PE buy of Neuberger could sow seeds of conflict 29 Aug 2008 Lehman has shortlisted private equity buyers for its asset management business. A buyout shop might invest through its funds. But now or later Neuberger might also fit with its parent company. One day, that could create conflicts between the funds' investors and their managers.
Disaster averted but pain continues for B&B 29 Aug 2008 The UK lender has survived its neardeath experience, appointed a new chief executive and collected £400m from a tortuous rights issue. That s the good news. The bad news is continued underperformance, an unpromising outlook and little scope to make things better.
McCain’s VP offers tough guy contrast to Democrats 29 Aug 2008 Sarah Palin will help McCain with conservatives. As Governor, she battled Alaska s corruption. She adds fiscal restraint credibility and economic savvy, breaking with bigspending Republican Congresses of recent past. She also helps emphasise Obama/Biden s toughness deficit .
Europe can afford to stand up to Russia 29 Aug 2008 European politicians needn t shy away from sanctions against Moscow. The Russian business climate is already suffering after the Georgian war, and the West has leverage over Russian assets abroad. Hints of energy cutoffs notwithstanding, the EU needn t fear Russia s bluff.
US ratifies new world order in accounting 28 Aug 2008 The decision to abandon US GAAP by 2014 is a symbol of a US loss of economic and intellectual hegemony. The move to the soontobeuniversal IFRS standards is also good for global capitalism. IFRS is far from perfect, but one rulebook is better than many.
Liberty faces a long siege 28 Aug 2008 Two of the world s biggest property companies have pitched their tents outside UK retail giant Liberty. Neither Westfield nor Simon Property will probably strike now retail property is slipping. But they are jostling for the high ground when an acquisition becomes possible.
Eddie Lampert should call for his own head 28 Aug 2008 Another dismal quarter shows Sears strategy is failing. The retailer's stock is melting down and rivals are eating its lunch. Sears even missed easy gains from the real estate boom. As the top shareholder, Lampert should fire the chairman and architect of the strategy himself.
Diageo stress tests consumer refuges 28 Aug 2008 Go long on premium vodka and beer for Nigerians. That s the strategy of the world s largest drinks maker. Diageo is trying out the conventional wisdom of consumer industry rely on premiumisation and emerging markets. So far the model seems to be working.
Brown-Forman gets pricked by a cactus 28 Aug 2008 The maker of Jack Daniels paid up to buy Mexican tequila producer Herradura in 2006. Exactly two years later, it is learning that distilling and farming are different fortes, after an earnings miss caused by dead agave plants. Maybe it should have stuck to whiskey.
Alitalia rescue is good politics, bad policy 28 Aug 2008 Berlusconi has kept his promise to find an allItalian solution for Alitalia, although the Italian airline will probably end up with a European partner. The new plan may enrich some businessmen investors, but won't calm fears that politics guide corporate dealings.
Natixis needs deep discount to keep viable float 28 Aug 2008 The CIB arm of Banques Populaires and Caisses d Epargne is considering a 40% discount for its coming E3.7bn rights issue. This is steep for an already battered stock. But it may be the only way Natixis can maintain its 30% free float.
Summer sackings signal Wall St. has worse to come 27 Aug 2008 Securities employment is highly volatile. Autumn is typically the season of sadness, as tightened budgets and competition for bonuses heats up. Horrid credit conditions and this summer s spate of firings suggest the fall will bring much more bloodletting.
Sorrell’s way to TNS looks clear 27 Aug 2008 GfK has withdrawn from a bidding war with the British advertising magnate s WPP. With its numerous ownership constraints, the German group was always going to struggle to beat Sorrell s already full £1.1bn offer for the market research group. No one else is likely to intervene.
Taylor Wimpey must get its banks on board 27 Aug 2008 The UK house builder has written down its land bank more aggressively than its peers. That should leave it looking healthier when the market finally turns. But write downs won t fix the negative cash flow or stabilize the share price. What s needed is a deal with its lenders.
Dresdner sale wouldn’t cure all German bank woes 27 Aug 2008 Allianz could agree to sell its problem child to Frankfurt rival Commerzbank as early as this weekend. CommerzDresdner would be a national leader, although no global powerhouse. But for the fragmented German banking sector, this merger might be more false start than new dawn.
