Krispy Kreme’s share price is bloated 6 Jan 2005 The US donut maker s business is imploding and the group may be facing liquidity problems. But the markets are pricing in a recovery of fat margins. Problem is, these margins were a myth.
Junk bonds illustrate Fed’s liquidity worries 6 Jan 2005 The US central bank has warned of excessive risktaking in some markets. That certainly seems true of junk bonds. Yieldhungry investors have piled into the market seemingly undeterred by the prospect of higher defaults.
Murky dealings at Galeries Lafayette 5 Jan 2005 Minority shareholders are right to demand an explanation for the recent manoeuvrings at the iconic French department store. Something is clearly afoot. But it is not clear what. And the controlling shareholders aren t telling.
LBO bubble inflates Amadeus bid battle 5 Jan 2005 The private equity boom has pushed up sellers price expectations for the global travel reservations firm to almost E5bn. Does this mean a private equity house is about to get burnt? Possibly, although at least one of the bidders has a plausible strategy.
IFRS puts kibosh on convertibles 5 Jan 2005 Publicis is refinancing a E690m convertible bond that would have looked much more costly under new IFRS accounting standards. Other companies may follow so long as the options embedded in their convertibles are not in the money.
Tsunami victim nations resist debt write-offs 5 Jan 2005 For Thailand and Indonesia, pride and credit ratings are more important than debt relief. Only poorer Sri Lanka is tempted. Aid and expertise from the advanced economies reduce the suffering. But South Asia is rapidly becoming selfsufficient, even in disasters.
China throws $30bn at biggest bank 4 Jan 2005 This may seem like a huge capital injection. But it probably fills only 10% of the country s financial black hole. The state is torn between doing too little, risking a financial panic, and giving out too much, allowing bad lending practices to continue.
Jaguar asks Ford for more cash 4 Jan 2005 The US carmaker isn t the only one to struggle with a legacy brand. Rolls Royce and Bentley have also been a burden for their buyers. Buying the mystique of a brand isn t enough. Success requires heavy investment and redesign. So far, only BMW s Mini has been a success.
Blackstone set for mammoth Celanese payout 4 Jan 2005 The private equity group is planning an IPO of the chemicals group one year after taking it private. If the shares are sold at the midpoint of the range, the buyout's investors stand to recoup $3.5bn from their $641m investment.