Vanguard is a tale of high expectations and the giant corporate belly. In fact, it only took four months after Vanguard’s release for Sony to gobble up the developers, Sigil. When Vanguard released in 2007, it was awarded the “Biggest Disappointment of the Year” award by Gamespy, noting the title’s lack of content, buggy performance, and the fact that the title was shoved out the door before completion.

It’s been a rocky two years for the title that was once touted as the Everquest 2 Killer. On the plus side, if anything just to get the good news out first, there will be more frequent (yet smaller) updates this year. Vanguard is looking at 2010 as a year to fix bugs, crush bugs, and fumigate the house. The developers are also looking at focusing on the story elements of the game, starting and ending chunks of storyline.

But the bad news, and there always is some, is that some planned updates have been shelved indefinitely:

• Alternate Advancement
• Halls of Shattered Souls
• Stiirhaad Mountains
• Pankor Zhi
• Nexus

Server mergers are also being planned, although nothing is set in stone at this point in time. But to answer a question asked on MMORPG:

So with the above features out, what is the team going to be working on in 2010?

Their resume. Everquest 2? That Star Wars casual MMO!

Most of us are aware that Sony likes to hold on to their titles until the bitter end, so your guess is as good as any as to what will happen to Vanguard in 2010. My prediction? Well, if Vanguard offers a lifetime subscription option at some point this year, consider how short that life time will be. I have a rule against predicting death, but there is very little doubt that Vanguard is on its death bed.

Yeah… I have to agree with this quote from an email titled, Concert Buyers Beware! from a group that includes the Black Cat and 9:30 club. Re: a potential Ticketmaster/Live Nation merger.  (click the quote for full article from the Examiner.)

“There’s a train wreck about to happen and consumer groups say YOU will be the victim if the two most powerful corporate interests in the live concert business get their way. But you can help stop the merger of Ticketmaster and Live Nation. The government needs to hear from music fans now. Tell the Department of Justice that you’re against these monopolies amassing illegal power over consumers, before it’s too late. antitrust.complaints@usdoj.gov.”

Raise your hand if you trust Ticketmaster for even a hot second to act responsibly.

That’s what I thought. Let’s get those emails rolling, folks!

Maybe I’m naturally more calculating and sentimentally austere than the average person (you can be the judge), but it’s hard for me not to look at romantic relationships in the same way C-level executives and investment bankers would look at a corporate merger or acquisition. The “deal” just has to make sense, right?

Any corporate merger or romantic relationship that lacks the crucial building blocks–expected creation of unique benefits, compatibility of culture and values, and a shared vision of the future–has little long-term viability.

When corporations look at strategic acquisitions, they tend to focus on the following:

• Revenue (“top-line”) synergies resulting from exposure to new markets, access to distribution channels, etc.
• Earnings (“bottom-line”) synergies resulting from improvements in cost margins
• Cultural integration of the employees of both firms

Shareholders and management of both corporations engage when both believe that the combination of the firms results in a value greater than the sum of the two parts. Corporate control issues aside, if a 1+1=3 situation does not exist, the combination will not occur. Typical language includes:

• “The acquisition brings [us] some of the world’s premier consumer brands.” – Johnson & Johnson buying Pfizer’s consumer healthcare business for $16.6 bn (2006)
• “[The acquisition will make us] bigger, bolder, and better than we could be apart.” – CBS acquisition of CNET Networks, $1.8 bn (2008)
• “Our shared culture, strong operational leadership and ability to successfully integrate operations…should allow us to bring the businesses together quickly and seamlessly. The [merger] will enable us to bring innovative products and packages to market faster, streamline our manufacturing and distribution systems and react more quickly to changes in the marketplace.” – PepsiCo’s merger with PepsiAmericas and Pepsi Bottling, $7.8 bn (2009)

Similarly, when two rational people in a monogamous society are romantically fond of each other, they would seek to enter a partnership where both people believe the benefits of that relationship are greater than the cost (risk) of exclusivity. In a good relationship or in the conversations leading to a relationship, expect to hear:

• “You make me happy in ways no one else ever has or can.”
• “We understand each other. We’re on the same wavelength and you finish my sentences. It just feels right.”
• “You make me feel special in ways that give me the confidence to do anything.”

I see three major and common themes between corporate M&A and relationships:

1. Creation of unique benefits
2. Compatibility of culture and values
3. Shared vision of the future

Any merger or relationship that lacks these crucial building blocks has little long-term viability. It’s no surprise then that a tiny percentage of potential merger combinations ever occur, and thanks to over-eager management teams, lawyers and investment bankers, an undesirably low percentage of these completed mergers actually create value for shareholders. James Surowiecki, columnist for The New Yorker, wrote in 2008 that “corporate marriages only rarely end in bliss—many studies have found that most mergers and acquisitions do little for the acquiring company’s bottom line.” He cites two studies, one a KPMG study of 700 mergers that showed only 17% created real value, and the other a 1990 McKinsey study that found less than 25% of mergers earned excess return on investment. The culprits are typical: overpayment (part of a phenomenon known as Winner’s Curse), lack of foresight into realistic implementation of many proposed synergies, and management’s motivation to “do something” for shareholders while simply seeking to increase their control over resources.

