Headquarters in london. France seen off today. What else have we got coming up for you today . Political powerhouse will join us this hour for a conversation. And bowie, does he become the olders winner of the brits . P. M. I. Data breaking for the eurozone as we speak. 62. 7. Later hour well dig into these numbers with an economist for deutsche bank. Were going to get his take on why the french data this morning is so disappointing. Lets begin with our top story this morning. Theave breaking news out of ukraine capital this morning. First off, the truce that the ukrainian president announced last night appears to be crumbling. Lashes have resumed at incidence square. A group has taken policeman hostage. They have captured them. Pictures show a priest leading police who have been captured. They have been brought to medical attention. Troops came under fire from what it says was a sniper position on a nearby rooftop. The ukrainian interior industry saying 20 of its police have been injured. Also we have gotten reports that the government headquarters has been closed and the parliament has been closed and from polands envoy in the ukraine, he is in ukraine together with the french and German Foreign ministers set to meet with the president. Officials in kiev are panicky. They can see black smoke from detonations and gunfire. When it comes to gunfire, the president ial palace, when it comes to the sound of gunfire, isnt too far from incidence square. Independence square. The meeting has been moved to a new location. He is not saying what that is. Clearly an awful lot going on. The truce didnt take long to break down. It didnt take long for the situation to deteriorate once again on the ground. Walk us through what is expected to happen. Both in kiev and also these ministers meet in europe. First off, the ukrainian president is supposed to meet with the Foreign Ministers of germany, france and poland and then they are supposed to meet with the opposition leaders. They have three leaders though it is unclear to what extent they are in control of the event s that arenow taking place in kiev. Then the opposition is supposed to sit down for direct talks with the president and then go to a meeting on the cry sniss crisis in ukraine. Diplomacy was supposed to take the forefront today. We had this truce announced by the ukrainian president late yesterday. He said he is committed to talks to find a way to end the blood shed but the truce has been tested and appears to be crumb bling. I guess there is a link between our top stories this morning. If you want to see it. E ukrainian founder of whats app. Is it worth the staggering price tag . Well, look around the industry. Lets find out. Us. Nichols joins what does zuckerberg see in this . Growth. They put a million new users every day. What is having the the user engagement. 70 of use goers there every day. Compare that with facebook. It is just 61 . 12 billion in shares. 4 billion in crash. 3 billion in restricted stock. Only 55 employees. It has more users than twitters 240 million users. When you break down what it costs per user, it is at 42 per user. Instagram is 5. 2013 was valued at 120 per user. That really drives this home for you. Zuckerberg talked about getting to a billion users. He said he is not going to try to put advertising on it. He wants to let it grow organically and do it its own thing. One of the things that stood out to me is the investment. What did they put, 60 million into this company . And their evaluation probably around 3. 5 billion. Sequoia has the golden touch. Whatsapp things that did, 55 employees. No press officer. No p. R. This is an engineerdriven company. Guy . You know things are serious when there is no p. R. Hans, thank you very much indeed. Hans nichols joining us from berlin. Lets get to our top corporate story. B. A. E. s shares will fall by as much as 10 this year. Lets put it all together, the last 48 hours. I looked through the numbers this morning and thought you know what . We need to tie yesterday into today. There is a gap here because they are not posting the revenue that we talked about yesterday with this new deal with saudi arabia. Am i missing something . I think saudi arabia may have less to do with the selldown than we initially thought. I think what were seeing is the longterm guidance is a bit disappointing for folks. I think it was an expectation that maybe 2013 was kind of the bottom on defense in the more traditional markets. Now they are guiding to 5 , 10 down. So i think the stock was people were thinking it was going to rerate and it hasnt quite yet. I think people are a bit disappointed. Do you think well see more clarity . I think we may get more clarity on what the numbers exactly mean. Because of the u. S. Budget situation, it has been so involved with sequestration, new budget agreement, how does the Defense Company book those deals and what does it really mean . It has been very complicated, but the fact of the as a matter folks were expecting more flat guidance taking saudi into account. I think that is disappointing folks. Saudi a big part of the story going forward. Hanks very much. David tweed is in berlin with more. 2014 looking better . Well, the share price has turned around in the last hour or so. 2014 is looking a bit better. They have a forecast for sales between h 4. 5 and 5. 5, which wasnt as bad as some people were expecting at least according to the french brokers. They still have head winds, though, and they will be sluggish consumer markets in europe. They are going to have difficulty because they have got milk price inflation. Milk prices nearly at records. We saw a 10 gain last year. Also market volatility. You know how they were talking about the difficulties they had with the botulism scare. What is interesting is how they are fighting back. They just increased the double dip stake in a company in china costing 5. 