All Articles Tagged "mergers"
Two brands that have been long-term favorites of urban apparel shoppers will soon be managed under one corporate masthead. Wall Street action watchers are excited by the recently announced agreement between Timberland and VF, owner of The North Face, which details VF’s plans to buy the iconic footwear company for $43 a share. The proposal will net Timberland shareholders $2 billion — and VF shareholders have responded by sending the company’s share price up almost 11% to over $100 a share.
The deal has been approved by the board of both companies, and is awaiting shareholder and regulatory approval for full execution. It is expected to go through by the third quarter of this year.
Analysts have praised the move, citing the strength of the Timberland brand internationally as a core asset that will enhance the VF portfolio, which includes other outdoor lifestyle companies such as Vans and Nautica. Industry estimates for Timberland’s first-year revenues under VF range between $700 million and $1.6 billion.
Lovers of the Timberland brand can rest assured that the larger organization will not dilute its characteristic style. Barron’s reports:
Morningstar analyst Peter Wahlstrom praised the fact that VF … “allows individual brands to function independently and pursue separate growth initiatives while leveraging centralized procurement, information technology, and logistics.”
So the brand many love will remain independent as it comes within the VF fold. As an investment opportunity, shares of VF are expected to continue on their upward trend. The parent corporation has set an aggressive goal for Timberland’s growth at 10%, with few competitors in their segment that can match their brands’ popularity and penetration. Now is a good time for African-Americans, who helped to make Timberland a hot commodity capitalize on Timberland as an investment.
By J. Smith
Steam is picking up in the case against the pending entry of Wal-Mart to the African economy. According to The Huffington Post, Argentina added their two, but very valuble cents to the argument, telling South Africa: Don’t do it! Reconsider!
The Anti-Wal-Mart Coalition, comprised of various trade unions representing millions of workers, has teamed up with Argentinian economic advisors to stand in opposition to a mega-acuisition of MassMart by Wal-Mart. MassMart owns roughly 290 stores in 13 African nations, the Post reports. An economic advisor to the Argentine Federation of Commerce and Service Workers submitted a statement before the Competition Tribunal deciding on the merger, saying that the worst impact of Wal-Mart on the Argentinian economy was not on wages, but on the nation’s supply chain. This resulted in “a detrimental effect on the business middle class.”
“Instead of buying products, Wal-Mart de Argentina offers a “sale spot” to suppliers — who bear the cost of unsold merchandise. ‘In the event the product sells,’ Scasserra explained, ‘the supplier gets paid, but if the product does not sell, then it was deemed never to be Wal-Mart’s to begin with, and therefore the supplier bears the full adverse effect of the unsold stock. Wal-Mart does not take ownership of the goods until the product sold.’ Scasserra said many companies were forced to close, especially in the food sector, where products are preishable. Some merchants were forced to sell on consignment, putting ‘immense pressure’ on the supplier if goods don’t sell,” The Huffington Post reports.
The financial gambling, and the debts incurred thereof, by local suppliers trying to work with Wal-Mart cause too catastrophic an effect on the local economy, proving that those “low, low prices!” just aren’t worth it. In addition to the false cooperation and eventual muscling out, the Post reports that Wal-Mart also forces suppliers to wait at least three months to get paid, they manipulate loopholes to escpae tarrifs whle importing cheaper products, and they force them to give the retailer discounted and free merchandise. All of these anti-supplier tactics result in, “small producers are often left out of the equation,” Scasserra explained.
And the movement rolls on.
(Chicago Sun Times) — What do the Congressional Black Caucus and AT&T have in common? And I don’t mean Common, Chicago’s hometown rapper. They share an “interest” in expanding broadband access and diminishing the nation’s digital divide. Last week, AT&T and T-Mobile announced a proposed $39 billion merger that would create a telecommunications company with nearly 130 million subscribers. If the new combine passes muster with federal regulators, it will become the nation’s No. 1 service provider. No! howled Free Press, a non-profit that lobbies for a more democratic media. The group argues that the merger would erode competition, punish consumers and kill jobs. Yes! cheered the Wall Street Journal, claiming the deal would inspire innovation and fertilize America’s communications landscape with an explosion of new options. Is it a devil of a deal, or a deal with the devil? Either way, if the omnivorous AT&T wants to gobble up T-Mobile, it should include a little healthy altruism in its diet. Universal and cheap broadband would help.
