US hotels enjoy hurricane season 7 Oct 2005 US hotels were thriving on business travel even before Katrina hit. The hurricane turned out to give an extra fillip to the trade. Few new rooms and increased concentration means large chains passing cost increases on to consumers and reaping windfall profits.
Rebels turn up the heat on VNU-IMS merger 6 Oct 2005 Shareholders are right to demand VNU drop its bid. The two companies no more belong together now than when they were demerged in 1996. But suggesting that VNU should break itself up is equally mistaken.
Creditors recover 40% of Parmalat investment 6 Oct 2005 Part comes from Parmalat's lawsuits against its banks, who are now big shareholders. If they thwart the suits, investors could get less. Excreditors, some of whom are being sued by Parmalat, will scrap over the new board, and any takeover bids the group may receive.
SanPaolo dismisses Monte dei Paschi deal 6 Oct 2005 A tieup between the Italian banks would be ambitious. It would have been hard to find a governance structure that satisfied both sides. But both lenders are prime candidates to participate in consolidation, now that rivals Antonveneta and BNL have falled to bids.
Italy mulls mad energy tax 5 Oct 2005 The government wants to raise E800m by taxing distribution networks like Terna and Snam. But the grids can't pass the cost on to customers. This would wipe out profits. And even if the draft law is scrapped, Italian utilities will still face increased regulatory risk.
Hedge fund manager launches single-stock fund 5 Oct 2005 Portfolio concentration has its merits. It forces the manager to devote more attention to stockpicking and avoid mindless diversification. But the big drawback with a singlestock fund is that the manager might become too riskaverse in picking his company.
BPB’s proposed capital return is a distraction 5 Oct 2005 The UK plasterboardmaker s extra £250m payout distracts from the debate about value, where it was making headway. The promise of higher dividends should buoy estimates of BPB s fair value. But BPB must prove it deserves a decent premium on top of that.
Prudential sacks dean of technical analysis 5 Oct 2005 Ralph Acampora of Prudential was a highprofile cheerleader of the 1990s bull market. In 1999 he forecast the Dow would hit 18,500 by 2006. The truth is that technical analysis is a useful investment tool, but for market forecasting, nothing beats flipping a coin.
Skandia chomps through advisers 5 Oct 2005 The Swedish insurer has fired Morgan Stanley and taken on Goldman Sachs to defend it against Old Mutual s E4.8bn takeover offer. The bid has divided Skandia s dysfunctional board. Goldman is gambling its own reputation if it thinks it can broker a peace.
German plans to pay AGM voters are daft 5 Oct 2005 The idea may appeal to sausageloving pensioners who enjoy general meetings, or indeed chief executives afraid of being fired. But its intention is to protect managers from the scrutiny of professional investors. That s something Germany needs more of, not less.
Another company bullies an analyst 5 Oct 2005 The US medical implants firm Cyberonics says an analyst cheated by sending students to gather information at companysponsored seminars. Yet that's what analysts should do, particularly for the classic faith stocks of biotech. Cyberonics doth protest too much.
Wal-Mart sued for stealing hip designs 5 Oct 2005 Chic outfitter Anthropologie says WalMart copied its styles and sold them at a knockdown price before the retailer could distribute them. Setting aside the merits of the case, this suggests WalMart is learning a trick or two from quickfashion retailers like Inditex and H&M.
Harvard struggles to replace star fund manager 4 Oct 2005 Jack Meyer has left the firm after achieving a 19% return in his last year. It s an impossible act to follow. Perhaps that's why, despite the prestige of the position, it seems no one wants to be Meyer s successor.
Ford and General Motors sales slump 4 Oct 2005 The employee discount sales incentives both carmakers introduced in June only temporarily salved declining sales. At least now, with inventories low, GM can start to tackle some of its production costs.
Telefonica not a convincing bidder for KPN 4 Oct 2005 A takeover of the Dutch telecoms giant would be ambitious even for Telefonica. What s more, it would offer few synergies. But that has not stopped investors piling into KPN. With telecoms M&A back on the agenda, big deals can no longer be ruled out.
Bollore raises stakes in Aegis auction 4 Oct 2005 The French corporate raider has built a substantial holding in the UK media buyer, now being stalked by ad group WPP as well as Publicis. Maybe he wants to make a turn on any deal. But as the top shareholder in Havas, he may also want to prevent Aegis falling into rival hands.
Trade buyers beat private equity in auctions 4 Oct 2005 Trade buyers can reap cost savings within a year, so for them, the same set of assets tends to be cheaper than it is for buyout funds. The danger is that private equity players might start bidding too aggressively. Either way, they have the most to fear.
Boots investors pin their hopes on an LBO 4 Oct 2005 Shareholders are blowing raspberries at the UK chemist s merger with Alliance Unichem. They ve bid up Boots stock on hopes of a rival bid. On paper, an LBO is possible. But if Boots were such an obvious target for private equity, it would surely have been taken out already.
Endesa raises the bar for Gas Natural 3 Oct 2005 The Spanish electricity company is promising over E7bn of dividends in a bid to fight off Gas Natural s hostile bid. This is a longoverdue recognition of shareholders interests and has rightly pushed the shares further above Gas Natural s offer.
Crazy DVD format war escalates 3 Oct 2005 Film studios, consumer electronic groups and computer firms are rushing to join one of two camps developing nextgeneration video players. The battle is starting to resemble the "War against Terror": vicious; costly; counterproductive and fought over largely irrelevant issues.
German political paralysis ends 3 Oct 2005 Gerhard Schroeder is finally on the way out. A grand coalition is likely to follow. That s better than stalemate, but not much. The election was billed as a break with the past. But it looks like delivering more of the same consensusled politics.
US crony capitalism should discourage investors 3 Oct 2005 Markets are ignoring a sharp increase in the fiscal deficit and the increasing number of senior Republicans who are under a cloud. But regimes that aren t committed to good financial practices normally cause damage.
Private equity stars cash in on Texas Genco 3 Oct 2005 The heady $5.8bn price tag for the US power company means its private equity backers will have made an outstanding return in just one year. And the key to the big profit is simplicity itself using forward contracts to lock in strong current prices.
NTL and Telewest seal $6bn cable deal 3 Oct 2005 NTL has finally got control of Telewest but at a price. It looks like the lion s share of the synergies are being paid to the target. But that won t worry NTL s biggest investors. Most of them were on both sides of the deal.
Boots deals its way out of a strategic hole 2 Oct 2005 The UK chemist s planned £6.5bn tieup with Alliance Unichem will help it diversify and protect its turf from the likes of Tesco. That may not be a panacea to Boots' problems. But the deal looks fair and goes a long way to addressing them.
BPB shouldn’t increase its capital return 2 Oct 2005 The UK plasterboard group needs capital for investment, having trumpeted its future growth in its defence against SaintGobain s £3.6bn bid. Besides, there s little evidence to suggest that returning capital creates real value. Investors can see through the earnings enhancement.