A roundup of some of the North American equities making moves in both directions today
On the rise
Aimia Inc. (AIM-T) surged over 13 per cent on Wednesday after announcing before the bell it has acquired a 10-per-cent stake in Chinese outdoor advertising firm Clear Media Ltd. for $75-million.
The move comes as the company works to transform itself from a loyalty rewards company into an investment holding firm.
Aimia says it has acquired 58.8 million common shares in Clear Media, including 19.6 million previously held by clients of Mittleman Investment Management which is also Aimia’s largest shareholder.
It says the investment was made in anticipation of a pending deal by Clear Media’s controlling shareholder, Clear Channel Outdoor, to sell its 50.9-per-cent stake to Ever Harmonic Global Ltd.
The acquisition was announced as Aimia reported a first-quarter loss of $9.6-million or 14 cents per share compared with a profit of $1.05-billion or $6.85 per share a year ago when its results were boosted by the sale of its Aeroplan business to Air Canada.
It intends to use the net proceeds for working capital and other general corporate purposes, “which may include potential acquisitions and strategic transactions.”
A deal could make Uber more competitive with market leader DoorDash.
The coronavirus pandemic has upended Uber’s core business of paying freelance drivers to shuttle people from place to place. A merger of its loss-making Uber Eats restaurant delivery service with GrubHub shows how the Silicon Valley disruptor is scrambling to pivot in what promises to be a long period of business interruption by doubling down on its fastest growing business.
Shares of Grubhub were down 3.7 per cent on Wednesday.
On the decline
Canadian Natural Resources Ltd. (CNQ-T), Cenovus Energy Inc. (CVE-T), Suncor Energy Inc. (SU-T), and Imperial Oil Ltd. (IMO-T) were all trading lower after being excluded by the Norwegian central bank from its $1-trillion wealth fund, the world’s largest, for producing too much greenhouse gas emissions, its first use of carbon emissions as a criterion to blacklist firms.
In a statement, Norges Bank said the firms were excluded from the fund due to “unacceptable greenhouse gas emissions."
The decision was based on recommendations from the Council on Ethics, the fund’s ethics watchdog, because of the companies’ carbon emissions from production of oil to oil sands, the central bank said.
Royal Caribbean Cruises Ltd. (RCL-N) dipped 5 per cent after it launched a new US$3.3--billion bond offering on Wednesday and said it would use 28 of its ships as collateral, as it looks to stay afloat after the COVID-19 pandemic upended the industry.
The company, which was forced to suspend its cruises globally and cut about 26 per cent of its U.S. workforce, said it would use the proceeds from the private note offering to repay a US$2.35-billion 364-day term loan agreement with Morgan Stanley.
Earlier in May, rival Norwegian Cruise Line Holdings Ltd. (NCLH-N) had raised over US$2.2-billion through debt and equity offerings, giving it much needed funds to survive for at least the next 18 months. The company used two of its ships and two private islands as collateral for the debt offering.
It was not immediately clear which ships Royal Caribbean pledged for the offering. It had vessels with a net book value of about US$22.7-billion as of Dec. 31, including the world’s largest cruise ship - Symphony of the Seas.
Shares of Norwegian and rival Carnival Corp. (CCL-N) were down 7.2 per cent.
Tesla Inc. (TSLA-Q) lost 2.3 per cent after Alameda County officials said it can take additional steps ahead of a potential reopening of its California assembly plant as soon as Monday after Chief Executive Elon Musk had vowed to defy authorities and won the backing of President Donald Trump.
In a tweet posted around midnight, Alameda said that following talks with Tesla it agreed that the electric carmaker can take steps “in preparation for possible reopening as soon as next week.”
Tesla did not immediately comment Wednesday but around the same time the county issued its statement, Musk tweeted: “Life should be lived.”
Life should be lived— Elon Musk (@elonmusk) May 13, 2020
Tesla’s sole U.S. electric vehicle assembly plant is in Fremont, California, which is in Alameda County.
The county said it would work with police in Fremont “to verify Tesla is adhering to physical distancing and that agreed upon health and safety measures are in place for the safety of their workers as they prepare for full production.”
On Monday, Musk said production was resuming in Fremont, defying an order to stay closed and saying if anyone had to be arrested, it should be him.
On Tuesday, Musk won Trump’s backing. “California should let Tesla & @elonmusk open the plant, NOW. It can be done Fast & Safely!” Trump wrote on Twitter.
Gilead Sciences Inc. (GILD-Q) slipped 1.2 per cent after it said on Tuesday it has signed non-exclusive licensing pacts with five generic drugmakers based in India and Pakistan to expand the supply of its experimental COVID-19 treatment remdesivir.
The pacts allow the companies - Jubilant Life Sciences Ltd., Cipla Ltd., Hetero Labs Ltd, Mylan NV (MYL-Q) and Ferozsons Laboratories Ltd.- to make and sell the drug in 127 countries.
The countries consist of nearly all low-income and lower-middle income ones, as well as several that are upper-middle- and high-income, the drugmaker said. Afghanistan, India, North Korea, Pakistan and South Africa are among the countries.
The licensees will also set their own prices for the generic product they produce, Gilead said.
Shares of Mylan were down 4.2 per cent.
The U.S. Food and Drug Administration declined to review an experimental multiple myeloma therapy from Bristol Myers Squibb Co. (BMY-N) and bluebird bio Inc. (BLUE-Q) as it sought more details, the companies said on Wednesday.
Shares of bluebird bio fell 1.8 per cent, while those of Bristol Myers dipped 0.1 per cent.
The FDA in its so-called refusal to file letter asked for further details on the chemistry and manufacturing of the therapy, named ide-cel, but did not request any additional clinical data, the companies said.
Ide-cel is one of the experimental therapies that Bristol Myers gained through its US$74-billion acquisition of Celgene Corp and its approval is linked to a higher payout to Celgene investors.
As part of the deal, Celgene investors are entitled to receive a contingent value right (CVR) payment of US$9 a share if three treatments achieve timely approvals.
The FDA last week extended its review for liso-cel, another treatment that is part of the CVR payout.
With files from staff and wires