Filed under: Deals, Law, IAC/InterActiveCorp (IACI)

Barry Diller has won his dispute with John Malone. Malone’s Liberty Media (NASADAQ:LCAPA) owns a a big piece of the company which Diller runs, IAC/Interactive (NASDAQ:IACI). Diller has the right to vote those shares under a long-standing agreement.

Diller has decided to break IACI into five companies because the businesses in the firm don’t have significant relationships to one another. Malone wanted to block the break-up and filed suit in court.

According to MarketWatch “Vice Chancellor Stephen Lamb ruled Friday that “Liberty has failed to demonstrate that Diller has breached or threatened to breach any contractual duty he owes to Liberty,” according to Lamb’s 78-page thought.”

Diller can now complete his plans.

That leaves open the question of whether IACI is worth more in pieces than it is as a conglomerate. The firm’s stock trades at $20, near its 52-week low and down from the period high of over $39. Some of the company’s divisions, especially Lending Tree and HSN had tough years in 2007. These would get very low valuations as independent operations and might not make up for the value of more attractive operations like Aks.com

Diller might have gotten his way, but it isn’t clear that it will help shareholders.

Douglas A. McIntyre is an editor at 247wallst.com.

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Filed under: Deals, Bad news, Management, Scandals, Bear Stearns Cos (BSC)

With news that Bear Stearns (NYSE: BSC) CEO James Cayne has sold all of his holdings in the stock for $61 million, I actually feel sorry for him. Usually when a senior member of management sells stock it’s cause for worry, but in this case, what would you’ve done?

According to the AP report: ” Cayne sold 5.66 million shares for exactly $10.84 a share on March 25, according to a filing with the Securities and Exchange Commission. His stake was once valued at about $1 billion when the stock was trading at $171.50 per share.”

With all due respect, the man has invested the last 15 years of his life in the company, and to go from being a billionaire, to someone with tens of millions of dollars overnight is a sad story. Now I know you are all going to comment that he still has $60 million, and it was his fault that the bank came crashing to the ground, but that kind of fall must be hard.

If I was in his position I would have sold everything as well. He needs to protect whatever he has, and if he has the ability to walk away with a small fortune, then all the more power to him.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer’s fund has no position in any stock mentioned, as of 3/28/08

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Filed under: Deals, Products and services, Consumer experience, Coca-Cola (KO), PepsiCo (PEP), Marketing and advertising

Just recently, I talked about a transaction involving PepsiCo (NYSE: PEP) and a foreign juice company. Now, it is Coca-Cola (NYSE: KO) and a foreign coffee venture that are making some noise.

As Melly Alazraki reported Thursday, Coca-Cola, Coca-Cola Hellenic Bottling and Illycafe SpA put together a joint venture to get some ready-to-drink coffees out on the global playing field. The venture, dubbed Ilko Coffee International, will start distribution of its products in April in ten countries. Coffee doesn’t interest me, but this venture does, since I own shares of Coke. Just like PepsiCo, Coke wants to do all it can to supplement its flagship carbonated soda brands with different beverage categories.

While I don’t like coffee, I know that it is a very popular drink around the world; in some respects, consumers are almost religious about coffee (and teas, as well). According to Bloomberg, the value of the ready-for-consumption coffee market is $16 billion, and it is focused in the Asian territory. This international scheme is therefore a great way for American shareholders to capitalize on a weak dollar. Many consumer companies these days are being helped out by currency valuations.

I can only envision that this market will grow significantly over time, and that Coca-Cola would be smart to aggressively invest in it and leverage its world-class distribution system to grab as much share as it possibly can. Future growth in case-volume is going to be directly dependent on Coke and its capability to work with its bottlers to efficiently exploit opportunities such as these.

With its blue-chip marketing muscle, I have no doubt that Coke will be able to translate many of these kinds of deals, in conjunction with its already deep collection of beverage products, into quality cash flows and further increases in its annual dividend payout, which is the ultimate reason for being a shareholder.

Disclosure: I own shares of Coca-Cola; positions can change at any time.

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Filed under: Deals, Employees, JPMorgan Chase (JPM), Bear Stearns Cos (BSC), Federal Reserve

James Cayne added insult to injury has he sold his last $61 million in stock. He got slight ly more than $10 a share. When the stock traded above $170 lost year, he was a bit better off. According to MarketWatch, “Cayne and his wife sold two huge blocks of more than 5.6 million Bear Stearns shares.”

Cayne will take a beating for cashing out while many Bear Stearns (NYSE:BSC) employees lose their jobs in a takeover by JP Morgan (NYSE:JPM). He’d been kicked out of the CEO job by his board. While he has much responsibility for the collapse of the firm, he has lost most of his fortune, and is in his seventies.

Cayne took what he could before the deal faces potential reviews by Congress. The transaction could still fall apart and take the stock to zero. Cayne will be long gone then, back to playing bridge, golfing, and allegedly smoking pot.

