Private equity firms team up to bid for Vivendi’s Brazilian unit GVT

A group of private equity firms, including KKR & Co LP (NYSE:KKR) and Apax Partners LLP, intends to make a joint bid of as much as USD5bn (EUR3.7bn) for Brazilian telecommunications company Global Village Telecom (Holding) SA, or GVT, a unit of French Vivendi SA (EPA:VIV), Bloomberg said today citing knowledgeable sources.

Other participants in the group are Gavea Investimentos Ltda, owned by JP Morgan Chase & Co (NYSE:JPM), and Cambuhy Investimentos Ltda. Brazilian investment bank BTG Pactual Group is still mulling over the possibility of taking part in the bid, the sources said. Valor Economico had reported previously, without citing sources, that BTG Pactual had pulled out of the race.

Their rival in the competition is US satellite-television provider DirecTV (NASDAQ:DTV), which is expected to propose a price closer to the asking price of USD8bn, due to the synergies that a possible deal could create. According to one of the sources, potential bidders are getting ready for the second round of the auction, which is seen to be completed by the end of next month.

Representatives for Vivendi, Apax, KKR, BTG Pactual and JP Morgan refused to comment. DirecTV did not immediately respond to Bloomberg’s message asking for a comment, whereas Cambuhy Investimentos did not answer the agency’s calls.

Vivendi put GVT up for sale in 2012 after buying it for EUR3bn (USD4.1bn) in 2009.

4 Helpful Tips for Deciding Where to Stash Your Cash

It’s always nice to have extra cash just lying around, but sometimes you can end up saving hundreds or thousands of pounds that simply sit there. Having all that extra money poses the problem of it simply sitting there and being useless, so what can you do with it instead?

There’s a lot of things that you can do with it. The best things will ultimately benefit you in the long run. So instead of choosing to spend all that money in one fell swoop, hold onto it. Better yet, you could take that money and multiply it with enough time.

Take a look at the top 4 things you can do with your extra money so that it isn’t wasting space underneath your mattress!

1. Put That Cash In a Savings Account

The safest place to invest your cash will always be a basic savings account at your local bank. While most bank accounts will currently only return a couple of percent a year. I just checked with Clydesdale Bank and they are currently advertising up to 2% Gross/AER on a term deposit, which is higher than most easy access savings accounts. An Individual Savings Account (ISA) is an even better option as it is a more tax efficient way to invest your money, although you can only shelter up to £11,280 in ISAs.

2. Buy Some Shares of High Dividend Value Stocks

It’s true that some people are immediately turned off by the idea of investing in the stock market. For many people, the idea of investing in something that’s currently down is downright outrageous.

Investing would be silly if every publicly traded stock was falling, but that simply isn’t the case. There are many different varieties of stocks that are doing great right now. The stock market offers a high-risk, high-reward opportunity for investing your spare cash.

The only problem with investing in stocks is that you need to have enough cash to cover broker fees and other commission charges as well as the price of shares. You may also not be a stock market genius, which could further put you off from this idea.

3. Invest in a Mutual Fund

A mutual fund is one of the more “safe” investments you can put money into. Mutual funds work by having a company pool funds from a number of investors. This allows investments to be made at one time and in bulk, which makes it much cheaper to buy versus if you were to buy the same share of stocks. This company will then diversify its investments in several vehicles such as stocks, bonds and mutual funds. In turn, this is what makes mutual funds a bit safer to invest in.

While your mutual funds can differ depending on your individual agreement, you’ll earn a certain amount of money based on how well your investments do.

4. Lend Your Money to a Credit Union

If you join a local credit union, you can invest your money in a way very similar to the way banks set up loans. The added benefit you will find is that because credit unions are owned by their members, they can offer better interest rates. You’ll also see a larger share of the returns.

Two things you’ll want to look into when it comes to credit unions are the returns on savings accounts. Ensure that each has a higher interest rate than you’d get at your local bank.

Italy’s UniCredit raises €890m from sale of stake in Poland’s Bank Pekao

Italian financial group UniCredit SpA (BIT:UCG) said it had pocketed some EUR890m (USD1.2bn) from the sale of 9.1% in its Polish unit Bank Pekao SA (PINK:BKPKF).

