Goldman Sachs hands out the golden rings 26 Oct 2006 The firm named 115 partners to Wall Street s most hallowed inner sanctum. That s the most mademen in Goldman s history. But as a proportion of staff it s smaller than in 2000. With profits nearly three times as large, these PMDs will divvy up a king s ransom.
Rossi has more to do to prove himself at TI 26 Oct 2006 The Italian telecoms group s boss has gone some way to making his mark by shelving plans for a mobile spinoff. But that was an easy hit. TI has more difficult corporate governance and financial tangles to unwind. Resolving those will be a bigger test.
Ferretti’s owners should flip not float 26 Oct 2006 Buyout firms are salivating over the Italian yachtmaker s rapid growth, and bulletproof cachet among the ranks of the uberrich. Ferretti was planning an IPO. But when private equity is probably willing and able to pay more, a secondary sale could make more sense.
AstraZeneca and Glaxo investors suddenly recall risk 26 Oct 2006 The two UK pharma giants have seen their share prices crushed by the failures of highrisk drugs under development. Pharmas look vulnerable to even small disappointments. Sector multiples have expanded, but growth in global drug sales continues to fall.
Do bonds and stocks reflect different futures? 26 Oct 2006 Bond yields are still on recession watch. But stocks are up. Equity buyers seem to expect continued profitable economic growth. But the two markets share one feature rising prices. It looks like a case of more buyers than sellers. Blame liquidity.
Jack Welch considers bid for Boston Globe 25 Oct 2006 The snag is that the price being bandied about is about half the $1.1bn that New York Times boss Sulzberger paid for it in 1993. Selling the Globe would crystallise the value destruction. But focusing on the group s core national paper makes strategic sense.
Forget about an STMicro buyout 25 Oct 2006 Sure, the E12bn FrancoItalian chip group looks like a natural candidate for private equity. It has no debt and throws off lots of cash. But even yoghurt is a strategic industry in the eyes of France. And it s virtually the only big Italian technology company. It s off limits.
Should governments copy central banks? 25 Oct 2006 Padoa Schioppa, the Italian finance minister and excentral banker, wishes they could. That way, bad budgets would be against the rules. But that isn t the way democracy works. Elected politicians need to be frightened into virtue. The Italians aren t looking scared enough.
Arcelor Mittal makes lowball E2.6bn Brazil offer 25 Oct 2006 The steelmaker must make an offer for Arcelor Brasil with equal conditions to the Arcelor acquisition. But equality is hard to define. Some minority holders were thinking in terms of share price premium and expecting E5bn. Mittal has gone for multiples. Expect a big fight.
Amazon scales back ambitions 25 Oct 2006 Investors have cheered the decision by the internet retailer to scale back technology spending. This is the right decision for its low margin business. The dilemma is that Amazon needs bells and whistles to justify its valuation.
Vivendi goes nuclear in Polish dispute 25 Oct 2006 The French media group failed in Europe to get redress from Deutsche Telekom for losses on a Polish investment. Now it's hit the US courts. The French may be hoping the Germans will capitulate in the face of a lawsuit under US antimobster laws. But this strategy may backfire.
Eurotunnel’s chief plays chicken with creditors 25 Oct 2006 The gap between Eurotunnel and its creditors doesn t seem to be closing. Yet liquidation may be just a week or so away. As in chicken, both sides are aiming to make the other blink first. Both can't be right. Many games of chicken end in a car wreck.
Michelin shows resilience in tough markets 25 Oct 2006 Despite the tragic death of its chairman a troubled car industry and rocketing costs, the tyremaker's shares are at an alltime high. It has strong brands and niche products and hence pricing power. Investors are also hopeful about the new managements restructuring plans.
Bernanke risks losing market credibility 25 Oct 2006 The US central bank governor is trying for a Goldilocks economic soft landing before killing inflation. He may miss both objectives. Financial markets worldwide have been buoyant since the Fed stopped raising rates unduly so.
Was Skilling Enron’s biggest weasel? 24 Oct 2006 Five years on from Enron s implosion, Skilling s sentence elicited an odd sense of collective sympathy on Wall Street. The former trading firm s CEO was sentenced to 24 years in prison. That s four times the jail term Enron finance chief Andy Fastow received.