Dougals A. McIntyre is an editor at 247wallst.com.

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Filed under: Deals, Private equity, Market matters, Clear Channel Commun (CCU), Cramer on BloggingStocks

TheStreet.com’s Jim Cramer wonders what’s going on with the Clear Channel deal.

The focus on this Clear Channel (NYSE: CCU) (Cramer’s Take) breakdown, the endless focus, is on the $500 million that the private-equity team, Bain/Lee, will have to pay Clear Channel.

What’s more important, I believe, is the billions of dollars I believe the bankers will owe Bain/Lee if they don’t find some way to cut this price and make this deal smaller.

There have been dozens of deals that were struck during this period that the bankers wished they could walk away from but didn’t. Which states to me, how desperate are they now NOT to have to pay the $22 billion in this very big deal. How desperate are they given the fact that a judge will, I believe, find against them and the damages will be immense, as big as the billions that Lee/Bain can show — and will — they would have made if the deal closed in the out years.

I hailed the breakdown as a return to rationality because of the fundamentals of radio and how terrible they are. But you can’t break the deal on those because no matter how bad the fundamentals of radio are, CCU’s fundamentals are certainly holding up better than everyone else’s because of its near-monopoly status. Plus, outdoor ads have been strong. These guys are certainly doing superior than another huge player — Cumulus (NASDAQ: CMLS) (Cramer’s Take), which can’t close its deal, either.

I believe the banks will have billions of dollars in exposure in courts, and that they’re simply making a calculation that they have the ability to put those damages off until their capital is rebuilt. It’s just the wrong time to take the money, give it to the deal and then have the deal default, which is what I am sure they’re worried about despite all of the rosy projections.

That means we’ve a situation where either the banks are supremely confident of some kind of case I can’t think of, or the banks are so depleted of capital at the moment that they would just as soon drag things out. If it is the latter, why didn’t more avail themselves of the Fed’s new program yesterday? If it’s the latter, why not just keep haggling?

Whatever, if there is a right thing to do it is for the banks to eat the deal and move on. Right now, while I don’t anticipate a court to force the deal to shut — hard to get specific performance — I do suspect that there are a lot of bad emails around among the banks and when the contract lawsuit gets around to damages they could be far more than the half-billion sum you’re hearing about now. Maybe 10 times more.

So, rationality’s back, but perhaps at too high a price.

RELATED LINKS:

• Clear Channel Boosted by Judge’s Ruling
• Clear Channel Buyers Sue to Force Funding

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com’s sites and serves as an adviser to the company’s CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

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Filed under: Before the bell, Earnings reports, Analyst reports, Deals, Apple Inc (AAPL), Nokia Corp. (NOK), Citigroup Inc. (C), Federal Natl Mtge (FNM), KB HOME (KBH), Red Hat Inc (RHT), Wachovia Corp (WB), Electronic Arts (ERTS)

Before the bell: Futures higher ahead of data; BSC, LEH, C

KB HOme (NYSE: KBH) is set to report fiscal first-quarter results this mornings. Analysts anticipate the company to report a loss of $1.17 per share, according to Thomson Financial. The comparable year-ago profit was 34 cents per share.

Wyeth (NYSE: WYE) is laying off about 1,200 U.S. sales representatives as part of its major companywide program announced recently to cut jobs and other costs and redesign the struggling business as increased competition and fewer new drugs are taking their toll on the pharmaceutical company.

Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) may raise as much as $20 billion in capital as part of an agreement with the Office of Federal Housing Enterprise Oversight that allows them to purchase more debt securities. They have the ability to raise the capital with common shares, preferred shares or convertible preferred shares, further diluting the already troubled stocks but helping the companies to stabilize. FNM shares are up over 2.5% in premarket trading.

Electronic Arts Inc. (NASDAQ: ERTS) is amending its tender offer for outstanding common shares of Take-Two Interactive Software Inc. (NASDAQ: TTWO) to counter Take-Two’s poison-pill adoption and its rescheduled annual meeting. EA has offered to buy Take-Two for $26 a share, or about $2 billion in cash. If the price still isn’t right, what could Take-Tow come up with next?

Red Hat (NYSE: RHT) shares are up 4.1% in premarket trading this morning after the software distributor reported Thursday after the close that its fourth-quarter profit rose 7% as it expanded the footprint of its open source products with pricey internal investments. Red Hat stated it earned $22 million, or 10 cents per share, in its first quarter under new CEO James Whitehurst. Revenue rose 27% to $141.5 million. The results were inline with analyst estimates. It seems that investors liked the new CEO’s strategy.

Nokia Corp. (NYSE: NOK) are up over 2% despite the an analyst saying the world’s largest maker of mobile phones might post low shipments of mobile phones in the first quarter as well as weak average selling prices.