Relationships are the same way. Nowadays, most people explore their romantic interests with at least one person before the person whom they marry. According to the 2004 ABC American Sex Survey, a man has, on average, eight sex partners before marriage; a woman has three (let’s assume that the number of sexual partners is a close proxy for the number of dating partners, or at least that 8 and 3 are statistically different from 1). When two people do finally enter into a holy and eternal union, approximately 40% of these end in divorce (Source: NYTimes, 2005). What these statistics tell us is that people are willing to make some effort to find compatibility, but that due to infatuation or desperation, people are disappointingly bad at choosing life partners and creating the kind of value (happiness) for which they had hoped.

People are willing to make some effort to find compatibility, but due to infatuation or desperation, people are disappointingly bad at choosing life partners and creating the kind of value (happiness) for which they had hoped.

What may surprise you is that the tax code actually makes it very difficult for any couple to enjoy any sort of economic benefit from marriage; in fact, there’s almost always a marriage penalty.

Please feel free to look into the calculations reached above by downloading this file.

What a purely economic analysis of marriage, like a purely economic analysis of corporate M&A, fails to take into account are intangibles whose “value” is either difficult or impossible to measure.

Synergies come in many forms. In the corporate world, the presence of a charismatic executive can have a substantial impact on corporate culture, which can improve employee productivity and generate previously unpredictable gains in value. On the other hand, two groups of brilliant research scientists can be combined, but if they don’t learn to work together  and, instead, pride forces them to become very territorial over the creation of new intellectual property, this can quickly erode the value of expected synergies.

Analogues exist with relationships. For example, the ability of a wife to provide the right kind of emotional support and encouragement to her husband at a critical moment in his career may significantly affect his level of self-actualization and sense of accomplishment, which greatly increases the couple’s level of happiness (and may produce economic benefits as well).  It is impossible to predict or measure this kind of value, but that hardly means it doesn’t exist.

You may wonder if the optimal solution lies in remaining boyfriend/girlfriend forever (best of both worlds: positive intangibles while preserving economic value). Perhaps, but I still disagree. For one, the merger of two human beings should be based on a solemn commitment, which communicates to both husband and wife a sense of belonging and protection. Humans are social creatures, and the guaranteed attention and affection of loved ones, especially from the loved one, creates non-substitutable value. Additionally, I just learned that marriage confers nearly 1,400 legal rights upon spouses, which can be extremely important in situations where you need someone you trust to make important decisions on your behalf (such as in highly unfortunate situations such as what happened to the late Terri Schiavo). If we lived in a perfect world and didn’t value some form of guaranteed human contact, marriage probably wouldn’t be as important. Putting on my financier hat once again, marriage could therefore be seen as a risk hedge, and the economic sacrifice can be interpreted as the price of owning at-the-money call and put options, a strategy known as a Long Straddle (similar to a Long Strangle, but somehow likening marriage to something called a long strangle doesn’t seem right).

Although it is not possible to quantify all of the benefits of corporate or human relationships, looking at the latter with the same  level of rigor as lawyers and bankers do for the former is a valuable exercise; if nothing else, it provides a framework. No need to perform a Merger Consequences analysis with projected accretion/dilution, or form of consideration analysis, but seriously think about the happiness your significant other brings to you, and whether that person will treasure you no matter what (“in sickness and in health till death do us part”).

And if that person has a trust fund.

Just kidding.

2009 was an interesting year. It was certainly better than 2008, but new solution buyers still seem to be cautious, but they’re out there.

There were alot of personnel changes at Sage, some understood, some not.

Partners closed their doors either by choice or their circumstances demanded a change. Other partners chose the comfort of a merger with a larger VAR who could protect their tier & provide them with resources that they didn’t have prior to the merger.

Still, other one time Select partners picked up other solutions outside the Sage family in hopes that the ability to offer product diversity would add additional sources of revenue.

Overall business was about what everyone expected, but the interesting outcome of talking with alot of partners is that there is some hope in the air that the worst is behind us.

The second part to those conversations is that people are starting to believe in the current leadership that we have at Sage.

A new method of business was probably just what the doctor ordered & now we’re having to find better ways to take care of our customers.

Social media is not just an buzzword, it’s here to stay. Look at the number of members of this group (2,900+) LinkedIn has over 50 million daily users, Facebook has 350 million active users. Twitter doesn’t release their user base numbers, but I’m sure their numbers are up there to. Are you utilizing these new sources to their fullest?

Let’s all say goodbye to 2009 & bring in 2010 & all that it will bring.

Partygaming and Bwin are in merger talks worth an estimated 2 billion pounds.

Various reports claim Partygaming, the parent company of Party Poker, and Bwin, the Austrian eGaming operator of the year, have been in merger talks since the summer to create a multi-billion pound industry giant.

Partygaming shares rose 3.3% in London, and Bwin Interactive Entertainment rose 4.2% in Vienna following the merger news.

You are here: Home / Car News / VW-Suzuki merger imminent, Up! production set for 2011VW-Suzuki merger imminent, Up! production set for 2011

December 9, 2009 by Tim Beissmann

16 Comments

Volkswagen AG is moving closer to a taking up a 20 percent stake in Suzuki Motor Corp, with three direct sources admitting the deal is imminent.

