French banks may stumble on appetite for deals 19 May 2006 BNPP, Credit Agricole and SocGen milked strong markets in Q1. They have earned their rerating compared with the investment banks. But their increasing reliance on investment banking and their hunger for deals may make it difficult to catch up with Europe s retail banks.
Ahold looks ripe for a break-up 19 May 2006 The scandalhit Dutch retailer s recovery has proved patchy, and the synergies between its retail divisions elusive. A full breakup would potentially unlock 30% of value and give investors the choice of what to do with the pieces.
SAP founder offers to sell his baby 19 May 2006 Hasso Plattner the cofounder of the German software giant named Microsoft, Google and IBM as his preferred parents. These companies may be willing and interested. But big barriers to parenthood exist for all three.
Deutsche Boerse needs more to win Euronext 19 May 2006 The German exchange wants to run the shop after a merger with its Parisbased rival. But it isn t prepared to pay up for the privilege. That may not be sufficient now that Nasdaq has given NYSE an extra incentive to snatch Euronext from under its nose.
Wall Street cashing out 19 May 2006 As investment banking stocks have soared, top dogs at Lehman, Merrill and Goldman have quietly been selling out. They're not alone. Evercore is going public. Greenhill and Weisel completed secondary offerings. Are they signaling something?
Job moves may signal top of LBO market 19 May 2006 You don't have to analyse leverage multiples to see if the market has peaked. Just look at the many leveraged loan bankers changing jobs. When bankers move to lock in guarantees, it's a sign they see future pay falling. The more that move, the more likely the top has gone.
Politicians won’t succeed in talking up the dollar 18 May 2006 It may have looked like France s finance minister managed to lift the dollar yesterday. But markets aren t impressed. They're used to political chat as the euro nears $1.30. And as the ECB is expected to up interest rates further, we ll hear more whingeing.
Hedge funds buy big chunk of KKR fund 18 May 2006 It's hard to see why investors would want to route a private equity play through a hedge fund. They pay high performance fees twice over. Hedge funds come up with lame explanations for investing. But the answer is staring at them: more money than they know what to do with.
Blackstone beefs up advisory with Studzinski 18 May 2006 The arrival of the former Morgan Stanley M&A boss will raise the profile of the buyout firm's hitherto discreet midcap advisory business. That may bring in more fees and column inches. But it may bring in conflicts too.
Option-timing scandals come thick and fast 18 May 2006 Stock options can inspire executives. But several US companies allowed management to retroactively pencil in the grant date. This creates all sorts of perverse incentives for rapacious behavior.
Mittal raises Arcelor offer by a third 18 May 2006 The new mixandmatch offer is not only more generous. Mittal has scrapped its twotier share structure. Arcelor will need some really strong reasons such as an attractive white knight to say no.
BT’s CEO puts his head back over the parapet 18 May 2006 Ben Verwaayen, the UK telecoms group s boss, has put out his first outlook statement since he was roasted for missing targets in 2003. Not a moment too soon. With Carphone Warehouse muscling in on broadband and concerns over IT services, that may settle investors nerves.
Vivendi rejects E40bn phantom bid 17 May 2006 It s hard to tell just how serious Sebastian Holdings is about buying the French media and telecoms group. But it may put pressure on JeanBernard Levy to boost the share price. That s no bad thing.
Meet the new safe havens: Korea and the eurozone 17 May 2006 When investors were scared, they used to flee to the dollar and gold. But the dollar couldn't be riskier and gold is no longer cheap. Step forward the Korean won. It offers growth, stability and a decent return. And if that's too exotic, stick to eurozone government bonds.
Tesco gets Buffett seal of approval 17 May 2006 The UK retailer ticks all the US billionaire s boxes. Virtually unassailable market position, low gearing the list goes on. Shame it has taken an endorsement from the folksy value investor to point out the obvious: that Tesco is undervalued by the market.
