No Reuters revival despite booming markets 23 Feb 2006 What happened to the big sales boost expected from the information group's turnaround plan? Underlying sales are only growing at about 2%. This is pretty disappointing, and raises the worry that the revamped product suite may not be all it's cracked up to be.
Italy surfs new protectionism wave 23 Feb 2006 All over Europe, informal takeover defences have been shown to have no clothes. Italy is the latest country to consider using poison pills. It isn t clear how effective this might be. France s attempt looks like a paper tiger. But for Italy to plan a deterrent would be silly.
Europe should welcome Indian call for open markets 22 Feb 2006 It might seem a bit rich when Indian politicians lecture European states on opening up to foreign bids. India is hardly open itself. But Europeans should cheer India s conversion to the liberal cause. Now it s just a question of Delhi practising what it preaches.
Montague looks for a free ride on LCR 22 Feb 2006 The former Treasury advisor is mulling an offer for the owner of the £5.2bn Channel Tunnel Rail Link that would cost surprisingly little. Montague would essentially be buying a free option on LCR s future. But it may not be easy for him to get away with it.
Geronzi ouster sends right message about Italy 22 Feb 2006 The chairman of Capitalia has been suspended amid investigations relating to the collapse of Parmalat. Given Capitalia s exposure to recent financial scandals, the move signals Italy s seriousness about restoring faith in its financial system.
BASF rightly keeps its cool over Engelhard 22 Feb 2006 Others have signed confidentiality agreements to see the US catalyst maker s books. But the German chemical group has so far refused. BASF is right to keep its cool. It's bid is still the only one on the table. And BASF would have to give up its right to go hostile.
Will Morgan Stanley’s research come under Mack’s knife? 22 Feb 2006 The investment bank has closed down its emerging markets bond research group. Many suspect that equities research will be next. With Morgan s research costs way above Goldman s they could be right.
Hedge fund enters the loan shark business 22 Feb 2006 SageCrest Capital s relationship with a loan shark looks like a sign of excess capital in the hedge fund industry. However, it could make sense for hedge funds to lend to businesses shunned by conventional banks.
Gas Natural may have to go for plan B 22 Feb 2006 If its Endesa bid falls through, the Catalan utility may turn its attention to Iberdrola, the electricity group it tried to buy in 2003. A deal still looks complicated. But a threat of a foreign takeover could force the pair into a deal.
Sportingbet makes mockery of online gaming valuations 22 Feb 2006 The online betting and gaming group grew earnings by more than 60% in Q2. But you wouldn't know it from the share price. Regulatory uncertainty is part of it. But Sportingbet is a diversified play in a growth industry. It should trade like one.
Madrid threatens rift with EU over power deal 22 Feb 2006 The mood music coming out of Spain is that the government may end up using its golden share to block E.on s bid for Endesa. Not only would this be flagrant abuse of shareholder rights. It would put Spain in conflict with the EU s plan to liberalise energy markets. Judging by the noise coming out of Spain, the government may end up using its golden share to block E.on s bid for Endesa.
E.on will struggle to create value with Endesa offer 21 Feb 2006 The German utility has no obvious synergies with the Spanish group. And it is paying a punchy price. E.on has long traded at a discount due to fears it was storing up cash for a large acquisition. It has done so in spades.
Barclays needs to pep up its UK business 21 Feb 2006 Most other bits of the group are doing well. The investment bank and wealth management are growing fast. The UK is the weak spot. Barclays is trying to sharpen things up at home. But it's work in progress. And that work may be hampered by a weakening credit cycle.
MAN shares look expensive 21 Feb 2006 Samuelsson s first year at the German conglomerate went well. All core divisions posted good results. MAN gave the dividend a generous hike. But MAN s stock is up almost 90% since he took the wheel. It now trades at close to its cyclical highs. It s time to catch some breath.
E.on deal could set debt financing record 21 Feb 2006 Raising the cash shouldn t be hard. Capital is plentiful and banks are even more eager to lend for M&A than last time. The financing package for its allcash offer for Endesa could surpass the E30bn high water mark set in Europe s last takeover boom.
Cadbury tries to reassure market on margins 21 Feb 2006 The UK confectionery group is delivering strong sales growth, but the shares have been dogged by fears it will miss margin targets in 2006. Though Cadbury has reiterated those targets again, investors may take further persuading. Meanwhile, bid talk puts a floor under the shares.
