Current M&A wave looks healthy 23 Sep 2003 That's because many deals Atos/Sema, EMI/Warner, Alcan/Pechiney, Morrison/Safeway, Granada/Carlton are driven by costcutting. Not only is costcutting normally deliverable. In slightly depressed times, it is disproportionately valuable.
Wall Street casino continues 23 Sep 2003 The business formerly known as investment banking (M&A and underwriting) showed some pickup at Goldman, MS and Lehman in Q3. But the proprietary desks powered MS and Lehman's bottom lines, while Goldman's slipped up underlining the inconsistency of the business.
Argentina: investors do the crying 23 Sep 2003 Private sector creditors will have to take a 75% haircut on their $94bn of defaulted sovereign debt. That's particularly galling when the IMF isn't taking a haircut at all on its $30bn of loans.
Statoil scandal claims another scalp 23 Sep 2003 The Norwegian energy group has now lost both its CEO and chairman over payments for advice on doing business in Iran. The group may now lose its international momentum. And state interference could well reduce Statoil growth prospects even further.
Atos Origin buys Schlumberger IT for E1.3bn 22 Sep 2003 The French IT services firm has made yet another acquisition despite having told share holders that its buying spree had come to an end. This is a big bite for the highly leveraged company nearly doubling its size. The risks look big but so does the opportunity.
EMI could enjoy 27% upside from Warner deal 22 Sep 2003 That s the potential value creation even if the UK music group gives Time Warner $1bn in cash and a quarter of its enlarged equity. There are two reasons: powerful synergies and EMI s own highly geared balance sheet.
Alstom’s new bailout green-lighted 22 Sep 2003 The E3.2bn deal averts the EU from seeking an injunction against France. That saves face, but make no mistake: Monti won this battle. Alstom is now controlled by its banks. Ironically, this might force Monti into some hard antitrust quandaries when Siemens comes knocking.
Inditex boss sold shares 3 weeks before results 22 Sep 2003 Spain doesn t have a rule stopping executives trading shares before their results. It should. Either he knew the outllook would be bad which would be appalling. Or he didn t which would be pretty worrying too.
HVB real estate spin-off reduces investor risks 22 Sep 2003 The German bank is about to push most but not all of its troubled commercial lending portfolio into the new real estate unit. Greater operational focus is one benefit. But the bigger gain is that the demerger cuts the risk that HVB will be brought down by bad loans.
Deutsche Bank and its CEO should stay put 21 Sep 2003 News that Josef Ackermann is to face trial over payments to Mannesmann executives after its takeover by Vodafone has raised two questions. Should the Deutsche Bank chief quit? And should the bank relocate its headquarters outside Germany in protest? The answer to both is no.
Dutch state sells 12% of KPN to Citigroup 19 Sep 2003 The E2bn deal unites two themes that will drive equity capital markets issuance in future privatisations and big block trades. Citigroup s bid was very aggressive and, at one moment, looked touch and go. But the bank s gamble has paid off.
Gold bugs on alert for new central bank pact 19 Sep 2003 The current arrangement that limits gold sales ends in a year. Central bankers may discuss renewing the pact at the IMF meeting. Some worry that European central bankers will massively step up sales next year to help fund budget deficits but that s unlikely.
NTL is not the next France Telecom 19 Sep 2003 The UK cable group's impending rights issue will steady its finances. But it won't completely fix them or presage a return to growth. The runup in NTL shares looks speculative and part of the explanation may lie in Telewest's forthcoming debt swap.
Bear Stearns weathers the storm in bonds 18 Sep 2003 The reversal in bond yields only marginally depressed revenues in fixed income. And profits still grew gangbusters. Bear remains hugely dependent on its proprietary trading operations. But they haven't missed a beat.
Axa to pay $1.5bn for US rival 18 Sep 2003 The puzzle is why MONY has agreed to sell out for a measly 6% premium. Rivals will be running the numbers to see if they can pay more. Small wonder that Axa is being coy about the potential for cost savings.