The group sold around 23.9m Pekao shares at PLN156.00 (USD50.40/EUR37.14) apiece to institutional investors, it said. The price was 6% below the Pekao closing before this announcement and 4% lower than the average price over the last three months.

The sale generated a capital gain of about EUR135m to UniCredit, resulting in an increase in the group’s CT1 ratio BIS2.5 based on its weighted assets as at 30 September 2012.

Following the placement, the Italian bank remained with 50.1% in Pekao and will continue its commitment to the subsidiary and to the Polish market which is core to its franchise and strategy.

UniCredit, which agreed to a one-year lock-up period for its remaining stake in the Polish unit, said it does not expect to shed further Pekao shares after this sale.

UBS Limited, UniCredit CA-IB Poland and Citigroup Inc (NYSE:C) were in charge of the share placement

US hair products firm Vogue seeks buyers for Organix Hair Care unit

US hair and personal care products manufacturer Vogue International is looking to sell its Organix Hair Care unit, hoping to collect at least USD800m (EUR590m) in the process, Reuters reported.

Three people with knowledge of the matter told the news agency that Vogue International had brought in Goldman Sachs Group Inc (NYSE:GS) as adviser. They added that interested parties had been asked to submit their first-round offer earlier in January.

The sources speculated that Organix Hair Care was likely to attract bids from French cosmetics giant L’Oreal SA (EPA:OR), as well as Unilever Plc (LON:ULVR) and Procter & Gamble Co (NYSE:PG) – the respective owners of the Sunsilk and Pantene hair care brands.

Organix makes shampoos, body washes and body lotions. According to the sources, the brand delivers annual EBITDA of about USD80m.

Goldman would not comment for Reuters, while the rest of the companies mentioned could not be immediately reached.

Bank of England reports continued rise in mortgage approvals

Further signs are emerging of a recovery in the UK housing market, as the Bank of England said today that mortgage approvals rose again in December 2012.

The number of loan approvals for house purchases climbed to an 11-month high of 55,785, increasing for the fifth month in a row.

Analysts believe that the revival in the market is an indicator that the government’s Funding for Lending Scheme (FLS) has been successful in boosting lending. The scheme was launched at the start of August 2012 and was designed to encourage lending to households and growing businesses by allowing financial institutions to borrow at low interest rates.

Since the launch of FLS the number of mortgages on the market has increased and lenders have been reducing their mortgage rates, according to personal finance website This is Money.

Separate figures released today by the Building Societies Association show that, over the whole of 2012, mortgage lending by building societies and other mutual lenders grew to a total of GBP30.7bn. This is a 30% increase compared to the prior year.

Mutuals also represented a larger share of the overall lending market, taking a 22% market share of total new lending in the year, up from 17% in 2011. In December, total lending by mutuals increased to GBP2.4bn from GBP2.1bn a year earlier.

Adrian Coles, director-general of the Building Societies Association, said that mutual lenders such as building societies are likely to continue to play a prominent role in the mortgage market in 2013 and he pointed out that more than half of the 35 firms that were signed up to the Funding for Lending Scheme in December are mutuals.

Last week the Council of Mortgage Lenders (CML) reported that gross mortgage lending in December reached an estimated GBP11.7bn, taking the estimated total for the year to GBP143bn, up from GBP141bn in 2011. In the coming year the organisation forecasts that gross lending will reach GBP156bn.

The CML represents banks, building societies and other lenders who provide a combined 95% of all residential mortgage lending in the UK.

Citigroup seeks buyers for Brazilian credit card and consumer finance unit

US financial services group Citigroup Inc (NYSE:C) is looking to divest the Credicard consumer finance unit of its Brazilian business as part of a plan to concentrate on its strongest operations, the Valor Economico newspaper said today without citing sources.

According to the report, Citigroup has opened a data room to possible suitors with preliminary information about the unit. Credicard, with some 7m clients, could draw interest from some of Brazil’s biggest players including Banco PanAmericano SA (SAO:BPNM4), part of Banco BTG Pactual SA, Valor said, adding that a price tag had not been determined yet.

A public relations executive for Citigroup refused to comment on market speculation, when contacted by Reuters.

Recently, Valor cited Citigroup’s chief country officer Helio Magalhaes as saying in an interview that the group did not plan to sell Credicard.

