Hey I thought a fund in France had a little over 5% and said they would not tender. Now is NOK trying to pull a fast one on the holdouts and the ALU holders that tendered with the reserve up clause
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My first attempt at posting got deleted, so I will try it without any link.
There was an interesting detail in Nokia's press release at the end of the reopened tender offer period for ALU shareholders.
"3 February, 2016
Stock Exchange Release
February 3, 2016 at 18:35 (CET +1)
Nokia announces that the reopened offer period in its public exchange offer for Alcatel-Lucent securities has now closed... If Nokia reaches 95% ownership of the share capital and voting rights of Alcatel-Lucent, it intends to squeeze out the remaining shares. In addition, if Nokia reaches 95% ownership of Alcatel-Lucent's fully diluted shares, it intends to squeeze-out the remaining OCEANE convertible bonds. Any such squeeze-out must be implemented within 3 months of the closing of the Reopened Offer and will be subject to a clearance decision by the AMF. "
Tomorrow being May 3rd, it marks the 3-month deadline for implementing the squeeze-out. I have not seen any notice from Nokia that the 95% threshold has been met; what happens, if anything, after tomorrow comes and goes?
Let me know if you find anything about Europe, Jac. I get the sense that the European carriers which overspent for 3G spectrum and fell behind in 4G may be looking to 5G to catch up. The erratic nature of European sales for Ericsson and Nokia/ALU may mean that they are staggering their 4G upgrades as much as possible with the intent to use a more advanced iteration of LTE-Advanced (4.75G?) to leapfrog in 5G. They're also watching how ATT and Verizon virtualize their networks.
ATT, in particular, is also trying to change the bureaucratic nature of their workforce -- from a cost plus guaranteed return unionized mindset to a more customer-centric and entrepreneurial mindset -- and that may be the most difficult part of virtualization for these carriers.
Good find, Jac. Yep that's a brutal 18.3% decline from $67+B to $55+B.
The 30+% or so negotiated European quota --- Ericsson (~10%) + Nokia/ALU and Nokia/Huwei joint venture (~24%) -- of the 4G wireless portion of that total wireline/wireless capex budget is somewhat protected by the 2014 settlement agreement, which includes 5 years of monitoring by the EU.
Huawei (45+% China revenues) and ZTE (50+% China revenues) should bear the disproportionate portion of that significant capex decline unless the Chinese start to cheat again.
You mean, shotgun wedding, of course! And the bride is too old to be preggers and she has lots of baggage!
Verizon is the higher profile bidder for Yahoo but ATT (partnered with several private equity firms) is also in the hunt. I believe any Yahoo acquisition could change the nature of the winning bidder's capex because, among other things, they will have to hyperscale the data center nodes in their networks.
Barron's: " ... We are ever more confident telcos will shift capex from distributed boxes in the field, such as routers, to centralized data centers. AT&T is particularly vocal about its support for the SDN and NFV technologies that allow this…and of its desire to spend less on routing. Verizon, and by extension, plenty of other telcos, are not far behind ...
... Data centers are poised to accelerate cap ex plans for 2016. Data center operators, which include companies focused on managed cloud services, IaaS, OTT services, social networking, etc., are poised to grow 2016 cap ex by 18%, up from the 7% cap ex growth recorded in 2015. Prior to 2015, data center operators had been growing annual cap ex at a mid-teens-% dating back to the mid-2000’s
... Gartner recently published a market update report which speaks to the driving forces behind strong data center cap ex. According to Gartner, total worldwide spending on Public Cloud “services” is estimated to reach $318 billion by 2019, growing at a 16% CAGR in the 2014-2019 timeframe ... "
While the Dell’Oro Group predicts a global Telecom CapEx decline of 6% in 2016, it appears it may be 3x worse in China. Consider …
CapEx in CNY-Bil
Discussion: Telco equipment providers to the China Telcos will take a real hit in 2016. Is this just a bump in the road? Hardly. The rollout of 4G in China has matured and reached its peak in 2015, and it will be downhill from there until 2019 (our projection) when 5G begins to ramp up Telco CapEx – but don’t look for the heady CapEx days pre software-centric systems. Also, don’t look for only todays large equipment providers gorging on the future 5G CapEx budgets; there will be many more smaller specialized players in that sandbox.
Supporting the CapEx decline argument is Shang Bing, chairman of China Mobile, who pointed out that with the improvement of 4G network coverage, capital expenditure of China Mobile will greatly decline.
Looking at the 4G piece of the CapEx pie, consider the words of IHS researcher Stéphane Téral - “2015 was an almost US$11 billion peak year for LTE in China, but 2016 is set for double-digit decline because the massive LTE rollouts are over,” said Stéphane Téral, senior research director for mobile infrastructure and carrier economics at IHS. “In the long run, we expect the Chinese mobile infrastructure market to slow down further, declining at a CAGR of -27 percent from 2015 to 2020.”
Bottom line: OH ME, OH MY!!! … JD
Later you write: “I`m Getting in touch with The Better Business Bureau and The SEC this Monday May 2 and I may institute a class action suit…”
I suggest that you also contact the Department of Homeland Security and the Pope – and if they decline to support you – then I also suggest that you include them in your class action lawsuit … JD
Josh … During their conference calls, both AT&T($22B) and VZ($17.45B) reaffirmed their 2016 CapEx plans. During Q1/16 both companies spent less than a quarter of their annual budgets, AT&T($4.45B, 20%) and VZ($3.39B, 19%), so I agree with you in expecting that 2016 CapEx expenditure will be back-end loaded – which is typically the case in the US. The exception was in 2014 where it was front-end loaded. BTW, this gave the ALU Q4/15 Y/Y a positive bias – that, and a little financial engineering, made the bride look pretty for the upcoming wedding … Jac
From StreetInsider: “February 3, 2016 11:52 AM EST
The reopened offer period in Nokia's public exchange offer for Alcatel-Lucent securities in France and the United States (the "Reopened Offer") has now closed... If Nokia reaches 95% ownership of the share capital and voting rights of Alcatel-Lucent, it intends to squeeze out the remaining shares. In addition, if Nokia reaches 95% ownership of Alcatel-Lucent's fully diluted shares, it intends to squeeze-out the remaining OCEANE convertible bonds. Any such squeeze-out must be implemented within 3 months of the closing of the Reopened Offer and will be subject to a clearance decision by the AMF.” http://www.streetinsider.com/Corporate+News/Nokia+(NOK)+Announces+Closure+of+Recently+Reopened+Alcatel-Lucent+Exchange+Offer/11275587.html
May 3rd is tomorrow; what happens if the squeeze-out window passes without reaching 95%?