IG Markets: Midday market update, 31 March
In company news, Richemont has announced that it has entered into a binding, conditional agreement to merge the operations of its subsidiary, the Net-A-Porter Group, with YOOX S.p.A. in an all-share transaction. The agreement is conditional upon the approval of YOOX shareholders at a meeting, which is expected to be held in June 2015.
Richemont will receive on a fully diluted basis 50% of the share capital of the combined entity's listed parent company. This transaction will generate a one-off, non-cash, accounting gain in Richemont's financial statements for the year ending 31 March 2016 of approximately EUR 317m.
Astrapak has today entered into agreements ("Transaction Agreements") to dispose of East Rand Plastics (a division of Astrapak Manufacturing Proprietary Limited) ("East Rand Plastics") and the property occupied by East Rand Plastics ("the Property") to Transpaco Limited ("Transpaco") ("the Transaction"). The disposal consideration in respect of the Transaction is based on an estimated value of R77.5m as at the closing date for the Business and R14.0m for the Property, representing an aggregate cash consideration for the Business and the Property of R91.5m.
Eskom Chairperson, Mr Tsotsi agreed to step down as a Director and Chairperson of the Board. Mr Tsotsi indicated that the board had unity of purpose and that his decision to step down was in the interest of the company and the country, it was done in order to allow the board to focus on the core issues facing Eskom.
The Rand is trading at R12.22 to the Dollar, R13.10 to the Euro and R18.04 to the British Pound. In commodities, Gold is currently trading at $1,179/oz., Platinum at $1,121/oz. and Brent Crude at $55.21/barrel.
On the economic front, In Europe, CPI Flash estimate data alluded to deflation of 0.1% y/y ahead of expectations, which had predicted deflation of 0.3%. The unemployment rate within the Eurozone worsened to 11.3% last month. In the U.K., the current account widened to a deficit of 25.3bn. The final GDP revision figure for the region showed q/q growth of 0.6%. In the U.S. we are expecting CB Consumer confidence data at 4:00pm.