all information,” Chen said, adding that he would like every Chinese household to subscribe to the paper.

If his offer failed, Chen said he would extend offers to CNN, the Washington Post or The Wall Street Journal.

“As long as they have some influence, I’m still willing to consider buying lesser media outlets,” he said.

(Additional reporting by Jennifer Saba in New York; Editing by Robert Birsel and Leslie Adler)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/xqLPa3Hdmi0/story01.htm

Buyout kings seek U.S. partnerships as deal prices rise


NEW YORK (Reuters) – Private equity firms are increasingly seeking to partner with U.S. companies rather than buying them outright, as they struggle to find ways to put their huge piles of money to work at a time when frothy markets have made takeovers expensive.

Major U.S. buyout shops, such as Blackstone Group LP (BX.N) and Carlyle Group LP (CG.O), are looking at deals such as minority investments in companies or partnerships with companies looking to make an acquisition — types of transactions that they largely shunned before the financial crisis of 2008.

Carlyle, for example, did no such deals in Carlyle Partners IV, a $7.8 billion U.S. buyout fund raised in 2005. But it ended up investing about 15 percent of its $13.7 billion Carlyle Partners V fund, raised in 2007, in such non-conventional deals.

It sees potentially even more such deals for the U.S. fund it raised this year, the $13 billion Carlyle Partners VI fund. In September, for example, it agreed to invest $500 million for a minority stake in Beats Electronics LLC, the headphones company co-founded by rapper Dr. Dre.

“You clearly need to do more of those deals to get your targeted rate of return,” said Peter Clare, co-head of Carlyle’s U.S. buyout group, who noted that the share of non-conventional deals could top 15 percent in its latest fund.

Private equity executives argue non-conventional deals can be more lucrative when full-blown buyouts are expensive. Competition for them is less, as the transactions are custom-made and often do not involve auctions.

“Once we have an investment in a company we will do everything we can to help them achieve their goals, whether it is investing more money or not,” Clare said.

While such non-conventional investments account for a small minority of private equity deals, they underscore the industry’s desire to avoid the debt-fueled excesses of the 2005-2008 buyout boom in today’s environment, in which cheap financing and high equity prices favor selling companies rather than buying.

Private equity firms took advantage of red-hot capital markets to cash out on investments throughout the year, an approach epitomized by Apollo Global Management LLC (APO.N) co-founder and Chief Executive Leon Black in April with the phrase: “We are selling everything that is not nailed down.”

Deploying capital has been more challenging. Although private equity-backed deal volumes are up 31 percent year-on-year in the United States in 2013 thanks to megadeals such as Dell inc and H.J. Heinz Co, the number of deals went down from 1,917 in 2012 to 1,715 in 2013, according to Thomson Reuters data.

At the heart of private equity’s predicament is a problem of plenty. The industry ended the year with $585 billion of “dry powder” to spend in North America, the highest since 2009, according to market research firm Preqin, thanks to yield-hungry investors, such as pension funds and insurance firms, piling in amid record-low interest rates.

At the same time, these firms have struggled to find enough buyout opportunities to invest in to make the 20 percent annual return they like to promise to the investors in their funds, who are known as limited partners (LPs).

Fierce competition for attractive buyouts and a U.S. stock market rally – the SP 500 has gained 29 percent this year – means the average price firms pay for leveraged buyouts has increased to levels not seen since 2008, the end of the last buyout boom that preceded the financial crisis.

The median earnings before interest, tax, depreciation and amortization (EBITDA) multiple in U.S. leveraged buyouts jumped to 9.8 times in 2013 from 8.3 times in 2012, according to Preqin. A recent research paper by a group of academics at the London School of Economics, University of Oxford, University of Chicago Booth School of Business and Ohio State University, shows funds that buy companies at higher EBITDA multiples tend to report worse returns.

Blackstone Chief Executive Stephen Schwarzman told a Goldman Sachs industry conference earlier this month that when a stock market rallies as much as this one has “and valuations all go up, what we try and do is not load the boat at that period of time because that’s irrational”.

