Janus and Henderson just surprised the market with a $6 billion transatlantic merger

• Carolyn Cohn, Reuters

• 11h
• 4,774
 
• 1

Bill Gross, the bond guru at Janus.REUTERS/Jim Young

Current Prices

Symbol	Price	+/-	%
HGG	1.81	-0.02	-1.10
JNS	15.69	+1.68	+12.00

Disclaimer

LONDON — The US asset manager Janus Capital and its London-listed rival Henderson Global Investors on Monday said they had agreed to an all-share $6 billion merger, sending Henderson's shares soaring.

The merger will enable the group to cut costs and increase diversification, Henderson CEO Andrew Formica told a media call, and comes as the industry looks to streamline operations to protect margins amid widespread pressure on fees.

"The combined product lineup will be much more balanced and diverse," he said. The combined company would manage more than $320 billion in assets, the firms said.

• Formica told CNBC that bond king Bill Gross, who works at Janus, is "very, very supportive" of the deal. "He sees it as just improving already on the strength of Janus, of what he's already seen since he's been there and he can see with the combination with Henderson can just make it an even stronger and better business."

Henderson and Janus shareholders are expected to own approximately 57% and 43%, respectively, of Janus Henderson Global Investors' shares, with the merger completing in the second quarter of 2017, subject to regulatory approvals.

The combined group will apply for a primary listing in New York, keeping Henderson's Australian listing but delisting in London. Henderson is in the FTSE 250 market segment.

The merger will involve a share exchange in which each Janus share will be exchanged for 4.719 newly issued shares in Henderson, the firms said in a statement.

"We see this as a positive move with complementary asset bases and a very material cost synergy figure," analyst Paul McGinnis at Shore Capital said in a client note.

The firms said they were targeting an annual run rate in net cost synergies of at least $110 million, representing about 16% of the combined group's underlying earnings before interest, taxes, depreciation, and amortization.

Janus' largest shareholder, Dai-ichi Life, supports the merger, the firms said.

The group's headquarters will be in London, Formica said. Talks on the merger began at the beginning of the year and were not affected by the Brexit vote, he added.

Formica will continue in the merged firm as co-CEO, alongside Janus CEO Dick Weil, who will also be co-CEO.

Henderson's shares jumped over 17% on the news.Investing.com

(Reporting by Carolyn Cohn; Editing by Rachel Armstrong and Simon Jessop)

Read the original article on Reuters. Copyright 2016. Follow Reuters on Twitter.

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The EU is threatening to fine Google for violating antitrust regulations

• Foo Yun Chee, Reuters

• Oct. 1, 2016, 6:28 PM
• 3,413
 
• 6

Google CEO Sundar Pichai. Justin Sullivan/Getty Images

EU antitrust regulators plan to order Alphabet's Google to stop paying financial incentives to smartphone makers to pre-install Google Search exclusively on their devices and warned the company of a large fine, an EU document showed.

The document, running to more than 150 pages, was sent to complainants last week for feedback. Google received a copy in April in which the European Commission accused it of using its dominant Android mobile operating system to shut out rivals.

The EU competition enforcer in its charge sheet, known as a statement of objections, said it planned to tell the U.S. technology giant to halt payments or discounts to mobile phone manufacturers in return for pre-installing Google's Play Store with Google Search.

The regulators also want to prevent Google from forcing smartphone makers to pre-install its proprietary apps if this restricts their ability to use competing operating systems based on Android.

Google "cannot punish or threaten" companies for not complying with its conditions, according to the document seen by Reuters.

The Commission's investigation followed a complaint by FairSearch, a lobby group supported by companies that want to ensure they are not disadvantaged by search engine market dominance, in March 2013.

Google could face a large fine because the anti-competitive practices, which started from January 2011, are still ongoing, the document said.

"The Commission intends to set the fine at a level which will be sufficient to ensure deterrence," it said.

The penalty could be based on revenue generated from AdWords clicks by European users, Google Search product queries, Play Store apps purchases and AdMob's in-app advertisements.

Commission spokesman Ricardo Cardoso declined to comment. Google which has previously denied any wrongdoing, did not immediately reply to a request for comment.

Separately, the Commission is investigating whether Google favors its own shopping service over those of rivals, and could also fine it in that case.

Google may have to rank rival comparison shopping services in the same way as its own services, the charge sheet sent in July said. The document, close to 150 pages, was heavily edited, with large sections of confidential information redacted by Google.

The Commission said it would decide at a later stage whether to let Google charge competitors for displaying their services prominently, with the amount corresponding to Google's operating cost or a nominal amount based on the lowest reserve price for AdWords which is currently 0.01 euro per click.

