Market Wrap: Summers Out as Fed Chair Nominee; U.S. Production Rises; A Paper Merger

September 16, 2013 5:17 PM EDT
Market wrap for September 16th

End of the Day: S&P 500 up 9.6 to 1,697.60; Dow Jones up 118.7 to 15,494.78; Nasdaq down 4.3 to 3,717.85

* According to the Fed, U.S. industrial production rose 0.4 points last month, following a flat reading in July. The number compares with consensus views calling for a 0.5 percent gain. Manufacturing, which accounts for 75 percent of production and 12 percent of the U.S. economy, rose 0.7 percent, more than offsetting a 0.4 percent drop reported in July. Auto production improved 5.2 percent in August, from a drop of 4.5 percent in July. For more color, click here.

* Over the weekend, former Treasury secretary Larry Summers withdrew his name as a candidate for next Federal Reserve Chairman. In a statement, Summers said, "I have reluctantly concluded that any possible confirmation process for me would be acrimonious and would not serve the interests of the Federal Reserve, the Administration, or ultimately, the interests of the nation's ongoing economic recovery.

* Packaging Corporation of America (NYSE: PKG) and Boise (NYSE: BZ) announced that they have entered into a definitive agreement under which PCA will acquire all of the outstanding common shares of Boise for $12.55 per share in cash, for an aggregate transaction value of $1.995 billion, inclusive of $714 million of outstanding indebtedness of Boise.

* UK Financial Investments Limited (UKFI) announced its intention to sell part of HM Treasury’s shareholding in Lloyds Banking Group plc (NYSE: LYG). The disposal of these shares (the “Placing Shares”) will be by way of a placing to institutional investors.

* Mosaic Company (NYSE: MOS) issued an update of the near-term price, volume and gross margin guidance, as well as the Company's effective tax rate guidance for the seven month transition period.

* Essent Group Ltd. (NYSE: ESNT) filed a registration with the U.S. Securities and Exchange Commission for an Initial Public Offering of its Common Stock. The proposed maximum offering price is $287.5 million. The company plans to list on the New York Stock Exchange under the ticker, "ESNT."

* Starboard Value LP, one of the largest shareholders of Emulex Corporation ("Emulex" or the "Company") (NYSE: ELX) with beneficial ownership of approximately 7.9% of the outstanding common stock of the Company, today announced that it has delivered a letter to the Company's President and CEO, Jeffrey Benck, and the Company's Board of Directors. In today's letter, Starboard expressed that based on its extensive research and analysis, Emulex is extremely undervalued and clear opportunities exist within the control of Emulex's management team and Board of Directors to unlock significant shareholder value. For more from the letter, click here.

* Pandora Media (NYSE: P) filed a registration with the U.S. SEC to sell, from time to time, up to 14 million shares of its Common Stock. Of the total, Selling Shareholders will be offering 10 million shares, which the Company will not received proceeds from those sales.

*Cornerstone Therapeutics, Inc. (Nasdaq: CRTX) agreed to be acquired by Chiesi Farmaceutici S.p.A. for $9.50 per share in cash. Chiesi currently owns 58% of Cornerstone's outstanding common shares.

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Federal Open Market Committee, Standard & Poor's, Larry Summers, Industrial Production, Definitive Agreement