Why is Guidant recommending J&J’s new $23bn bid? 12 Jan 2006 J&J's bid isn't just lower than Boston Scientific's $25bn rival offer. It hasn't even increased it to the level that it originally offered. What's more, the J&J offer is below Guidant's share price. Guidant's recommendation is puzzling.
Boots confounds sceptics with Christmas trading 12 Jan 2006 The UK retail chemist has scotched rumours it had taken a beating. It stemmed the decline in sales, without the need for megadiscounts. That doesn t make the planned nilpremium merger with Alliance Unichem more attractive. But it may increase the chances of a better offer.
BBVA shouldn’t be too generous with BNL 11 Jan 2006 Now that Unipol, has been blocked amidst the Italian banking scandal, the Spanish are in the best position to secure BNL. BBVA will probably have to offer a slight premium. But it shouldn t go overboard.
SEC seeks one number for executive pay 11 Jan 2006 The SEC is poised to require a 'single number' for top executive pay disclosure, a reform long past due. The new rule will bring some transparency to what should be a simple idea. This may even curb abuses by greedy bosses and unwitting boards.
Investors get first chance to judge Iraq government 11 Jan 2006 Iraq s first sovereign bond issue since the US invasion is a bet on the country s future stability and its ability to keep pumping oil. Given the bonds are trading with an indicative yield of 1112%, the market looks to be cautiously optimistic.
Gnutti resignation won’t be enough 11 Jan 2006 The disgraced Italian financier's coinvestors should try to remove him from Hopa s capital structure. That s the best chance of preserving value at Hopa, conceivably even avoiding a E1.1bn capital loss from its stake in Telecom Italia.
Morrison shows early signs of stabilisation 11 Jan 2006 After five profit warnings, the UK retailer is finally meeting expectations. Many stores with new formats are doing better than expected. With the company due to unveil new restructuring plans in March, investors will be hoping it has turned the corner.
Investors should brace for Aviva M&A 11 Jan 2006 The UK insurer seems to have tried and failed to do a $3bn deal with a US peer. But a rising share price will help it fund alternative buys. That s no bad thing. Aviva needs to diversify away from its lowgrowth home market and has a solid M&A record as both buyer and seller.
PSA ignites bidding war for P&O 11 Jan 2006 It seems money is no object when it comes to bidding for the last listed global ports operator. The Singapore port operator's approach tops what was already a very rich price from rival Dubai for the UKlisted group.
DrKW generously bankrolls Macquarie’s LSE bid 11 Jan 2006 The German lender is providing bumper leverage on very favourable terms for the Australians bid for the London Stock Exchange. DrKW clearly believes the LSE can support £1.3bn of debt. But it may struggle to convince others when it comes to syndicating the loan.
Home Depot goes after builders with $3.5bn deal 10 Jan 2006 The home improvement retailer is backing up plans to sell more to contractors, plumbers and the like with its biggest takeover ever. But the price it is paying for Hughes Supply is high and it may take its eye off the ball as rival Lowe s pounces on retail clients.
Bird flu could create economic havoc 10 Jan 2006 The odds on a pandemic have risen after an outbreak in Turkey. It has highlighted the inadequacy of many countries' contingency planning. If the disease does start to spread between humans, the economic disruption could be immense.
M&S offers little cheer for rivals 10 Jan 2006 After last year's festive bloodbath, the UK retailer has beaten expectations, with food sales motoring ahead. But while M&S feels the effects of its turnaround, other retailers may not be so lucky. And even M&S may find the quick wins are behind it.
Unipol should ditch BNL bid 10 Jan 2006 The insurer's new chairman says he's sticking by his predecessor's plans to acquire Banca Nazionale del Lavoro. He should change his mind. Otherwise he will squander a chance to abandon an expensive deal with financial and execution risks aplenty.
Virgin Mobile investor takes bird in the hand 10 Jan 2006 The company is said to be in talks with NTL about a bid at 400p in cash. But the deal is complex and uncertain. Virgin s shares are 71% above the IPO price and 16% above the prebid level. No wonder investors are taking cash off the table.