5 million euros. They aring on increased sales of yogurt there. Lets talk about m a. There is a story. They have this medical nutrition unit. Any thoughts or ideas what they are going to do with that . They have declined to comment. We have spoke on the a person who says yes, they are considering selling off the nutritional business. I suppose the argument is that it doesnt exactly fit with their core business of pure Dairy Products because the Nutrition Business is aimed at the medical. That is something we need to watch. They didnt talk about it today. I want to leave you with something. Im just fascinated by the old and the new. This is a company which is valued at 44 billion. T has 102,000 employees. Half the evaluation, 19 billion but 55, im just stunned by this old versus new. The world is changing pretty fast. Can institutions keep up with the rate of change . Thank you very much indeed. What else is on our radar this hursday morning. The worlds second biggest reinsurer announced its chief ill be the new c. F. O. The electric car company is facing setbacks in releasing its model x s. U. V. The c. E. O. Told bloomberg why. Im sort of a perfectionist when it comes to product design. I take the blame for some of that delay. Not being completely happy with the product. And the fed has backed away from its commitment to considering raising rates when nemployment falls to 6. 5 . With joblessness falling faster than expected, it may soon be appropriate the revise Interest Rates. Guy . Still to come on pulse pulse, were going to test out 10,000 expensive for oo top downhill racers. 15 minutes past the hour. Welcome back. You are watching pulse pulse. Lets talk about our corporate story. Facebooks 19 billion purchase of whatsapp. It is the biggest acquisition since instagram. It dwaffers instagram. You remember 2001, right . Is it a smart buy . Joining us to discuss this, the of research. Ve in a world dominated by structured valingses, to my mind this doesnt look out of kilter. You look the evaluation of twitter. Fewer users than whatsapp and less integration of those users as well. It doesnt seem as bonk ers when you look at the numbers. It is 1. 2 of users, billion users. It makes sense. Look. Clearly this conversation has been going on for quite sometime. Clearly facebook understands that it needs to grow. Mark zuckerberg cannot just stay with facebook. He is going to have to carry on doing this. If you think about facebook, facebook is controlled by mark uckerberg. Follow up and try to such a big variation. An advantage . If you believe it is the right move and i think it makes sense as a move, it can be an advantage. It can move really fast. How does how does Mark Zuckerberg make the most of this business . If you look at facebook, it is mostly around photo sharing as well as messaging. That is how it was built. Acquisition, it makes sense. You have a photo share b app on obile. You know messaging. So there is a real strategy to be aggressive. Is this a better this is a much bigger acquisition. But is it a better acquisition than it is difficult to tell. Four, five years versus snap hat. Certainly in the past 1215 months have gone very fast in value in india and mexico. Happen is chat is nowhere there. Whatsapp is really an older player with a much bigger user base. Snap chat is mostly teenagers. Whatsapp is a wider range of feels like another dark day for European Technology companies. Yeah, it is a tough one. I would say there is some hope but it is on a different scale. One last question. Can you really monetize this stuff quickly enough . It is a stock acquisition. If you believe in the facebook story and i think it is a good people were asking would it be able to monetize. They demonstrated that they are very well in mobile. It is a very Good Platform for me companies to get facebook if you think about what whatsapp, 55 people, it is impossible to monetize certainly at some point it will it is very interesting what sfook putting in place. Facebook is putting in place. Keep working together. Step by step, the facebook machine. Yes, makes sense. Thank you very much indeed. Thank you, guy. It will be interesting to see quoyia e i. R. R. On the se acquisition is. Lets talk about some of the other company news you need to know about. Air france is under its new c. E. O. Starting to pick up speed. B. H. P. Billiton is said to be planning a sale of assets in pakistan. The move effectively joins other Companies Including shell and said to be in talks can chinese retailer. They are planning a u. S. I. P. O. That would be the biggest buy a Chinese Company to date. Coming up, a new spin on skateboarding. We hit the streets with an inventer who is betting that one wheel is the way forward. Check this out. Welcome back. Lets get you up to speed with todays lim hot shots. Wins his ed ligety second lim gold. U. S. Mens ice hockey teams are riding high, undefeated on the ice. Russia is out. And the womens finals, norway put in a dominant performance led by one of the legends of the sport. From the olympics to the markets, jon ferro. Thanks very much. I think the color of the european map tells the story. A move lower. If you ever wanted a recipe for the session in europe, on autopilot. Then you have china. China, china, china, hsbc, manufacturing data shows a contraction. Sevenyear low. France, pathetic, in contraction. One question is being asked. What is the b. C. Going to do . If they do the e. B. C. Going to do . If they do anything, what shape is that policy going to take . That story is going to develop. Well talk more about the p. M. I. Numbers shortly. What else have we got coming up for you . One of the biggest players in the world got the start by turning a brick road yellow. Tech color is the company. Good morning. Welcome back. Youre watching pulse pulse live from bloombergs European Headquarters here in london. Im guy johnson. My colleague, Francine Lacqua off today. Lets talk about the Bloomberg Top headlines. Chinese manufacturing fell to its lowest level in seven months. Worse than economists were expecting. Asian markets experienced declines. Facebook is buying whatsapp for 19 billion the biggest internet acquisition in more than a decade. They have more than 50 million members with 450 million users with one million users being added daily. Several people were injured by sniper fire in