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MLPs are on track to have their third worst year in history and unlike all the other bad years, there's not a broader macro crisis going on at the same time.
This article came out today on Seeking Alpha and explains pluses and minuses of MLPs along with the current market sentiment on these. Also some good insights provided by some of the comments.
https://seekingalpha.com/article/4118647-irrational-investor-mlps-trading-unfundamentals
MLPs have been out of favor with investors this year and many have been selling their MLP fund shares. EPD is a major holding for these funds.
EPD also decreased the dividend rate of growth for the next six quarters from 4.6% to 2.3% in early October to eliminate the need to raise equity to fund their expansions as they have been doing for years due to the low value equity markets have been assigning to their units. IMO, this is a very positive move to prevent further unit dilution and more evidence of the exceptionally strong management team at EPD. This dividend growth rate cut has also been a contributing factor to the recent sell-off.
Earnings call is next week..The yield is near 7%, there is a 5% discount for DRIPs, and the US exports of energy and petrochemicals is just getting started. This is both a high yield and value play coupled with the tax advantages of an MLP.
Barron’s on EDP: MLP Promises Both Growth and Income
The stock market isn’t showing much respect. Investors should.
http://www.barrons.com/articles/an-mlp-that-promises-both-growth-and-income-1509160317
IMHO, EDP is screaming buy now for non-IRA holding with nearly 7% yield, the best management in the field, and uniquely positioned for the petrochemical surge that is taking quietly taking place in the US.
Good insights in this Barron’s Oct 28 article:
“The Houston outfit was early in recognizing that the U.S. shale boom would significantly boost production of natural gas liquids (NGLs), which account for more than half of profits. The company extracts NGLs from natural gas, transports them, and separates them into components, such as ethane and propane—a process called fractionation.
It has the only pipeline that carries ethane from the prolific Marcellus gas-producing region, centered in Pennsylvania, to the Gulf Coast. There, it operates the nation’s largest group of fractionators at the NGL hub at Mont Belvieu, Texas. Surging NGL production is fueling construction of large petrochemical plants on the Gulf Coast that will use ethane as the key input to produce ethylene for plastics. The company wouldn’t talk with Barron’s ahead of posting third-quarter earnings on Nov. 2.”
Ally Announces Normalization of Regulatory Capital Requirements at Ally Bank
Roll-off of $2.7 billion from Ally Bank to Ally Financial increases likelihood of high interest unsecured debt being paid off as scheduled over next several years.
https://media.ally.com/2017-08-22-Ally-Announces-Normalization-of-Regulatory-Capital-Requirements-at-Ally-Bank
Commitment to Maintain a Tier 1 Leverage Ratio of At Least 15% and Other Application Commitments Released
DETROIT, Aug. 22, 2017 /PRNewswire/ -- Ally Financial Inc. (NYSE: ALLY) today announced that the Federal Reserve has released Ally Bank from the capital, liquidity, and business plan commitments that had been made in connection with its application for membership in the Federal Reserve System, including the commitment to maintain a Tier 1 leverage ratio of at least 15%. Ally Bank may now manage its capital and liquidity subject to applicable regulatory requirements and, as a result, is expected to distribute a dividend of approximately $2.9 billion to Ally Financial Inc. during the third quarter of 2017.
"The release of these application commitments is a significant milestone for the company," said Ally Chief Executive Officer Jeffrey J. Brown. "This development completes the process of normalizing our regulatory framework, allowing us to optimize our capital and funding structure on a level playing field with other banks, and is a critical step in ensuring we remain on track for delivering on our financial and strategic objectives."
John Goodenough should have won the Chemistry Nobel over two decades ago...
https://mag.uchicago.edu/science-medicine/his-current-quest
Ally Announces Non-Objection to 2017 Capital Plan 9% Higher Share Repurchases and 50% Dividend Increase
https://media.ally.com/2017-06-28-Ally-Announces-Non-Objection-to-2017-Capital-Plan
$760 million in share repurchase during the Q3 17 - Q2 18 period represents 7.7% of current market cap. New dividend yield is 2.2%.
DETROIT, June 28, 2017 -- Ally Financial Inc. (NYSE: ALLY) today announced that the Federal Reserve did not object to the company's capital plan as part of the Comprehensive Capital Analysis and Review. Ally's capital plan includes the following actions:
A $0.04 increase in the quarterly cash dividend on common stock from $0.08 per share to $0.12 per share, expected to begin in the third quarter of 2017, subject to consideration and approval by the Ally Board of Directors; and
A 9% increase in the Company's share repurchase program, which has been authorized by the Ally Board of Directors, permitting the Company to repurchase up to $760 million of the company's common stock from time to time from the third quarter of 2017 through the second quarter of 2018.
"After initiating common capital distributions one year ago, we are very pleased to announce increases to both our common stock dividend and share repurchase program, reflecting the strength of our financial profile," said Ally Chief Executive Officer Jeffrey J. Brown. "We remain focused on driving long-term value for our shareholders, and efficiently managing capital is a critical component of that strategy."
Shares acquired under the repurchase program are expected to be used for general corporate purposes and may be available for resale, including in connection with the company's compensation and employee-benefit plans. The repurchase program enables the company to acquire shares through open market purchases or privately negotiated transactions, including through a Rule 10b5-1 plan, at the discretion of the company's management and on terms (including quantity, timing, and price) that the company's management determines to be necessary, appropriate, or advisable.
$153 million equity raise would save $25 million in interest over next two years and would complete the remaining 35% of 8.25% 2020 note that could be paid now via equity issuance.
Redemption options for the 2020 8.25% first lien note that CLF issued in March 2015 when things were in dire shape...
https://www.sec.gov/Archives/edgar/data/764065/000076406515000068/clf-2015331ex41.htm
1. Prior to March 31, 2018, up to 35% of the note can be redeemed using cash proceeds from an equity issuance (we might see more redemptions soon with new shelf).
2. Mar 2018 0 Mar 2019 redemptions are at 108.25%
3. Mar 2019 - June 30 2019 redemptions at 104.125%
4. After June 30, 2019, redemptions at 100%
The table reflects outstanding amounts left after the Mar 24 redemptions.
The 2020 8.25% note was $540 million initially and $35.6 million of that was just redeemed.
For the 2020 8.25% note, I believe anything redeemed prior to Jan 1, 2019 has to be redeemed at 108.25% of the principal.