One told Reuters that an announcement could come as early as this week and that it may just be the first step in the process, with VW possibly looking to expand its share to one-third or more.

It is believed a 20 percent share in Suzuki – Japan’s fourth-largest vehicle manufacturer – would be worth around 250 billion yen (AUD$3.12 billion).

Neither VW nor Suzuki is commenting on the proposed merger at the moment, but VW has previously said it was keen to gain small car know-how from the from the baby car master that is dominant in India.

News of the merger was made even more intriguing today with the announcement by VW that it will produce its new Up! range of small cars in Bratislava, Slovakia, from 2011.

 The Up!, Space Up! and Space Up! Blue will join the Touareg, Audi Q7, Porsche Cayenne and Skoda Octavia on the production line, increasing capacity to 400,000 vehicles per year.

“The launch of production which is scheduled for 2011 will add 1500 new jobs to 7800 jobs already at the plant,” VW chief executive, Andreas Tostmann, said.

Total investment in the plant is estimated to be AUD$619 million.

With the recent announcement of the Comcast / NBC deal and with Jeff Zucker taking over the leadership, can we tag the merger as defensive or visionary?   How about both?   I ask this because with video streaming threatening the broadcast business, NBC needs more access to infrastructure for their content.  Comcast owns that.  With Netflix looking to change the paradigm with their streaming service and NBC competing with Hulu, Comcast has to be wondering what happens to the cost of and availability of content?  They are big into TV Everywhere and with this deal they stay in the game at all levels with direct access to infrastructure and direct control over the ability to create original content.   They also get access to the movie distribution infrastructure!  Zucker has proven that he can create margin instead of awards.  While it is bad press to be in last place in the ratings, I have heard that the GE execs love Zucker because he knows how to drive margin.  What this means for the quality of shows that are available is questionable.  I would choose a moderately good episode of West Wing or the light-hearted parody of Seinfeld over the best Fear Factor or The Biggest Loser any day of the week.  But…  I am not in the majority and… I do not have to answer the challenge, “how do I make money doing this…” like Zucker does.  Therefore, I cannot fault him.  “We the people…” can influence Zucker’s direction by voting with our remote controls at any time by changing channels… for now.

How much television do you watch? Now, how much television do you watch on your television? If you’re like me you don’t have time for such pesky things as TV schedules and minutes-long commercial breaks. In this day in age the Internet is king, and the king mandated that we the people shall get some TV whenever we want it.

As of last week, change that mandate from some to all: One the world’s largest cable service providers, Comcast, has bought NBC. You know, NBC! Aka the NATIONAL Broadcasting Company, aka the parent network of CNBC, Bravo and USA (among many others). With this merger, a big, drooling, fire-breathing, Chuck-Norrising, monster, behemoth has been born.

Comcast is the largest ISP (internet service provider) with nearly 20 million subscribers, and NBC, is well, NBC. So what’s so special about this merger? I’ll put it this way: Not only does Comcast not control the tubes that connect us all, they can control what flows through those tubes (in terms of digital entertainment).

Now, there are two camps probably forming at this point. On one side we have the “WTF Comcast?! Way to go and destroy my Net Neutrality dreams!” camp, and on the other side we have the “Woohoo! I’m so pumped because now I will have more access to all my favorite hit NBC shows like Community, The Office and 30 Rock (it’s comedy night done right, starting tonight at 8:30! Am I right NBC? That pitch was free, the next one won’t be)!

The latter camp has good reason to be excited. Today, no one pays attention to the schedules TV stations set up because God gave us things like TiVo and Hulu. When we want our entertainment, we get it. This Comcast-NBC deal will make this even more true than it already is.

Though this is exciting, I do also sympathize with the “WTF?!” camp. Comcast controlling what entertainment you consume means that it is the decider. Want to catch some Leno? No problem! “Here you go”, Comcast will say, “watch as much Jay as you want!” Now should you have the nerve to watch Jimmy Kimmel Live on ABC, well Comcast may very well be to say “You want Kimmel? OK. As long as you pay us, not a problem.” I think I just got a shiver down my spine, because that could be one dark future.

Having to pay to watch Jimmy Kimmel, may be a scary notion, but you could come out from under the covers for a little bit, because nothing has actually been set yet. Thankfully you live in the United States of Insanely-complex-government-system-rica, and it likely will not be another year until you actually see the full effects of this merger. There’s the FCC, the FTC, the Justice Department and who knows who else that needs to approve this merger. This merger will be a hot topic in parts of Washington over the next year, and could seriously shake up how we get our Conan in a year’s time. Speaking of Conan, check out his take on this merger in a clip from The Tonight Show!

This is a legal process by which a company is allowed to extinguish or reduce liability on  any of its shares in respect of share capital not paid up or allowed to cancel any paid up share capital which is lost or is allowed to pay off any paid up capital which is in excess of its environment.

A company may do so by-

• Extinguishing of reducing the liability in respect of share capital not paid up

             A company may have come out with an issue of capital, wherein shareholders will be required to pay the issue price in stages, as and when called. Before all the calls are made, the project may be over and the further funds may not be immediately required. In such a case, the company can reduce capital by extinguishing or reducing the liability in respect of share capital not paid up.

