Randomly Noted

There is clearly a lot of positioning going on by AT&T to convince the public and U.S. regulators that its proposed acquisition of rival T Mobile from Deutsche Telecom shouldn’t be viewed as anti-competitive. One certainly might think that when two of  the top leaders in any industry join forces.

If you check out the AT&T website, already there is a video of CEO Randall Stephensen discussing, among other things, his respect for regulators. There is a brief presentation of the deal that shows how consolidation has not hurt pricing. to the contrary, prices have come down since consolidation has been underway.

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Sen. Charles Schumer, D-NY, is concerned about a name. So is a Congressman from Florida. But they’ve got it wrong. Whether a name is kept or not, the world it represented already is gone.

Schumer and Rep. Ted Deutch, D-Fla., and no doubt other U.S. politicians yet to be heard from are hell-bent that if a merger between Deutsche Borse and NYSE Euronext takes place, as expected, the New York Stock Exchange name be preserved.

Schumer even went so far Sunday as to say the New York Stock Exchange name has to come first in the combined and so far undeclared title of the new entity, which would be the planet’s largest exchange. This despite the fact that Deutsche Borse shareholders would have 60% of the new entity.

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At first, it’s hard to tell if BMO Financial Group’s $4.1 billion acquisition of Marshall & Ilsley is about a strategic expansion of business in the U.S. or an opportunistic buy of a bank beat up by bad real estate loans.

The answer is it is probably both. Marshall & Ilsley has lost money for nearly two years because its loan portfolio – heavily commercial – soured across the board. But it has a strong deposit footprint in Wisconsin, Minnesota, Florida and Arizona.

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When we think of technology, things like iPads or incredible smart phones or those incredibly small but good cameras come to mind. Not bland things like storage. But data storage and analyzing tons of data being stored are two of the hottest areas these days in technology.

IBM became the latest company to express an interest in data storage and analytics with its offer to buy Netezza for $1.7 billion. One of the attractions for IBM could be that Netezza apparently not only knows its business, but knows how to it much more cheaply than others. As the company says on its website:  ”Think of Netezza as a Ferrari, with the price and efficiency of an economy car.”

The question is whether other companies will bid up for the business, taking the economy out of this economy car and making it more fully priced.

There’s an interesting story playing out near the southern tip of Argentina that people who play the gold market should watch closely.

Andean Resources, a mining exploration company whose principal assets are gold and silver deposits in the Santa Cruz region of Argentina, had two gold companies offer to buy the company – Goldcorp, which made a $C3.6 billion bid, and Eldorado Gold, which offered $C3.4 billion. Andean accepted the higher offer but the market thinks another one could be coming.

The accepted offer translates into about $3.4 million. The value of the gold and silver reserves is about $3.6 billion. Now we all know there is a cost involved in extracting the gold from the ground, thus a bid should be at a discount. But this one seems very close to the reserves value. Which could mean a couple of things – Goldcorp and Eldorado are making a statement about gold and silver prices and that statement is they think prices will go higher. It could speak to the rarity of such desposits being available for sale. Or it could mean Goldcorp thniks there’s more gold in them hills. Likely a combination of the three.

And that could mean the bidding for Andean has only just begun.

Stanley Works is acquiring Black & Decker, and Peet’s Coffee & Tea is buying Diedrich Coffee. One deal is valued at $4.5 billion, the latter “only” about $213 million. Three of the four are familiar brands, especially the tool makers; Peet’s coffee and cafes are especially well-known in California. Diedrich specializes in single-cup coffee, and plays mainly in the wholesale market; single-cup has become enormously popular in recent years. Both transactions come as it becomes increasingly clear the economic recovery will be long and slow; people won’t be opening their wallets with gusto for several years. Not surprisingly, the proposed mergers bring opportunities for cutting costs. But it’s worth noting that the corporate buyers are paying up: Black & Decker’s being sold at a 23% premium, Diedrich for 28% over its closing share price. My colleagues at the WSJ’s Deal Journal blog posit that Stanley covets Black & Decker’s $800 million cash stash. This is prudent: American consumers are still reeling from the past year’s job- and retirement-fund losses. Home construction and renovation remain weak. The bright minds at Stanley know they need to remain in something of a defensive crouch. Stanley and Black & Decker tools are pricier than the various discount alternatives one can find. Ditto coffee: Buying a hulking tin of java at Cosco will remain a more appealing alternative to boutique brands for some time. That said, in buying Diedrich, Peet’s appears to be diversifying – into single-cup. It’s a fairly bold strategic play, actually, and in this sense differs from Stanley’s more conventional move on Black & Decker. It will be worth watching to see if the next few merger deals fall into the Stanley, or Peet’s, category.

You could be cynical and just suggest that Blackstone Group is talking its book. But it does have the look and feel of something much bigger than that. The Financial Times reported today that the huge private equity firm has told investors in its funds that it is looking to sell chunks via stock offerings of up to eight companies in its portfolio (for full story, click here.) The move is notable for a handful of reasons. You could sugest that Blackstone perhaps is making a call that the market move higher since the March lows is likely to continue going in that direction (not making a statement about when). The FT notes that Blackstone was one of the first private equty firms to get cautious on the financial markets and this move might herald Blackstone becoming one of the first private equity firms to be making such a bold call. It’s also worth noting that buyout activity has begun to pickup and Blackstone may be thinking it needs to raise more cash to play in that game.

The protracted MTN-Bharti negotiations are over and done with. It’s a relief. On the surface, a tie-up between the big Indian and South African telecom firms made sense the way Daimler+Chrysler once did: Bring two mighty, complementary players together to create a ginormous entity with sparkling growth potential. MTN+Bharti would have instantly had 200 million subscribers and $20 billion in annual revenue with a vast span across continents and emerging markets. We all know how Daimler/Chrysler played out, leaving both firms in sorry shape, especially Chrysler. MTN-Bharti Airtel was heading in the same dubious direction, thanks largely to South African concerns about losing control of a national champion to a foreign buyer. As DJN colleague Robb Stewart recently wrote about the deal, which was scuttled Wednesday, “Cross-border telecommunications deals already have a poor history of success. Deals touted as mergers-of-equals tend to fare even worse.” You may recall that Daimler-Chrysler was also presented as a “merger of equals,” whereas reality soon proved otherwise. Ironically, over the years MTN itself benefited from the failure of a competitor to thrive amid convoluted ownership. As Robb wrote, “The companies may want to learn from Vodacom Group Ltd., a mobile venture that had been owned equally by South Africa’s Telkom SA ltd. and Vodafone Group PLC until the U.K. mobile giant bought control. Telkom managers have conceded that Vodacom was held back by its ownership structure and restrictions that prevented it from competing in marktes that were seen as belonging to Vodafone. The beneficiary of all this was MTN, which outgrew it.” Laissez-faire, anti-regulation types will wring their hands over the deal being effectively killed by politicians prioritizing South African corporate might over pan-markets industrial logic. I say: Don’t waste your time.