CLF Total Debt $1.65 billion, $107 million annual interest
Maturity Outstanding Rate Annual Interest
3/15/20 $ 88,879,000 5.90% $ 5,243,861
3/31/20 $504,400,000 8.25% $ 41,613,000
10/1/20 $122,400,000 4.80% $ 5,875,200
4/1/21 $138,431,000 4.88% $ 6,748,511
3/1/25 $500,000,000 5.75% $ 28,750,000
10/1/40 $298,400,000 6.25% $ 18,650,000
Total Debt Yearly Interest
$1,652,510,000 $106,880,572
Ally Financial to Host March 21 Financial Outlook Conference Call
http://seekingalpha.com/pr/16770511-ally-financial-host-financial-outlook-conference-call
CHARLOTTE, N.C., March 14, 2017 /PRNewswire/ -- Ally Financial (ALLY) (NYSE: ALLY) will host a Financial Outlook conference call on Tuesday, March 21, from 9:00 a.m. – 10:00 a.m. EDT. The call will be hosted by Chris Halmy, chief financial officer, Brad Brown, corporate treasurer, and Dave Shevsky, chief risk officer.
Presentation materials will be available around 7:30 a.m. at http://www.ally.com/about/investor/ under the Events and Presentations section of the Investor Relations website.
Conference Call Information: Dial 844-530-6677 (or +1-508-637-5641 for international access) at least 10 minutes prior to the start time and enter the conference ID code 88224574. A live audio webcast will be available on the day of the conference at http://www.ally.com/about/investor/ under the Events and Presentations section of the Investor Relations website.
Archive: A taped replay of this call will be made available from 12:30 p.m. EDT on Mar. 21, 2017, until Mar. 28, 2017. Please dial 855-859-2056 (or +1-404-537-3406 for international access) and enter the conference ID code 88224574 to access the taped replay. A replay of the webcast will also be made available on the Ally Investor Relations website.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/ally-financial-to-host-financial-outlook-conference-call-300423256.html
SOURCE Ally Financial
Unfortunately, preemptive strikes are rapidly becoming the only viable solution..
We have Bill Clinton to thank for giving NK the freedom to develop nuclear weapons...
US household net worth has been rising ~7-8% annually for a number of years
http://www.zerohedge.com/news/2016-09-16/household-net-worth-hits-record-89-trillion-there-just-one-catch
Fed's Z.1 release provides balance sheets for sectors of the U.S. economy. One key one is Table B.101, "Balance sheet of households and non-profit organizations".
In 3Q2015, the top line of the US household sector stood just under $100 trillion
• Household sector net worth was ~$85 trillion
• ~$15 trillion in household sector debts.
• U.S. household sector net worth was 34% of the worldwide total.
Assets
• $30.6 trillion in non-financial assets - $25 trillion in real estate, $5 trillion in "consumer durables", mostly cars
• Deposits were $10.4 trillion, only 10% of overall assets.
• Biggest equity line items were $20.64 trillion in pension fund entitlements,
• Directly owned stock was $12.7 trillion; mutual fund shares add $7.9 trillion.
• Small business equity adds $10 trillion in wealth,
Note: Equity assets are ~twice value of real estate which is ~twice value of deposits
Liabilities
- $14.386 trillion in debts, with 2/3rd in home mortgages - $9.46 trillion
Consumer Debt
- Auto loans outstanding at $1.071 trillion as of the end of the 2Q2016
- Student loans are up to a level of $1.364 trillion
- Revolving credit (primarily credit cards) $975 billion
LG has publicly stated his goal of getting LT debt down to $1 billion, between this~ $500 million equity raise and 2017 expected cash flows, he could well attain this by the end of the year. When fully exercised, this would be a ~25% dilution. IMO, another solid play by LG.
CLF was up $1.85 today; a larger amount than the $1.62 & $1.64 prices the stock was selling at on Jan 29, 2016.
Ally Financial up 15.34% since Monday's close
Ally Financial was up:
2.57% today
2.50% Thursday
2.27% Wednesday
7.26% Tuesday.
This bank is still undervalued.
Ally Financial Is The Cheapest Bank Around
http://seekingalpha.com/article/4041515-ally-financial-cheapest-bank-around
This is still the case. In a down market week, Ally Financial was up 2.50% today, 2.27% yesterday, and 7.26% Tuesday. Over 12.4% increase since Monday. Earnings call gave the same news as last quarter. Investors are starting to listen; this still has a way to run.
Ally has a tremendous leadership team and a well thought out business plan which they have been executing for some time. They have also been buying back 7-8% of their stock annually since the price is so low. The SA article does a superb job laying out what they are doing. Think startup mentality with the aggressive steps they are taking.
Ally Financial +7% after earnings beat
Ally (formerly known as GMAC) currently has the makings of a startup company staffed by active entrepreneur-executives in Charlotte with significant Bank of America experience. Brand new bank of the future with no branches, new credit card, new mortgage and acquired brokerage/wealth management businesses. Deposits in rapidly growing branchless bank will be replacing expensive unsecured long-term debt over next several years. This company knows ins and outs of auto loan business and very effective at managing risk in that arena. ALLY is also buying back 7-8% of its shares annually. IMO, no brainer long-term investment at these valuations...
http://seekingalpha.com/news/3239234-ally-financial-plus-7-percent-earnings-beat
Ally Financial Reports Full Year and Fourth Quarter 2016 Financial Results
Full Year 2016 Net Income of $1.1 billion, $2.15 EPS, $2.16 Adjusted EPS1
Fourth Quarter Net Income of $248 million, $0.52 EPS, $0.54 Adjusted EPS1
https://www.multivu.com/players/English/8028451-ally-financial-full-year-and-fourth-quarter-2016-results/docs/press-release-1033468661.pdf
Just unloaded all AAPL shares bought years ago when undervalued. Majority of AAPL revenues are from iPhones which people are keeping 3-4 years vs 18-24 months before. Also, AAPL faces significant future risk / uncertainty in China. Would consider reentry if price falls back below $80.
wc21
Tim Cook?
Former PCL CEO Rick Holley recently sold nearly half his WY shares for $19.8. million on Jul 26. Could be significant...
http://www.tradecalls.org/2016/08/courier-capital-corp-lowers-stake-in-weyerhaeuser-co-wy-353907/
Holley sold 608,000 shares of Weyerhaeuser stock in a transaction dated Tuesday, July 26th. The shares were sold at an average price of $32.55, for a total transaction of $19,790,400.00. Following the completion of the transaction, the director now directly owns 696,488 shares in the company, valued at $22,670,684.40.
WY at $32.80 is equivalent to a $52.48 PCL share price with the 1.6 conversion.
Weyerhaeuser and Plum Creek to merge
Under the terms of the agreement...Plum Creek shareholders will receive 1.60 shares of Weyerhaeuser for each share of Plum Creek held. This fixed exchange ratio represents an implied premium of 13.8% to the 30-trading-day Volume Weighted Average Price ratio of Plum Creek shares to Weyerhaeuser shares.
http://phx.corporate-ir.net/phoenix.zhtml?c=68740&p=irol-newsArticle_print&ID=2110195
Weyerhaeuser and Plum Creek to merge, creating the world's premier timber, land and forest products company
Combination of two industry leaders to create a $23 billion timber REIT with more than 13 million acres of the most productive and diverse timberland in the U.S.
