ITV tries to lift its game 9 Mar 2005 The UK broadcaster had a great year in 2004, thanks in large part to cost cuts. Now it says it is focused on growth in digital TV. Early signs are good, as they are for some huge regulatory savings. Yet it s not clear these are enough to offset ITV1 s shrinking audience.
Commodity rally should scare bond buyers 9 Mar 2005 Commodity funds and ultralong bonds are two of the hottest asset classes around. But it will be hard for both to do well. Rising commodity prices are a prime raw material for bondkilling inflation. But bond prices are still in a nofear zone.
Oracle muscles in on SAP merger 9 Mar 2005 Bill Gates has pretty much always been evil incarnate for software execs. But Oracle boss Larry Ellison is trying on the role. While vexing for software execs, his aggressive merger campaign is good for investors.
BHP Billiton makes A$9.2bn bid for WMC 8 Mar 2005 The Australian giant has outbid Xstrata by 12%, enough to get tentative approval from WMC. Xstrata has given up. BHP will regret this expensive bid unless metal prices have reached a new high plateau rather than merely being near a cyclical peak.
UK retail has worst February in 13 years 8 Mar 2005 Boots has already warned on profits, and M&S is cutting prices. This doesn t bode well for the other retail turnaround stories. Noone expected retail to do very well. But anecdotal evidence and the latest official data suggest the situation may have deteriorated.
Telecom Italia taps markets’ lust for yield 8 Mar 2005 The group is pricing a new 50year bond to yield 5.25% not much more than the dividend yield on its stock. This is odd. But there's an explanation: bond investors aren t allowed to buy shares.
Benetton slumps on 2005 forecasts 7 Mar 2005 As lowcost fashion from H&M and Zara takes the world by storm, the previously iconic Italian brand is being forced to cut prices. But the worry is that Benetton s wholesale business model will still make it hard for it to compete.
Buffett fails to practice what he preaches 7 Mar 2005 The Sage of Omaha wants the US to reindustrialise to reduce its dependence on imports. But his own business Berkshire Hathaway exemplifies the trend away from industry to finance.
Japanese icon gives top job to non-Japanese 7 Mar 2005 In promoting Sir Howard Stringer, the electronics group has taken a leaf out of Nissan s book. Having a gaijin in charge did the carmaker no harm. The move shows Sony is ready to be radical. But Sony needs to be, given its problems.
Boeing chief quits after ‘personal relationship’ 7 Mar 2005 It s not surprising that the US defence group should be very careful of its image just 16 months after a major commercial scandal. But given its own admission that Stonecipher's relationship had no impact on the business, Boeing may be overreacting.
Lowball bids become the norm 7 Mar 2005 Take Murdoch s recent bid for the Fox minorities. The first bid valued the US media group at a discount to rivals. The logic of lowballing is simple. Bidders gamble that, once ownership shifts to hedge funds, they only need to sweeten slightly to win.
BAe Systems buys UDI for $4bn 7 Mar 2005 The deal makes industrial sense. It extends the UK defence group s armoured vehicles business into the US where spending is rising. If there's a snag, it is that BAe seems to have paid a high price for the business.
Deutsche Boerse scuppers LSE auction 7 Mar 2005 The UK exchange is left with only one suitor, Euronext. And it has publicly rejected a price that was too rich for the Boerse's investors. A deal is still possible but only if Euronext can avoid a widespread rebellion among its own shareholders.
Capital One in $5.4bn buyout of Hibernia 7 Mar 2005 The deal s primary aim is to give Capital One, a credit card issuer, access to lowcost funds provided by Hibernia s depositors. In buying a bank, the acquirer may be preempting the sort of funding problems that made Household fall prey to HSBC.
Why are investors buying corporate bonds? 6 Mar 2005 These bonds looks clearly overvalued. But pension funds are forced buyers. And fund managers are scared of selling in a bull market. This is perverse. The funds are taking big risks for small returns. And the fund managers are risking clients money to preserve their jobs.
