Brown plays it boring in Budget 16 Mar 2005 The UK chancellor thinks the country has a winning economic formula, so he is making only token changes. This preelection budget had few crowdpleasers just a few nibbles for the poor and even less for the middle class.
BMW shares deserve a re-rating 16 Mar 2005 The luxury carmaker s shares have suffered on fears that its earnings will be hit by the expiry of dollar hedges. But these worries are overdone. And the group's largerthanexpected share buyback should help restore confidence.
UK private equity hit by tax change 16 Mar 2005 Buyout firms have been dressing up their equity injections as debt to claim UK tax relief on them. The closure of this loophole could raise the industry s cost of capital and undermine its cash flows.
Roche’s subsidiary Genentech offers pair trades 16 Mar 2005 Shares in the Swiss drug maker s subsidiary are bubbling over. They have risen more than 20% this week on news of a cancer drug s success. Genentech s frothy valuation opens up attractive pair trades involving the group, the parent company and the sector.
Unicredito revenues gather pace 15 Mar 2005 While Italy s economy stagnates, the best of breed bank is taking market share. Loans are up almost 11% this year. Rival Intesa may have done a great job on its restructuring. But it could be hard pushed to deliver anything like Unicredito s growth.
Iliad persists with market share grab 15 Mar 2005 The French internet service provider is using low prices to pile on customers at a frenzied pace. That's great while Iliad's cost structure allows it. But looming tariff changes may sour the story.
Ebbers found guilty of WorldCom fraud 15 Mar 2005 The former telecoms mogul tried to convince the jury he was a yokel incapable of cooking WorldCom s books even if he tried. Even if jurors believed that, it failed miserably as a defence. Ken Lay better try another tactic to avoid becoming Ebbers cellmate.
Allianz needs to make its mind up about DKW 15 Mar 2005 The German insurer s dillydallying over its investment bank was a factor behind the departure of corporate finance chief Steve Berger. The symbolic effect of such exits is damaging. Making any decision about DKW's future is now becoming as important as making the right one.
Lehman racks up another record quarter 15 Mar 2005 The first securities firm to report 1Q results has bested its last quarter s performance by half. That should put its rivals to shame. But Lehman has relied more than ever on fixed income, which should temper some enthusiasm from shareholders.
Metrovacesa bids for E5.5bn French rival 15 Mar 2005 At first glance, this looks amazingly ballsy. The Spanish property company is bidding cash for Gecina, which is twice its size. But it's not so big a bite. Gecina's REIT status gives the Spanish the tax benefits of full ownership without buying the whole company.
UK retail dogs lose finance director shield 15 Mar 2005 It is now up to the chief executives to turn these businesses around. If they fail, hiding behind CFOs will no longer be an option. Boots has just lost its finance director. M&S, Sainsbury and WH Smith have all appointed new ones.
Greenberg steps down as AIG boss 14 Mar 2005 Few companies have embodied the personality of their leader as AIG has that of Hank Greenberg. For decades that served shareholders well. But he failed to change with times. Trying to tough out the regulators was more than his independent directors could bear.
Hedge funds face succession crunch 14 Mar 2005 Paul Marshall s decision to step back from running money at Marshall Wace is a reminder of how rare it is to see hedge fund founders retire. Many are just workaholics. Others face the heavy cost of arranging their succession the sacrifice of ego and equity.
Myners’ call for limits on stock lending misplaced 14 Mar 2005 The City bigwig, who has led an investigation inspired by the UK government, wants stock recalled ahead of contentious votes. He s afraid hedge funds could buy votes on the cheap. But rules aren t the answer. If investors lend stock foolishly, that s their problem.
Lufthansa circles closer to Swiss rescue 14 Mar 2005 The Swiss still don't really want the Germans to take control of their national airline. But they don't have much choice. Swiss is still losing bucketloads of money, and its attempt to tie up with British Airways fell through last year.