• Writing off or cancelling the capital which is lost

             If the company has been incurring losses for a long period of time and the accumulated loss has gone beyond the reserves which it had built in the past, it would have actually lost a part of its paid up capital. This means art of paid up capital is no more represented by any real asset. here, the company may have been showing the accumulated loss as a fictitious asset in the asset side of the Balance Sheet and in parallel would have been showing its paid up capital at a historical figure, figure more than what actually exists. For Example: if a company has a total Capital of 1 Crore and accumulated paid up capital of 50 Lakhs. It will be added in Debit side of the Balance Sheet and the net will be deducted from the Capital to show an aggregate of the total as 50 lace in Capital part.

• Buy-back of Securities

              This is an important tool of capital restructuring. When a company holds excess cash, which it does not require in medium term; it is prudent for the company to return this excess cash to its shareholders. Such situation arises at the beginning of recessionary phase. In such situations even Interest Rates come down and Stock Markets show Bearish Nature.

One way a company returns excess crash to its shareholders is by paying a hefty special or onetime dividend. Another is to buy-back of equity shares hence indirectly increasing the promoters voting rights without making an open offer. This is also called Creeping Acquisition.

This week we announced that Inovis and GXS have signed a definitive agreement to merge our two companies.  This merger is expected to be finalized the first half of 2010 pending regulatory approval.  We believe, and early industry analyst feedback agrees, that this is a deal that will significantly change the B2B e-commerce landscape.   We believe the merger of our two companies will advance our respective customers’ ability to achieve total B2B integration efficiently and cost-effectively.

It was a bit of a shock to our team when I announced the merger with one of our biggest competitors.  As one employee asked me, “How do we merge with the people we hate?”  As  our people thought about it a bit more, the feedback I received was that this makes sense.  Our team has quickly moved on to think about what the combined company could do for our great customers.

The feedback from our customers and partners has been very  positive.  We really feel great about the large numbers of customers that talked about wanting to keep the great Inovis people on their account and the Inovis products in place.   As always, Inovis is dedicated to our commitment to maintaining and increasing levels of innovation and service, and through this merger, we will extend our global reach, increase network scale and efficiency, maximize the depth and scope of services-based architecture, and allow new and greater product capabilities.

Change is unsettling for our team and our customers, but we firmly believe our business going forward will be nothing short of the world’s premier service provider exclusively focused on B2B e-commerce and integration.   We will still face stiff competition from great competitors like Sterling, Axway, Easylink, nubridges, SPS Commerce, Descartes and Extol as we move forward after completing the merger.  This competition, as always, will drive innovation that will benefit the market we serve.

We are excited about the future, but until the merger closes we will continue to operate as Inovis and provide the market leading operation execution and innovation excellence you have come to depend on us for every day.

To learn more about the merger please visit www.inovis.com/gxs.

The Virginia based AOL now worth $2.5 B down from their $100 B valuation prior to their 2001 merger with Time Warner. AOL will start a new life starting tomorrow completely independent from their sugar daddy, Time Warner. Their stock will start trading tomorrow on the New York Stock Exchange. The sugar daddies ended up having one share of AOL for each of their 11 shares after the market closed today. I wonder what’s going to happen to them tomorrow after market closes. I hope they go higher. It will be good for us Washingtonians – the more successful companies around D.C, the better for all of us.

I remember their merger from my Web 1.0 days when I was running my first internet company, telezoo.com:

When I heard about their deal, I just could not comprehend why the analysts and other old farts were so optimistic about it. None of my numbers added up. I just figured I was new to world of business. So, I told myself they knew what they were doing. Nearly, nine years gone, they are divorce now, and the same old farts who are older now are saying the merger was one of the most disastrous of all time. Well, that makes me feel better. I am now convinced I am not an idiot. In fact, I was right all along.

Just curious how a company of $2.5 B with over 90%of their dial-up Internet business gone, how do they plan to compete with a $186 B Google (NASD: GOOG) and $21 B Yahoo (NASD: YHOO). AOL has to reinvent themselves in such competitive space. I hear they plan to lay off 2,500 – 3,000 people.

Scott Rosenberg of those days with Salon.com was the closest who shared my view:

I wish them luck. A LOT OF LUCK!

Dallas-based Overhead Door Corp. has completed its purchase of the door and storm-panel operations of Wayne-Dalton Corp., based in southern Ohio. Here we go folks!

The deal creates the largest maker and distributor of residential and commercial overhead doors in North America, with a combined 3,800 employees, 24 manufacturing facilities, 79 regional distribution centers and 2008 revenue of about $1 billion. For now. We’ll see how long it lasts until they start laying off people and closing facilities due to overlap.

Overhead Door, said in a statement the acquisition would enhance the company’s position within the residential and commercial door market and help ensure long-term growth. It also will allow both groups to continue to focus on product innovations that will generate better and feature-rich products for the marketplace. Unlikely.

As part of the integration, the brand identities, product lines and distribution channels of both Overhead Door and Wayne-Dalton will be preserved. We’ll see if that happens. It’s been attempted before and never lasted. Turned out to be a fiasco.