Xstrata’s $15bn Falconbridge bid looks canny 17 May 2006 The Canadian target is tied up in a three way battle with Inco and Teck Cominco. Shareholders might jump at the allcash bid from Xstrata. Whether victory will prove sweet for Xstrata s own shareholders is another question. It could work out, if prices don t fall too fast.
Univision highlights difficulty of being Goldman 17 May 2006 The broadcaster s $12bn auction is one of Wall Street s hottest deals, attracting all the top LBO firms and advisors, plus Bill Gates. This puts Goldman in a pickle. It runs the risk of angering private equity and corporate clients by competing against them as a principal.
UK pension deficits cut in half 16 May 2006 It s an accounting miracle. Marktomarket calculations have allowed the deficit to fall from £77bn to £34bn since January. That s too fast a change for a such a longterm liability. No wonder investors have mostly ignored it.
Air Berlin does a high-cost IPO 16 May 2006 The low cost carrier spent 17% of its IPO proceeds on fees the bulk on advertising, even picking up investors tax bills. The aim was to woo retail investors. But they were conspicuous by their absence, making up only 10% of the deal.
NYSE rightly scraps anti-shareholder takeover loophole 16 May 2006 The Big Board wants to stop companies using treasury shares to cede control without a shareholder vote. That s good news for investors. But it comes too late for Sovereign Bancorp shareholders. They argued against its use of the exemption last year with Santander, and lost.
Investor holds cards in Gambro battle 16 May 2006 The Swedish conglomerate s revised E4bn bid for the dialysis group hasn t quieted criticism this is an opportunistic bid because it is. But the 3.6% increase appears enough to swing sufficient votes behind Investor.
UK gaming companies hit by Italian protectionism 16 May 2006 An Italian court has rejected an attempt by UK online gaming groups to overturn a ban on Italian access to their sites. This ban is in breach of EU law and is designed to shore up government revenues. If Prodi is a good European, he will scrap the ban.
Hybrid could placate angry Eurotunnel investors 16 May 2006 The convertible bond would put off for three years the dilution shareholders would face in a debt restructuring. It might pass muster with lenders too if only because it's possibly their least worst option.
Spanish stamp companies need to show the money 15 May 2006 Afinsa and Forum Filatelico, two Spanish stamp dealers, have denied any wrongdoing. But the fraud allegations against them are monumental. A sniff at Afinsa's 2004 accounts show why it may not be easy for it to honour the E1.7bn of guarantees it has written to stamp investors.
Permira has the house edge in Gala Coral IPO 15 May 2006 The bingotobetting group s private equity owners will all more than double their money if they exit at the mooted £5.5bn price next year. The irony is that the last one in Permira has made the best return of all. It shows that timing can matter just as much as elbow grease.
Stock markets wake up to world’s woes 15 May 2006 Inflation and dollar fears have shaken equity investors. No more sweet dreams of strong economic growth and doubledigit profit increases. But equities are just catching up with the worries of bond and currency markets. Now everyone is fretting about global imbalances.
AstraZeneca pays for delaying CAT purchase 15 May 2006 The UK drug maker is paying a fat 70% premium for Cambridge Antibody, partly because it was still bound by an existing standstill agreement. Biotech groups are in essence an option. The agreement effectively extended CAT's maturity, which jacked up the price.
Univision buyout could set new leverage record 15 May 2006 Mexico s Televisa needs US privateequity firms for its expected $12bn bid for the US Spanishlanguage broadcaster to succeed. It s the only way around US regulations. But it may need to lever up to 11 times ebitda or more to pay for it. That d be a record.
Evercore partners set for big bonanza 15 May 2006 The boutique M&A advisor opened its kimono for the first time as it filed for a public stock offering that may value it at some $800m. Based on its fast growth rate, planned compensation ratios and Greenhill s valuation, its partners may see $30m windfalls.
Are too many fund managers spoiling the broth? 15 May 2006 The US is damaged by the brain drain into money management, says Charlie Munger. Yet America has a comparative advantage in investment. Besides, excessive fees, and the prospect of disappointing returns, are likely to produce a shakeout in the investment world.