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Opening Bell: 09.16.14

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Olive Garden defends unlimited breadstick policy (AP, earlier)
Olive Garden is defending its practice of giving customers as many breadsticks as they want, saying the policy conveys "Italian generosity." The remark is part of a response by the chain's parent company, Darden Restaurants, to a nearly 300-page criticism released by hedge fund Starboard Value last week. Starboard took Olive Garden and its management to task for a litany of issues, including its liberal distribution of breadsticks to customers, its failure to salt the water used to boil its pasta and even the length of the asparagus it serves. Darden's 24-page response doesn't specifically address each of Starboard's criticisms, but states that the company is already implementing a variety of strategies to improve Olive Garden's performance. The company says it has introduced new menu items to underscore value, for instance, and is testing new ordering technologies using table-top tablets...As for its breadsticks, Starboard said last week that Olive Garden was being wasteful because servers weren't sticking to the policy of providing one breadstick per customer, plus an extra for the table. The investor said servers lacked "training and discipline" and were bringing out too many breadsticks at a time, which also led to cold breadsticks. Starboard noted that it wasn't calling for Olive Garden to stop giving away unlimited breadsticks, but simply exercise more control in how they're distributed. Starboard also said servers were overfilling salad bowls and using too much dressing, which it said drives up costs. In its response Monday, Darden said that "Olive Garden's salad and breadsticks have been an icon of brand equity since 1982." The company didn't say whether it would change the way salad and breadsticks are brought out, however.

Alibaba Boosts Possible IPO to $21.8 Billion Amid Demand (Bloomberg)
Alibaba raised the amount it’s seeking in its initial public offering to as much as $21.8 billion, coming a step closer to breaking a global fundraising record after investors showed strong interest in the shares. China’s biggest e-commerce company is now offering the shares for $66 to $68 apiece, according to a regulatory filing yesterday, compared with an initial range of $60 to $66 each. The company and its backers including Yahoo! Inc. (YHOO) plan to offer 320.1 million shares.

Alibaba IPO Is a Bonanza for Select Firms (WSJ)
The initial public offering of Alibaba Group Holding Ltd. this week will be a bonanza for a group of previously undisclosed investors who snapped up preferred shares in the Chinese e-commerce company that were sold in the run-up to its public debut. Roughly two dozen investors bought convertible preferred shares in Alibaba through a little-noticed $1.7 billion private offering in 2012, including sovereign-wealth funds, Asian hedge funds, one of the banks that managed the deal and other big asset managers, people familiar with the matter said. They stand to profit handsomely from the investment—and their potential payday got a little bigger Monday, when bankers pitching the shares to investors moved their price even higher. Based on the anticipated price for stock in the Alibaba listing, which is on track to begin trading Friday, those preferred shares will have more than tripled in value, making the investors big winners in an IPO that could raise $25 billion, a record amount.

Calpers Pulls All $4 Billion in Hedge Funds, Citing Costs (Bloomberg)
The California Public Employees’ Retirement System plans to divest the entire $4 billion that it invested with hedge funds, saying they’re too expensive and complex. The decision to eliminate 24 hedge funds and six hedge fund-of-funds, isn’t related to the performance of the program, interim Chief Investment Officer Ted Eliopoulos said yesterday. The board of the $298 billion pension, known as Calpers, hasn’t decided where to invest the money after the pullout, which will take about a year, he said.

Spider-Man, Batman Arrested After Alleged Times Square Brawl (HP)
Two costumed characters in New York City's Times Square were arrested on Saturday night along with a third man for allegedly fighting, according to multiple reports. The two characters were doing what costumed heroes do these days -- hustling for tips on a street corner in exchange for photos -- when two men started yelling and gesturing at them. The New York Post reports that 23-year-old Thomas Rorke allegedly grabbed Batman -- aka 41-year-old Jose Escalona-Martinez -- from behind and shouted, "I'm gonna fuck you, Batman.” Then, he allegedly grabbed Spider-man -- aka 35-year-old Abdel Elkahezai -- on the rear. His Spider Sense clearly tingling, Elkahezai allegedly sprayed Rorke with his webbing, or at least his prop Silly String, the paper reported. Soon enough, punches were thrown. Rorke appears to have gotten the worst of it, with CBS New York reporting that he was socked repeatedly in the face and chest. “He (Rorke) was intoxicated and messing with Batman and they got into it,” a rival Spider-man, 50-year-old Paul Smith, told the New York Daily News. “Everybody, no matter what costume they are wearing, has the right to protect themselves. It's like Stand Your Ground in Florida,” he told the newspaper. All three were arrested.

Fight Against Climate Change Seen Driving Economic Growth (Bloomberg)
Countries can expand their economies through emissions reductions in cities, land use and energy, according to a report released today by the Global Commission on the Economy & Climate, a panel set up by seven nations including the U.K. to advise on the best ways to tackle global warming. The report, which found that about $90 trillion will be invested in city infrastructure over the next 15 years, comes a week before world leaders head to New York for a climate summit hosted by United Nations Secretary General Ban Ki-moon.

ECB invites banks to tap new funds it hopes will pep up euro zone (Reuters)
The European Central Bank invited banks on Tuesday to bid for a fresh round of long-term loans it hopes will stimulate lending to businesses and reinvigorate the euro zone economy but which may see only modest take-up. The program is a key plank of ECB efforts to stave off the threat of deflation and breathe life into the euro zone economy, which stagnated in the second quarter. At 0.3 percent, inflation is running well below the ECB target of just under 2 percent. The ECB will announce how much it is granting banks in the new loans at around 5:15 a.m. EDT on Thursday, doling out the fresh cash just as the cheap three-year long-term loans - or LTROs - that it issued in late 2011 and early 2012 approach expiry.

Pershing Square and Allergan Reach Settlement on Litigation Over Special Meeting Date (WSJ)
Pershing Square Capital Management LP and Allergan Inc. reached a settlement to one contentious scene in their tussle, putting an end to the debate over a special meeting of Allergan shareholders. The agreement means Allergan will hold a special meeting on Dec. 18, where Pershing Square and Valeant Pharmaceuticals International Inc. will seek to remove a majority of the Botox-maker's board and push forward their $53 billion takeover attempt. The board had already set that date, but there remained questions on whether the meeting would happen amid legal wrangling and Allergan's strict corporate rules. Those rules are being loosened by the settlement. Under the settlement, announced by Allergan late Monday, the meeting would happen even if some shareholders who called it sell their shares, reversing a rule that Pershing Square's William Ackman had criticized.

Australian Pizza Hut's Hamster Promotion Totally Backfires (HP)
The store, which is located in the suburb of Mount Waverly, southeast of Melbourne, had a sign in its window that advertised: “Buy any 10 large pizzas and get one free small animal from Pets Story.” The tasteless giveaway, which was not condoned by Pizza Hut Australia, was immediately flamed on social media. People could not believe that the store had deemed it appropriate to, as one Twitter user put it, “give away animals like toys." A local animal rights organization, Oscar's Law, got involved and added fuel to the fire by demanding the store take down the sign. After first covering it up, the sign was eventually removed. Pizza Hut Australia apologized, and insisted that no animals were actually given away by the rogue franchise.