(New York Times) — AT&T announced on Sunday that it had agreed to buy T-Mobile USA from Deutsche Telekom for $39 billion, in a deal that would create the largest wireless carrier in the nation and promised to reshape the industry. The transaction, one of the largest since the onset of the financial crisis, is expected to start a fierce battle in Washington as regulators scrutinize the effect of the deal on competition and consumers. The deal would leave just three major cellular companies in the country: AT&T, Verizon and the much smaller Sprint Nextel.
Some critics denounced the merger within hours of its announcement, saying it would most likely lead to higher prices. T-Mobile had offered some of the lowest rates in the country, keeping pressure on competitors. While AT&T is expected to honor current contracts, T-Mobile customers may have to pay higher rates once those contracts expire. Still, AT&T pointed on Sunday to a recent report from the federal Government Accountability Office that said cellular subscription costs fell 50 percent from 1999 and 2009, a period in which the industry has consolidated.
“Consumers have borne the brunt of the increasingly concentrated market for mobile phone service,” Senator Herb Kohl, the Wisconsin Democrat who heads the subcommittee on antitrust, competition policy and consumers rights, said in a statement. “The explosion of cellphone usage — especially smartphones — makes competition in this market more important than ever as a check on prices, consumer choice and service.”
(Business Insider) — AOL and the HuffPo deal has been analyzed upside down and inside out by various media outlets; Business Insider being no exception. But a vital element of the examination has been mysteriously missing from the long narrative regarding AOL’s road to content start-around. So let’s get to it.
The digerati typically seem reluctant to ever discuss the convergence of tech, racial influence and revenue; but it’s a mega pink elephant in the room that will simply not go away because, like it or not, there are actual people between the 1′s and 0′s of technology, and they sometimes have very unique and particular behavior and desires that often times stem from cultural influence and history very different from that of the mainstream. If a hamburger or a car company can face such issues, so too can our industry.
There’s no free pass just because one is dealing with technology. It’s not about morals (in this article, anyway), it’s about money. Let’s be real. There is nothing post-racial about the U.S. in 2011, and that’s okay as our nation continues on its path to maturity. But to move in a manner that is rather ambivalent to that fact is to risk missing golden business opportunities.
(AdAge.com) — As it turns out, minority programming became the linchpin to Comcast’s expensive and hard-fought campaign to win federal approval for its merger with NBC Universal. In what some observers saw as a cynical, yet savvy ploy, the cable giant specifically sought to appease Federal Communications Commissioner Mignon Clyburn, a Democrat who had expressed concerns that the merger would drown out diverse voices in an increasingly conglomerated media world. Comcast put her at ease by agreeing to add at least four African-American-managed or -owned cable networks and four Latino-owned or -managed networks over the next eight years, as well as some English-language programming geared toward Asian Americans.
(BASN) — The recent merger between Comcast Corp. and NBC Universal is considered one the most significant events in the history of modern media. Comcast is going to buy 51% of NBC Universal from General Electric for $13.8 billion. The merger got the attention of the Justice Department and advocates for black media ownership, who feel that such a massive concentration of power is not good for the industry.
(Philadelphia Tribune) — TThe National Coalition of African American Owned Media (NCAAOM) is calling foul. This is not a partisan issue. Project 21, a conservative think tank that deals with Black issues, is also crying bloody murder. It was reported in The Hill, a publication that covers Congress, that the merger will enhance minority opportunities with 10 new independent cable networks, eight of which would service Black, Latino, Asian and other minorities, plus $20 million in venture capital for minority entrepreneurs.
(BlackWeb2.0) — Yesterday’s announcement that the Federal Communications Commission and the Department of Justice approved the merger to Comcast and NBC-Universal created a large amount of media scrutiny. Most reports focused on size of the deal, and the merger is indeed a staggering one. The deal joins Comcast’s cable network and TV channels with NBC-Universal’s theme parks, affiliate stations, studios, TV channels, and stake in Hulu. One of the most interesting aspects of the merger is the host of conditions placed on the combined company. For example, Comcast must offer its television programming to competing online sites.
(Washington Post) — Federal regulators on Tuesday blessed Comcast’s $30 billion acquisition of NBC Universal, imposing a slew of conditions on everything from competition with rivals to the price of Internet service for poor families out of concern that the firm’s vast sweep could harm consumers. The deal marries the nation’s biggest cable and Internet service provider with NBC Universal’s library of entertainment – which includes “30 Rock” and Bravo’s “Top Chef” – and marks the first time a cable company has owned a major network.