Parmalat’s international banks formally under investigation 10 Feb 2004 What role did the likes of Bank of America, Citigroup, Deutsche Bank, Morgan Stanley and UBS play in this E14bn fraud? Did they know of Parmalat s troubles? Or were they ignorant? Neither answer is entirely comfortable.
BP only flattered by comparison to Shell 10 Feb 2004 The oil company says it will buy back shares. Shell didn t. It is also growing production and replacing used reserves. Shell isn t. But BP has its disappointments too. The culprit appears to be poor returns in oil exploration and production supposedly BP s strong suit.
Philips’ chip division profits already priced in 10 Feb 2004 The Dutch electronics conglomerate's chip division moved into the black after nearly three years of losses. But the market has already priced a semiconductor boom and more into Philips stock.
UBS gains from bond to equity switch 10 Feb 2004 So much for its fear that the fixed income gusher would swtich off before equities recovered. That said, UBS didn't back its hunch. It poured investment into equities while rivals were still cutting back. So much for its fear that the fixed income gusher would switch off before equities recovered.
Psion sells Symbian stake to Nokia 9 Feb 2004 The Finnish handset manufacturer gets control of the mobile operating system and with it relief on royalty payments. Psion hasn't got a bad price. But the unrealistic expectations for Symbian built into its shares have come crashing down.
When can you keep some debt off balance sheet? 9 Feb 2004 One answer is when it is raised by a subsidiary that you have an agreement to sell. There s nothing wrong with that, if the sale goes through. But, unfortunately for Finmatica's investors, in its case it hasn t.
Analysts too bearish 9 Feb 2004 Bereft of company guidance, analysts underestimated the recovery in earnings. Maybe they also tried too hard to show their independence. But the macroeconomic environment could also be to blame. It's hard to get forecasts right when the cycle is turning and trends are fuzzy.
UK banks eye US for deals 9 Feb 2004 Transatlantic expansion has historically been a pretty hitandmiss exercise for the Big Four. With everyone piling in to take advantage of US consolidation and a falling dollar, the risk of slipups is rising.
Eurotunnel faces yet another debt restructuring 9 Feb 2004 The crossChannel rail operator is hoping to jumpstart business by slashing tunnel access charges. That might be sensible, but it could lead to even less revenue to service its mountain of debt. No wonder investors are fed up.
OPEC is in a corner 9 Feb 2004 Everything looks as though it is going well for the oil cartel. Crude prices are high, and markets are healthy. But looks are deceiving, and the group is not in the rude health it might appear to be in.
Everyone got what they wanted at G7 8 Feb 2004 So the result was a fudge. But at least one thing was clear about the G7 s feelings about currencies. There was no mention that anyone thought the dollar had fallen too far yet.
Italian investors flee fund managers post-Parmalat 6 Feb 2004 None more so than Intesa s asset management arm which saw E1.6bn drain out in January. Nextra seems to have paid a particulary high price also because of its convoluted dealings in Parmalat bonds.
Expensive? Never mind. Buy! 6 Feb 2004 Record US mutual fund inflows are just the latest sign of investors sharpened appetite for risk. But rising interest rates may do for this hunger what the mutual fund scandal so far has not.
Italy declares war on financial crime 6 Feb 2004 Well up to a point. The new postParmalat draft law strengthens penalties. But the Italian legal system has difficulties securing definitive convictions. So the harsher penalties may not be a big deterrent.
Vodafone needs a sweet deal from Verizon 6 Feb 2004 The UK mobile group can only justify bidding for AT&T Wireless if it can sell its minority stake in Verizon Wireless at a premium. If Vodafone can persuade Verizon Communications, the majority owner, to do that, it will really have played a blinder.
So much for Royal Dutch/Shell’s mea culpa 5 Feb 2004 Chairman Phil Watts won t resign over the reserves cut. He says he understands investors disquiet, and will listen to their concerns. But that s it for now. Bar some internal tinkering, bigger changes to Shell s clunky structure will have to wait for Watts successor.