the ukraine. The president , Viktor Yanukovych declared a temporary truce yesterday. That has very much broken down. Lets get the latest from kiev. Ryan, what do we need to know . The headlines are the truce is crumb g, the clashes that crumbling. He clashes have resumed. The German Foreign minister is sitting down and we go into the ukrainian president as we speak. Presumably he is alongside the french and polish Foreign Ministers who are also there. The polish foreign minister tweeted that he was about to meet with panicky ukrainian counterparts. He could see black smoke. He tweeted that the meeting was going to move. That meeting is now underway. The ukrainian president meeting with three e. U. Foreign ministers. They met with the opposition earlier in the day. Now just within the last hour, also, we have learned that the government headquarters has been evacuated. The parliament has been evacuated and we are getting new casualty figures from the police. The plig police saying that one of their policeman has been killed this morning and at least 21 wounded. Earlier today they said policeman had come under fire from a sniper on a nearby rooftop and that 20 of their policeman had been shot. Fatality figures rising as well from various sources going as high as 11 according to the ukrainian channel number five. A very fluid situation on the ground at Independence Square. Some of it obviously you can see in that live picture. Most of the people clearly protesters. Guy . Ryan, as you say, things are changing every five minutes in Independence Square in the country and ryan will continue to monitor events. Any further developments well be back to ryan. Now our next guest is in charge of a company that has more patents than google, apple, eriksson. It is not a company you nrblely think of the company is technicolor. They invented the process for making movies color. The wizard of oz stands out in its notable history. Ood morning to you, frederick. Let me throw you little bit of a curveball, first of all. You are a technology company, essentially. The world of technology is moving at such a pace at the moment that it is hard to keep up with what is going on. When you read in the papers this morning or online more accurately that facebook is spending 19 billion on a company that has 55 employees, what is your reaction . I feel like were back in the year 2000. Valingses are going everywhere. Evaluations are going verywhere. Not too long ago we thought instagram was a great price. We saw snap chat turning down over 3 billion and now we see 19 billion. There is no economic model that justifies it. What justifies it is a thirst for new customers, particularly for the youth. The younger generations that are probably not using facebook today that are probably in different countries. It really is a play on getting market share. Is it worth 19 billion . I dont know. I also know that most of it is in paper. The shareholders are paying for it. It does remind me of 19992000. Does that make you nervous . Yes, it does. It does, because i think at the end of the day, everything has to come back to fundamentals. In order to justify your share price, you need to have some economic rationale. You need to generate some revenue. Facebook has been absolutely brilliant at doing this. However, you have to wonder with these evaluations, are they sustainable . I think if you look at it from an economic standpoint, they are not sustainable. The only way they can be justified is just the need to gain market share. When you look at your own business, as i say, you in the technology sector, and if you look at facebook here as a company that is desperate to make its Business Model mobile. To what extent does that apply to what you do at technicolor as well . Well, what we do at technicolor is try to invent the technologies that youre going to find in all of your devices in five10 years from now. Let me give you a simple example. Video. Five years ago, 10 years ago, we all watched video on the television. We then moved to the computer screen and then the tablet and now smart phones. One of the key requirements to be able to do this is to be able to put the band width through. To be able you need compress the data. We have a very good future driven by the growth in mobile devices. How hard is it, you clearly have to invest an awful lot of money in r d. How hard is it to recruit the engineers and the people that are going to make this happen for you . On, t we are focused connectivity, color, things like high dynamic range, technical interprets which are important for the future. We are one of the leading companies in the world and particularly in europe, were probably the only European Company remaining. We are able to attract highly talented individuals who love the fact when they come work at technicolor, they are working on some fundamental scientific problems. We expose them to the ntertainment side. What is more fun than meeting people . You this interesting mix of the world that we bring together which attracts a lot of very highly talented engineers. You are a company that is european. That is leading in its space. There are not Many Technology companies out there in europe that can say that right now. What do we need to do over here to compete with Silicon Valley . I think in every european country, the answer is slightly different, but i would say the number one issue we need stability from a fiscal standpoint so we can plan for the future, and we also need to not be ashamed that some people will make a lot of money. We should not be ashamed of that we should let them make fun. At the end of the day, you only have a snap chat or a whatsapp. People need to dream. The reality is we see a lot of ople leaving Continental Europe first moving to london and then moving to the united states. Why . Because they are working very hard and they would like if they hit the jackpot, they would like to keep some of that money. The second thing is i think we need to move away from this culture in europe, which is were going to the top down, were going to tell people what they should be investing in. We have this big