ATYPICAL DEALS

Just this month, Blackstone agreed to invest $200 million for a minority stake in shoe company Crocs (CROX.O); Silver Lake Partners agreed to offer $1 billion in financing for Avago Technologies Ltd’s (AVGO.O) $6.6 billion acquisition of semiconductor maker LSI Corp (LSI.O); and Deere Co (DE.N) sold the majority of its equity in its landscaping business to Clayton, Dubilier Rice LLC for $300 million, retaining a 40 percent stake.

In the case of Crocs and Avago, the private equity firms will not have majority control, but they have strong influence over the outcome. Silver Lake already has a seat on Avago’s board of directors as a result of its ownership of the company between 2005 and 2012, while the Crocs deal gave Blackstone two seats on the company’s board.

Both companies said they would also benefit from the expertise and advice the private equity firms will offer. They also had financial incentives.

Avago’s $4.6 billion loan package backing its acquisition of LSI had a blended interest rate of about 3.5 percent as of the day it was announced, while the $1 billion convertible bonds issued to Silver Lake have a fixed 2 percent coupon.

Crocs said it would use proceeds from its $200 million sale of preferred stock to Blackstone, as well as cash on its balance sheet, to fund a $350 million common stock buyback program.

Following the announcements of these two deals, both Avago and Crocs rallied above the common share price at which Silver Lake can convert its bonds and Blackstone can convert its preferred stock.

INVESTORS FEEL CONFLICTED

The jury is still out on whether such investments will boost returns for fund investors. In the past, such deals have also ended up costing some firms dearly.

For example, Hicks, Muse, Tate, Furst Inc, one of the biggest buyout firms of the 1990s, spent too much on stakes in public telecommunications companies that did not pay off, eventually leading to the closure of the firm after many investors were disappointed with its results.

Private equity executives tell their limited partners that these deals offer them exposure to companies that they could not get otherwise and facilitate transactions that would not have been feasible without the use of their capital.

For now, fund investors are playing along. Some believe they have little choice.

“LPs are conflicted because they see private equity doing things outside its sweet spot and are not sure how this will turn out,” said Kelly DePonte, managing director at private equity advisory firm Probitas Partners LLC. “But at the same time, they want to be paying management fees on invested capital rather than dry powder.”

(Reporting by Greg Roumeliotis in New York; Editing by Paritosh Bansal, Martin Howell and Kenneth Barry)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/HatfC5FoulY/story01.htm

U.S. home price gains slow in October, but yearly gain increases: S&P


NEW YORK (Reuters) – U.S. single-family home prices rose less than expected in October but posted their strongest annualized gain in more than seven years, a closely watched survey said on Tuesday.

The SP/Case Shiller composite index of 20 metropolitan areas gained 0.2 percent in October on a non-seasonally adjusted basis, below economists’ expectation of a 0.7 percent gain. Prices rose 0.7 percent in September.

On a seasonally-adjusted basis, prices were up 1 percent.

Compared to a year earlier, prices were up 13.6 percent, beating expectations of 13 percent and marking the strongest gain since February 2006, when the increase was 13.8 percent.

Housing prices have been rising since early 2012, and a rebound in the sector has helped the U.S. recovery gain steam.

But the more subdued monthly gains “show we are living on borrowed time and the boom is fading,” David Blitzer, chairman of the index committee at SP Dow Jones Indices, said in a statement.

“The key economic question facing housing is the Fed’s future course to scale back quantitative easing and how this will affect mortgage rates,” he said.

The Fed recently said it would start trimming its asset purchases by $10 billion a month in 2014. That could push up bond yields and mortgage rates, slowing the housing rebound.

Prices in all 20 cities rose on a non-seasonally adjusted yearly basis, led by a 27.1 percent gain in Las Vegas and followed by a 24.6 percent increase in San Francisco.

(Reporting By Steven C. Johnson; Editing by Chizu Nomiyama)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/6-XejCujLak/story01.htm

Apollo’s failed deal for Cooper sows doubt on future Indian M&A


MUMBAI (Reuters) – The ambition from Indian mid-sized companies for large debt-fuelled acquisitions abroad was dealt a major setback after the unraveling of a $2.5 billion bid by India’s Apollo Tyres Ltd (APLO.NS) to buy Cooper Tire Rubber Co (CTB.N).