US-based food group Hostess to sell Twinkies to private equity

US wholesale baker Hostess Brands Inc could soon announce a deal worth around USD400m (EUR296.2m) to divest certain snack cake brands such as Twinkies and Donettes to buyout firms Apollo Global Management LLC and C Dean Metropoulos & Co, two sources told Reuters.

The targeted activities also include the Dolly Madison bread and Hostess cupcakes brands.

The bankrupt company is currently picking stalking horse bidders for its various brands and activities. Previously, it agreed to sell most of its bread business plus the Beefsteak bread brand to Flowers Foods Inc (NYSE:FLO) in two separate transactions for up to USD360m and USD30m.

Furthermore, Hostess entered into an agreement to shed its Drake’s snack cake operation to McKee Foods Corp for USD27.5m as well as its Sweetheart, Eddy’s, Standish Farms and Grandma Emilie’s bread brands and some assets to United States Bakery Inc, also called Franz Family Bakery, for USD28.9m.

Other interested parties could still participate in an auction for these businesses and make better offers. According to the lead banker on the sale, Joshua Scherer of Perella Weinberg Partners, many parties have shown interest in Hostess’ assets, Reuters said.

Germany’s Siemens hires Rothschild to divest security products unit

German engineering group Siemens AG (ETR:SIE) intends to divest its Sweden-based security products business and has appointed investment bank Rothschild to advise it on the process, Bloomberg reported today citing three insiders.

The move is part of the company’s plan to sell slower-growth operations that are less synergistic with its core activities in a move to bolster its profits.

The target, which employs some 350 people, offers security cameras and access card readers, among other products. Last week, Roland Busch, head of the infrastructure and cities division, said that as a stand-alone entity, the security products business did not comply with the company’s focus on security solutions that are part of its building automation solution and therefore was not viable.

Siemens, whose shareholders already backed the planned spin-off of lighting maker OSRAM Licht AG, also intends to shed its airport luggage systems, mail automation and water technology businesses. Siemens spokesman Philipp Encz refused to comment on other possible sales of units. A spokesman for Rothschild also did not wish to comment.

Volvo to invest $900m in joint venture with Chinese truck maker Dongfeng

Swedish truck maker AB Volvo (STO:VOLV-B) said it would pay CNY5.6bn (USD900m/EUR669m) for 45% in a new venture with Chinese peer Dongfeng Motor Group Company Ltd (HKG:0489), or DFG, in a move that would convert Volvo into the largest global heavy-duty trucks maker.

The venture called Dongfeng Commercial Vehicles (DFCV) will comprise most of DFG’s medium- and heavy-duty commercial vehicles operations, the buyer said. The deal, part of a strategic alliance between the two groups, will enhance Volvo and DFG’s positions, while ensuring great opportunities for both of them.

Volvo will contribute technological expertise and global presence, providing a significant potential to DFCV to expand and make profits outside China.
In turn, the Swedish group will become co-owner of China’s largest heavy-duty and medium-duty truck manufacturer, securing economies scales in terms of sourcing, development and production for its truck business, it said.

Completion is anticipated to take place in 12 months, pending clearance from Chinese regulators, among other conditions.

On a pro-forma basis, DFCV had net revenues of some CNY39bn and an operating profit of around CNY1.2bn, from the sale of about 142,000 heavy-duty trucks and 49,000 medium-duty trucks in 2011. It has some 28,000 employees.

Japanese retailer Aeon hires banks to advise on Matahari deal

Japanese retailer Aeon Company Ltd (TYO:8267) and Thai The Central Group have appointed investment banks as advisors on a possible bid for Indonesian retailer PT Matahari Department Store, a portfolio company of UK private equity firm CVC Capital Partners Ltd, Reuters reported Friday, quoting unidentified sources in the know.

Central Group would act via a unit, Reuters said.

The investment company aims to sell the Indonesian retailer for as much as USD3.5bn (EUR2.6bn), the insiders told the agency.

According to a report by Reuters of October 2012, CVC had hired banks to help it offload its 80% interest in the Indonesian company.

CVC may also proceed with a public placement of its shares in Matahari if there are no suitors for the business before a tentative March deadline, Reuters noted. The private equity firm is pondering a share sale to institutional investors, which may fetch up to USD1.5bn, the sources told the agency.

CVC did not wish to comment on the matter, when reached by Reuters, while the tipped potential suitors denied plans for buying PT Matahari.