GM dividend cut a no-brainer 10 Jan 2006 Kirk Kerkorian's top aide shouldn t need to tell the ailing car company to cut its dividend. The board should have moved years ago. The delay suggests the board has not fully grasped the gravity of GM s longterm challenges. But the unions have also been asleep.
Hybrids allow capital-light capitalism 10 Jan 2006 Take Lottomatica. The Italian lottery operator, is engaging in a heavily leveraged $4.8bn buyout of its American competitor Gtech. Yet the deal's structure allows Lottomatica to assume control while retaining an investment grade rating and without diluting its parent.
Danish fund may not want to torpedo TDC deal 10 Jan 2006 By voting against the E12.5bn private equity takeover of the Danish telecoms group, ATP might look like it wants to skewer the bid. More likely, as TDC's biggest shareholder, ATP wants to benefit from a private equity turnaround without paying private equity fees.
Don’t rule out a bid for Easyjet 10 Jan 2006 Easyjet shares may be at 400p, but the Icelandic group stalking the budget airline could pay more than 500p without destroying value. That might not get Stelios dashing for the exit, but the board would find it hard to ignore if minorities were keen.
Tyco split is long time coming 9 Jan 2006 The rationale for the US conglomerate s portfolio of businesses never made much sense as anything but an acquisition machine. But that game ended when the bubble burst and Kozlowski was indicted. If anything, investors have already factored in a full breakup.
HSBC loses its halo 9 Jan 2006 The global bank used to trade at a 40% premium to UK peers. But this has vanished as costs have risen and acquisition prices have rocketed. There's no quick fix. HSBC needs to increase its growth rate and wait for targets to get cheaper. When these happen the stock will rebound.
Rising hedge fund closures are part of evolution 9 Jan 2006 Roughly twice as many firms liquidated in 2005 as in 2004, even though both were average years for hedge fund performance. But if this is the longawaited "shakeout", it is still pretty modest. Indeed, it is evidence of the industry's growing maturity.
Nothing wrong with UK reit proposals 8 Jan 2006 The UK property industry is up in arms over government plans to impose ownership limits and a gearing cap on real estate investment trusts. But the potential valuation uplift from conversion to reit status means the market can easily navigate its way past these obstacles.
Hedge fund fees must come down 6 Jan 2006 It's an open secret that hedge fund charges of 2/20 are too high to satisfy investor requirements. Disappointing investment returns and the prospect of a hedgefund glut may give investors the muscle to demand lower fees.
Boeing tells story of US industrial slippage 6 Jan 2006 The US company had more orders than Airbus in 2005, for the first time since 2000. It s a modest comeback. But over the aircraft cycle, Boeing has steadily lost ground to its European rival. In the last peak it had 70% share. Now it s 50%.
Hedge fund’s assault on Mellon unjustified 6 Jan 2006 Highfields Capital Management wants to break up the US asset management firm. But that ignores synergies binding the business together. Furthermore, Mellon has taken the right steps to reduce its stock discount, and its businesses are performing well.
Weisel Partners IPO looks like a miss 6 Jan 2006 The former Montgomery Securities boss has taken lots of growth companies public. So why debut his investment bank given its poor results? It has made just $7m since 2000 and faces many competitive pressures. The reason must be to get rid of the pesky VCs who backed him.
Biotech has mixed record on 30th anniversary 6 Jan 2006 The industry may have bright prospects, but biotech stocks have not been a cureall. Returns have been unevenly distributed and volatile. The market doesn t appear as attractive now as it did in 2002. But some value probably resides in the biotech minnows.
Sixt’s Europcar bid may be hard to pull off 6 Jan 2006 The German car rental firm has joined buyout house Apax in an audacious bid for its larger rival. That may help it pay the highest price. But the pair will also have to agree on a workable strategy, including getting around the antitrust authorities. That could prove tough.
Second-lien loans fail to supplant mezz in LBOs 6 Jan 2006 This form of subordinated debt is popular in the US and was touted as cheaper replacement for mezzanine debt in Europe. But it hasn't proved so easy to sell as hoped. Its longterm future remains unclear.