Dell’s $10bn buyback rather stingy 4 Mar 2005 The world s largest computer maker has spent around $15bn on buying back stock over the past five years. Now it promises another $10bn. But with $4bn in net cash and minimal capital expenditure, why isn t it buying back far more?
US oil producer Unocal attracts suitors far and wide 4 Mar 2005 It s a dowdy asset made sexy by the difficulties of oil majors to boost reserves and the desire of developing nations to secure supply. The risk for ChevronTexaco or others, coming after China s interest, is that they may find themselves bidding against an irrational buyer.
Tiscali capitulates on need to sell French arm 4 Mar 2005 Selling France for E200mE300m would allow the troubled Italian internet service provider to pay down this year's debt maturities. But this wouldn't necessarily mean that Tiscali can avoid another bond or stock issue. Indeed, this disposal could help it tap the markets.
NYSE seats keep climbing in value 4 Mar 2005 This suggests the odds are in favor of the biggest US stock exchange scrapping its nonprofit status and eventually launching an IPO. Were this to happen, it could still mean big value creation for seatholders.
Gazprom merger hits another speed bump 4 Mar 2005 The Russian gas giant has fallen out with oil firm Rosneft over their proposed merger, a central plank of Moscow s energy strategy. Such problems are to be expected from such a controversial deal, but they are not enough to stop it. Moscow remains too committed.
EU wants right to get into US airline business 4 Mar 2005 The EU's old negotiating goal was the right for its airlines to fly within the US. Now it wants full foreign ownership. The EU is keen to support an unprofitable industry. But US nationalism may deprive it of this opportunity to lose money.
Horlick may bid for DeAM UK arm – report 3 Mar 2005 The star fund manager fell out with Deutsche when it suspended her after appointing her to run the unit in 1997. That bodes ill for a sale. After all, Commerz didn t sell Jupiter to founder John Duffield, after ejecting him from the top job. And he was offering to top rival bids.
Daimler raises target for Mercedes 3 Mar 2005 The German carmaker aims to cut an extra E1bn of costs from its luxury unit, on top of the E3bn restructuring plan it announced last month. It s easy to see why Daimler is setting the bar high. But this doesn t make the original plan look any more credible.
Greenspan’s ideology may not help US economy 3 Mar 2005 He is focusing on privatising the US Social Security system. And as for the more serious trade deficit, he wants to see the markets rule. That fits with the radical antigovernment thinking of Greenspan's youth. And it may also be why he is reluctant to deliver higher rates.
Two cheers for Trinity Mirror chief Sly Bailey 3 Mar 2005 The UK newspaper group has turned in its biggest profits in four years, upped the dividend and is to buy back stock. Yet though the share price has almost doubled under Bailey, she has yet to solve the group s biggest problem: falling circulation.
Fazio keeps bank merger veto and life mandate 3 Mar 2005 The governor of Italy s central bank has certainly scored a coup. Only a year ago, the government was waging a war against him. Italy has missed a chance to reform Fazio s unusual role. This is also bad news for foreign banks trying to buy their Italian rivals.
AstraZeneca dodges regulatory bullet 3 Mar 2005 But the damage is done. The public s poor perception of the drug s safety means it will never deliver the growth investors once anticipated. Shares in the pharma group have rallied after US regulators allowed the group s controversial lead drug, Crestor, to stay on the market.
Xstrata turns up heat on WMC 2 Mar 2005 The UKbased miner has made its A$8.4bn hostile offer for the Australian competitor unconditional. That is daring. It is trying to force its way in at a belowmarket price. The aggressive strategy is in the Xstrata tradition, and might well work.
Telefonica’s plan to partially list Endemol is odd 2 Mar 2005 Investors would have preferred a trade sale, rather than this half eviction of the Dutch TV firm that produces "Big Brother". But the Spanish telecoms giant may have had to choose this route after it found it harder to sell Endemol that it hoped.
Prudential increases operating profits by 39% 2 Mar 2005 The UK insurer has also flagged up increasing repatriations of capital from its overseas operations. That gives credibility to the idea that Pru can keep financing growth once it has spent the £1bn raised in last year s rights issue.