On Thursday, Comcast publicly announced a deal to acquire a majority stake in NBC Universal. The deal is a clear attempt for Comcast, a national leader in phone, internet and cable distribution, to leap into the business of providing content. But is the obvious attempt at vertical integration another AOL Time Warner in the making, or more important, is this move good for consumer choice and free flow of information?

It seems that the aforementioned deal is evidence that these kind of distributor-content mergers are a disappointment for both businesses and consumers. The AOL Time Warner merger was a disaster financially, with the company reporting a nearly $100 billion loss in 2002 (just a year after the merger). While this loss was mostly due to declining productivity of America OnLine and loss of market share in internet distribution, the losses by AOL sent the once-proud Warner into a tailspin which it has yet to recover from. Timer Warner has been forced to sell off countless of television holdings and rights since the merger, as AOL has dragged Warner down.

If the Comcast NBC merger goes through it would be unlikely, but possible, that a similar situation could arise for Comcast/NBC. For example, what if a shift in the home phone market crippled Comcast’s phone provider service like how the rise of dsl internet service and new competition destroyed AOL? If this sounds unreasonable, consider how more young Americans are ditching home phones in favor of using only cellular service. Also, with the rise of internet-ready phones and voice over internet protocol (VIOP) it is not unlikely to see home phone service replaced by cellular internet communication in the not too distant future. Imagine what would to happen to Comcast if a company put out a cellular device with wifi or resonable 3G internet charges, and allowed users to use a free VIOP program. (HINT: keep waiting for Google’s driod phone to develop). NBC would surely lose on a merger if Comcast’s business model faltered.

However, what is more likely is that consumers will lose out big on this deal. A larger Comcast will be from a position of power and can leverage for higher higher subscription rates for services. Also, with Comcast getting into the world of providing content, expect Comcast to fight with other cable and satellite tv distributors over the rights to NBC Universal channels. In response, expect Comcast’s competitors to do the same. Expect a divide in access to sports channels – the ESPN network against the Versus/NBC Sports. Expect competing providers to drop popular NBC programming such as Saturday Night Live, Law and Order, and The Office. Expect Comcast to integrate Hulu into a for-pay model.

Worst off, expect 30 Rock to stop making fun of GE products, as General Electric is selling its controlling interest to Comcast. How will they manage?

Geokinetics Inc. and Petroleum Geo-Services (PGS) have signed a definitive agreement under which Geokinetics, provider of seismic data acquisition, processing and interpretation services, will acquire the onshore seismic data acquisition and multi-client data library business of PGS (PGS Onshore) in a cash and stock transaction valued at nearly $210 million, on a cash-free, debt-free basis, which includes net working capital of $37.5 million. The final purchase price is subject to customary post-closing adjustments. The transaction is expected to close in the first quarter of 2010 and is subject to normal closing conditions and regulatory approvals.

            The combination of Geokinetics and PGS Onshore will create the second largest provider of onshore seismic data acquisition services in the world in terms of crew count and the largest based in the Western Hemisphere. The combined company will have the assets and technical capabilities to support up to 38 crews and carry in excess of 207,000 equipment channels and over 150 vibroseis units; and possess in excess of 6,240 sq miles of multi-client library data upon completion of current projects in progress. Empowered by a broad range of technologies that include transition zone (TZ), ocean bottom cable (OBC) and land vibroseis, the new Geokinetics will be able to compete more effectively within the entire seismic value chain of planning, proprietary and multi-client acquisition, processing and interpretation services. Furthermore, this acquisition will propel Geokinetics into new markets, including Alaska and Mexico, as well as certain new countries in the Middle East and North Africa.

            On a pro-forma basis, the new Geokinetics would be expected to generate in excess of $700 million in revenues for 2009. PGS Onshore had backlog of $196 million as of September 30, 2009, and combined with Geokinetics backlog totals $455 million. Geokinetics anticipates the transaction will be highly accretive to 2010 earnings.

            Richard Miles, President and CEO of Geokinetics, said: “We expect the combined company to be better positioned to serve our expanded customer base as we will have an enhanced ability to redeploy assets into more attractive markets. Our increased number of crews should also provide longer term contract opportunities with fewer mobilizations, which should result in better utilization and profitability. In addition, PGS has invested over $130 million over the last three years in their 5,500 sq miles of multi-client library data and multi-client technical capabilities, and we believe this high-quality resource will place us in an important segment of the market in which we have not previously participated in a meaningful way. We look forward to PGS becoming a large shareholder in Geokinetics, as we believe this will provide numerous opportunities going forward and should benefit both companies. We are eager to welcome the PGS Onshore employees into Geokinetics, and look forward to building a stronger, more competitive business.”

            Jon Erik Reinhardsen, President and CEO of Petroleum Geo-Services, commented: “The combination of PGS’ and Geokinetics’ competence and market presence will create a new force in the onshore seismic industry. As a future key shareholder, we are excited about the growth potential and leading market position of the new Geokinetics. This transaction adds value for our shareholders, our employees and our customers. At the same time, this transaction establishes PGS as a focused marine geophysical company. The strengthened financial position of PGS will further allow us to continue to develop the most efficient fleet and leading-edge technology in the industry.”