All-stock transaction followed by $2.5 billion post-closing share repurchase
Total annual cost synergies of $100 million
Funds Available for Distribution per share accretion in the first full year
Rick R. Holley to be non-executive chairman; Doyle R. Simons to be president and CEO
Weyerhaeuser to review strategic alternatives for its Cellulose Fibers business, as announced in a separate news release today
Weyerhaeuser Company (NYSE: WY) and Plum Creek (NYSE: PCL) today announced they have entered into a definitive agreement to create the world's premier timber, land and forest products company with more than 13 million acres of the most productive and diverse timberland in the U.S. At closing, the combined company is expected to have an equity value of $23 billion based on current share prices. The combined EBITDA for both companies in 2014 was $2.2 billion.
Under the terms of the agreement, which has been unanimously approved by the boards of directors of both companies, Plum Creek shareholders will receive 1.60 shares of Weyerhaeuser for each share of Plum Creek held. This fixed exchange ratio represents an implied premium of 13.8% to the 30-trading-day Volume Weighted Average Price ratio of Plum Creek shares to Weyerhaeuser shares. Following closing, Weyerhaeuser and Plum Creek shareholders will own approximately 65% and 35%, respectively, of the combined company's common stock. Weyerhaeuser intends to execute a $2.5 billion share repurchase shortly after closing. The repurchase will result in a net financial impact on the company that is as if the deal were structured with approximately 70% stock and 30% cash. The combined company expects to maintain Weyerhaeuser's current annual dividend of $1.24 per common share, representing a 13% dividend increase to the dividend currently received by Plum Creek shareholders.
"With an extraordinary set of combined assets and the proven value creation records of both Weyerhaeuser and Plum Creek, the combined company will offer a compelling opportunity for shareholders," said Rick R. Holley, chief executive officer for Plum Creek. "These two companies are already best-in-class timberland managers with a relentless focus on sustainable resource management. The breadth and diversity of our combined land and timber assets uniquely position the new company to capitalize fully on the improving housing market, continue to capture Higher and Better Use land values across the combined portfolio, and create additional opportunities to build lasting value. Doyle Simons and I share a commitment to disciplined capital allocation and sustained value creation, and I look forward to working together as we build a great new company."
"We're excited to combine the two leaders in our industry to create the world's premier timber, land and forest products company," said Doyle R. Simons, president and chief executive officer of Weyerhaeuser. "This new company will create tremendous benefit for shareholders as we drive value through shared best practices, economies of scale, cost synergies, operational excellence and disciplined capital allocation. Our customers and employees will also benefit as we form a winning team with common values and unparalleled expertise in timber, land and manufacturing. I have the utmost respect for Rick Holley and the Plum Creek team and look forward to working together to successfully integrate these two outstanding companies."
The merger of Weyerhaeuser and Plum Creek creates a winning combination with:
The largest private ownership of timberland in the U.S.
More than 13 million acres of diverse, productive forests
The ability to drive performance through shared best practices and economies of scale
A unique ability to capitalize on the housing recovery
Significant Higher and Better Use potential across the combined portfolio
A best-in-class management team
A recognized commitment to sustainable resource management
Low-cost manufacturing assets
A strong balance sheet and a commitment to an investment grade credit rating
Anticipated annual cost synergies of $100 million
Accretion to per-share Funds Available for Distribution in the first full year following closing
An attractive dividend
A disciplined approach to capital allocation
Rick Holley will serve as non-executive chairman of Weyerhaeuser's board, which will be expanded to 13 directors. Eight directors will be from Weyerhaeuser (including Simons) and five directors will be from Plum Creek (including Holley).
Doyle Simons will serve as president and CEO of the combined company. Upon closing, the executive team will include:
Rhonda Hunter, Senior Vice President, Timberlands
Tom Lindquist, Executive Vice President, Real Estate, Energy & Natural Resources
Adrian Blocker, Senior Vice President, Wood Products
Russell Hagen, Senior Vice President, Chief Financial Officer
Devin Stockfish, Senior Vice President, General Counsel & Corporate Secretary
Denise Merle, Senior Vice President, Human Resources
Tim Punke, Senior Vice President, Corporate Affairs
"We've drawn from the best talent in each company to select a leadership team with unmatched expertise in the industry," said Simons. "I'm confident these are the right leaders to take best practices from both companies to achieve our targets, serve our customers, and drive shareholder value over the long term."
The transaction requires the approval of shareholders of both Weyerhaeuser and Plum Creek and is subject to customary closing conditions. The transaction is expected to close in late first quarter or early second quarter of 2016. The combined company will retain the Weyerhaeuser name and continue to be traded under the WY ticker symbol on the New York Stock Exchange. As previously announced, Weyerhaeuser intends to move its headquarters to Seattle in mid-2016.
In a separate news release, Weyerhaeuser announced that its board of directors has authorized the exploration of strategic alternatives for its Cellulose Fibers business. Cathy Slater will continue to lead this business as senior vice president of Cellulose Fibers throughout the review process.
For Weyerhaeuser, Morgan Stanley & Co. LLC is serving as financial advisor and Cravath, Swaine & Moore LLP is serving as legal counsel.
Goldman Sachs is serving as lead financial advisor to Plum Creek. BofA Merrill Lynch is also serving as a financial advisor to the company. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel.
Conference Call
The management of both companies will hold a joint conference call at 8:30 a.m. Eastern Time (5:30 a.m. Pacific Time) on Monday, Nov. 9, 2015, to discuss the announcement. To access the live webcast and presentation online go to www.weyerhaeuser.com or www.plumcreek.com on Nov. 9. To join the conference call from within North America, dial (877) 296-9413 (access code – 78061007) at least 15 minutes prior to the call. Those calling from outside North America should dial (706) 679-2458 (access code – 78061007). Replays will be available for one week at (855) 859-2056 (access code – 78061007) from within North America and at (404) 537-3406 (access code – 78061007) from outside North America.
About Weyerhaeuser
Weyerhaeuser Company began operations in 1900 and is one of the world's largest private owners of timberlands. It owns or controls nearly 7 million acres of timberlands, primarily in the U.S., and manages additional timberlands under long-term licenses in Canada. The company manages these timberlands on a sustainable basis in compliance with internationally recognized forestry standards. Weyerhaeuser is also one of the largest manufacturers of wood and cellulose fibers products. The company is a real estate investment trust. In 2014, its continuing operations generated $7.4 billion in sales and employed approximately 12,800 people who serve customers worldwide. Weyerhaeuser is listed on the Dow Jones World Sustainability Index and its common stock trades on the New York Stock Exchange under the symbol WY. Learn more at www.weyerhaeuser.com.