Walt Disney names Bob Iger as boss 13 Mar 2005 The choice of the US group's operational boss isn't surprising. It leaves lingering worries that outgoing boss Eisner scared off candidates. But Iger s role in helping to revive ABC, combined with Eisner s vow not to seek the chairmanship, mitigates these concerns.
Were lessons learned from the dotcom crash? 13 Mar 2005 Five years on, the fundamentals of surviving internet businesses look sound. Demand is up and supply is down. So does this justify the recent rally of internet stocks? Not really. That is still based more on hope than experience.
Dollar about to hit tipping point 11 Mar 2005 The problem for the dollar is not simply the huge US current account deficit. It is the debt that the US is taking on to cover it. Indeed, the US may soon have to start borrowing to cover payments on past debt. This is unsustainable.
Cablevision shareholders still face trouble 11 Mar 2005 The cable group s controlling investor will fund its moneylosing satellite unit, removing concerns he would override shareholders' wishes. But investors can t breathe easy yet. The board still must negotiate an exit from the business that benefits shareholders.
Banks and hedge funds in a close embrace 11 Mar 2005 Hedge funds account for an eighth of bank revenues, according to a CSFB study. The share of profits is probably much higher. Does this matter? Not unless banks take too many risks financial and regulatory to keep things cosy.
National stereotypes come through in video game consolidation 11 Mar 2005 Making games profitably is increasingly about scale. In Europe, this is leading to different responses. While the Brits are happy to sell up to allcomers, the French are striving to build Gallic champions.
Thales wants to stay independent 11 Mar 2005 After the attempt to bounce it into a deal with EADS, the French defence group is understandably fighting to retain control of its destiny. That s all right if it means resisting politicallymotivated deals. But Thales should not rule out valuecreating moves.
Bond markets sleep as eurozone discipline slips 10 Mar 2005 Eurozone politicians are showing no signs of selfdiscipline. A crack of the whip from the market might shake them up. But investors assume that no eurozone country will be allowed to default. Perhaps ECB President Trichet should talk about this conundrum.
Fastweb shares rise during rights issue 10 Mar 2005 The Italian broadband operator's E800m capital raising shows how keen investors are to fund persuasive growth plans. Furthermore, Fastweb used the equity injection as a platform to refinance its debts, thereby lowering its overall cost of capital.
Suez should spin off Electrabel. 10 Mar 2005 The French group has owned half the Belgian utility for years. The plan was to end this inefficient arrangement by taking full control. But a better plan would be for Suez to give its Electrabel stake to its own shareholders.
Intercontinental Hotels to return another £1bn 10 Mar 2005 But investors should look beyond the disposal story. ICH isn t covering its cost of capital. Disposals may help, but they are not a panacea. With the sale of 73 hotels, the group has now committed to returning 80% of its market capitalisation at the 2003 demerger.
Aviva promises juicy synergies in £1.1bn RAC deal 9 Mar 2005 Forget revenue synergies. The UK insurer can justify the acquisition purely on the scope to improve the breakdown group's measly margins. The deal will bolster chief Richard Harvey s reputation for careful M&A. He may wish to exploit that by pursuing bigger deals overseas.
Premiere debut doesn’t signal German IPO revival 9 Mar 2005 The German payTV company s offering was 12 times subscribed and its shares rose sharply in their first hours of trading. But the offering was heavily reliant on foreigners and retail investors. Core German investors played a relatively small role.
M&A bankers focus on hedge funds 9 Mar 2005 The incursion of hedge funds into LBOs is forcing investment banks to rethink the way they cover the industry. Hedge funds aren't just lucrative clients. They may also be easier to work with than private equity firms that traditionally dominate LBOs.
OPEC spending splurge helps avert 1970s-style slowdown 9 Mar 2005 Unlike in past oil shocks, exporters have spent their windfall almost as fast as they have earned it. This has supported the global economy. However an oil price spike beyond current record highs, which looks increasingly likely, could easily change that.