With Merger Mondays back in fashion, could “Freaky (Rumor) Fridays” be far behind, as Eric Savitz over at Barron’s Tech Trader Daily blog writes? Since this morning, there has been a steady stream of rumors — most of them originating in the options market — about who might buy whom. Not surprisingly, these are all tech companies, since tech is the one sector that has seen a flurry of recent deals, including Dell buying Perot Systems, Cisco buying Tandberg and Brocade shopping itself. A quick roundup:

• Blue Coat Systems option volume is up after Deal Reporter suggested Cisco might bid for it.
• NCR calls are up on rumors of a takeover bid, although it has not been linked to any company.
• American Superconductor jumps on rumors of an ABB bid.
• Riverbed Technologies could be acquired by Juniper Networks.

Another old favorite among tech gossips is also doing the rounds today — the idea of Microsoft buying Research in Motion. That one came from Alley Insider’s Henry Blodget (seems like he suggested the same thing in February too).

But as my colleague Wojtek Dabrowski, who covers tech, media and telecoms companies out of Toronto, says: “Microsoft could have bought RIM at $35, because that’s the low the stock hit in March of this year. The stock is now at $70 and RIM is under pressure from the iPhone. Such a deal makes no sense, though it could have in the past, especially given Microsoft’s continued commitment to Windows Mobile.”

But if there is any truth to these rumors, the media will start buzzing with news by Sunday evening. And as a deals reporter, I know that would shatter my Sunday (even if it would represent a shot in the arm into an M&A market still running far behind last year’s levels). I’ll probably have to rechristen my Sundays as something. Here are some suggestions from colleagues: Savaged Sunday, Slaughterhouse Sunday, Sucky Sunday, Sacrifical Sunday. Anyone got a better name?

Photo: Jamie Lee Curtis and family arrive for Freaky Friday premiere/Reuters

It’s official: Salomon Brothers has been completely picked apart.

Citigroup’s agreement to sell Phibro, its profitable but controversial commodity trading business, to Occidental Petroleum today puts the finishing touches on a slow erosion of a once-dominant bond trading and investment banking firm.

When Sandy Weill (pictured left) staged his 1998 coup – combining Citicorp and Travelers, Salomon Brothers was a strong albeit humbled investment banking and trading force. Yet little by little, a succession of financial crises, Wall Street fashion and regulatory intervention has whittled away at the once-dominant firm.

Not long after the Citigroup was formed, proprietary fixed income trading –  once the domain of John Meriwether, was shut down after the Asian debt crisis fueled losses that Weill could not stomach.

The Salomon name disappeared long ago as investment bankers and underwriters were rebranded Citigroup Global Markets.

Now Phibro, the former Philips Brothers that merged with Salomon in the early 1980s, is to be cast off because its energy traders made too much money when the rest of the bank suffered losses and required a $45 billion of taxpayer bailout.

Occidental Petroleum is buying Citi’s commodities trading unit Phibro for roughly its net asset value. How much that is, exactly, is hard to tell. Occidental said its net investment in Phibro is expected to be about $250 million.

The bigger figure, of course, is the $100 million associated with star trader Andrew Hall. His pay package has been the subject of much hand-wringing at Citi and in Washington.

Phibro’s management team, headed by Hall, and its employees will remain with the unit after the sale, expected to close by year-end. Citigroup shares were fractionally lower in morning trading on the New York Stock Exchange, while Occidental shares were up about 1 percent.

The problem, as many pundits are pointing out, is that Phibro is a profitable business, and Citi needs funds to repay a $45 billion government bailout. Like so many asset sales put together by institutions on the government drip — AIG in particular — the golden eggs tend to sell better than the rotten ones.

Why put cash into JJB Sports? Investors are apparently so keen to do so that the sports retailer expects to raise 100 million pounds — more than its market capitalisation of just over 80 million.

At first glance, it is hard to see why. Britain is in the grip of a deep recession and only a few months ago, JJB was flirting with administration. Its shares have fallen 90 percent in two years. If that wasn’t enough, the company is embroiled in price fixing probes by the OFT and the Serious Fraud Office.

Clearly, JJB has benefited from the effect of a buoyant stock market into which investors still seem keen to put cash. As a stock that has fallen a long way, JJB is more likely to rebound once doubts about its future are lifted.

But there’s more to it than that. Many investors are trying to pick those that will emerge strongest in their sectors. They are backing JJB because they see it as a potential winner.

Under executive chairman David Jones the group is positioning itself to sell high quality sports clothing and equipment — in contrast to Mike Ashley’s Sports Direct discount chain, the UK’s largest sports retailer.

But a bigger factor is that while the sportswear market remains quite fragmented, many smaller independents are finding it hard to raise cash. So even if people are buying fewer Manchester United strips overall, more of those who do are defaulting to the bigger retailers. So JJB should take market share.

If investors buy that argument, why back the number two over the number one?

Firstly, Sports Direct is out of favour with the City after a disastrous stock exchange debut in 2007. Sports Direct may find it tougher to find willing lenders.

There is also a specific reason why Sports Direct may be a relative loser. The SFO and OFT investigation into possible price fixing and fraud hangs over both JJB and Sports Direct, but as the whistleblower on alleged cartel activity, JJB gets immunity, leaving Sports Direct to take the rap.

All that makes JJB an obvious pick, but there’s no certainty it will come out ahead. Fresh capital will help it restock the shelves of its 253 stores, rebuild relationships with Nike and Adidas and refurbish its shops, and so emphasise the difference between it and Sports Direct or the pure sports fashion focus of JD Sports.

Investors who subscribe to a share issue will be banking on JJB proving it can become more than an also-ran.