About Plum Creek
Plum Creek is among the largest and most geographically diverse private landowners in the nation with more than 6 million acres of timberlands in 19 states. The company also operates wood products mills in the Northwest. Plum Creek manages its working forests using sustainable practices to benefit its many stakeholders. Plum Creek employees work together to create shareholder value, serve as stewards of the environment, make wood products for everyday use, and build strong communities. The company is a real estate investment trust. Please visit http://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.plumcreek.com&esheet=51184453&newsitemid=20150918005827&lan=en-US&anchor=www.plumcreek.com&index=1&md5=725c8570755b4cfd839d674906d6e668 for the latest information about Plum Creek.
FORWARD-LOOKING STATEMENTS
This communication contains statements that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, without limitation, with respect to Weyerhaeuser's and Plum Creek's future results and performance, the expected benefits of the proposed transaction such as efficiencies, cost savings and growth potential and the expected timing of the completion of the transaction, all of which are subject to risks and uncertainties. Factors listed below, as well as other factors, may cause actual results to differ significantly from these forward-looking statements. There is no guarantee that any of the events anticipated by these forward-looking statements will occur. If any of the events occur, there is no guarantee what effect they will have on company operations or financial condition. Neither Weyerhaeuser nor Plum Creek will update these forward-looking statements after the date of this communication.
Some forward-looking statements discuss Weyerhaeuser's and Plum Creek's plans, strategies, expectations and intentions. They use words such as "expects," "may," "will," "believes," "should," "approximately," "anticipates," "estimates," and "plans." In addition, these words may use the positive or negative or other variations of those and similar words.
Major risks, uncertainties and assumptions that affect Weyerhaeuser's and Plum Creek's businesses and may cause actual results to differ materially from those expressed or implied in these forward-looking statements, including, without limitation, the failure to receive, on a timely basis or otherwise, the required approval of Weyerhaeuser's shareholders or Plum Creek's stockholders with respect to the proposed transaction; the risk that any of the conditions to closing of the proposed transaction may not be satisfied; the risk that the businesses of Weyerhaeuser and Plum Creek will not be integrated successfully; the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages, and strength of the U.S. dollar; market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; performance of our manufacturing operations, including maintenance requirements; the level of competition from domestic and foreign producers; the successful execution of internal performance plans, including restructurings and cost reduction initiatives; raw material prices; energy prices; the effect of weather; the risk of loss from fires, floods, windstorms, hurricanes, pest infestation and other natural disasters; transportation availability and costs; federal tax policies; the effect of forestry, land use, environmental and other governmental regulations; legal proceedings; performance of pension fund investments and related derivatives; the effect of timing of retirements and changes in the market price of company stock on charges for stock-based compensation; changes in accounting principles; and other factors described in Weyerhaeuser's and Plum Creek's filings with the SEC, including the "Risk Factors" section in Weyerhaeuser's and Plum Creek's respective annual reports on Form 10-K for the year ended December 31, 2014.
NO OFFER OR SOLICITATION
This communication is neither an offer to purchase, nor a solicitation of an offer to sell, subscribe for or buy any securities or the solicitation of any vote or approval in any jurisdiction pursuant to or in connection with the proposed transaction or otherwise, nor shall there be any sale, issuance or transfer of securities in any jurisdiction in contravention of applicable law.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
The proposed transaction involving Weyerhaeuser and Plum Creek will be submitted to Weyerhaeuser's shareholders and Plum Creek's stockholders for their consideration. In connection with the proposed transaction, Weyerhaeuser intends to file with the SEC a registration statement on Form S-4 (the "Registration Statement"), which will include a prospectus with respect to Weyerhaeuser's common shares to be issued in the proposed transaction and a joint proxy statement for Weyerhaeuser's shareholders and Plum Creek's stockholders (the "Joint Proxy Statement") and each of Weyerhaeuser and Plum Creek will mail the Joint Proxy Statement to their respective shareholders or stockholders, as applicable, and file other documents regarding the proposed transaction with the SEC. SECURITY HOLDERS ARE URGED AND ADVISED TO READ ALL RELEVANT MATERIALS FILED WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT AND THE JOINT PROXY STATEMENT, CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION AND RELATED MATTERS. The Registration Statement, the Joint Proxy Statement and other relevant materials (when they become available) and any other documents filed or furnished by Weyerhaeuser or Plum Creek with the SEC may be obtained free of charge at the SEC's web site at www.sec.gov. In addition, security holders will be able to obtain free copies of the Registration Statement and the Joint Proxy Statement from Weyerhaeuser upon written request to Weyerhaeuser Company, 33663 Weyerhaeuser Way South, Federal Way, Washington 98003, Attention: Director, Investor Relations, or by calling (253) 924-2058, or from Plum Creek upon written request to Plum Creek, 601 Union Street, Suite 3100, Seattle Washington 98101, Attention: Investor Relations, or by calling (800) 858-5347.
PARTICIPANTS IN THE SOLICITATION
Weyerhaeuser, Plum Creek, their respective directors and certain of their respective executive officers and employees may be deemed to be participants in the solicitation of proxies in connection with the proposed transaction. Information about Weyerhaeuser's directors and executive officers is set forth in its definitive proxy statement for its 2015 Annual Meeting of Shareholders, which was filed with the SEC on April 1, 2015, and information about Plum Creek's directors and executive officers is set forth in its definitive proxy statement for its 2015 Annual Meeting of Stockholders, which was filed with the SEC on March 26, 2015. These documents are available free of charge from the sources indicated above, and from Weyerhaeuser by going to its investor relations page on its corporate web site at www.weyerhaeuser.com and from Plum Creek by going to its investor relations page on its corporate web site at http://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.plumcreek.com&esheet=51184453&newsitemid=20150918005827&lan=en-US&anchor=www.plumcreek.com&index=1&md5=725c8570755b4cfd839d674906d6e668.
Additional information regarding the interests of participants in the solicitation of proxies in connection with the proposed transaction will be included in the Registration Statement, the Joint Proxy Statement and other relevant materials Weyerhaeuser and Plum Creek intend to file with the SEC.
Weyerhaeuser Contacts
Analysts & Investors: Beth Baum, 253-924-3815
Financial Media: Dan Katcher, 212-355-4449
Regional Media: Anthony Chavez, 253-924-7148
Plum Creek Contacts
Analysts & Investors: John Hobbs, 206-467-3628
Regional Media: Kathy Budinick, 206-467-3620
AAPL is buying back 15% of their stock...
Right now, RDS-A is nearly two dollars cheaper!
RDS.B 67.46
RDS.A 65.62
wc21
"PS Pure speculation on my part - but one possible way to get around this patent might be to use a different subclass (or subclasses) as the proxy for enox status. E.g. perhaps using octasaccharides and hexasaccharides as an adequate proxy instead of tetra. But of course it would take substantial time to prove to the FDA that that new proxy was, in fact, adequate."