Meinertzhagen exits globalised City 24 Oct 2006 The broker s career spanned London s transformation from provincial backwater to global financial centre. This revitalised Meinertzhagen s own business of equity issuance. But it brought changes with which he was not entirely comfortable.
Anglo American disappoints with new head 24 Oct 2006 She wasn t even second in command at Alcan, a much smaller and simpler company than Anglo. No wonder the shares fell on the news. Cynthia Carroll s appointment may bring a new perspective, but she has little experience with finance, deep mining or South Africa.
Internet bulletin boards claim their first scalp 24 Oct 2006 The shareholder revolt that forced out the founder of Coffee Republic should worry other boards for two reasons. It illustrates how internet chat rooms can spread misleading stories, and how easy the web makes it for retail investors to club together.
Macquarie goes hostile in Germany 24 Oct 2006 Having decided to go hostile, taking a 19% stake looks smart. It forces the German company to the table, as well as locking out rivals. That's bold. But a growing appetite for infrastructure assets means the Australian group is loath to let targets like E1.1bn Techem escape.
Wrigley investors rejoice at scion’s departure 23 Oct 2006 Bill Wrigley s stepping down as CEO gave an immediate 15% pop to the chewing gum maker founded by his greatgrandfather. That s embarrassing, even if it has juiced up his family s wealth by $225m. It also suggests great expectations hang over his successor.
Network at heart of options scandal 23 Oct 2006 There s value in networks not least among grasping executives. Companies that backdated options shared a very large number of directors. Few executives could come up with such a convoluted idea to enrich themselves. And it s easier to behave questionably if you aren t alone.
Corus investors shouldn’t bank on CSN counterbid 23 Oct 2006 The Brazilian group is the most likely candidate to make a counterbid for the AngloDutch steelmaker. But investors shouldn't be hopeful. CSN would get similar synergies to rival Tata. But financing will be hard unless CEO Steinbruch is willing to be diluted that's unlikely.
Have Merrill’s oil and gas pains passed? 23 Oct 2006 The broker s acquisition of Petrie Parkman is its second foray into energy since Enron. On paper the acquisition makes sense. But boutiques have a tendency to disappear into the abyss. Given that one of the founders already abandoned ship isn t a good sign. But boutiques have a tendency to disappear into the abyss. It isn't a good sign that one of the founders has already jumped ship.
France must pay for Suez-GdF merger agreement 23 Oct 2006 Suez and GdF have been overcoming their differences since the GdF chairman threatened to resign. The only sticking point now is price. Suez had to make concessions to get EU approval. But its shareholders are still demanding better terms and should get them.
Ford’s Q3 underscores attraction of going to Ghosn 23 Oct 2006 Selling the majority of its luxury car unit and striking a global alliance wouldn t just bring the Motor City car maker much needed cash. It would enable Ford to cut more costs and boost its credit arm s performance. New chief Mulally should jump at the chance to strike a deal.
Shell offers $6.8bn for Shell Canada minorities 23 Oct 2006 By taking full control of its Canadian subsidiary, the AngloDutch oil group should be better able to tackle its spiralling cost problems. Shell Canada shares have slumped this year so Shell is hoping the offer of a 22% premium will be enough to persuade investors.
UK listed industrials shrinking fast 23 Oct 2006 That exaggerates the decline of British manufacturing. But maybe the government should work harder at nurturing domestic companies. Corus is on the way out and BAE could be moving. If both leave the FTSE 100 index, the industrial sector will shrink by a quarter.
Panama Canal expansion is $5bn well spent 23 Oct 2006 It will allow passage of today s larger container ships, removing a bottleneck on the world s shipping fleet. With $10tr of world trade rising twice as fast as GDP, canal expansion has huge multiplier effects.
Aer Lingus workers hold key to Ryanair bid 22 Oct 2006 Investors hostile to O Leary s offer control almost 44% of the Irish carrier. That s why he needs the employee s support they own 12%. The payout employees will get if they support his bid boosts O Leary s chances so long as they vote with their heads and not their hearts.
Italy moves notch closer to eurozone crisis 20 Oct 2006 Debt downgrades from S&P and Fitch reflect the facts the Prodi government is too weak to face fiscal reality. Investors and politicians prefer to keep their eyes closed. But without a big change in direction, a debt crisis looks inevitable. Debt downgrades from S&P and Fitch reflect reality the Prodi government is too weak to stave off fiscal decline.