            Following the closing of the transaction, PGS will become Geokinetics’ second-largest shareholder after Avista Capital Partners. The acquisition is expected to provide annual synergies in excess of $10 million, driven mainly by organizational streamlining and cost reductions. There may be additional synergies via cross-selling opportunities and additional opportunities for processing behind Geokinetics’ expanded number of crews. Geokinetics expects to begin to capitalize on these synergies in mid-2010 as the company starts to benefit from the integration of the two businesses.

            Geokinetics has agreed to finance this acquisition through a combination of cash and common stock. At closing, Geokinetics will issue PGS approximately 2.15 million shares, which represents 19.9% of outstanding Geokinetics shares, valued for purposes of the transaction at $12.11 per share or $26.1 million. The remainder of the purchase price or $183.9 million will be paid in cash. The company will have until February 15, 2010, to close the transaction.

www.geokinetics.com

www.pgs.com

The Live Feed

Those fretting that Comcast will immediately and drastically close theatrical windows once it takes over NBC Universal should take a breath.

Yes, Comcast has been a leading proponent of video on demand, and would like to shorten the theatrical window AND the cable window. But now it will have a big stake in the content creation side as well. And one thing studio execs do NOT want to do is diminish the much larger revenue streams from exhibition and homevideo sales.

Rather, they are engaged in a delicate balancing act, trying to adjust to consumer demand for content in home more quickly while also protecting established revenue streams.  (For more on this, read my Variety story from last week here.)

Brian Roberts is not a digital revolutionary. He is, by all accounts, a button-down businessman who wants more control over his company’s destiny. And that he will have control over both sides of the equation. Will he push for premium VOD ahead of disc releases? Probably.

But he’s not the only one interested in that: Several other studios also favor the notion; the MPAA is pushing the FCC for a waiver that would enable them to better control transmission of their movies into TV sets.

Another prediction: Look for further shortening of standard homevideo/VOD windows on big hits to around three months, rather than four. Already we’re seeing signs of that from Paramount, and Bob Iger recently reiterated the need to get movies to consumers sooner, when they are still perceived as fresh, and therefore desirable. The studios have been testing VOD windows and how they affect DVD sales for some time.

But more than one studio honcho believes that DVD sales will bounce back once the economy does. The last thing they want to do is damage that high-margin business with low-cost VOD alternatives.

The reality is likely to be more prosaic than doomsday scenarios.  This is not, Rafat Ali observes in paidContent, a digital play. Nor is Roberts a reckless conglomerator like Charles Bluhdorn, yawns Peter Bart, who worked for the latter at Paramount.

But make no mistake: Roberts does indeed have his eye on the future.

UPDATE: A few more observations: Steve Burke told analysts yesterday that Comcast would indeed play around with VOD windows, the LAT reports. But I still maintain that the company will tread carefully around the theatrical window, and not just offer movies significantly earlier at the same VOD price we’re used to today.

That could indeed “do serious damage to its studio and the film business generally,” as Kim Masters frets in the Daily Beast.

Burke sounded a pragmatic note, telling analysts that there are “a lot of opportunities out there,” but added, “obviously not all of them are going to work.”

Also intriguing: The effect the acquisition will have on streaming windows. Networks are also experimenting with streaming windows, delaying the streaming of certain programs to try and force viewers to watch during primetime. And there’s growing tension between network brass and Hulu, the popular streaming site jointly owned by NBC and Fox. Read more about the impact of the Comcast deal on web streaming in Brian Stelter’s front-page NYT story.

Comcast Has Bought NBC.

Comcast Communications has finally wrangled NBC Universal away from GE. The question now is, what does this mean? Will TV be affected? Will film production be impacted? NBC Universal is a media company speciaIizing in broadcast TV, cable TV and film production. There is little doubt a $30 billion deal involving the biggest cable operator with one of the crown jewels of entertainment will reshape the industry, but it comes at a particularly unique historical juncture and that juncture suggests the merger is doomed to fail. Comcast is already unwieldy entity.

In interviews with employees there is one constant comment. They have no idea what’s going on. The bosses don’t know what the marching orders are. They complain about working in a vacuum. For projects to get done, even on the simplest levels, approval needs to come from Philadelphia. The initiative to explore or create is stymied by people far away from the scene of action. It reminds one of the old adage about the committee building a race horse. You end up with a mule.

Adding new layers to the corporate structure will make this unwieldiness even more difficult to manage. If a mule is borne from this merger/sale of NBC Universal to Comcast, the possibility of growth will be adversely affected. When adverse growth occurs for any extended time, the short sighted mavens of Wall Street and the persnickety institutional investors will start griping. The possibility of Comcast being abandoned by powerful forces in the financial community is real.

In and of itself, structure does not have to be a problem. The problem for Comcast purchasing NBC is that it is occurring in a period of remarkable transition. Many in the media, newspapers, broadcast TV even cable, do not have clear, distinct goals and even an understanding where things are headed. How can any of these media outlets figure out a path when they have no idea where they are going? What should be particularly worrisome to any entity involved with this sale of NBC Universal to Comcast, is the emerging concept of ‘channels’ on the Internet and that the platform of the future may not be the television set, but the cell phone. How will a big unwieldy company maneuver itself in a rapidly shifting landscape? It will be difficult.