While some bankers said Apollo’s bid for Cooper was risky due to the larger size of the target, the outcome will add to skepticism about the ability of Indian family-run firms to execute large cross-border deals despite their need to search for growth abroad.

Apollo’s bid for Cooper, hoping to transform itself into the world’s seventh-largest tire maker, was surprising given that the Indian company was a third of the size of its U.S. target. Apollo relied on a hefty debt package for its ambitious attempt.

“It’s like a casino game for some of the Indian company founders who dream of getting into the big league by finance-backed acquisitions, but the devil is in execution and very few of them are good at that,” said Rishi Sahai, managing director at Cogence Advisors, a boutique India investment bank.

“Every investment banker would now be cautious in showing a billion-dollar-plus target to mid-sized Indian companies and question their ability to get the required financing and close the deal, while their Chinese counterparts come all prepared.”

India Inc’s overseas ambitions rose along with China’s roughly 10 years ago as the two countries courted growth outside their own economies.

Corporate India has won some successful overseas deals, including Tata Motors’ (TAMO.NS) acquisition of Jaguar Land Rover from Ford Motor (F.N) in 2008 for $2.3 billion.

But for the most part, India has struggled to show that its companies are equipped with the savvy, the experience and the determination needed to win cross-border deals and to manage them well.

India Inc has launched $117 billion worth of outbound MA in the past decade, but that pales in comparison to China’s $390 billion worth of outbound deals announced in the same period, according to Thomson Reuters data.

Unlike China, where state-owned enterprises have dominated deal flows, in India the private sector companies, especially small and medium-sized ones, have been at the forefront of deal making with deals often fuelled by large amounts of debt.

GVK Power Infrastructure (GVKP.NS) in 2011 agreed to pay $1.26 billion for a majority stake in three Australian coal mines and a port and rail project owned by Hancock Group, but has seen the debt denting its balance sheet and its shares.

Other mid-sized family-owned Indian enterprises, such as GMR Infrastructure (GMRI.NS), are also reeling under the impact of the debt they took on to acquire overseas assets in the last couple of years.

“There wasn’t a gung-ho attitude toward outbound MA anyway in the last couple of years in India and the Apollo-Cooper episode will further slow down the process,” said the head of MA at a European bank in Mumbai.

“Indian companies … especially the mid-sized names, would be a lot more cautious about the kind of assets they buy, the kind of leverage they take.”

SHOCK BID

Apollo’s offer to acquire Cooper faced obstacles from the start.

At the heart of the dispute has been Apollo’s failure to reach contract agreements with Cooper’s U.S. labor union. At the same time, Cooper’s partner in China opposed the merger, filing a lawsuit to dissolve their joint venture.

Apollo has said these two developments were not expected at the time of the deal, but Cooper maintains the issues were a result of the merger and says Apollo was aware of the risks.

According to people familiar with the matter, investment bankers had pitched acquisition ideas to Apollo for years. With annual sales of about $2 billion and a market value of roughly $700 million, the practice was restricted to targets worth less than $500 million.

Apollo declined to comment on Tuesday.

One banker involved in the deal said he was shocked when Apollo’s managing director, Neeraj Kanwar, whose family owns 43 percent of Apollo, showed interest in Cooper.

“In a pitching process, people show all kind of things to a possible buyer, but few thought of showing Cooper to Apollo,” the banker said, declining to be named as he was not authorized to speak to the media.

All the bankers Reuters spoke to for this article declined to be named.

Now that the deal has unraveled, questions are being asked whether cheap financing and over-exuberance took precedent over a deeper scrutiny of Cooper, raising worries that it will make other Indian acquirers gun shy.

“People, including perhaps Apollo, will continue to look at deals, but the outbound deals worth more than $500 million will be very, very selective. Indian companies will have a lot of homework to do before they get back into the aggressive mode,” said the investment banking head at a foreign bank in Mumbai.

(Additional reporting by Denny Thomas in HONG KONG; Editing by Matt Driskill and Louise Heavens)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/kKrCfcV6AdY/story01.htm

Futures edge up; Wall Street set for best year since 1997


NEW YORK (Reuters) – U.S. stock index futures inched higher on Tuesday before housing and consumer confidence data, with the SP 500 on track for its best year since 1997 and the Dow set to record its best performance since 1996.