BT envisions in-sourcing Indian outsourcing 27 Aug 2008 The UK telecom operator is reportedly mulling a sale of its 31% stake in Tech Mahindra, a $2.2bn software services joint venture. BT sees India as a future crown jewel, and this venture is growing fast. So why think about selling? Maybe BT thinks it could do the job itself.
Childless and old – German consumers slow down 27 Aug 2008 Cautious shoppers are blamed for the fall in German GDP in the second quarter. It s nothing new. A shrinking, ageing population, with low immigration, doesn t make for big spending. One implication: the demographically more dynamic US will tend to grow faster than old Europe.
Why Detroit shouldn’t get any handouts 27 Aug 2008 The three big US car makers are angling for $50bn in government aid. It s understandable: they are struggling, and policymakers seem willing to throw money at financial sector basketcases. But helping Chrysler, Ford and GM would be much more dangerous, Richard Beales argues.
RBS board changes don’t alter balance of power 27 Aug 2008 The UK bank has found three solid new nonexecutives. But it s only a second tier reshuffle. Bigger heads must roll for RBS really to start afresh. Investors may want the chief executive to stay for a while to integrate ABN Amro, but a new chairman is in order right now.
Dubai’s anti-corruption drive is a nice-to-have 26 Aug 2008 The emirate s high profile effort to increase investor confidence has rightly been trumpeted yet China s success shows that neither transparency nor a free media are necessary cornerstones of a burgeoning financial market. Dubai is still missing an essential: liquidity.
KDB has better growth options than Lehman 26 Aug 2008 The Korean regulator was right that Korea Development Bank should be wary of buying a Wall Street firm. If KDB wants an investment banking business, it should attack the market from below, buying domestic houses with lower staffing costs and less risk in chosen Asian countries.
Thai economy may need a new king 26 Aug 2008 Political uncertainty threatens to plunge Thailand into economic chaos. Violent protesters, partially backed by King Bhumibol, demand the resignation of Thailand s democratic government. At some point, the monarchist Thais may have to choose between their king and their economy.
Foxtons floundering is private equity test case 26 Aug 2008 BC Partners swoop on the London estate agency last year looked as pricey as the property valuations of its infamously aggressive sales staff. The rental arm may help to keep it afloat. The bigger question is how to minimize the fallout from a classic topofthemarket deal.
Post-Olympics NBC isn’t any more compelling for GE 25 Aug 2008 NBC s chief said the network s ratings success from the games should silence questions over its future. Even so, profits from the games, once annualised, would add very little to the media division s results. NBC s fit within the industrial conglomerate is still an open question.
Advice to Obama – start by replacing Ben Bernanke 25 Aug 2008 Breakingviews has five recommendations on the US economy for the Democratic hopeful. To begin with if Obama wants the benefits of sound monetary policy he should replace Bernanke, whose term ends in 2010. Also on the list: Freer trade and targeted curbs on Wall Street.
Korean regulator deals another blow to Lehman 25 Aug 2008 The idea that stateowned Korea Development Bank would buy the embattled Wall Street investment firm was always farfetched. Now the bank s regulator seems to have scotched it. With the firm s quarterend approaching, Lehman boss Dick Fuld is still searching for answers.
Grim reaper stalks US newspapers 25 Aug 2008 Their revenues are plummeting. Tribune is selling assets to stay afloat. McClatchy is struggling. With top lines falling fast across the sector, publishers especially those of smaller papers that carry large amounts of debt look to be at serious risk.
AMD pays bill for debt-fuelled battle with Intel 25 Aug 2008 The chip maker s plucky multidecade fight against Intel has resulted in little except ruinous price wars. Its debtfuelled ambition has now unravelled, leaving it in the sad position of jettisoning bits and bobs to stay afloat.
Will Fannie and Freddie tarnish Wall Street’s finest? 22 Aug 2008 Goldman has sent a small army into government service and now Morgan Stanley is labouring to solve the US mortgage giants mess. Such public service may cast a flattering light. But if Fannie and Freddie truly come unhinged, bankers may wish they stayed home.
Oil rout looks set to fail the Georgia test 22 Aug 2008 For almost two weeks after Russia flexed its muscles in the Caucasus, it looked like the momentum of falling oil prices was stronger than geopolitical fear. But now the price of crude is up 8%. Demand is too strong, supply too well controlled, and money too easy for a collapse.