Monday's Early Headlines
- The Return of M&A Monday in 2010 -- The beginning of a new year has brought several deal announcements. Novartis (NVS) agreed to buy an additional 52% stake in Alcon (ACL) from Nestle for about $28 billion. Meanwhile, BioForm Medical (BFRM) has agreed to be acquired by privately held Merz Pharma of Frankfurt for $5.45 a share in cash, of a total of $253 million.
- Additionally, Fxall, a foreign exchange currency-trading platform, has reached an agreement to buy LavaFX from Citigroup (C), although terms of the acquisition weren't disclosed. And lastly, Chesapeake Energy (CHK) said a U.S. unit of France's Total (TOT) will acquire a 25% interest in Chesapeake's upstream Barnett Shale assets in a $2.25 billion joint venture.
- Kraft Reportedly Set to Boost Cadbury Bid -- Kraft Foods (KFT) is preparing to increase its hostile takeover bid of more than 10 billion pounds ($15.9 billion) for British confectionery maker Cadbury (CBY), according to the U.K.'s Sunday Times. Kraft's Irene Rosenfeld, chairwoman and CEO, will announce a revised offer in the next two weeks, the newspaper reports. Under U.K. Takeover Panel rules, Kraft has until Jan. 19 to raise its offer. Meanwhile, Il Sole 24 Ore reported Saturday that Italian confectioner Ferrero has met with private equity firms Kohlberg Kravis Roberts & Co and Blackstone Group as well as Hershey (HSY) to discuss a possible bid for Cadbury.
- Regulation is First Defense: Bernanke -- In prepared remarks to the American Economic Association's annual meeting in Atlanta, Federal Reserve Chairman Ben Bernanke said stronger regulation should be the first line of defense against speculative bubbles that could send the economy into a new crisis. Bernanke said that all efforts should be made to strengthen the regulatory system to prevent a recurrence of the crisis, and that "we must remain open to using monetary policy as a supplementary tool." Meanwhile, The Wall Street Journal that Fed Vice Chairman Donald Kohn said that the central bank will need to be ahead of the curve in withdrawing stimulus in a gradually improving economy. although he warned the nature of the economic crisis means officials do not have a good road map for the action they'll need to take. "We will need to begin withdrawing extraordinary monetary stimulus well before the economy returns to high levels of resource utilization," Kohn said, according to the Journal.