SNL Financial
“JPMorgan makes a move on UK payments biz; Saba Capital to shut London office”
On the M&A front, JPMorgan Chase & Co. and Vantiv Inc. are trying to buy London-based Worldpay Group plc. The British payments company confirmed that it received separate preliminary takeover approaches from the two U.S. companies. Sources for the Financial Times say their bids «contrast sharply.» While JPMorgan has made a cash takeover offer carrying a substantial premium to Worldpay’s pre-bid share price, Vantiv is looking for a predominantly share-based merger at a much lower premium. This potential move on Worldpay would be JPMorgan’s biggest deal since the 2008 financial crisis, The Wall Street Journal notes. The companies now have until Aug. 1 to make a formal bid for Worldpay, which according to The Guardian, is valued at more than £8 billion.
In the asset management sector, Saba Capital Management LP intends to shut down its London office and move its European trading operations to its New York headquarters, sources told Reuters. And JPMorgan Asset Management will launch a suite of actively-managed exchange-traded funds in the U.K. and Europe, the London-based Financial News reports.
The Guardian
“Hamburg braced for huge, violent protests in run-up to G20 summit”
Hamburg is bracing itself for an escalation of violence on the eve of Friday and Saturday’s G20 summit after a fleet of hi-tech water cannons was used to disperse crowds partying near the conference venue, and police warned that protesters could be hoarding weapons at secret locations across the city. Authorities in Germany’s second-largest city are preparing for the arrival of an unprecedented lineup of controversial world leaders including Donald Trump, Vladimir Putin and Recep Tayyip Erdoğan, as well as thousands of international protesters ranging from anti-capitalist activists to middle-class families’ keen to voice dissent.
Police say they expect a core of about 5,000 violent protesters to gather in the city’s historic port area for a “Welcome to Hell” march just as world leaders and international delegates start arriving at Hamburg airport on Thursday afternoon.
The German chancellor, Angela Merkel, has appealed to protesters to express their dissent in a peaceful manner, warning that “those who turn to violence mock democracy”.
Bloomberg
“South Africa’s ANC Said to Propose Central Bank Be State-Owned”
South Africa’s ruling party has proposed that the central bank should be wholly state-owned rather than an institution with private shareholders.
The Reserve Bank stock being held by private investors is “an anomaly,” the African National Congress’s head of economic transformation, Enoch Godongwana, told reporters Wednesday in Johannesburg at the party’s policy conference. South Africa “is still sticking to the framework of the 1920s,” he said.
The move opens a second front challenging the central bank’s established status just two weeks after Public Protector Busisiwe Mkhwebane attempted to instigate a change in its mandate. She instructed Parliament to amend the constitution to make the Reserve Bank focus on the “socioeconomic well-being of the citizens” rather than inflation, prompting a drop in the rand as investors viewed her action as a threat to its independence. The proposal on the central bank’s ownership concluded the institution’s independence should be guaranteed in the constitution, Godongwana said.
The Economist
“BNP Paribas faces accusations over the Rwandan genocide”
BNP PARIBAS, France’s biggest bank, pleaded guilty in America three years ago to assisting a monstrous regime in east Africa. In 2006, it had helped to finance Sudan’s government, which in turn supported militias that massacred tens of thousands of civilians in Darfur. The firm thereby abetted in genocide and circumvented American sanctions on Sudan. It agreed to pay a fine of $9bn for breaking that embargo, as well as ones on Cuba and Iran.
The case is not frivolous. Indeed, its details have been aired for many years. Following the Rwandan genocide, various organizations—notably the UN, in a lengthy report to the Security Council in January 1998, introduced by Kofi Annan, then its secretary-general—said BNP in June 1994 had financed a deal for 80 tons of weapons, including AK-47 rifles, ammunition, hand-grenades and mortars, delivered to the Rwandan army. Two shipments were brokered by a South African gunrunner, Willem Ehlers, who got payments of $592,784 and $734,099 respectively. The source of the funds was listed as Banque Nationale de Paris (which later merged with Paribas). The bank this week refused to comment on its reaction to the 1998 report.
BNP has little choice than to hunker down and hope the attention will pass. The financial threat this time around looks lower than in the case of Sudan, when America’s authorities withdrew the bank’s access to dollar clearing for some transactions for a year. But the spotlight may prove just as uncomfortable.