Italian banks face misselling probe 9 Jun 2003 Some of what has gone on doesn't look good. And with banks, reputation really matters. The stock market regulator and the Bank of Italy fear that some banks pushed overly risky investments to their retail clients.
Heard the one about negative commissions? 9 Jun 2003 Some brokers offer to pay, not charge, commission to win orders during index reshuffles, like the one to follow this week s FTSE rejig. The practice pays off because they can jack up spreads. The victims are the endinvestors.
Britain funks the euro again 6 Jun 2003 After nearly six years of fencesitting, the UK government's big euro decision is to sit on the fence. Smart politics, maybe. But as a mediumterm foundation for economic policy, it is a nullity for which those responsible should be ashamed.
EU gets OK to negotiate aviation pact with US 6 Jun 2003 An open skies deal would open the way towards rationalisation of Europe's tattered airline industry. But this is only a first step on a very long road.
Xstrata wins MIM by a whisker 6 Jun 2003 The UKSwiss miner s bid for its Aussie rival is all over bar the shouting. Xstrata needed 50% of MIM shareholders and got 59%. Opponents may try to block the deal on the grounds that hedge funds increased their votes by splitting their holdings. That may backfire.
Three UK scraps 3G business model 6 Jun 2003 Deepdiscounting voice calls was the 3G pioneer's weapon of last resort. It has deployed it after just three months of operations. The Hutchison outpost may have unleashed a price war that will damage all mobile players if it doesn't collapse first.
Morgan Stanley may bid for Canary Wharf 6 Jun 2003 Why would anybody want to take the highly leveraged skyscraper group private when commercial rents are still plunging? Because credibility has been shot to bits. All the more reason why management shouldn t be able to buy it on the cheap.
Oracle launches $5bn cash bid for Peoplesoft 6 Jun 2003 The unsolicited cash deal might seem to suggest the bull market is back. But the deal rationale suggests otherwise. The 6% premium looks too low.
JP Morgan sells protection against tumbling equities 5 Jun 2003 The US investment bank has pioneered the "equity default swap", an equity derivative contract that pays out when stocks crash. But if investors think equities are back on the up, they may be unwilling to surrender higher returns for the sake of a bit of protection.
Dow climbs over 9,000 5 Jun 2003 Everything, bar the dollar, is rallying. Equities are rallying because investors believe central banks will successfully reflate economies. Bonds are up because yields may be capped in the deflation fight. Who are these investors? Judging from fund flows, the little guy is back.
Boots stuck in a bind 5 Jun 2003 The UK chemist has had a decent year for sales. But that s largely been at the expense of its margins. Growing the core business much faster will be an uphill struggle. Profitability seems set to slide further.
Vodafone banker quits Goldman 5 Jun 2003 Scott Mead has decided that the M&A game isn't as exciting as it was just like Vodafone's Gent. Retiring M&A bankers fall into two categories: those, like Mead, who want to get into politics; and those who become commercial bankers.
US prosecutors brandish Mortons Fork 5 Jun 2003 The Feds are rounding up Martha Stewart, Frank Quattrone & Co on charges of obstructing justice. That may seem weak compared to insider trading or fraud. But today's equivalent of Morton's Fork may lead to similarly grim penalties.
Handover time at central banks 5 Jun 2003 So heaven forbid that the latest ECB and BoE decisions had anything to do with office politics.
Smith & Nephew should not match Zimmer 5 Jun 2003 The financial logic of S&N matching the bid for Centerpulse is debatable. But on balance it looks too risky. Walking away would be a strategic blow for the UK orthopaedics group. But not a fatal one.
Kirch flop teaches a healthy lesson 5 Jun 2003 One sale has collapsed, but the Kirch saga goes on. Creditors must now choose whether to run the business themselves or seek more bids. Whatever they do, Kirch's rancid capital structure just makes their job harder. It's time to give minority shareholders rights.
Vodafone expansion talk under scrutiny 4 Jun 2003 The mobile giant's incoming chief executive hinted at some anachronisticsounding growth plans in his first public remarks. But it is far too early for shareholders to get excited about these early sniffs at Arun Sarin's strategy.
New Mediobanca gets honeymoon 4 Jun 2003 There s little evidence of that just yet. What s clear is that the new Mediobanca will inherit many of the problems of the old. Investors seem to believe that the new management will eschew power politics and focus on creating value.
Cable & Wireless to exit US, restructure UK 4 Jun 2003 The telecoms group s new strategy is right. But C&W isn t saying how much the restructuring will cost. It won t be cheap, judging by horrible UK losses. But investors should not draw alarmist conclusions from the scrapped dividend.
Phoney bidding war for AWG limps on 4 Jun 2003 Now CVC may reportedly enter the fray as well with a potential offer for the British water company. AWG is putting up a strong defence. The real enemy is not West LB or CVC, but the looming regulatory price review.
Daimler trashes Chrysler profit target 4 Jun 2003 Investors don't believe in Daimler's promises of a turnaround, judging by the implied value of the business based on current prices. On this basis, shareholders appear to reckon Chrysler is on as solid a footing as Italian basket case Fiat.
Dollar depreciation isn’t all bad news for Europe 4 Jun 2003 US monetary policy can seem designed to shock and awe a competitive devaluation that exports deflation. But there s a more benign interpretation. It will allow the ECB to cut interest rates more aggressively this week.
Banks wise up on backup lending 3 Jun 2003 Using relative value pricing, lenders can now force companies to pay the going market rate if they dig into unfunded commitments. While borrowers in trouble might have to pay higher rates just when they can least afford it, they still get their money.
SEC takes probe up the food chain 3 Jun 2003 Clamping down on managers who breached existing rules on Wall Street should instil more confidence than passing new ones. This will be especially true if the latest probes lead to frying bigger fish than the Blodgets and Grubmans.
Alcatel amends terms of E1bn convertible 3 Jun 2003 The French group apparently sold the original deal to banks. It must explain why it did not hold them to any guarantees. The revised terms are still great for Alcatel. But the company has tested the limits of investors enthusiasm.
Ryanair tries to wound Easyjet 3 Jun 2003 The Irish carrier is slashing fares to ribbons deliberately to hurt its struggling rival. Its own returns may suffer but Easyjet will hurt more
Bertelsmann revives Warner books interest 3 Jun 2003 The media giant has to balance repairing its finances and satisfying the ambitions of its Random House arm. But Bertelsmann's balance sheet is a moving, and improving, target. A few months ago, a purchase was not doable. Now it makes more sense.
Pension deficits cannot be insured 3 Jun 2003 The UK government is looking to create an insurance scheme to pay the bill when defined benefit pension schemes fail. This will force strong schemes to subsidise weak ones. That can only be a big disincentive to the prudent management of pension obligations.
PeopleSoft in $1.7bn swoop for JD Edwards 2 Jun 2003 This allAmerican deal suggests technology's secondtier players sees their future as a defensive one. Revenues are not growing much and the battle to preserve market share will be won by merging and cutting costs.
Altadis pays E1.3bn for Morocco tobacco stake 2 Jun 2003 So far, the FrancoSpanish tobacco has shown an admirable restraint in international deals. Now it is catching up. Regie des Tabacs is selling for more than twice its asking price, and in a sealed bid auction. No souk haggling there.