Meredith Whitney, the Oppenheimer analyst who has written one note after another about financial institutions, lowering her estimates constantly, have stated this day that Citigroup Inc. (NYSE: C) and Wachovia Corp. (NYSE: WB) will likely have to announce dividend cuts next month due to shrinking earnings. Whitney expects Citigroup to earn $1.43 a share less than its dividend payout this year and for Wachovia to have to pay out “just about all of its estimated earnings this year.” If investors hold huge bank shares for dividend, this could injured the stocks further, especially as Citi has already reduced its dividend payout by 41% earlier. The shares aren’t showing a negative reaction for now.

In a hacking contest where three laptops — Sony Vaio, Fujitsu U810, and the MacBook — were offered provided hackers could hack into each of them, Apple’s (NASDAQ: AAPL) MacBook Air was first to be hacked (in 2 minutes) after organizers relaxed the rules a tiny. According infoWorld, “Contest rules say that Miller could only take advantage of software that was preinstalled on the Mac, so the flaw he exploited must have been accessible by, or possibly inside, Apple’s Safari browser.”

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Filed under: Business, World wide web, Office, Web services, web 2.0

Zoho has added an on the internet invoicing application to its ever-growing suite of on the internet office/business products. While Zoho Invoice is hardly the only on the web invoicing tool around, the application gives users a lot of control over the invoicing process. You can add your own logo to your invoices, add custom messages, and select from several customizable templates. You can also keep a list of customers, products and services and run reports.

On the down side, you can only create and send up to 5 invoices per month with a free account. For $5 per month, you can send up to 25, while $15 per month will get you 150 invoices, $25 brings you to the 500 invoice level, and if you do a lot of business you can create up to 1500 invoices for $35 per month. Meanwhile, services like Invoice Journal and Invotrak let you create as many invoices as you like for free, but they lack some of Zoho Invoice’s features.

The other thing that makes Zoho Invoice worth checking out is the fact that it’s just one of more than a dozen on the internet services offered by Zoho. If you like the idea of managing your office documents, web conferencing, and HR management all through the same company, Zoho’s got you covered. For a small fee.

[via TechCrunch]

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Filed under: Business, Apple

If you liked the iPod/Nike+ gadget to help you with your runs, you might be excited to know that was merely the beginning of what seems to be a much bigger pie Apple has been working on (pun absolutely intended).

AppleInsider appears to have gotten its hands on some patent filings made for what looks like a comprehensive “fitness companion.” At this point, it looks like a bunch of iTunes-esque prompts for a “fitness inteview” to help you get a fitness program for your goals, and flow chart type displays of how these programs might look as you are using them.

Considering that it is still in the patent stages, we have no idea if Apple is really going to follow through. But at least we can be hopeful. Whether this will work on current iPod Touch/iPhone technology or on next generation models isn’t clear, especially with rumors of new iPods coming on the market later this year.

Or maybe we have the ability to just memorize our workouts and write down our progress on paper. Old school, but it works.

[via TechMeme]

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Filed under: Before the bell, Analyst reports, Analyst upgrades and downgrades, Deals, Management, Insiders, Market matters, Citigroup Inc. (C), JPMorgan Chase (JPM), Economic data, Oil, Lehman Br Holdings (LEH), Bear Stearns Cos (BSC), Federal Reserve

U.S. stock futures were positive this morning, pointing to a higher open Friday as lower oil prices, encouraging indications from the Federal Reserve regarding bank funding and a Lehman Brothers upgrade helped boost sentiment after two straight sessions of declines.

Overseas, Asian stocks finished higher, while European stocks are climbing from earlier losses. In the U.K., the economy grew by 3% in 2007, but grew 0.6% in the final three months of the year. Fourth quarter GDP rose 2.8% on a year-on-year basis.

Oil prices fell Friday back below $107 a barrel, after jumping more than $1 a barrel in the previous session following the bombing of a key Iraqi oil pipeline heightened supply concerns. Meanwhile, Bloomberg reports that “the dollar headed for its biggest weekly decline in a month against the euro as traders raised bets the Federal Reserve will cut interest rates to avert a recession.”

As has been the case the past few days, banks take front and center of the news. This morning, we hear Bear Stearns (NYSE: BSC) chairman James Cayne sold his entire stake in the investment bank after for $61 million as JPMorgan Chase (NYSE: JPM) is about to take it over. With BSC shares trading above $11, over the $10 bid from JPMorgan, this could indicate a superior offer isn’t in the cards. BSC shares are down over 4.5% in premarket trading.

Also, Citigroup upgraded Lehman Brothers (NYSE: LEH) to Buy from Hold, with a price target of $65 due to valuation, the resilience it showed in the latest quarter and management’s track record. LEH shares are up over 6.8% in premarket trading.

Meanwhile, Citigroup (NYSE: C)’s CEO Vikram Pandit keeps reshuffling top management at the bank. He replaced Ali Hackett and Tom Tesauro, co-heads of global equity finance and prime brokerage to be replaced by Nick Roe, who runs the European part of the prime brokerage unit. Citigroup’s share are up 1.4% in premarket trading.

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