Claims 3 and 4 of the 466 patent cover a number of other subclasses to include both octasaccharides and hexasaccharides; claim 4 provides a table of allowable amounts. Claims 3 and 4 of the 466 patent are the only ones with the term "determining" in them and may be most pertinent for this case.
wc21
Claims 3 and 4:
3. The method of claim 2, wherein the method further comprises determining if the enoxaparin preparation has a fraction distribution profile of dodecasaccharides, decasaccharides, octasaccharides, hexasaccharides and tetrasaccharides, as shown in FIG. 2.
4. The method of claim 2, wherein the method further comprises determining if one or more fractions shown in the following tables are present or present in an amount shown in the following tables.
Distribution by Range A Range B Range C % Height of % Height of % Height of % Height of HPLC peaks HPLC peaks HPLC peaks HPLC peaks Tetrasaccharides 14.8 17.8 14.1 18.8 12.5 20.4 Hexasaccharides 21.2 23.9 20.8 23.9 19.7 24.9 Octasaccharides 21.6 22.7 21.5 22.8 21.1 23.3 Decasaccharides 19.8 21.2 19.7 21.5 19.1 22.0 Dodecasaccharides 17.6 19.3 17.3 19.6 16.5 20.3 Distribution by Range A Range B Range C % Area under % Area under % Area under % Area under HPLC curve HPLC curve HPLC curve HPLC curve Tetrasaccharides 9.8 12.3 9.1 12.5 8.0 13.7 Hexasaccharides 18.8 20.4 18.4 20.6 17.6 21.3 Octasaccharides 16.8 17.4 16.6 17.5 16.3 17.9 Decasaccharides 13.0 14.1 12.9 14.4 12.4 14.9 Dodecasaccharides and 34.0 38.8 33.4 39.9 31.3 42.0 higher size chains
info on claims 1 and 2...
Claim 1 is for an hplc method for enox prep analysis of a tetrasaccharide mixture to detect specific chains and allowable amounts that are then tabulated in claim 1.
Claim 2 is for an FPLC method to separate out the tetrasaccharides.
"What is claimed is:
1. A method of analyzing an enoxaparin preparation, comprising: providing an isolated tetrasaccharide fraction from a size fractioned enoxaparin preparation; analyzing the tetrasaccharide fraction using strong anion exchange high performance liquid chromatography (HPLC) to determine if one or more chains shown in the following table is present or is present in amount identified in the following table:......(table omitted here)
2. The method of claim 1, wherein the tetrasaccharide fraction is fractionated using fast protein liquid chromatography"
Wc21
Here are the claims that cover "determining". Essentially if any other analytical method is used to analyze any of the components in the table, the 466 patent covers that. I am assuming that fplc and hplc are also being used in sample separation or analysis. Determining is a broad definition that would cover any other separation method such as capillary electrophoresis (CE).
"3. The method of claim 2, wherein the method further comprises determining if the enoxaparin preparation has a fraction distribution profile of dodecasaccharides, decasaccharides, octasaccharides, hexasaccharides and tetrasaccharides, as shown in FIG. 2.
4. The method of claim 2, wherein the method further comprises determining if one or more fractions shown in the following tables are present or present in an amount shown in the following tables. TABLE-US-00008 Distribution by Range A Range B Range C % Height of % Height of % Height of % Height of HPLC peaks HPLC peaks HPLC peaks HPLC peaks Tetrasaccharides 14.8 17.8 14.1 18.8 12.5 20.4 Hexasaccharides 21.2 23.9 20.8 23.9 19.7 24.9 Octasaccharides 21.6 22.7 21.5 22.8 21.1 23.3 Decasaccharides 19.8 21.2 19.7 21.5 19.1 22.0 Dodecasaccharides 17.6 19.3 17.3 19.6 16.5 20.3 Distribution by Range A Range B Range C % Area under % Area under % Area under % Area under HPLC curve HPLC curve HPLC curve HPLC curve Tetrasaccharides 9.8 12.3 9.1 12.5 8.0 13.7 Hexasaccharides 18.8 20.4 18.4 20.6 17.6 21.3 Octasaccharides 16.8 17.4 16.6 17.5 16.3 17.9 Decasaccharides 13.0 14.1 12.9 14.4 12.4 14.9 Dodecasaccharides and 34.0 38.8 33.4 39.9 31.3 42.0 higher size chains
5. The method of claim 1, wherein the presence or amount of one or more of a tetrasaccharide that includes five or six sulfate groups, 0 or 1 galacturonic acids, a mannosamine or glucosamine at the reducing end, a .DELTA..sup.4,5 double bond at the non-reducing end, and a 1,6 anhydro structure is determined. "
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Complex Biologics: The View from Teva
Sep 1, 2011 By: Dr. Jill Conner
PHARMACEUTICAL EXECUTIVE
[Here is a recent article from a TEVA scientist pushing for clinical trials prior to approval of any generic forms of Copaxone]
"Given the inability to fully characterize the active ingredients of Copaxone, any purported generic version must be studied in preclinical testing and full-scale, placebo-controlled clinical trials with measured clinical endpoints (such as relapse rate and disability accumulation) in MS patients to establish safety, efficacy, and immunogenicity."
http://pharmexec.findpharma.com/pharmexec/Company+Profiles/Complex-Biologics-The-View-from-Teva/ArticleStandard/Article/detail/739258?contextCategoryId=39722
The Hatch-Waxman Act (Drug Price Competition and Patent Term Restoration Act), introduced in 1984, was a revolutionary piece of legislation that paved the way for the approval of small-molecule generic drugs offering patients safe, efficacious, and cost effective therapeutic options. Generic therapies continue to be an important treatment option, but as new, complex medications come to market, it's important that follow-on versions are properly evaluated to ensure patient safety.
Last year, the Affordable Care Act enacted a pathway for biosimilar drugs to address the approval of these increasingly complex products. The FDA must now work to implement this new law and the framework for approval of products deemed "biosimilar" or "interchangeable." The new pathway, however, is mostly silent as to the treatment of non-biologic complex drugs (NBCDs), such as glatiramoids and liposomal drugs. For the next 10 years, any follow-on versions of biologic products and NBCDs will be approved under the Federal Food, Drug, and Cosmetic Act, if the innovative product was approved under that pathway. After 10 years, all biologics, follow-on and innovator, will be approved or deemed approved under the Public Health Service Act. A wide range of industry experts have provided recommendations to the FDA surrounding the approval pathway for these types of therapies; most recently, several global experts convened at a workshop in Leiden, Netherlands, to discuss the necessary requirements, with a specific focus on the importance of balancing the safety and immunogenicity concerns associated with certain complex drugs against an approach that encourages competition in the market.
What's the Catch?