Read the original article on Reuters. Copyright 2016. Follow Reuters on Twitter.

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What Brexit? — Britain's manufacturing sector is going wild

• Will Martin
 

• 10h
• 1,308
 
• 3
 

Pool / Pool

Britain's manufacturing sector is going crazy, rising to a near-two and a half year high, according to the latest data released by IHS Markit on Monday morning.

IHS Markit's growth data shows that Britain's factories recorded activity of 55.4 in September, up a full two points from August's 53.4 reading, and marking a level not seen since June 2014. Forecasters had the projected that the sector would grow more slowly in the month, predicting a reading of 52.1.

The purchasing managers index (PMI) figures from IHS Markit are given as a number between 0 and 100.

Anything above 50 signals growth, while anything below means a contraction in activity — so the higher the number is, the better things look for the UK.

Speaking about the data, IHS Markit senior economist Rob Dobson said:

"The rebound over the past two months has been encouragingly strong, and puts the sector on course to provide a further positive contribution to GDP in the third quarter.

"The weak sterling exchange rate remained the prime growth engine, driving higher new orders from Asia, Europe, the USA and a number of emerging markets. The domestic market is also still supportive of growth, especially for consumer goods."

David Noble, CEO of CIPS, which helps compile the survey, added:

"This month, manufacturing made up lost ground since the EU referendum, with a robust rise in new orders and production expanding at a pace not seen for over two years.

"It was largely domestic orders that fuelled the rise in overall activity, although the weaker pound also bolstered export orders which increased at the steepest rate for 32 months."

Here is IHS Markit's chart, showing the huge surge over the last two months:

IHS Markit

The numbers are obviously good news for those worried about the state of the British economy in the post-referendum landscape, but should be taken with a pinch of salt given the boost to exports given by the weak pound, and the fact that manufacturing accounts for just under 10% of UK GDP. The services sector by contrast, makes up more than three-quarters of GDP.

As IHS Markit's release notes: "Conditions in the UK manufacturing sector continued to improve at the end of the third quarter. Rates of expansion in output and new orders accelerated further, rising at rates rarely achieved since the middle of 2014. The domestic market remained a prime driver of new business wins, while the weaker sterling exchange rate drove up new orders from abroad."

Earlier on Monday, eurozone manufacturing PMI data showed that the continent's manufacturers are enjoying strong growth right now. Markit's manufacturing PMI for the eurozone grew to 52.6 from 51.7 in September, matching the earlier flash estimate.

The pound moved marginally higher against the dollar on the news, but remains depressed on the day after Prime Minister Theresa May told the Conservative party conference that she plans to trigger Article 50 by the end of March next year:

Investing.com

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BREXIT: Theresa May will trigger Article 50 before the end of March 2017

• Reuters and Rob Price

• Oct. 2, 2016, 4:12 AM
• 1,507

Britain's Prime Minister May leaves 10 Downing Street in central London. Thomson Reuters

We've finally got some more hard information about when Britain will begin the two-year process to leave the European Union.

Prime Minister Theresa May said on The Andrew Marr Show on Sunday that the UK will trigger Article 50,which will kick off the formal process to leave the 28-nation bloc, before "the end of March next year."

The announcement comes afterMay told The Sunday Times in an interview that the UK will not wait for German elections due in September 2017 before triggering Article 50.

May, who will give a speech to members of the ruling Conservative Party on Sunday, also ruled out an early general election, saying it would cause "instability", but said she would repeal the 1972 European Communities Act, which took Britain into what is now the EU.

"We will introduce, in the next Queen's speech, a Great Repeal Bill that will remove the European Communities Act from the statute book," she told the newspaper.

Overturning the act will take legal effect once Britain formally leaves the EU, the newspaper reported.

The timeline for invoking Article 50 has been hotly debated. Is it better to pull the trigger as soon as possible, before European attitudes harden? Or is it more prudent to wait until everything is more rigourously prepared? Once it is invoked, the negotiations between Britain and the EU over the former's departure can begin in earnest. If no deal is reached after a two-year period, Britain will automatically leave anyway.

(Reporting by Costas Pitas, editing by Elizabeth Piper)

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Here's how many miles you have left when your car's empty light comes on

• Caroline Praderio, INSIDER

• Sep. 27, 2016, 1:51 PM
• 103,334
 
• 1

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Running your car on empty is a dangerous gamble — it's tough to imagine a worse situation than breaking down on a 70-mph highway or twisty back road.

So it's helpful to know exactly how many miles your car can travel once that low-fuel warning light turns on. 