Comcast has achieved a goal it had been seeking for some time. It has nabbed NBC Universal with $30 billion deal. It now is a content rich company to enhance its cable operations. Don’t hold out too much hope that it will succeed. Vertically integrated media empires will not fare well in the coming years, let alone decades.

Like newspapers or radio stations, television will soon be facing some difficulty choices. Ad money will dry up. Competition from the internet will draw viewers away. Erosion on all fronts will accelerate. Eventually cable television will feel the same pressures. Big media empires will need to be nimble to survive. This new company will be huge. Comcast/NBC Universal looks like just another dinosaur lumbering its way to extinction.

# # # # # # # # # #

From opinions to savvy tips, the Frugal Yankee knows how to enjoy life and spend less. Find out more by going to FrugalYankee.com. While you’re there, sign up for the Frugal Yankee Newsletter -  tips, factoids, jokes and more.
Follow the FRUGAL YANKEE is on Twitter .

Way back in January 2000, AOL and Time Warner announced plans to merge. Actually, AOL bought Time Warner in a stock swap and debt acquisition worth $182 billion. At the time, this created the largest digital media entity anywhere. Oh how the mighty do fall as this relationship has dissolved and AOL is but a shell of it’s great self. 

In November, AOL announced it was cutting 100 jobs initially with up to a total of 1,000 jobs eliminated by the time restructuring was complete. It appears that estimate was even short, as AOL has now said they will cut one-third of its staff, pending approval of a new restructuring plan and the completion of its separation from Time Warner. If approved, approximately 2,500 jobs will be eliminated from AOL’s 6,900 employees. In terms of square feet with empty seats, this is in the neighborhood of 600,000+/- SF.  The next likely step is an announcement on lease cancellations.

On a side note: I wonder, if in 10 years, the Comcast-NBC Universal deal will suffer the same fate. It’s already been tagged as creating ”a media behemoth”.  Of course, that’s provided the deal goes through.

It’s taken several months, but it looks like the deal is done: Comcast is buying NBC Universal from GE. Well, at least 51% of it.

While the deal still has to pass regulatory hurdles, it seems likely that The Tonight Show and The Office are going to be part of Comcast’s vast cable operation and its own array of TV programming that includes E! Entertainment, G4, and multiple sports channels.

Comcast is also getting something else out of the deal: Hulu, one of the hottest web properties around and something that Comcast is looking to kill. The fallout of this deal could affect the future direction of online video.

First, let’s be clear: nobody knows what involvement Comcast will have with Hulu. NBC Universal owns 30% of Hulu and Comcast will own only 51% of NBC Universal. In addition, NBC Universal will be a spinoff, meaning that it will operate in many ways like an independent company.

You can bet though that Comcast will have major influence behind NBC’s decisions, including the decisions behind how Hulu is monetized. Comcast has already declared that it prefers a subscription model with its TV Everywhere service, announced in June of this year. TV Everywhere lets Comcast and Time Warner subscribers access certain TV channels and shows online, including TBS and TNT (owned by Time Warner).

This could exactly be in line with Hulu’s future direction. We know that Hulu may start charging for content in 2010, according to an executive from News Corp. Comcast could push it further in that direction.

We think it’s very possible that a two-tiered system of free and paid content will eventually constitute Hulu. The cable giant isn’t going to try to kill Hulu, nor will it have the ability to do so. It realizes that online video is growing, not shrinking, and that it must find ways to adapt. Having Hulu in its arsenal is an asset for the company.

Let us alleviate some of your fears: Comcast won’t force NBC to pull out of Hulu, won’t be removing content from it (more likely, it’ll add content), and won’t make the entire thing a pay service. However, expect Hulu to evolve and expect it to include subscription services, but don’t expect a lot of interference from Comcast.

Austin-based Drilling Info Inc. has acquired HPDI, an energy software and information services company that provides production data and Web-enabled analytical software tools for financial and investment analysis and hydrocarbon marketing sectors. HPDI’s primary focus is historical oil and gas production data along with transportation data, gas plant and refinery data, and well-head pricing data. HPDI offers Web-enabled applications that are used to access their data to create reports, GIS maps, charts and exports to secondary applications.

            Allen Gilmer, Chairman and CEO of DrillingInfo, said: “This acquisition achieves a number of strategic objectives for DrillingInfo and our base of more than 10,000 oil and gas professionals. Among the key benefits of acquiring HPDI is the immediate expansion of our coverage to every oil and gas producing state in the US as well as offshore Gulf of Mexico and certain Canadian provinces.

            “HPDI’s focus on gathering oil and gas production data has allowed them to develop an extremely high-quality database of current and historical production data that complements DrillingInfo’s historical production database, making the combined product the premier US monthly production database. The combination of this with our deep well detail information and mineral leasing and land database is extremely powerful and will enhance our members’ ability to make much better decisions in a fraction of the time.”

            Gilmer continued: “HPDI customers will have the opportunity to enhance their access to decision-critical information and tools through a combined DI Plus Membership. HPDI and DI provide two very different platform options that in combination can be optimized to meet virtually any oil- and gas-related decision support process and workflow.”

            Effective immediately, Drillinginfo All States Members will have access to production data for all oil producing states in the US as well as for offshore Gulf of Mexico and Pacific wells. In addition, Drillinginfo is releasing permit activity data for the corresponding state expansion.