Is beer becoming a buyer’s market? 18 Sep 2003 Interbrew s latest German deal suggests the consolidators are getting pickier amid a glut of sellers and are less willing to overpay. But it s too early to assume others will follow its lead. Shareholders in the big brewers could still be unpleasantly surprised.
EMI should muscle in on Warner/BMG merger 18 Sep 2003 The British group cannot afford to be a wallflower yet again in a music merger. The failure of Time Warner and Bertelsmann to clinch their deal by their deadline gives EMI a chance to get its oar in. It should do so.
NYSE must set example post-Grasso 18 Sep 2003 There are four simple, but radical things the exchange could do to clean up its governance. That wouldn't just be good for itself. It could be cathartic for the whole of corporate America.
Morrison looks well placed to manage Safeway 18 Sep 2003 The UK supermarket chain may have sacrificed some of its margin to boost sales. But the group's firsthalf results still suggest it could make a good fist of a major acquisition.
Axa bid offers arbitrage gamble 18 Sep 2003 The outcome of the French insurer s bid for Mony is in doubt following opposition from the US company s shareholders. The convertible bond issued to fund the bid represents a chance to lay a wager on Axa s chance of success.
Ford re-enters unsecured bond market 17 Sep 2003 The automaker has capitalised on the economic uplift and its agreement with labour unions. But investors don t really see Ford on the road to recovery. They bought into the $3bn bond because of a lack of highyielding alternatives.
Molson tempts European brewers 17 Sep 2003 The $4.7bn Canadian brewer has hinted it is open to a bid. The logical European buyers would be SAB, Heineken and S&N. If the deal's worth doing, S&N will have cash and SAB equity to pay. Heineken would be challenged, and face the prospect of issuing stock.
Ahold chairman quits as CEO alters pay package 17 Sep 2003 The twin moves should remove the sting from criticism of the Dutch retailer, which added a governance faux pas to a financial scandal. No tears will be shed over the loss of chairman, who was asleep during the financial scandal. But it is good the new CEO is being kept.
Alstom D-Day postponed by Brussels and Paris 17 Sep 2003 If Mario Monti hit the rescue plan hard, he might have bankrupted the struggling French engineer. If not, he stood to lose all credibility. So a fiveday ceasefire is hardly surprising. But it merely postpones the inevitable. Either Brussels or Paris is going to lose face.
Investment banks start re-hiring 17 Sep 2003 Bank of America, for one, is recruiting 140 bankers in Europe. The pickup is admittedly patchy. But business is looking up. After years of huge cutbacks, there are glimmerings of a jobs recovery.
New Kingfisher CEO faces Castorama challenge 17 Sep 2003 The French DIY business which Kingfisher bought out last year is never going to be another B&Q. But the task for Gerry Murphy is to reverse its market share decline while improving its margins.
NYSE brouhaha has silver lining 17 Sep 2003 Grasso s pay dispute may nudge the NYSE closer to abandoning its mutual status and giving up its regulatory functions. That would benefit the investing public and NYSE members alike. The value of their NYSE seats could surge to more than about $3.2m apiece.
Zurich launches $1bn hybrid issue 17 Sep 2003 The Swiss group is the latest insurer to exploit the scarcity of hybrid paper to strengthen its capital base. Investors' appetite for yield means there is a window to issue such paper. Lots of insurers would like to jump through it.
Tesco beats expectations 16 Sep 2003 The UK retailer s international businesses are slowly finding their feet. But the real powerhouse for the group is still the domestic market, where nonfood is opening up huge opportunities.
Statoil payment scandal rubs dirt into big oil 16 Sep 2003 The Norwegian oil group is being investigated for possible corruption linked to fees it paid for advice on doing business in Iran. Such payments may be normal in the international oil business. The issue is how they are done, and to whom they are paid.