There are many reasons why the approval pathway for follow-on biologics and NBCDs should differ from those of small-molecule compounds. Most small-molecule drugs are low-molecular-weight organic compounds that can be easily characterized and have a known active moiety. In contrast, biologics and NBCDs are complex therapies that are manufactured using living organisms or chemically synthesized proteins. They are far more complex than most small-molecule chemical drugs and can possess not only primary structures, but secondary and tertiary structures as well. Because biologics and NBCDs are more difficult to characterize, unwanted or unplanned immune responses might occur, leading to a loss of efficacy or severe side effects. For these reasons, the Hatch-Waxman Act guidelines may suffice for generic approval of small molecule compounds without safety concerns, but they do not properly consider complex drugs.
As Dr. Janet Woodcock, Director of the FDA's Center for Drug Evaluation and Research (CDER) has observed, "Unlike small molecule drugs, whose chemical composition can easily be determined to be the same as an approved product, the very nature of protein products makes comparisons of one protein to another, including establishing safety and efficacy, more scientifically challenging. Because of the variability and complexity of [these] molecules, current limitations of analytical methods, and the difficulties in manufacturing a consistent product, it is unlikely that, for most proteins, a manufacturer of a follow-on protein product could demonstrate that its product is identical to an already approved product. Therefore, the section 505(j) generic drug approval pathway, which is predicated on a finding of the same active ingredient, will not ordinarily be available for protein products."
Per Dr. Woodcock's observations, generic versions of biologics and NBCDs are typically shown to be similar to, but not identical to the reference product. As such, it is highly unlikely that the active substances are identical between the reference and follow-on product. Additionally, analytical techniques are not available to establish biopharmaceutical equivalence between generics and their biological or NBCD counterpart. Therefore, additional considerations are needed when determining an approval pathway for generic versions of biologics and NBCDs to ensure that safety, efficacy, and immunogenicity concerns are appropriately addressed.
One such example can be seen with the glatiramoid class of drugs, including Copaxone, which is manufactured by my company, Teva. Copaxone is classified as a complex, chemically synthesized heterogeneous mixture of polypeptides with immunomodulatory activity. The actual active sequences, or structures (epitopes) responsible for the efficacy and safety of the product, are unknown. It is currently impossible to isolate and identify the active amino acid sequences in Copaxone, even using the most technologically sophisticated multidimensional separation techniques. Furthermore, Copaxone's mechanisms of action, and their specific effects on the immune system, are still not fully elucidated.
When Teva pursued development of a new glatiramoid product—protiramer—the company found that even slight changes in the manufacturing process led to systemic toxicity and caused extensive fibrosis, organ damage, eosinophilia, and death in animals. These signs were never observed in similar preclinical studies involving lower molecular weight glatiramer acetate. Given the inability to fully characterize the active ingredients of Copaxone, any purported generic version must be studied in preclinical testing and full-scale, placebo-controlled clinical trials with measured clinical endpoints (such as relapse rate and disability accumulation) in MS patients to establish safety, efficacy, and immunogenicity.
Establishing Parameters
Liposomal drugs are another example of complex products in which clear guidelines will be necessary to determine the safety of generics. Liposomes are known to have a broad array of differing molecules, which vary in physiochemical properties. Some examples, such as Doxil or Myocet, include marketed intravenous formulations of anthracyclines, or a class of drugs used in cancer chemotherapy derived from a certain bacteria, encapsulated in liposomes. These types of compounds differ from one another because of the many possibilities to vary the composition and characteristics including size, charge, bilayer fluidity, number of bilayers, hydrophilicity of the external surface, and the attachment of hydrophilic polymers and/or targeting ligands to the external surface. The main factor in determining the safety and efficacy of these products is through the rate and extent of the drug release from the liposomal particles. For this reason, bioequivalence between generic liposomes and the reference product should surround the release profile of the two therapies. Furthermore, the FDA has expressed concern that generic versions of these types of drugs may, in fact, represent a completely new complex drug profile. As with all generics, a generic liposome product should have the same characteristics as the innovative product; therefore, the parameters established for these drugs need to be carefully addressed.
It has been argued that even if adequate technology is available to evaluate preclinical analytic data for products that demonstrate interchangeability, it may still be difficult to ensure that the same dose of a generic product and its innovator are truly equivalent. The EMA and other regulatory bodies have adopted a biosimilar approval pathway that requires clinical trials to show therapeutic equivalence. However, for more complex drugs like glatiramoids, regulatory guidance is still undefined. The FDA is currently working on guidance regarding the approval pathway for biosimilars and should take the EMA guidelines and insights from industry experts into consideration. A single regulatory pathway meant to encompass all biologics and NBCDs may be untenable. For example, some therapies may not require clinical trials to show substitutability while others may. To protect patients, both the therapy and disease mechanism of action need to be considered.
The small-molecule generic approach should be limited to products that can be fully characterized, with established efficacy. For highly complex products, like glatiramoids, where guidance does not exist, the biosimilar-like approach outlined by the EMA should be applied, which includes full documentation of quality; inclusion of preclinical and clinical data; and a comparison between the reference and generic product in terms of quality, safety, and efficacy. Special emphasis should also be given to immunogenicity issues.
As US regulatory authorities grapple with the many considerations involved in developing guidance for the approval of follow-on biologics, they should take into consideration the unique sensitivities associated with highly complex drugs, like NBCDs. By referencing the EMA biosimilar pathway, the FDA has a foundation from which to build, as the agency works toward a US regulatory process. Clinical data may be necessary for follow-on biologic and NBCD applications, but should not delay the approval process if the reference product can be fully characterized.
Jill B. Conner, PhD, is Director of Medical Affairs and Medical Operations at Teva Neuroscience. She can be reached at Jill.Conner@tevapharm.com [jill.conner@tevapharm.com]
Jill B. Conner, PhD
MNTA COO Brugger sells 32,200 shares on 03/09/2010 at an average price of $15.17 a share.
http://www.gurufocus.com/news.php?id=87132
Aria is a complete design disaster; vegas insiders are taking bets on when it will close. Not sure what MGM's exposure to this property is...
The Elvis cirque show also has major problems.
wc21
Moynihan new BAC CEO; how long before HQ move?
http://tinyurl.com/ykyzymj
Charlotte Business Journal
Wednesday, December 16, 2009, 8:14pm EST
BofA names Moynihan as new CEO
Bank of America Corp.’s board has named Brian T. Moynihan as chief executive and president of the company. He will assume the office and join the board following the retirement of Ken Lewis on Dec. 31.
BofA spokesman Bob Stickler says the board voted unanimously to promote Moynihan to the post. His office will be in Charlotte and the bank’s headquarters will remain here, Stickler says. Moynihan, 50, had been based in Boston.
