Virgin Mobile isn’t worth a premium to rivals 19 Jul 2004 Sir Richard Branson s mobile unit is growing faster than competitors. But that will be tought to maintain with competition intensifying. A queasy market for IPOs means a price cut is needed. Without that the float will be tough to get off the ground. Sir Richard Branson s mobile unit is growing faster than competitors. But that will be difficult to maintain with competition intensifying.
Virgin Mobile slashes float price by 19% 19 Jul 2004 It has also cut the number of shares being offered. The proceeds tumble from £230m to £130m. It is telling that the flotation is still attractive to Sir Richard Branson, despite the massive cut.
UK takeover rules don’t need revamp 18 Jul 2004 M&S wants it to be harder for phantom bidders like Green who never made a hard offer to lay siege to a company. This would be a bad idea. The threat of hostile takeover is an important tool for galvanising companies to improve performance.
Permira strikes deal on WH Smith pensions 16 Jul 2004 The bidder isn t just reducing the debt it s putting into the retailer; its banks seem to have agreed to rank equally with the pensioners. While that may seem a huge concession, in some ways it s just a recognition of the reality.
Continental work ethic reasserts itself 16 Jul 2004 The French and Germans were never really lazy. But changes in international trade and demographics are making them work harder. Friction is inevitable. Unions are reluctant and politicians want to get ahead of the trend. But the trend is clear.
Low-cost poster child runs into problems 16 Jul 2004 Ryanair and Easyjet love comparing themselves to Southwest. But the US carrier is being hit by rising labour costs and competition. These problems may be coming to Europe sooner than people think.
Parmalat bondholders lose out 15 Jul 2004 Banks owed money by some Parmalat operating companies will swap their loans for equity of the same value. That leaves less for bondholders. But there s little danger of the plan getting blocked. The voting procedure makes that difficult.
New Apax fund raising shows good timing 15 Jul 2004 That will be an advantage if the supply of funds over the next 18 months swamps investor demand. The move to raise E4.5bn will put it ahead of rivals who are preparing their own fund raising drives.
Apple finding it harder to profit from iPod 15 Jul 2004 Consumers bought more iPods, the iconic digital music players. But revenues from these sales fell compared to last quarter. It is a good example of just how hard it is to make a buck on consumer electronics.
Harrah’s in $9.4bn bid for Caesars 15 Jul 2004 This latest gambling deal will do more than light up the Vegas strip. Bells will be ringing with regulators in Washington and elsewhere. But that may be intended Harrah s might as well stir the pot while antitrust officials are stewing over the MGMMandalay deal.
Nokia’s stock slammed after profit warning 15 Jul 2004 Unstylish phones have shrunk market share despite price cuts. And sales and profits are expected to shrink next quarter. The stock now looks undemandingly valued. But much depends on the group delivering hipper phones by Christmas.
Chirac cornered into calling a referendum 15 Jul 2004 The French President did not want to test the popularity of the proposed EU constitution. But domestic politics forced his hand. Referendums will now be held in almost every big EU country. Rejection somewhere is very likely.
Reed Elsevier bulks up in risk management 14 Jul 2004 Buying Seisint for $775m cements Reed s position in a fast growing, high margin information market segment. But the AngloDutch publisher has paid a premium price and may struggle to make the deal accretive in the first year.
Intel sets stage for another tech blow-up 14 Jul 2004 The chip giant reported its highest inventory levels in nearly a decade. And stockpiles are growing throughout the sector. These excesses will have to be worked off. Margins look set to plummet.
WPP to start diligence on Grey 14 Jul 2004 A deal would add yet another network to WPP s constellation of advertising agency brands. But Grey looks expensive. WPP will need to find big cost savings to make a deal stack up.
SEC votes for hedge fund registration 14 Jul 2004 Chairman Donaldson had to cast the deciding vote over Republican commissioners, squandering his dwindling supply of political capital. He should devote his efforts to worthier causes, such as increasing freedoms for investors to sack and nominate corporate directors.
Shell ought to think radical 14 Jul 2004 The oil and gas giant has now hired two investment banks to beef up its corporate governance review. It is a sign that Shell might actually consider overhauling its cumbersome doubleheaded structure. That would be the cleanest solution.
European Court judgment turns screws on Italy 14 Jul 2004 The judgement that finance ministers cannot ignore the Commission's rules will make it harder for Italy to rack up even bigger deficits. Not that it will be easy for the country to rein in its finances. But the Commission now has a bit more power to bring it into line.
Should hedge funds be ignored? 13 Jul 2004 M&S faces that question. A biggish chunk of the company is owned by arbs and hedge funds, who rarely want to hold out for jam tomorrow. Shortterm considerations are unlikely to sway the board. But if push comes to shove, everyone s votes will count.
Morgan Stanley sexism case not a watershed 13 Jul 2004 The bank s $54m settlement is clearly a victory for women working on Wall Street or in the City. But it probably won t make life too much easier for them, especially in corporate finance.
Ad stocks lose ground 13 Jul 2004 Revenue growth is expanding but not enough to justify the amount investors bid up agency share prices. Investor sentiment is also being hurt by changes in fee structures, a possible economic slowdown in 2005 and option accounting changes
M&S boss considers taking options at 400p 13 Jul 2004 Rose shouldn t just consider it; he should do it. Even better would be to accept an exercise price that ratchets up every year. This would amount to Rose putting his money where his mouth is when he says shareholders should reject Green s 400p of cash.
HSBC got good deal with M&S Money 13 Jul 2004 Returns on the deal ought to be near 20%. That's not surprising given that the most obvious competitors Barclays and HBOS couldn't bid. But M&S still seems to have done OK. HSBC can only make a good return because of the genuine synergies it brings.
Bond market bite leaves mark on Merrill 13 Jul 2004 The investment bank s revenues declined in every business line except private clients in the second quarter from the first. The Goldilocks scenario of rising corporate finance and equities revenue offsetting declining trading income just isn't panning out.
Commodities not entering a new paradigm 13 Jul 2004 Sure, prices are up. But the move is cyclical. As always, today s higher prices will lead to higher investments, and then to lower prices. Optimists are starting to say that this time will be different. But they underestimate the power of innovation.
Allianz negatively positive on DKW 13 Jul 2004 The German insurer keeps on offering reassurance that it won t pull the plug on either the investment bank or its parent Dresdner. But only if they earn their cost of capital. Fresh investment is another matter altogether. It s hardly a message to boost morale.
M&S probably delivers just enough 12 Jul 2004 The UK retailer hasn't produced a knockout defence. But a £2.3bn buyback plus £320m cost cuts should just see off Philip Green. Green will find it hard to rabblerouse shareholders. Both his plan and M&S's are worth about 400p. Green also has to swallow poison pills.
MCI knocked into play 12 Jul 2004 Leucadia National is seeking regulatory clearance to buy at least half of the former WorldCom s stock. Here is one of those examples where a poison pill may function as a necessary evil in American corporate governance.
Wall Street gets off lightly from scandals 12 Jul 2004 Last week s indictment of Ken Lay and conviction of John Rigas suggest corporate America s evildoers are receiving their comeuppance. Wall Street, however, has got off relatively scotfree. The pain has been borne by shareholders, not individuals.
Continuing his bear-hug wouldn’t have guaranteed success. But delivering an ultimatum guaranteed that he wouldn’t succeed. 12 Jul 2004 The move was odd given that the tide among investors was shifting in his direction.