Month: July 2004

Eureko drops F&C IPO plan in favour of merger

2 Jul 2004

FP gets a controlling stake, but it s paying a premium for the privilege. That was more attractive to F&C than taking an IPO discount. It is merging fund manager Foreign & Colonial into the asset management arm of Friends Provident.

Are airlines due another rally?

2 Jul 2004

There are signs that airlines are gaining pricing power on the longhaul routes. That tends to kick off a bull run in the sector. But talk of a rally sounds premature. Capacity is on the increase, interest rates are rising, and oil is still a risk.

Has Morrison bitten off more than it can chew?

2 Jul 2004

The retailer warned profits this year will be lower than expected due to plummeting sales and margings at its new business, Safeway. It is too soon to say for sure that the acquisition has backfired on Morrison. But the early signs are certainly not good. The retailer warned profits this year will be lower than expected due to plummeting sales and margins at its new business, Safeway.

Secondary deals no panacea for private equity

2 Jul 2004

One financial sponsor buying assets from another may be keeping money circulating around the industry. But secondary deals are only partly making up for weakness in traditional exits. And they raise questions over the industry s fees.

Standard Life’s UK pension sales take a dive in H1

1 Jul 2004

The proposed flotation may be two years away, but that's not long to reinvent the whole company by allocating capital to better markets. The life insurer s spat with the regulators has had a hugely damaging impact on the core business. The life insurer s public spat with the regulator has damaged its core UK personal pensions business. Annualised sales now match those of rival Legal & General. But this doesn t mean Standard Life should float at L&G s £6bn valuation.

JP Morgan sued for alleged ego premium

1 Jul 2004

The classaction suit alleges the bank paid an unnecessary $7bn of premium to Bank One to secure the CEO s job for Bill Harrison. The allegations cut to the heart of what bankers call the social issues of deals. But it s hard to see them stacking up.

The European Central Bank is doing a good job

1 Jul 2004

Critics want a more active approach. But steady monetary policy is the right treatment for the slowgrowth European economy. The eurozone has lots of economic problems, but asset bubbles are not one of them. The ECB deserves some of the credit.

Sainsbury’s Peter Davis had to go

1 Jul 2004

The architect of the supermarket group s failed strategy was standing in the way of effective change. Now Justin King, the new chief executive, looks set for a radical review. This could be pretty painful, at least in the short term.

Euro Disney restructuring just a bandaid

1 Jul 2004

The plan gives Euro Disney muchneeded breathing space, but it doesn t go far enough. Even after a E250m rights issue, its balance sheet will be far too stretched. It s hard to see why minority investors would sign up.

Colt struggles to find its Holy Grail

1 Jul 2004

The UK alternative telecoms carrier is missing out on highmargin revenue streams. Competition and investment cutbacks are to blame. Colt can still become cash flow positive. But absent highmargin revenues, the case for the shares is weak.

The UK gas firm has made out like a bandit. Its Automobile Association unit is probably only worth £1.3bn to Centrica.

1 Jul 2004

Investors should be pleased. Not only has Centrica ended a diversification strategy that hasn't worked; the result is a chunky £1.5bn payout