Moynihan has held senior leadership positions at BofA representing experience across virtually all business lines. He currently is president of Consumer and Small Business Banking, which has relationships with about 53 million households and small businesses across the United States.
“Brian’s wide range of experience, his relationships inside and outside of the company, and his demonstrated ability to understand business dynamics and effect constructive change made him the best person for the position,” Walter Massey, BofA chairman, said in a statement.
Massey led a search that considered both internal and external candidates. “Brian has been the top executive leading wealth management, corporate and investment banking and consumer banking. His work with international clients in our capital markets businesses has given him broad knowledge of and perspective on global financial services markets. He has excelled in every role, earning the loyalty and respect of customers and associates alike. In short, Brian brings the right combination of knowledge, experience and leadership to achieve all of our company’s goals for the future.
“While we considered external candidates,” Massey added, “the board decided after listening to shareholders, regulators and others that Brian’s experience was commensurate with or better than any of those candidates, and he offered the advantage of a smooth transition. Bank of America has a talented team, and one of our principal jobs as directors is to support that team as it goes about creating value for all of our constituencies.”
Moynihan, who was named to his current role earlier this year, joined FleetBoston Financial (a predecessor to Bank of America) in 1993. He subsequently rose to senior positions at that company. Fleet was acquired by BofA (NYSE:BAC) in 2004.
“I am honored to have the opportunity to lead this important company,” Moynihan said in a statement. “We have everything we need at Bank of America to be the best financial services company in the world. We have leading positions in every important sector and market. We have capabilities that I believe match or exceed all our competitors. We have the right values and culture, and we have an unbelievably dedicated management team and associate base.
“What we need to do now is very simple,” Moynihan continued. “We need to execute. This company has a long tradition of operational excellence and strong execution. My goal is to refocus our efforts and attention on those core capabilities that will make us the best financial services firm in the world.”
Earlier this week, it appeared Bank of New York Mellon Chief Executive Bob Kelly was poised to become the next leader of BofA. He was mentioned in multiple reports as being in negotiations with BofA's board.
But on Monday evening Kelly, a former Wachovia chief financial officer, sent a memo to members of his staff, telling them he had decided to remain at BNY Mellon.
There has since been speculation that Kelly and the board couldn't agree on how much power and pay he should receive. Other reports have suggested BofA's board was split about hiring an outsider.
Two days later, the board settled on Moynihan.
The news follows months of speculation and uncertainty at the bank. When Lewis announced plans to retire in September, many thought it was a polite way for the bank's board to move on. But the topsy-turvy search process quickly revealed the bank was not prepared for Lewis to leave.
Multiple candidates were reported to have turned down bank recruiting efforts. And analysts speculated the government would ultimately decide the next leader since the bank was on the hook for $45 billion in taxpayer aid. Further complicating the search were a number of shareholders that wanted the bank to hire an outsider without ties to the recent controversy.
BofA even missed a self-imposed Thanksgiving deadline to pick a new CEO.
This month, the process speeded up as BofA repaid its obligation to taxpayers and gained some freedom in its decision-making. In the end, the bank picked the man many thought was the front-runner all along.
Charlotte Mayor Anthony Foxx spoke with Moynihan soon after he was named CEO.
"He said some strong things about the relationship between Charlotte and Bank of America," the mayor said. "The words he used were that there is no consideration to changing the headquarters."
Foxx and Moynihan have never met, but the mayor extended an invitation to get together in Charlotte soon. Moynihan was receptive to that offer, Foxx said.
NY Times: P.& G. Sees the World as Its Client
Nice article today on PG's global vision
http://www.nytimes.com/2009/12/12/business/global/12procter.html
Go Bob!
wc21
By LESLIE WAYNE
Published: December 11, 2009
Add close to 548,000 new customers a day.
Every day.
For the next five years.
That is the goal Robert A. McDonald, Procter & Gamble’s new chief executive, has been promoting in recent weeks and that will be an important benchmark for his tenure.
If he is successful, it will be an important new chapter for the company, after Mr. McDonald’s predecessor, A. G. Lafley, spent the last decade revitalizing the 172-year-old company and doubling its sales.
Now the consumer products giant has to keep expanding its reach beyond its core markets of the United States, Western Europe and Japan, and start winning over new customers in places like Nigeria, India and Somalia.
P.& G., best known as the maker of Crest toothpaste, Tide detergent and Pampers diapers, is taking on steep challenges.
One is that its rivals Unilever and Colgate have long had a presence in many of these far-flung countries, so much so that they are called walled cities within the industry because of the difficulties new competitors face in penetrating these new markets.
“It will be a knife fight, it will be brutal,” said William Schmitz, an industry analyst with Deutsche Bank North America. “It will be fought in shampoo, detergent, deodorant, and Unilever and Colgate won’t roll over.”
The other big challenge is how a company that built itself on selling premium products at premium prices can shift to selling an array of low-priced products for consumers who often live on only a few hundred dollars a month or less.
In some cases, potential customers do not use many of P.& G.’s products and may even have to be taught how to do so.
At his first presentation as a chief executive to P.& G. shareholders last October, Mr. McDonald talked at length about the expansion plan and described the growth prospects in less developed countries as “absolutely amazing amazing.”
Today, sales from developing markets represent 32 percent of P.& G.’s $78 billion in annual revenue, up from 23 percent four years ago. Sales from developing countries are doubling every four years.
Unilever and Colgate, though, already get about 45 percent of their sales from emerging markets.
Today, P.& G. has annual sales of $25 billion from developing countries, compared with $8 billion eight years ago. Procter already operates in 80 countries, selling its wares everywhere — large superstores in cities and tiny storefronts in remote villages.
“For several years, they have been very quietly laying the groundwork,” said Lauren Lieberman, an industry analyst with Barclays Capital, said of P.& G.’s push into developing countries. “Now they are ready to fully explore the strategy.”
The pitch from P.& G. executives to Wall Street is relatively simple: Americans spend about $110 a year per capita on Procter’s products. The worldwide per-capita figure is $12. In Mexico, the number is $20; it’s less than $3 in China and less than $1 in India.
The goal, these executives say, is to get the per-capita numbers in China and India to look like Mexico’s. If that were to happen, Mr. McDonald told shareholders, sales at P.& G. would increase by $40 billion — a statement repeated, almost as a mantra, by various other Procter executives at any number of industry conferences.
Of course, customers in developing countries have little money to spend. And getting Procter’s goods to small towns and villages is a difficult logistical challenge.
“Distribution in emerging markets is extraordinarily expensive, and it is fraught with missteps,” said Ali Dibadj, an analyst with Sanford C. Bernstein & Company. “You are taking things down to the village level.”
Products, too, have to be adjusted. Procter & Gamble has had to break down products like shampoos and soaps into smaller and less expensive sizes. In these countries, for instance, P.& G. makes sure that a small package of shampoo, enough for one or two uses, does not cost more than the price of an egg.