Nobody ever got poor betting on Chinese demand for gambling, though the big players in Macau have seen a few busted flushes along the way. With more than a billion fatalists eager to hit the tables, and only one place to do it (Macau is China’s only legal gambling venue), it’s not hard to see the case that Wynn Macau and Las Vegas Sands are making for Hong Kong investors. It’s the same story Hong Kong and Macau magnate Stanley Ho has made for decades.

Wynn Macau’s $1.63 billion Hong Kong IPO, the sixth-largest in the world this year, was considered rich, despite the hype and that “sure thing” ring. After all, the colony is covered with half-finished projects and other remnants of the last time this too-good-to-be-true investment turned out to be what it was.

Wynn Macau shares ended 6 percent higher on Friday, valuing the casino giant at $6.9 billion. The solid debut bodes well for rival Las Vegas Sands, which plans to raise up to $2 billion in a Hong Kong offering for its Asia assets, most notably in Macau.

Macau gambling revenues hit a monthly high of $1.4 billion in August, a faster-than-expected recovery compared with Las Vegas, and revenues are believed to have been stronger still in September as China relaxed restrictions on its citizens crossing into Macau from Guangdong Province, reports Sui-Lee Wee.

Analysts say the IPO was perfectly priced and that the twin dangers of competition from other potential gambling hotspots in the region and the inscrutable winds of Beijing’s political climate could turn the tables quickly on these investments. Place your bets.

Highlights from the Thomson Reuters Investment Banking Scorecard:

· CHINA, BRAZIL & US ACCOUNT FOR 80% OF IPOs
Banco Santander (Brasil) SA raised $7.0 billion in an initial public offering in New York and Sao Paulo, marking the largest IPO by a Brazilian company on record and the second largest IPO this year behind an offering from China State Construction Engineering, which raised $7.3 billion in July.
Global initial public offerings for year-to-date 2009 total $59.4 billion, a 35% decline from last year at this time.  Despite a flurry of recent offerings, nearly 80% of IPOs this year, by proceeds, have come from companies based in China, Brazil and the United States.

· ACQUISITIONS BY RUSSIAN COMPANIES DOWN 53%
An $11.7 billion bid by Russia’s Vimpelcom for Kyivstar, a Ukrainian provider of wireless telecommunications services partly owned by Norwegian state-owned Telenor ASA ranked as the week’s biggest deal and the largest acquisition by a Russian company this year.
Overall, worldwide M&A totals $1.5 trillion for year-to-date 2009, a 38% decline over last year.  Acquisitions by Russian companies total $28.6 billion so far this year, a decrease of 53% compared to 2008.

· JAPANESE FOLLOW-ONS REACH $35.6 BILLION
In its second common stock offering this year, Nomura Holdings Inc, raised $5.1 billion, marking the third largest Japanese follow-on offering this year behind Sumitomo Mitsui Financial Group ($9.4 billion) and Mizuho Financial Group ($5.9 billion).
The volume of follow-on offerings in Japan totals $35.6 billion for year-to-date 2009, nearly eight times greater than the volume seen during year-to-date 2008.  Capital raising by financial issuers dominates the market this year, accounting for 77% of total issuance.

On a quiet day for deals, worth noting that Royal Bank of Canada joins the growing queue of prospective buyers of a wealth management business. Read the exclusive Reuters story here. On a larger scale, Wynn Macau’s strong debut in Hong Kong ups the ante for Europe, where bookbuilding for the IPO of Poland’s PGE starts next week. For more deal-related news from Reuters, click here.

Elsewhere:

* The U.S. Federal Deposit Insurance Corp is questioning the positive conclusions given to Citigroup Inc’s management team in a government-mandated review in the aftermath of the financial crisis, the Wall Street Journal says.

* A management buyout of Malaysia’s national carmaker Proton Holdings could be possible, the firm’s chairman was quoted as saying in the Star newspaper.

Two very different deals announced Wednesday show that financing markets are starting to support larger private equity transactions again.

Still, large numbers of banks were involved in each deal and both involved a significant amount of the private equity firms’ own equity.

“It suggests there’s a little bit of thawing,” said Steven Kaplan, a professor of finance at the University of Chicago. “It suggests there will be a normal world at some point and they are both the kind of deals you’d expect to see in this environment — you don’t expect public-to-publics in this market.”

Blackstone’s acquisition of AB InBev’s theme parks involves up to $1 billion of equity in the deal, which is around 40 percent of the overall price. The rest is coming from senior secured debt, mezzanine financing and an undrawn revolver. Senior credit facilities are being provided by a line of banks — BofA Merrill Lynch, Barclays Capital, Deutsche Bank Securities, Goldman Sachs Loan Partners and Mizuho Corporate Bank.

Clayton Dubilier & Rice Inc’s $477 million deal to take a stake in cleaning company JohnsonDiversey and undertake a $2.6 billion recapitalization was backed by an even longer list of banks: eleven in total are willing to participate in the financing, CD&R said.

The large number of banks involved “indicates that the lending market is still not robust so you need a bunch of lenders to get one of this size,” said Kaplan. Lenders will prefer to be diversified, he added.

Equity levels in deals are also higher than during the boom years. The equity check put in by Blackstone for the theme park deal is higher than what firms might have put in during 2005-07. During those frothy years, a more usual number was around 30 percent, whereas this year, some deals by private equity firms have even involved 100 percent equity.

“Equity percentages when the debt market is strong tend to be in the 30 percent range — or 25 percent if it is really high — and when the bank markets are off, which they are now… you’re at 35 or 40 percent, which is where you are today,” said Kaplan.

Still, there’s a long way to go between here and the late 1980s buyout wave.

“The big difference between the late ’80s and the recent wave is that (then), the median deal was 90 percent debt and 10 percent equity — it was insane,” said Kaplan. “The deals done in this last wave were much safer.”