Economic data expected on Tuesday’s full trading session includes the SP/Case-Shiller home price index at 9 a.m. (1400 GMT). Expectations call for a gain of 0.7 percent on a non-seasonally adjusted basis.

Later in the session at 10:00 a.m. (1500 GMT), investors will eye the Conference Board’s consumer confidence data. Expectations call for the reading to increase to 76 from the 70.4 in the prior month.

“Consumer confidence, that is an interesting number because even though it’s been lagging it looks like this holiday season was OK enough for retailers. But a little bit of data is always good,” said Kim Forrest, senior equity research analyst, Fort Pitt Capital Group in Pittsburgh.

The SP 500 .SPX is up 29.1 percent for the year and the Dow .DJI is up nearly 26 percent for 2013, boosted in large part by stimulus measures by the Federal Reserve. The Fed recently announced it will trim its monthly bond purchases in response to an improving economic picture.

The Nasdaq .IXIC is up 37.6 percent for the year, setting the technology-heavy index up for its best yearly performance since 2009.

“The data (this year) wasn’t as strong as I would have liked to have seen it, but I guess comparatively we have seen improvement in the fundamental data that tells us the economy continues to heal. I can’t wait until I’m back in the business of just looking at companies as opposed to watching the Fed,” said Forrest.

SP 500 futures rose 2.3 points and were slightly above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 16 points and Nasdaq 100 futures added 4.75 points.

For the month, the Dow is up 2.6 percent, the SP has gained 2 percent and the Nasdaq has risen 2.3 percent.

Trading volume is once again expected to be light with U.S. markets closed Wednesday for the New Year’s holiday. Many traders are away, so the thin volume could make for greater volatility.

Volume on Monday totaled 4.37 billion shares, well short of the 5.89 billion average so far this month, according to data from BATS Global Markets.

Marvell Technology Group Ltd (MRVL.O) jumped 5.7 percent to $14.54 in premarket trade after private equity firm KKR Co LLP (KKR.N) reported a 6.8 percent stake in the chipmaker, according to a regulatory filing.

Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) struck a deal for around $1.4 billion of stock to buy a Phillips 66 (PSX.N) business that makes chemicals to improve the flow potential of pipelines. Phillips shares gained 1.7 percent to $76 in light premarket trade.

Hertz Global Holdings Inc (HTZ.N) gained 3.8 percent to $26.90 before the opening bell after the company said it had adopted a one-year shareholder rights plan in response to “unusual and substantial activity” it has observed in its shares.

European shares inched higher early in a shortened session on Tuesday before the New Year break, with pan-European indexes set to post their biggest annual gains since 2009. .EU

(Reporting by Chuck Mikolajczak; Editing by Kenneth Barry and Nick Zieminski)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/813uGnHcNcc/story01.htm

World shares enjoy vintage year, seen gaining more in 2014


LONDON (Reuters) – World stocks were ending 2013 close to six-year peaks on Tuesday and benchmark bond yields were poised for their first annual rise since 2009 as investors anticipated a further pick-up in global growth.

Ultra-easy monetary policies and an improving economic outlook have given equities a vintage year in 2013. Wall Street was on track for its best year since 1997 with a 29 percent gain, while Japan’s Nikkei .N225 ended up 56.7 percent and European shares .FTEU3 gained 16 percent.

MSCI’s all-country world equity index .MIWD00000PUS was up 0.14 percent at 407.57 on Tuesday, having hit its highest since late 2007 at 407.65 on Monday.

The FTSEurofirst 300 .FTEU3 index of top European shares was up 0.25 percent at 1,315.09 points, on course for its best year since 2009. U.S. stocks futures were flat to slightly positive.

Assets favored by investors in economic downturns took a beating in 2013, with falling prices driving top-rated U.S. and German bond yields near their highest levels in around two years and gold limping towards its worst annual performance in three decades.

With bets that the economic recovery will continue even as the U.S. central bank steadily trims its bond-buying stimulus and that the euro zone will take more steps towards overcoming its debt crisis, investors look for more of the same in 2014.