            “The addition of HPDI allows us to fulfill our corporate vision of becoming the single most comprehensive and valuable decision support and workflow platform for the US oil and gas industry, as well as for companies and industries with peripheral and parallel interests,” said Gilmer. “Our commitment to the oil and gas industry and the resident domain expertise of the two companies will allow us to achieve our goals much faster. To say we are excited about this would be a dramatic understatement.”

            HPDI will continue to operate under its current business model and its customer base will not be impacted by this acquisition. All of HPDI’s employees have been retained and operations will not be affected. HPDI customer support will continue to be available through the same channels.

www.drillinginfo.com

www.hpdi.com

It’s World AIDS Day. Watch this vid:

Iron Man 2:


News

• Barack will make an address tonight on Afghanistan, with preliminary reports suggesting a rapid deployment of an additional 30-35,000 troops.
• The proposed Comcast-NBC merger would be the largest media merger in recent history.
• South Africa vows to treat all HIV-positive babies (which is a big change of direction post-Mbeki).

Health care

• Latino voters see health care as the overwhelming priority.

Green

• The folks over at Treehugger debunk the global-warming-conspiracy conspiracy and critique the whole Climategate fallacy.

Finance reform

• The House is moving forward on financial regulation reform; the Senate is sluggish … very sluggish.

Miscellaneous

• My good friend Ziya looks at the different perceptions of beauty.
• Is Lasik worth thousands of dollars?

(CFD.net.au – Contract for Difference, Share, Forex, ETFs, Commodities Traders) –

Until now, a VW statement said, VW had sought to acquire 42 percent of Porsche in the first step of a full merger of the two companies.

The increase stake purchase “reflects the positive development of … discussions between Volkswagen and Porsche,” it said.

The two companies have made good progress on “synergies in several areas,” a VW spokesman said.

VW planned to finance the operation with a capital increase of around 10 billion euros by 2014, with the first tranche launched in the first half of 2010.

“At least four billion euros” would be used to buy Porsche, which will become VW’s 10th brand, the spokesman said.

In August, VW ended months of tension with Porsche by announcing it would take Porsche over in stages during a complex transaction expected to last several years.

The overall calendar has not changed and the final merger of the two groups is still expected to occur in 2011, the VW statement said.

VW wants to raise cash to finance the Porsche purchase, underpin its rating by international agencies and retain “financial flexibility,” the spokesman added.

The capital increase must be approved by VW shareholders at an extraordinary general assembly on December 3.

The total amount being targeted has raised speculation over a possible VW move on the conglomerate MAN, which makes heavy trucks and in which VW is already the dominant shareholder with a stake of around 30 percent.

VW supervisory board president Ferdinand Piech said last month he would like to see 12 brands within the VW group, and the company is also believed to be interested in a tie-up with the Japanese car maker Suzuki.

Source: VW to buy 49.9 per cent of Porsch | Business Breaking News | News.com.au

Carregour

JAKARTA. Komisi Pengawas Persaingan Usaha (KPPU) dalam sidang pleno memastikan kasus dugaan monopoli Carrefour masih terus berlanjut. KPPU geram dengan perilaku Carrefour yang menolak tawaran perubahan. “Dengan begitu kasus akan kami lanjutkan,” tegas Benny Pasaribu, Ketua KPPU.
KPPU juga menambah dua dakwaan baru kepada Carrefour dengan menggunakan pasal 20 dan 28 UU No 5 tahun 1999 mengenai tindakan merger dan akuisisi yang berdampak pada monopoli dan persaingan tidak sehat. Penyelidikan kasus ini bermula ketika Carrefour mengakusisi PT Alfa Retailindo.
Jika merujuk pasal 47 UU No 5 Tahun 1999, Carrefour dapat terancam sanksi melakukan divestasi saham PT Alfa Retailindo. Benny menyebutkan, pendalaman kasus Carrefour akan memakan waktu 90 hari kerja. “Satu dua hari lagi, tim pemeriksa baru akan kami bentuk,” ujar Benny. Yang jelas, KPPU memerlukan tambahan data dan informasi sebelum menjatuhkan putusan.

Direktur Urusan Korporat Carrefour Irawan Kadarwan menolak tuduhan dan dua tambahan pasal baru KPPU. “Kami belum menerima surat dari KPPU terkait dua dakwaan baru. Kami tetap tidak menerima tuduhan KPPU,” tegasnya. Ia bilang, sebelum memulai usaha atau bisnis apapun, Carrefour selalu mengacu pada aturan yang berlaku termasuk UU No 5 Tahun 1999. “Kami tak bisa komentar banyak dulu karena belum mempelajari dua pasal tersebut,” ujar Irawan kepada KONTAN.

Sekretaris Jenderal Asosiasi Pedagang Pasar Seluruh Indonesia (APPSI) Ngadiran bilang, Carrefour boleh saja mendirikan cabang di mana pun asal tidak berhadapan dengan pasar tradisional. “Sangat sulit menemukan pemerintah yang memihak pasar tradisional,” ujarnya. Ngadiran bilang, saat ini, pengusaha toko modern lokal juga sudah mulai menjerit. “Cuma mereka malu karena sama-sama mengklaim pasar modern,” tegasnya.
(sumber : kontan online)