Monti gets tough with France over Alstom 9 Sep 2003 About time too. The French state has ridden roughshod over EU state aid rules in its rescues of France Telecom and Bull. If the competition commissioner seeks an injunction against the rescue, how will Alstom s underwriting banks respond?
Munich Re’s rights issue will be sooner not later 9 Sep 2003 Standard & Poor's has given the German reinsurer a healthy sixmonth window to raise capital and avoid another humiliating downgrade. But for all its protests to the contrary, Munich Re would benefit from a rights issue as soon as possible and has an excuse for one.
Vivendi should split 9 Sep 2003 With the sale of VUE to General Electric, Vivendi has just about exhausted its options for creating value. What remains is its big conglomerate discount. A breakup would help eliminate that.
Investors clamour for mezzanine funds 9 Sep 2003 Goldman closed a $2.7bn fund as investors hope returns from "private equity lite" can rival those from the riskier mainstream variety. But a flood of money into private equity diluted its returns. The same could happen with mezzanine funds.
This is just the latest jobless US recovery 8 Sep 2003 The US economy has been in recovery for 20 months. In a normal cycle, jobs would be growing at a 6% clip by now. They are falling instead. This is an even slower bounce than in 1991 the last jobless recovery when jobs only started to grow 18 months into the upswing.
RSA pays over the top for underwriting 8 Sep 2003 The insurer is paying £48m in fees for its £1bn rights issue, even though the shares are being sold at a thumping discount. The theoretical cost of a put option on its shares at such a discount would have been a tiny fraction of this.
Employees gamble on DKW doing a Lehman 8 Sep 2003 By pledging support for two years, and keeping open the ownership question, Allianz has given the bank a chance to shape its own destiny. If management can turn it round, DKW could win autonomy just like Lehman did from Amex a decade ago.
Thou shalt not attend IPO pitches 8 Sep 2003 That, at least, is what the UK's FSA wants following Spitzer's lead in the US. The European Commission's approach is less clear. But whatever the regulators decide, the industry big boys are likely to implement a selfdenying ordinance on analysts attending pitches.
Marconi recovery may have legs 8 Sep 2003 The UK telecoms equipment maker is nearly back in the black. It could soon be paying down debt to the benefit of shareholders. The shares remain risky but the valuation is relatively comfortable.
Tech stocks on a flyer again 5 Sep 2003 There is growing evidence from Intel, Cisco and software companies that technology spending is rebounding. But the rebound won t justify nosebleed valuations.
Suez needs to sharpen its strategy 5 Sep 2003 The financial firefight is over. In just nine months, Suez has sold E10bn of assets, and hit debt targets way ahead of schedule. But a sumofparts valuation shows how much work could still be done. The group is penalised by a large conglomerate discount.
State sell-offs may aid primary equity markets 5 Sep 2003 A rash of stake sales by deficithit countries would pick up the slack in ECM now that the wave of distressed activity is ebbing. But a for real pickup, companies would have to start doing M&A deals and IPOs again. And that sort of activity is still patchy.
Denmark’s Dong bids $1.7bn for utility Nesa 5 Sep 2003 The stateowned energy company wants to lead consolidation of the Danish power sector, and Nesa is up for grabs. But Nesa s biggest shareholders should view Dong s offer as the opening round of an auction.
Public-to-private M&A needs new ideas 5 Sep 2003 The stream of European publictoprivate deals this year has been driven by UK property and retail. The stock market rally, rising financing costs and fewer pickings may prompt a slowdown.
Too soon to remove HVB from the critical list 4 Sep 2003 The German bank has made great strides in turning itself round. But it faces tough financial goals. And the rating agencies may pounce if it misses them.
Prada breaches covenant on E700m loan 4 Sep 2003 With Prada not doing so well, that doesn't look such a great move. Deutsche Bank gave the Italian group a "going public" loan in hopes of winning lucrative IPO business.
RSA puts gun to investors’ head 4 Sep 2003 The £744m gap in the UK insurer's reserves is much bigger than feared. That's why the discount on its £1bn rights issue is much deeper than expected. That will force shareholders to cough up.
Ahold mucks up CEO pay 4 Sep 2003 The Dutch grocer was clearly going to have to pay up for a new CEO. But Moberg's E10m package looks insufficiently linked to performance. Worse, by springing it on shareholders, Ahold raised bad memories of its former guise.
Diageo deserves better premium to Allied 4 Sep 2003 But that s not to say there s no fizz left in the stock. Allied Domecq's share price been frothed up by bid talk. And Diageo s prospects are not what they seemed in the readytodrink era.
Spitzer bears down on hedge funds 4 Sep 2003 But the regulator should resist imposing a raft of hedge fund regulation. It should pressure institutions to seek better transparency. The crusading New York Attorney General s clampdown on hedge fund chicanery has stolen a march on the SEC.
French M&A enjoys post-summer spurt 4 Sep 2003 But the string of multibillion euro deals and neardeals is not a sign of French imperial resurgence. Quite the contrary. The Vivendi, France Telecom and Suez deals clean up past imperial excesses; while Pechiney will fall into foreign hands.
LogicaCMG reaps merger benefits 3 Sep 2003 The AngloDutch IT services group has cut costs admirably, defending its margins from the downturn. But it has produced precious little evidence to suggest revenues can rebound. That must come soon to support its share price.
Collins Stewart’s boss slips up 3 Sep 2003 A comment made by Terry Smith, the UK stockbroker s boss, in defence of the firm turns out to have been inaccurate. It may have been an innocent mistake. But silly slips will not boost Smith s credibility.
SEC crosses swords with NYSE 3 Sep 2003 SEC Chairman William Donaldson is right about one thing: he should have stayed longer at the Big Board. Left alone, NYSE boss Dick Grasso had the freedom to handpick a clubby board, whose poor governance should precipitate his departure.
Vivendi demerger hint a come-on to Vodafone 3 Sep 2003 If Vivendi demerges its telecoms arm, Vodafone will probably bid for it and will have to pay considerably more than it offered last year. The French group's pragmatism in dismantling itself augurs well for shareholders. The conglomerate discount may be turned into a premium.
Suez to sell US water unit for $4bn – reports 3 Sep 2003 The French utility is getting serious about its debt reduction plans. Suez has already sold some E6bn of assets this year. This drastic kill or cure approach to underperforming assets is defensive, however. Suez still needs to show it can grow profitability.
Deutsche Bank prepares giant hybrid capital issue 3 Sep 2003 The bank s timing is very clever. After the boom in hybrids earlier this year, demand now outstrips supply. That suggests investors will lap up Deutsche s offering, and on favourable terms for the bank. Patience can be a very commercial virtue.
US presses the case for China currency float 2 Sep 2003 The Chinese yuan is under attack not from investors but from US government officials who say it is too cheap. The yuan may be undervalued. But the US needs to be careful, lest it gets what it wishes for.
RAS has more cash than it knows what to do with 2 Sep 2003 With nothing much to buy on the horizon, RAS could come under pressure to return some cash to shareholders. While European rivals are passing the cap round, the Italian insurer has some E900m of excess capital.
Next shake-up looms at Merrill 2 Sep 2003 Following the summer power struggle, the investment banking department is now being reorganised and its boss is moving to a new job. Investors will be hoping the musical chairs will lead to a more efficient structure and are not a reflection of more infighting.