Europeans defend KPMG against US prosecution 11 Jul 2005 Since the demise of Andersen, only four big audit firms remain. And one of them, KPMG, is under threat. But the European concern is misguided. Competition is good, but the bigger problem is a lack of auditor independence.
VNU aims to double size with E5.8bn IMS deal 11 Jul 2005 The deal makes a lot of sense strategically. It cements the Dutch media group s position as the world s biggest market research company. The worry is that VNU has bitten off more than it can chew; and that the high price it has paid leaves little margin for error.
London attacks a wake-up call for retail LBOs 11 Jul 2005 It is hard to tell what effect the events in London will have on retail spending patterns. But they may trigger a rethink of one of the bigger M&A fashions leveraged bids for retailers.
Euronext in a bind over buying the LSE 10 Jul 2005 If the FrancoDutch exchange wins regulatory approval for a bid, it will be the only show in town as far as the LSE is concerned. The snag is that the LSE has done rather well this year. And that may have hardened the LSE s idea of its own value.
Energy prices close to critical levels 10 Jul 2005 Comparisons with previous oil shocks suggest oil prices will have to reach at least $100 a barrel before they change people's behaviour. That may still seem a long way off. But if one factors in the effects of soaring natural gas prices, we may be there already.
Chris Flowers outbids Fortis for NIB 8 Jul 2005 It s not often that private equity outbids a trade buyer for a bank. But that s what has happened with the E1.7bn Dutch commercial bank. Flowers is an unusually experienced and ballsy investor. But he ll have to work hard to make this acquisition pay off.
Morgan Stanley on hook for $100m severance 8 Jul 2005 Firing former chief Philip Purcell was never going to be cheap. Nor was hiring John Mack as his successor. But the board made this disorderly handover more expensive than was necessary. And shareholders are footing the bill.
Danone buoyed by bid rumours 8 Jul 2005 Pepsico has denied building a stake in the French food group. But there's little doubt Danone is an attractive target. The snag is that Danone already trades at a premium to the sector. And taking over iconic French companies is notoriously tricky.
Diageo disappoints on growth 7 Jul 2005 The UK spirits group has again been hit by tough trading in Europe and the decline of the US readytodrink market. The combination of better US margins and more share buybacks should ensure earnings growth but not enough to push the shares higher.
Markets roiled by London bombings 7 Jul 2005 The initial reaction stocks down, bonds up and safehaven currencies in demand will soon ease, if recent experience is any guide. But 9/11 showed that terrorist shocks can accentuate underlying trends. And in the UK, a worrying trend is declining consumer confidence.
Attacks reverse Olympics euphoria 7 Jul 2005 Leisure and transport stocks, which rose following London s Olympic success, have been hit hardest by the terrorist attacks. Investors are also selling off sectors that may suffer in the backdraught such as insurance and retail stocks.
London well prepared for attacks 7 Jul 2005 The UK capital has plenty of experience of terrorism. And this attack had long been expected. The police even said it was inevitable. The attacks are unlikely to mess up London s financial markets. But the psychological effects could weigh on Europe's business capital.
Unocal mulls whether to recommend CNOOC bid 7 Jul 2005 If oil were an ordinary business, Unocal s board would have a simple job. It would recommend the higher Chinese cash offer. But politics and nationalism has queered the pitch as it did during the Man Utd bid. Then, as now, the best price should prevail.
Baugur’s partners want it to bow out of Somerfield bid 6 Jul 2005 They re unhappy about the fraud charges brought against the Icelandic group s controlling shareholder. They fear it may tar their bid. It would be wrong if they could just sling Baugur out. But shaking off the Icelanders won t be easy without their agreement.
London wins the 2012 Olympic bid 6 Jul 2005 Londoners are rightly celebrating an Olympic victory that promises muchneeded regeneration for London s East End. Its challenge is to avoid the kind of construction cost overruns that have dogged previous host cities.
