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Stock Market News For 21 June: BP, Royal Dutch Shell, Citigroup, Exxon, Coca-Cola

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UK FlagUK

“UK Banks – George Osborne will on Tuesday announce a GBP 3bln tax on banks while promising lower taxes for other businesses. In his first budget, the chancellor will announce a levy at bank balance sheets, not their profit. Osborne will also proceeds with a plan to levy a capital gains tax at around 40% on non-business assets and will soften corporation tax when he announces his budget plans. (Sunday Times)

BP (NYSE:BP) – Co. is seeking to raise USD 50bln to cover the cost of the oil spill in the Gulf of Mexico. The first USD 10bln may come from a bond sale this week, and the company is talking to banks to get a USD 20bln loan. The remaining USD 20bln would come from asset sales over two years. (Sunday Times) Other reports also suggest BP will divest all its North Sea assets’ as it seeks to cut costs by USD 14bln in six months to sustain profitability. The board it also considering whether to sell its 1.4% stake in Rosneft, Russia’s largest oil company. (Observer) Finally, T2 Partners LLC write in a weekend Barron’s article that the co. is extraordinarily cheap and is able to cover damage costs without going bankrupt providing a buying opportunity for the stock. (Barron’s) In other news, co. is preparing to sue its main partner in the leaking oil field for its share of clean-up costs after Anadarko, which has a 25% stake in the well, signalled that it will refuse to pay up. (Telegraph)

- Co. says on June 19, a total of approximately 11,050 barrels of oil was collected, which is less than recent averages because process facilities were shutdown for part of the day. Co. added that the cost of the response to date amounts to approximately USD 2.0bln. Co. says preparations continue for the next step in containment operations, and construction of the first floating riser remain on schedule for the end of June. Co. further said that work on first relief well reached a depth of 15,936 feet and work on second well is at a measured depth of 10,000 feet. (RTRS/Sources)

Royal Dutch Shell (RDS) – Co. has confirmed it is still talking to a potential bidder for its east Montreal oil refinery. (Edmonton Journal)

BHP Billiton (NYSE:BHP) /Rio Tinto (NYSE:RTP) – Australia’s competition watchdog has set a July 22 deadline to review a proposed USD 116bln Iron ore joint venture between the co.s. In other news, co.s have agreed to pay higher royalty rates to the Western Australian state government in return for approval for their USD 116bln joint venture. The miners said in separate statements they would pay the state government a royalty of 5.625% on sales revenue of Iron ore fines, up from 3.75%, and 5% for beneficiated or lower grade ore, up from 3.25%. (RTRS)

Prudential – Jim Schiro, the former chief executive of Zurich Financial Services, has emerged as a candidate to replace the co. chairman, Harvey McGrath, if the former Man Group boss bows to investor pressure and quits. (Independent)

US FlagUS

US Financials – The SEC is stepping up its investigation into the complicated mortgage securities at the heart of the financial crisis, focusing on deals by an Illinois-based hedge fund that made big profits as these securities went sour. (WSJ)

Citigroup (NYSE:C) – Co. has positioned itself to sustain profitability through cost cuts and reduced risks, its chief executive Vikram Pandit told reporters on Saturday. (RTRS)

Exxon (NYSE:XOM) – The expected closing of co.’s purchase of XTO Energy later this month could end a year-long slump for co. shares, Barron’s reported on Sunday. (Barron’s)

Coca-Cola (NYSE:KO) – Co. plans to spend JPY 50 bln (USD 556 mln) over the next 3 years to consolidate some of its operations in the Tokyo area.

Metlife (NYSE:MET) – Co. shares could rise into the USD 50 range over the next two years from about USD 41 now as its profits rise, Barron’s said on Sunday. (RTRS)

Northrop Grumman (NYSE:NOC) – Co. beat Lockheed Martin (NYSE:LMT) and was awarded a USD 517mln contract by the US Army last week to build airships. (Sunday Express)

Anadarko – BP is preparing to sue co., its main partner in the leaking oil field for its share of clean-up costs after co. which has a 25% stake in the well signalled that it will refuse to pay up. (Telegraph) In other news, Moody’s downgraded co. long term debt, and placed the co.’s ratings under review for further possible downgrades. (AP)

US Steel Cos. – Shares of U.S. steel companies are undervalued after being battered in recent months by global economic worries, Barron’s reported on Sunday.(Barron’s)

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GERMANY

BASF – Co. has completed a final analysis of Cognis GmbH and will agree on June 22 to buy the specialty-chemical maker for about EUR 3.2bln, according to people familiar with the transaction. (FT Deutschland)

Infineon – Co’s CEO said the co. is well placed for acquisitions. (Sources)

FRANCE

BNP Paribas – Co. is aiming to double its Latin American revenue of EUR 300mln last year within three or four years, according to the head of Brazilian operations. (Les Echos)

France Telecom – Co.’s supervisory board has approved the firm’s participation in a joint bid with two other investors for a stake in Le Monde, according to a source close to the matter. (RTRS)

Axa/Resolution – Resolution plan to extract GBP 800 mln from the assets it is acquiring from AXA. (Sunday Times)

Bouygues – Co.’s construction unit has won a EUR 360mln contract to build a tunnel in Hong Kong. (Sources)

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