{"id":13243,"date":"2015-10-18T20:15:35","date_gmt":"2015-10-19T00:15:35","guid":{"rendered":"http:\/\/www.pgm-blog.com\/?p=13243"},"modified":"2015-10-18T20:15:35","modified_gmt":"2015-10-19T00:15:35","slug":"highlight-of-the-week-of-october-12-2015","status":"publish","type":"post","link":"https:\/\/www.pgmcapital.com\/nl\/highlight-of-the-week-of-october-12-2015\/","title":{"rendered":"Highlight of the Week of October 12, 2015"},"content":{"rendered":"<p><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/shutterstock_183886784.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-13264\" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/shutterstock_183886784.jpg\" alt=\"\" width=\"300\" height=\"225\" \/><\/a><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/sabmillerabinbev.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-13267\" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/sabmillerabinbev.jpg\" alt=\"\" width=\"330\" height=\"166\" \/><\/a><\/p>\n<p>Dear\u00a0<strong>PGM Capital\u00a0<\/strong>Blog readers,<\/p>\n<p>In this weekend&#8217;s blog edition we want to discuss some of the most important events that happened in the global capital markets, the world economy and the world of money in the week of October 12, 2015:<\/p>\n<ul>\n<li>Anheuser-Bush Inbev agrees to buy SabMiller for 68\u00a0billion British Pound<\/li>\n<li>Walmart warns that strong US-Dollar will hurt its earnings.<\/li>\n<\/ul>\n<p><strong><span style=\"color: #0000ff;\">AB-INBEV TO BUY SABMILLER FOR 68 BILLION BRITISH POUND:<\/span><br \/>\n<\/strong>On Tuesday, October 13, SABMiller (LSE: SAB) announced, that it has agreed to sell itself to Anheuser-Busch InBev (NYSE: BUD) for US$104 billion (\u00a368 billion) in a deal that will be the biggest takeover of a British company and create the world\u2019s first global brewer, with a value of around US$275 billion, in what could be one of the top six corporate takeovers in history.<\/p>\n<p>AB InBev \u2013 which brews Budweiser and Stella Artois \u2013 proposed to pay \u00a344 a share in cash for each SABMiller share. As can be seen from below chart, based on the news SABMiller shares rose 8.6% to \u00a339.31.<\/p>\n<p><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/181015-Screen-Shot-2015-10-18-at-2.14.01-PM.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-13261\" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/181015-Screen-Shot-2015-10-18-at-2.14.01-PM.png\" alt=\"\" width=\"600\" height=\"319\" \/><\/a><\/p>\n<p>The takeover, one of the top six deals in corporate history, will create a brewing empire making about a third of the world\u2019s beer. AB InBev is already the world\u2019s biggest brewer, and SABMiller is its closest rival.<\/p>\n<p>The deal would create a company generating more than US$ 70 billion of annual revenue from brewing 80 billion liters of beer a year. The giant corporation will have big operations in Europe, north America, Latin America and the Asia Pacific region, and will give AB InBev, the brewer of the US\u2019s favorite beer, Bud Light, access to the fast-growing African beer market.<\/p>\n<p><strong><span style=\"color: #0000ff;\">WALMART GIVES EARNINGS WARNING:<\/span><br \/>\n<\/strong>On Wednesday, October 14, Wal-Mart Stores Inc. (NYSE: WMT) suffered its worst stock decline in more than 27 years after predicting a drop in annual profit, underscoring the giant retailer\u2019s struggles to reignite growth.<\/p>\n<p>As can be seen from below chart, it slid further on Thursday. Wal-Mart dropped about 5.7% on Thursday to post a new 52-week low of U$58.61 against a 52-week high of US$90.97.<\/p>\n<p><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/181015-Screen-Shot-2015-10-18-at-2.19.14-PM.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-13259\" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/181015-Screen-Shot-2015-10-18-at-2.19.14-PM.png\" alt=\"\" width=\"600\" height=\"330\" \/><\/a><\/p>\n<p>Earnings will decrease 6% to 12% in fiscal 2017, which ends in January of that year, the Bentonville, Arkansas-based company said at its investor day on Wednesday.<\/p>\n<p>Investors were stunned and its stock plunged 10% on Wednesday, instantly wiping out more than $21 billion in shareholder wealth. That drop was bad for anyone who owns shares of Walmart.<\/p>\n<p><span style=\"color: #0000ff;\"><strong>PGM CAPITAL COMMENTS:<\/strong><\/span><\/p>\n<p><strong>AB-Inbev &#8211; SABMiller merger:<br \/>\n<\/strong>Anheuser-Busch InBev\u2019s proposed $106 billion deal to buy SABMiller will create the world\u2019s largest brewer \u2014 an intercontinental giant with 30% of global beer sales.<\/p>\n<p>The deal is partly motivated by both companies\u2019 need to defend their market share in mature markets as younger consumers abandon big brands and move towards craft beers; but perhaps more importantly, it offers AB InBev access to the beer industry\u2019s last great growth frontier \u2014 Africa.