“There may be one billion new customers,” said Mr. Schmitz of Deutsche Bank. “But it is a question of the price per customer and what they can buy. How can you maintain profit margins when you are trying to sell small shampoos or little bars of soap in deepest India or sub-Saharan Africa?”
Procter has come up with marketing efforts that are decidedly different than those in the United States and other more developed countries.
Many infants, for instance, simply go without diapers, which means that P.& G. goes to hospitals and mobile clinics to demonstrate the use of diapers. Because the cost of diapers are often an issue and because children and parents often share the same family bed, P.& G. is promoting diaper use only at nighttime.
“It’s an educational effort showing the importance of a good night’s sleep to the family,” said Werner Geissler, Procter & Gamble’s vice chairman for global operations. “What we want them to do is use one diaper per night. And, if they can afford it, we are promoting use of diapers for outings, like when a family visits friends.”
Earlier this month, to promote greater use of its feminine hygiene products, P.& G. started a scholarship and a hygiene education program for young girls, featuring its Always sanitary pads.
The company was promoting the pads as a way to reduce stress during their periods and to provide greater comfort, enabling the girls to study better.
This comes on top of a similar P.& G. program — called “Live your Life” — which featured young Nigerian girls writing essays about their first menstrual period, with a scholarship granted to the winning entry.
Procter & Gamble executives say they think their company and Unilever can find plenty of business without engaging in hand-to-hand combat. Even more, P.& G. is confident it can trump the products offered by local and regional companies.
“When two or three companies come in offering these products, it builds awareness of them,” Mr. Geissler said.” Across emerging markets, we can take market share without having to do battle with Unilever.”
NY Times speculation on Ken Lewis' replacement. Bob Steel is the only credible choice mentioned.
http://www.nytimes.com/2009/10/02/business/02bank.html
BAC has reached $33 million settlement with SEC; SEC filed so court could approve it as required.
http://tinyurl.com/nz4f5c
SEC: BofA to pay $33 million in Merrill settlement
By Rick Rothacker
rrothacker@charlotteobserver.com
Posted: Monday, Aug. 03, 2009
The Securities and Exchange Commission today said Bank of America Corp. has agreed to pay $33 million to settle charges the Charlotte bank misled investors about bonuses paid to Merrill Lynch & Co. executives.
The SEC alleged that in proxy materials sent to shareholders about the proposed Merrill acquisition Bank of America said the New York investment bank had agreed to not pay year-end bonuses without Bank of America's consent. The bank, however, had already authorized Merrill to pay up to $5.8 billion in bonuses for 2008 under the merger agreement.
“Companies must give shareholders all material information about corporate transactions they are asked to approve,” said Robert Khuzami, director of the SEC's Division of Enforcement, said in a statement. “Failing to disclose that a struggling company will pay out billions of dollars in performance bonuses obviously violates that duty and warrants the significant financial penalty imposed by today's settlement.”
Shareholders approved the $50 billion deal on Dec. 5. Soon after the merger closed on Jan. 1, New York Attorney General Andrew Cuomo began raising questions about bonuses paid to Merrill executives before the deal closed.
The SEC filed its complaint in U.S. District Court for the Southern District of New York. The settlement requires court approval.
“Bank of America believes that the settlement, which it entered into without admitting or denying the SEC's allegations, represents a constructive conclusion to this issue,” Bank of America spokesman Scott Silvestri said. “This is an important step forward for Bank of America and allows us to focus our energies on enhancing stockholder value by continuing to execute our strategies for the long-term success of our business.”
The SEC said it received assistance from the U.S. Attorney's Offices for the Southern District of New York and the Western District of North Carolina, the FBI and the Office of the Special Inspector General for the Troubled Asset Relief Program. The investigation is ongoing.
Bank of America to close 10% of its 6,100 branches
http://www.charlotteobserver.com/136/story/857081.html
"Report: BofA planning to cut 10 pct of branches
By IEVA M. AUGSTUMS
AP Business Writer
Posted: Tuesday, Jul. 28, 2009
CHARLOTTE, N.C. Bank of America Corp.'s CEO Ken Lewis said he is planning to shrink the bank's 6,100-branch network by about 10 percent, The Wall Street Journal reported Tuesday.
The newspaper said Lewis told investors of the plans at a meeting last week in Charlotte, where the bank is based. The Journal cited unidentified people familiar with the discussion.
The move would be a pullback from the bank's two-decade expansion, most recently under Lewis' command, which expanded the bank from coast to coast.
A Bank of America spokesman could not be reached for immediate comment.
Shares of Bank of America fell 7 cents to $13.02 in premarket trading Tuesday.
The newspaper said it was told Liam McGee, president of Bank of America's consumer and small-business bank, cited changing customer preferences for the move, saying more people are using online and mobile banking.
McGee, however, reportedly said it would be premature to specify how many locations could be closed.
The report comes as Bank of America continues to be under the careful watch of the U.S. government, while it works to integrate two recent deals.
Bank of America acquired troubled mortgage lender Countrywide Financial Corp. last summer and investment bank Merrill Lynch & Co. in January.
Those two acquisitions have proven challenging for Lewis, who was stripped of his chairman title by a shareholder vote at his company's annual meeting in April.
The bank and Lewis have been under intense scrutiny because Bank of America is one of the biggest recipients of government bailout money - $45 billion - and because the losses at Merrill Lynch turned out to be much higher than expected. It is not known when it will repay the government.
Last week, Bank of America announced a big second-quarter profit, but tempered the news by reporting it is still contending with losses from failed loans. During a call with analysts, Lewis said it would be "much tougher" to turn a profit for the rest of the year.
"Closing branches actually makes a lot of sense from a standpoint of trying to cut costs and have profitability," said Jason O'Donnell, a senior research analyst at Boenning & Scattergood Inc.
And because of the bank's numerous acquisitions over the years, "BofA does have the luxury of looking back and getting rid of overlap and overhead," O'Donnell said.
Bank of America has become a financial powerhouse befitting of its name.
First under chief executive Hugh McColl Jr., and since 2001 under Lewis, the bank has grown through acquisition from a little North Carolina National Bank into a behemoth that holds more assets and deposits than any U.S. bank.
In 2004, the bank acquired FleetBoston Financial, a move that gave Bank of America $133 billion in deposits in eight Northeastern states. Three years ago it added millions of names to its customer ledger through the purchase of credit card issuer MBNA Corp.
In 2007, the bank completed its purchase of wealth management company U.S. Trust and acquired LaSalle Bank Corp., immediately turning Lewis' bank into the market leader in Chicago.
The acquisition of California-based Countrywide last year brought Bank of America to the forefront of the mortgage business, and the Merrill Lynch deal bought the bank a large presence back on Wall Street."