“There is almost a complacency about next year and how well it could go,” said Hans Peterson, head of asset allocation at SEB investment management. “There is still abundant liquidity even if the Fed started to taper and that is still the main theme … Everything looks nice and easy right now.”

Reuters polls show European stocks are expected to hit new highs in 2014, while Chinese, U.S. and other major stock markets are also seen posting solid gains.

Gold is expected to remain depressed, while benchmark bond yields are seen rising only slightly, despite investors’ preference for riskier assets, the polls show.

Analysts do not foresee a sharp bond sell-off because inflation in major economies is expected to remain stubbornly low, while the European Central Bank and the Federal Reserve have pledged to keep interest rates low for a prolonged period.

While staying overweight in equities, Didier Duret, chief investment officer at ABN AMRO private banking, said 2014 “will be a good opportunity to … buy some good quality bonds as yields pick up above 3 percent in the United States and above 2 percent in Germany.”

The yield on the U.S. 10-year Treasury note, which sets the standard for global borrowing costs, has risen to almost 3 percent from 1.75 percent at the start of the year, but it is seen rising to only 3.35 percent in 2014.

Emerging markets have been a noted exception to the rally in equities. MSCI’s EM Index .MSCIEF fell 5 percent in 2013 on worries that cuts in global monetary stimulus could expose economic imbalances and as funds return to the rich world.

Russian stocks .IRTS hit eight-day lows after two deadly attacks in less than 24 hours that raised security fears ahead of the Winter Olympics.

EURO

The euro is set to end 2013 close to its highest level in two years against the dollar, but a Reuters poll shows it is expected to reverse its upward trend next year as the continued soft stance of the ECB contrasts with the Fed’s.

On Tuesday, the single currency inched down to $1.3776, still up more than 4 percent for the year.

The easing of the euro zone crisis and signs of a pick-up in economic activity even in the bloc’s weakest states have offered strong support to the euro and brought Italian and Spanish debt yields to just over half their crisis peaks.

In recent days, a rise in money market rates due to thin year-end liquidity has given the shared currency extra impetus, but there are some expectations the ECB may react with new long-term liquidity injections into the banking system if that continues in 2014.

“One of the themes for 2014 is likely to be dangerously low inflation,” said Marshall Gittler, head of global FX strategy at IronFX Global. “That’s got to be a worry for the ECB and why they are likely to take more measures to loosen policy in 2014. That’s the direct opposite of what the Fed is doing, which is why I expect the euro to weaken against the dollar.”

The euro was quoted at 144.61 yen, down slightly on the day, having set a five-year high of 145.67 yen last Friday. The dollar was a tad lower at 104.96 yen, but remained on track for its biggest annual gain in 34 years, with the Japanese currency having been bowled over by the Bank of Japan’s money-printing.

In the oil market, Brent crude held above $111 per barrel on Tuesday supported by slashed Libyan output and violence in South Sudan. U.S. oil futures were down 35 cents at $98.94. O/R

Hopes for global growth meant copper traded around four-month highs, while aluminum dipped after climbing to two-month highs last session. Zinc looked set on Tuesday to be this year’s best-performing industrial metal. MET/L

(Additional reporting by Laurence Fletcher; Editing by Jeremy Gaunt/Ruth Pitchford)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/pM8VhiLcorQ/story01.htm

Chinese recycling tycoon says he wants to buy the New York Times


BEIJING (Reuters) – An eccentric Chinese recycling magnate said on Tuesday he was preparing to open negotiations to buy the New York Times Co..

Chen Guangbiao, a well-known philanthropist, is something of a celebrity in China. During a particularly murky bout of pollution in January, the ebullient and tireless self-promoter handed out free cans of “fresh air”.

But Chen says he is perfectly serious in his bid to buy the Times, which he said he had been contemplating for more than two years. He said he expected to discuss the matter on January 5, when he is due to meet a “leading shareholder” in New York.

“There’s nothing that can’t be bought for the right price,” Chen told Reuters.

It is unlikely that the Times, which has long been controlled by the Ochs-Sulzberger family, would sell to Chen.

A spokeswoman for the New York Times, contacted after initial Chinese media reports about Chen’s offer, said the company did not comment on rumors.

The company’s chairman, Arthur Sulzberger, Jr., said recently that the Times was not for sale.