<\/p>\n<p>Analyst\u00a0forecast that 40% of profit growth in the brewing industry over the next decade will come from Sub-Saharan African markets, but InBev, which owns brands including Budweiser, Corona and Stella Artois, has yet to establish a foothold in the region. By contrast, SABMiller has around 40 brands in Africa, and makes around a third of its profit and revenue across 37 African markets.<\/p>\n<p>The man behind it all is, Brazilian riches man <a href=\"https:\/\/en.wikipedia.org\/wiki\/Jorge_Paulo_Lemann\" target=\"_blank\">Jorge Paulo Lemann<\/a>, the head of private equity firm 3G Capital, which has done deals with Kraft, Heinz, and Burger King.<\/p>\n<div id=\"attachment_13257\" style=\"width: 410px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/jorge-lemann.jpg\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-13257\" class=\"wp-image-13257\" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/jorge-lemann.jpg\" alt=\"\" width=\"400\" height=\"300\" \/><\/a><p id=\"caption-attachment-13257\" class=\"wp-caption-text\">Jorge Paulo Lemann<\/p><\/div>\n<p>In 1999, Lemann and two partners created AmBev, a master company of all the brewers they had acquired.<\/p>\n<p>Then in 2004 AmBev bought Belgian brewer Interbrew to create InBev. Then InBev bought US-based Anheuser-Busch for US$52 billion in 2008.<\/p>\n<p>Now Anheuser-Busch InBev is bidding for SAB Miller.<\/p>\n<p><span style=\"color: #0000ff;\"><strong><span style=\"color: #000000;\">WalMart Earnings Warning:<\/span><br \/>\n<\/strong><\/span>Wal-Mart faces tough competition on multiple fronts, from the relentless expansion of online leader Amazon.com Inc to dollar stores and supermarkets fighting for a piece of its grocery business. Its international operations are also under pressure with a stronger dollar eating into sales.<\/p>\n<p>Wal-Mart also announced a US$20 billion share buyback but the drop in its share price wiped out close to the same amount in market value, and the 10 percent drop was the worst one-day percentage performance since January 1988.<\/p>\n<p>As can be seen from below chart, the company&#8217;s shares are down more than 30% YTD and currently trading at a 4-year low.<\/p>\n<p><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/181015-Screen-Shot-2015-10-18-at-2.20.10-PM.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-13258\" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2015\/10\/181015-Screen-Shot-2015-10-18-at-2.20.10-PM.png\" alt=\"\" width=\"600\" height=\"331\" \/><\/a><\/p>\n<p>The company said it would slow the pace of new-store openings in the U.S., where it operates about 4,600 outlets. Last fiscal year, Wal-Mart opened 354 U.S. stores, including Supercenters and its smaller Neighborhood Markets. Next fiscal year, the company estimates it will add between 135 and 155 stores.<\/p>\n<p>Because of the slowdown, Wal-Mart now expects capital investments of about US$11 billion next business year, down from the US$12.4 billion it expects to spend this year.<\/p>\n<p>Until next week.<\/p>\n<p>Yours sincerely,<\/p>\n<div id=\"moreHeadlines\">\n<p><a href=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2014\/05\/Suriname-Times-foto.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-9925 \" src=\"http:\/\/www.pgm-blog.com\/wp-content\/uploads\/2014\/05\/Suriname-Times-foto-150x150.jpg\" alt=\"Suriname Times foto\" width=\"96\" height=\"96\" \/><br \/>\n<\/a>Eric Panneflek<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Dear\u00a0PGM Capital\u00a0Blog readers, In this weekend&#8217;s blog edition we want to discuss some of the most important events that happened in the global capital markets, the world economy and the world of money in the week of October 12, 2015: Anheuser-Bush Inbev agrees to buy SabMiller for 68\u00a0billion British Pound Walmart warns that strong US-Dollar<a href=\"https:\/\/www.pgmcapital.com\/nl\/highlight-of-the-week-of-october-12-2015\/\">[&#8230;]<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7,23,9,10,11,19,26,13,29,15,22,1,17,18],"tags":[],"class_list":["post-13243","post","type-post","status-publish","format-standard","hentry","category-commodities","category-earnings-report","category-emerging-markets","category-eric-panneflek","category-euro","category-financial-news","category-logistic","category-market-volatility","category-merger-acquisition","category-pgm-capital","category-the-week-in-review","category-uncategorized","category-us-dollar","category-world-economic-outlook"],"_links":{"self":[{"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/posts\/13243","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/comments?post=13243"}],"version-history":[{"count":0,"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/posts\/13243\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/media?parent=13243"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/categories?post=13243"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pgmcapital.com\/nl\/wp-json\/wp\/v2\/tags?post=13243"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}