Deutsche Bank pursued takeover by Citigroup 5 Feb 2004 Talks stalled last month. The reported reason, fear of controversy, is odd: CEO Josef Ackermann must have been aware of that from the start. The real reason is probably more simple. Ackermann couldn't get Citi to pay the right price.
Fee bonanza from Invensys refinancing 5 Feb 2004 Paying £109m in fees for a £2.7bn deal looks indefensible. But strip out legal costs and an oddity and the banks get about £79m. That s still chunky, but the deal digs Invensys out of a potentially more costly liquidity trap.
Invensys launches £2.7bn refinancing 5 Feb 2004 The shares and loans package makes more sense for the UK engineer than the alternative selling assets at distressed prices. But Invensys owes its survival more to the risk appetite of the financial markets than to its own recovery efforts. Deutsche Bank has made a massive bet on the UK engineer. Early signs are that it will pay off. But the bank will be biting its fingernails for a while.
Fee bonanza from Invensys refinancing 5 Feb 2004 At first glance, the £109m cost of the £2.7bn deal looks indefensible. But it includes legal costs and a premium for repurchasing bonds. Strip those out, and the banks get £63m. That s still pretty chunky, no matter how hard they are working for their money.
Canary Wharf gets back to back bids 5 Feb 2004 Morgan Stanley's latest bid at 275p is no knockout, but it keeps the game going. It's up to Brascan to close the bidding. The risk is that Brascan does not and Morgan Stanley fails to garner the votes it needs. Investors should sell at 276 while they can.
Gold bugs are on the G7 lookout too 4 Feb 2004 It increasingly looks as though the G7 won t muster any more support for the dollar this weekend than they did last November. If the dollar resumes its fall, the dollar price of gold would soar and, for the first time, rise in other currencies too.
ABN Amro pulls down takeover defences 4 Feb 2004 The move brings the Dutch bank into line with new governance rules. It also removes a big barrier to takeover.
Black accuses Hollinger of thievery 4 Feb 2004 That s a bit rich. It appears to be a case of the pot calling the kettle Black. Lawsuits are popping up like popcorn at Hollinger. At least the Delaware lawyers are set to make a killing from this mess.
Nestle slightly loosens L’Oreal impasse 4 Feb 2004 Nestle now has a direct stake in L Oreal, rather than a minority position in the parent and no longer risks having to buy the whole group. But the only way something could move in the shortterm is if there was a bid for L Oreal. And that doesn t look terribly likely.
New index taps novice interest in hedge funds 4 Feb 2004 FTSE's Hedge Index will be restricted to respectable funds that are at least 2yearsold, externallyaudited, and open to new investors. But only 40 out of 6,000 hedge funds qualify. The question is whether the reason they have room for new money is that they don't perform.
Ryanair gets off easy from EU ruling 3 Feb 2004 Or at least that s how it appears, judging by the euphoric market reaction. But watch out the ruling is ambiguous and even Ryanair is confused about the ruling's impact on its finances.
Deutsche loses prop traders to hedge fund 3 Feb 2004 Investment banks are bending over backwards to try and stop this kind of flow. All sorts of perks are on offer. But banks are pushing water uphill. They can't halt the ongoing rush of money into hedge funds which is making them so attractive to join.
Italy fluffs Bank of Italy reform 3 Feb 2004 A new draft law on financial regulation reportedly gives both the Bank of Italy and the competition watchdog a say in bank consolidation. That is bad news for investors who had hoped Italy s banks would be freed from Governor Antonio Fazio s grip.
Suez sells E1bn stake in French TV station 3 Feb 2004 The French utility wasted no time in offloading M6 after getting the green light from the regulatory authorities. The sale increases M6's free float by a third, and leaves Bertelsmann's RTL as the only major shareholder calling the shots.