Chen believes the Times is worth $1 billion, but said he would be willing to negotiate.

He said that because his funds were limited, he had persuaded a Hong Kong tycoon to put in $600 million while he would pay the rest. He said the tycoon was not ready to reveal his identity.

“If we act in sincerity and good faith, I believe the Times chairman will change his way of thinking,” he said.

IDEALS

Chen said if he was unable to buy the New York Times, he would settle for becoming a controlling stakeholder, and failing that, would simply buy a stake.

Hurun’s Rich List of China’s super-wealthy put the magnate’s wealth at about $740 million in 2012. Chen said he would not hesitate to sell off most of his assets if it enabled him to buy the Times.

Chen said his aim was not to push any political agenda, but rather his personal ideals of “peace on earth, protecting the environment and philanthropy”.

He attracted attention in August 2012 when he bought a half-page advertisement in the New York Times stating that an island chain at the centre of a dispute with Japan had belonged to China since antiquity.

“After that, I realized that the Times’ influence all over the world is incredibly vast,” he said. “Every government and embassy, all around the world, pays attention to the New York Times.”

The Times earned the ire of the Chinese government in 2012 with a report about the wealth of former Premier Wen Jiabao. The Times website has been blocked since then.

Chen said it was natural for the government to block the site because the report on Wen “contained biased and negative things that were not verified”.

“If I acquire the Times, the paper will only report the truth and must verify all information,” he said, adding that he would like every Chinese household to subscribe to the paper.

If his offer failed, Chen said he would extend offers to CNN, the Washington Post or the Wall Street Journal.

“As long as they have some influence, I’m still willing to consider buying lesser media outlets,” he said.

(Editing by Robert Birsel)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/xqLPa3Hdmi0/story01.htm

China says to rein in local debt, push financial reform


BEIJING (Reuters) – China’s top planning agency pledged on Tuesday to curb local government debt while the central bank said it will keep monetary policy stable in 2014 as it pushes financial reforms.

The promises come as China’s policymakers are looking to put the economy on a more sustainable footing.

The National Development and Reform Commission (NDRC) said it would curb the “disorderly expansion” of local debt, remarks that came after the National Audit Office said local governments had run up total debt of 17.9 trillion yuan ($2.95 trillion) as at the end of June.

Leaders are looking for steady growth in the economy as they push through one of the country’s most ambitious reform agendas, aiming to transform the economy into one driven by consumers rather than the traditional investment and exports.

But policymakers faces a series of challenges, including weak demand for China’s goods overseas, over-capacity in industries at home and structural problems as well as the rise of debt at all levels of government.

The NDRC said that, overall, debt levels were under control, but it would take measures to keep debt down, including allowing local government financial companies to issue bonds to replace some existing short-term debt that has high interest rates, and encouraging private capital into infrastructure projects.

It will also step up spot checks on local government financing vehicles.

In a New Year message on the bank’s website, www.pbc.gov.cn, People’s Bank of China Governor Zhou Xiaochuan said monetary policy would be more pre-emptive and coordinated next year.

“We will vigorously promote financial reform, accelerate financial innovation to maintain financial stability, improve financial services and management to support the economic development and adjust the economic structure,” Zhou said.

His comments supplement earlier ones from the bank after its fourth-quarter monetary policy committee meeting that China will achieve reasonable growth in credit and social financing while keeping appropriate liquidity to support growth.

The central bank has not found its part in the reform process easy, having tried to cut the cash in the system to rein in bank lending in a move that caused credit crunches in June and December.

The central bank said separately on Tuesday it had added 70 billion yuan ($11.6 billion) worth of three-day bills into China’s money markets on November 18 via short-term liquidity operations.

Also on Tuesday, the central bank announced rules for financial institutions issuing asset-backed securities, saying they must keep at least 5 percent of the securities themselves to prevent risk.

In a further announcement, it said that as part of its ongoing interest-rate reforms, qualified banks would be able to allow their branches to issue certificates of deposits in future. ($1 = 6 yuan)

(Reporting by Aileen Wang and Kevin Yao; Editing by Nick Macfie and Robert Birsel)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/L1tKGQQqMtI/story01.htm