E Global Market News This Week

Dong Energy of Denmark became the biggest IPO this year and rose 10% in its first day of trading to Dkr 259/sh. It runs offshore wind farms. The sellers include Goldman Sachs (which is keeping 13.4% of its former 19% stake, however.) Goldman financed the switch to wind by Dong 2 years ago when the Danish government refused to, and quickly doubled its money. The US investment bank set firm conditions for its investment including an IPO by 2018, getting put options, veto rights on changes in investment and strategy, and other conditions to limit Copenhagen interference. The government until now owned 59% of Dong.

 A lot about Mexico for a change, and more deals out of Hong Kong and more Latin finance moves.

Talent and Telcos

Talent agencies WME-IMG will join with Tencent, Fountainvest Partners, and Sequoia Capital China to expand US Chinese coverage of sports and entertainment with targeted ads on TCEHY's WeChat. TCEHY will replace cash hungry Japan's Sofbank which invested in the 2014-merged former William Morris Agency, a long-term China pioneer this spring, Probably a quick profit for SFTBY, will result. Source:Variety.

Separately, TCEHY is rumored to be in talks with Finnish game-maker Supercell Oij to replace SoftBank as dominant shareholder. The Japanese group may need to sell. When we reported on this earlier the valuation estimate by Bloomberg was $5 billion for the maker of Clash of Clans and other mobile games. Now it is believed to be $9 billion, again from Bloomberg. We reported earlier this week on deals involving a movie studio. We wrote recently about how TCEHY will finance a capital increase at WeBank (controlled by TCEHY) which will to charge for loans made for e-commerce because China will not let foreigners invest in its highly risky on-line shadow banking sector.

China may be in slow-down mode but its netizens are not slowing down their internet activities and Tencent is leading them into new businesses. I am having trouble keep up with the blaze of moves.

Vodacom of South Africa was featured on the Deutsche Bank ADR site this morning. This firm is part owned by Vodafone and, confusingly, trades there as VOD-JSE. However its ADR is VDMCY.

Our Vodafone is busy in the southern hemisphere too as it will merge its New Zealand telco with Sky Network there. SKY sells TV services and has 830,000 New Zealand subscribers, while VOD (of Q) has telco subscribers, 2.35 million using mobile phones and a half million using landlines. The merger is worth US$2.4 bn to be paid by Sky (a part of the Rupert Murdoch Down Under business) to VOD, whose shares dropped on the news.

From the Oil Patch

S&P today left unchanged its rating on Ecopetrol's unsecured 10-yr notes initially issued in Sept 2013 at $1.3 billion yielding 5.875% after EC used an add-on provision to borrow another $500 million under the same terms. The main reason for backing the issue despite the increased liability is that the Colombian government will provide “extraordinary support” under conditions of “financial distress” at EC because it is the controlling shareholder although EC has independent management. The second reason is that EC debt is under 20% of its capitalization.

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