Wunderlich Securities Comments On Liberty Global's Blowout Of CDU

According to Wunderlich Securities, Liberty Global's LBTYA blowout of CDU over the weekend highlights potency of total return swap. Wunderlich Securities reported that German Chancellor Angela Merkel's Christian Democrats (CDU) lost power in Baden-Wuerttemberg this weekend for the first time since 1953 off concerns over nuclear policy, Libya and the Euro. “According to Der Spiegel, the Greens (24% of the vote) could well form a government with the Social Democrats. The CDU and FDP partners took only 44% of the tally. Political flux shows that it was wise not to ignore regulatory risk on Buy-rated Liberty Global's (LBTYA) purchase of KBW, with Liberty positioned through its Total Return Swap with JP Morgan (JP-NR) to still capture deal upside, as long as cable multiples hold and the market recognizes the superior growth vector of KBW.” Liberty Global closed yesterday at $42.22.