You might be tempted to trust the miles-to-empty display that comes standard in many car dashboards these days. But the experts at car repair service YourMechanic say you can't rely on that number alone: It's based on your average gas mileage over time, but you're not always going to be in average driving conditions.

For example: If you normally drive on the highway but suddenly end up in gridlock traffic, your miles-to-empty gauge won't be accurate.

Luckily, YourMechanic has assembled a handy chart for the 50 most popular cars in America, showing how many miles you can actually drive on empty. There's a pretty surprising range of possibilities: Some models can get you about 100 miles, while others will only take you 30.

Courtesy Your Mechanic

By the way: Habitually running on empty is really bad for your car. Debris and contaminants tend to settle at the bottom of the fuel tank, and constantly driving with a low level of fuel means some of that debris can damage the fuel pump.  

Read more about the risks of running on empty over at YourMechanic.

Read the original article on INSIDER. Follow INSIDER on Facebook. Copyright 2016. Follow INSIDER on Twitter.

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Japan just released a raft of data and most of it was really weak

DAVID SCUTT 

SEP 30, 2016, 10:31 AM   

Photo by Adam Pretty/Getty Images

Be it the Bank of Japan or the government, policymakers in Japan will not be pleased with the latest batch of economic data that’s just hit.

It’s weak, and that’s putting it mildly.

At the top of that list is inflation, or should we say deflation.

According to Japan’s statistics bureau, core consumer price inflation — that which excludes fresh food prices — fell by 0.5% in the 12 months to August. It was unchanged from the level seen in July, but missed expectations for an uptick to -0.4%.

It currently sits at the equal lowest level seen since March 2013.

Suggesting that deflationary pressures are unlikely to ebb when September’s figures are released next month, core CPI in Tokyo — released one month in advance of the national figure — slid by 0.5% in the past year, below the 0.4% pace seen in August.

It too was the lowest level seen since March 2013, and missed forecasts for an unchanged reading from August.

Making matters worse, so-called core-core inflation — that which excludes both fresh food and energy prices and more akin to core CPI figures used in other advanced economies — rose by just 0.2% in the year to August, down again on the 0.3% pace seen in July.

In overall terms, headline CPI fell by 0.5% from a year earlier, down on the 0.4% drop seen a month earlier.

Disinflationary forces appear to be growing, rather than subsiding, for the moment, much to the disgust of the Bank of Japan no doubt.

Earlier this month the BOJ announced a commitment to overshoot on its 2% inflation target, pledging to expand the nation’s monetary base until the annual increase in CPI exceeded its price stability target “and stays above the target in a stable manner”.

That looks a long way off yet. It’s little wonder why there’s widespread scepticism that the bank’s newly adopted “QQE with yield curve control” policy stance, adopted at its September monetary policy meeting, will struggle to achieve this goal.

Outside of inflation, the news elsewhere was hardly stellar with the exception of industrial output.

After receiving a poor retail sales result yesterday, the weakness in household consumption was confirmed with spending plunging 3.7% in August.

The figure missed forecasts for a decline of 1%, and was the steepest monthly decline since April last year.

It left year-on-year decline at 4.6%, the largest annual contraction since March. It too was below expectations for a narrower decline of 2.5%, and followed a 0.5% drop in July.

Ugly. There’s no other way to put it.

Even labour market data, one of the few bright spots in recent months, also underwhelmed.

The unemployment rate ticked up to 3.1% in August, up from the 3.0% level seen in July. The jobs-to-applicants ratio — simply the number of jobs available compared to those looking for work — held steady at 1.37.

While it remains at a 25-year high — certainly nothing to scoff at — the level was unchanged from July.

With inflation, spending and labour market data all disappointing, there data deluge was salvaged partially by an impressive uplift in industrial output.

It increased by 1.5% in August from a month earlier, an improvement on 0.4% decline of July and forecasts for a gain of 0.5%.

Not only that, factories indicated that they expect output levels to improve further in the months ahead, forecasting increases of 2.2% and 1.2% for September and October.

The improvement in factory output fits with recent manufacturing PMI data which revealed activity levels improved for the first time in seven months in September.

Still, while there’s signs of life in the nation’s industrial sector, it’s unlikely to offset the weakness seen in other areas of the economy, particularly the household sector.

The Japanese yen has weakened following the data deluge with the USD/JPY sitting at 101.20 as at 9am JST, up 0.19% for the session.

The Nikkei 225, following the lead provided by US stocks, is currently down 1.5% at 16,448.91.

Boosted by heightened risk aversion, Japanese 10-year government bond yields sit at -0.085%, below the 0% level targeted by the Bank of Japan.

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