– BG Group plc (BG/ LN): In a press release this morning, Shell confirmed it got the Australian Foreign Investment Review Board (FIRB) approval. Shell CEO, Ben van Beurden, says “We remain on track to complete the deal in early 2016.”. FIRB approval was granted and never any real gating item after ACCC already cleared the deal in November. Slightly surprised to see spread behaving so well despite crude prices collapsing yesterday. Would cut small portion of existing position at GBp 80 levels, awaiting further crude price evolution over next 1-2 weeks.

– Fagron NV (FAGR BB): Belgian disaster stock story continued with stock having now almost halved to EUR 8 price levels since Friday – after it has become evident that a large equity raise with huge current shareholder dilution seems the most probable path forward now – while the company is facing both firstly reimbursement pressures in the US and EU, and secondly civil investigative demands by the US DoJ regarding a sector-wide investigation re aggressive pricing by pharmaceutical compounders. Too much negative and external, regulatory uncertainty to get comfortable that Fagron could escape from its out its debt fuelled death spiral. Just one to monitor for now.

– Belgian telecoms market (Proximus NV (PROX BB); Mobistar (MOBB BB); Telenet NV (TNET BB)): Large sell-side sector note on Belgian telecoms market highlighting that Belgium’s telecoms sector dynamics are about to change with the expected Telenet/Base transaction to be approved and the revised cable wholesale obligation in Belgium to come into force in 2016. Sector note highlights that Mobistar would be greatest beneficiary of these dynamics (able to offer better multiplay propositions and increasing market share) and that Proximus might be most at risk, given it is expected to prioritise margin over share. Although we agree on increased competition for Proximus, we like Proximus in the EUR 29-30 range, given its below sector valuation, its under leveraged balance sheet, and fact that Proximus could be prime candidate for European sector consolidation for the likes of Orange SA (who is actively looking at large one-country telecoms operators – although would first have to sort its stake in other Belgian operator Mobistar) or other telecom operators with pan-European aspirations- now that Belgian government recently dropped a legal requirement to maintain a majority stake in Proximus.  

– Deutsche Wohnen (DWNI GY) / Vonovia (VNA GY): Couple of small developments in Vonovia’s hostile pursuit of Deutsche Wohnen: 1) Deutsche Wohnen announced the acquisition of a 13.600 residential units EUR 1.2bn property portfolio from Patrizia; 2) Vonovia’s shareholders just about (78% approval vs 75% required) approved the required capital raise for an acquisition of Deutsche Wohnen; 3) the offer document was published, with offer period to run until Jan 26; and 4) most likely that deal will receive Phase 1 approval from the German Bundeskartellamt next week.