How much is Spirit worth? 6 Jul 2005 After a weak Q2, the UK managed pub group posted modest growth in Q3, although ebitda is still running below last year's pro forma figure. But that doesn t help in valuing Spirit, as it only covers half the estate. And there's the added complication of two sale and leasebacks.
C&W won’t find Energis deal an easy sell 6 Jul 2005 Buying a rival UK telecoms operator may have industrial logic. But there s a snag. C&W s investors ascribe no value to its existing UK unit. Cable & Wireless will have to come up with a very juicy deal to avoid charges of chucking good money after bad.
Should Shell sell its refining business? 6 Jul 2005 Downstream has always been the poor relation of upstream activities such as exploration and production in the oil industry. But thanks to soaring refining margins, downstream is staging a comeback. More companies including Shell might think about cashing in.
Amvescap snubs Canadian bid approach 6 Jul 2005 The AngloUS fund manager is vulnerable to an opportunistic bid. It has a history of disappointing. And it s still looking for a new CEO. If the mooted £3.2bn offer price is genuine, Amvescap has its work cut out cobbling together a decent defence.
BPI (Lodi) ups capital with E1bn minorities sale 6 Jul 2005 The deal is a get out of jail card for the Italian bank. The move restores its capital ratios to above the minimum standard. What's baffling is how it got Deutsche Bank and Dresdner to buy unlisted minority stakes in its subsidiaries without a guaranteed exit.
RHM cuts IPO price by 20% 5 Jul 2005 At the midpoint of the range, the UK food producer will have a market capitalisation of £975m. That would give it a yield of about 6%, which looks about right.
Capitalia unveils ambitious growth targets 5 Jul 2005 The Italian bank aims to quadruple its earnings in three years. This would require becoming one of the country s most efficient banks. Capitalia s managers have proved themselves capable of meeting stiff targets. But such rapid improvement looks tough to deliver.
ABN Amro wins E1.3bn auction for The Priory 5 Jul 2005 The Dutch bank outbid its financial sponsor clients to nab the UK s renowned mental health clinic for a price well above what was expected. This is more than just a principal investment. ABN hopes to award itself financing, hedging and even M&A mandates as the company grows.
Europe gains from Morgan Stanley civil war 4 Jul 2005 London bankers stayed out of the infighting partly because the bank s European business is cohesive and selfconfident. And they have benefited from it. Europe is getting a bigger say in the top management at Morgan Stanley.
Deutsche Telekom mulls future of US unit 4 Jul 2005 The German telecoms operator isn't sure its US mobile business can hit its return on investment targets. If it can t, DT is in a pickle. It will be a weak holder of a weak asset. And there are few, if any, obvious buyers.
Italian establishment hit by perfect storm 4 Jul 2005 The old lynchpins of the system big blue chip companies are weakening. Meanwhile a new group of aggressive entrepreneurs is on the way. Loanhungry banks give these interlopers access to massive leverage. And Italy s political and financial institutions have taken their side.
ITV buyout still looks complicated 4 Jul 2005 Apax and Time Warner are the latest suitors reportedly planning to take the UK broadcaster private. But for private equity, teaming up with a trade buyer is notoriously difficult to pull off. Besides, the numbers don't seem to add up.
Live 8 won’t make poverty history 3 Jul 2005 Nor will debt relief. One thing rich countries could do would be to allow more temporary immigration of unskilled labour. This would get round the problem of corrupt governments. The problem is it would go down badly with the bracelet wearing classes.
O2 shareholders overexcited by bid hopes 3 Jul 2005 Shareholders think the UK mobile operator may fall prey to a bid soon, judging by its elevated share price. But while the French or the Germans might want O2, they are unlikely to pounce soon. And a privateequity bid looks like a long shot.
UK company balance sheets are too strong 3 Jul 2005 With real interest rates at extraordinarily low levels, companies should be gearing up. It is happening in the US, but not in the UK. Executives and shareholders seem to be almost paralysed. Private equity investors may be on the right track.