RadioShack head trips up on schooling 21 Feb 2006 David Edmondson was sacked as president because he made up two university degrees. It's easy to see the temptation in an MBAobsessed world. But he should have been proud to join the dropout tradition of Carnegie and Gates.
E.on rides to Endesa’s rescue with punchy E55bn bid 21 Feb 2006 Gas Natural, which made a hostile bid for its larger Spanish rival, will find it hard to compete with a German cash bid that is 30% higher. Although it probably won't give up without a fight, it may need new allies to stay in the game. The Spanish government won't like this German invasion. But it will be hard to block it.
Enel will need to be bold to muscle in on Spanish scrum 21 Feb 2006 The Italians were hoping to pick up scraps if Gas Natural bought rival Endesa. But E.on s bid for Endesa makes that harder. Enel could team up with Gas Natural to bust up E.on s deal. Or it could train its sights on Iberdrola. But neither will be easy to pull off.
HSBC’s hot M&A tickets are long overdue 21 Feb 2006 First Mittal. Now E.On. HSBC has landed the hottest advisory mandates of the year after two years of struggle. This is cosmetically impressive. But HSBC has yet to demonstrate that its investment banking strategy will deliver value for shareholders. First Mittal. Now E.On. HSBC has landed the hottest advisory mandates of 2006 after two years of struggle.
Hybrids need to be handled with care 21 Feb 2006 There is nothing straightforward about these taxdriven instruments, which combine features of both debt and equity. For investors, a key consideration is whether a hybrid is repaid after 10 years. If it isn t, what looks like debt becomes more like equity.
UK stock market is not as cheap as it looks 20 Feb 2006 The hordes of foreign bidders for UK companies have helped reinforce the perception that UK stocks are cheap. True, the average price earnings ratio is well below the longterm average. But the median p/e and yield tell a very different story. True, the average pricetoearnings ratio is well below the longterm average. But the median and yield tell a very different story.
Gold Fields might be smart to buy £3.8bn Lonmin 20 Feb 2006 The South African gold miner is in a strategic box, with a portfolio of highcost mines. Lonmin would help it diversify into platinum. That might be good news for Gold Fields shareholders. But its also why Lonmin investors should be wary of its advances.
Saban should merge ProSieben’s two share classes 20 Feb 2006 Duh? Didn t the US billionaire recently persuade Axel Springer to pay almost 70% more for his unlisted voting shares than for the prefs? Sure, but the bid flopped, and there s no other firm deal on the table. If he wants an exit, a merger of the two shares may be his best bet. Sure, but that deal flopped, and no one else has bid. If he wants an exit, a merger of the two shares may be his best bet.
Italian mandatory bid threshold should be lowered 20 Feb 2006 A debate is raging in Italy about whether shareholder pacts where investors club together to control companies should be binned. A better solution would be to properly punish those who don t disclose pacts and to make it harder to hijack control without making a bid.
Macquarie gives up the ghost over LSE 20 Feb 2006 The Australian bank never stood a chance after London Stock Exchange shares rose 50% above its original lowball offer. The whole episode has damaged Macquarie s credibility. Meanwhile, the LSE finally looks free to determine its own future.
BAA should avoid nationalist defence 19 Feb 2006 Wrapping itself in the Union Jack to fight off a Ferrovial bid will only erode the UK airport owner s credibility among investors. A better way to defend itself against the Spanish firm is to stake out the moral high ground of shareholder value.
Two cheers for the P&O break-up 19 Feb 2006 Isn t that a bit mean? The shipping group sold its various bits especially the cruise line and ports unit for very high prices. True, but while P&O has done well recently, that has only made back the dismal underperformance of prior years.
Fastweb changes tack with E300m cash return 17 Feb 2006 The payout looks odd. The Italian broadband operator raised E800m from investors under a year ago and has just been trying to sell itself. Growth companies generally consume rather than disgorge capital especially when, like Fastweb, they are still devouring cash.
Investors need an alternative to alternative investment 17 Feb 2006 Private equity and many hedge funds charge exorbitant fees for merely repackaging and leveraging conventional asset classes. With US interest rates still climbing, cash currently represents a more attractive alternative asset class.