Month: April 2007

Carlsberg gets ready to defend Russian crown jewel

30 Apr 2007

The Danish brewer s move to relax its rules on new shares looks like a defensive move rather than the prelude to a takeover of rival S&N. At stake is the Russian venture Carlsberg and S&N share. The Danes best bet might be to try to seize control of it now, or lose out later.

Centaurus plays pilot fish role with Group 4

30 Apr 2007

It looks like the hedge fund has stuck E150m into the security group s equity in the hope of it being auctioned to private equity. Its involvement in the Atos buyout shows Centaurus is keen to partner with private equity on deals. Now it may be prospecting for targets.

Altadis should be careful in smoking out an auction

30 Apr 2007

After rejecting rival Imperial Tobacco's E15bn bid, the Spanish group is right to seek a private equity alternative. Getting up an auction can be the best way to secure a top price. But Altadis must show it can handle competing bids fairly.

Italians extract gatekeeper fee from Telefonica

30 Apr 2007

Mediobanca and chums are the new insiders at Telecom Italia. Telefonica gets to be only a secondclass insider, and pays for the privilege. Tronchetti, leaves with dented pride but some salvage value. The ordinary TI outsiders are, of course, left completely on the outside.

Turbulence may be opportunity for Southwest

30 Apr 2007

Southwest Air has been one of the most efficient carriers in the business. But its competitive edge hasn't helped shareholders much lately. In its latest results, Southwest warned of weakening demand and shrugged off LBO talk. Still, it might wrong for investors to bail out.

Activists give Wendy’s a double whammy

30 Apr 2007

First Bill Ackman pushed the company to spinoff Tim Hortons. Now, under the watch of Nelson Peltz, the company might be sold. If the company is sold, shareholders will reap a windfall from both a demerger and a merger. That s not as backwards as it sounds.

Deutsche Boerse overpays for ISE

30 Apr 2007

The Germans $2.8bn bid for the US options platform values it in line with CBOT, another inplay derivatives market. But the deal s return may not cover its cost. It looks more like a defensive move to keep bidders from Deutsche Boerse s own door. But the deal s return won't cover its cost. It looks more like a defensive move to keep bidders from Deutsche Boerse s own door.

Dollar fall is not over yet

30 Apr 2007

Traders attribute the currency s slide against the euro to a slowing economy. Higher inflation and the big trade deficit don t help. But it could be much worse. The major US trading partners are still willing to buy US assets. That should keep the dollar s fall moderate. The currency hit an alltime low of $1.37 against the euro. Blame the slowing economy, higher inflation and a still big trade deficit. But as long as the major US trading partners are still willing to buy US assets, the pace of decline is likely to stay moderate.

Rudd attack on analysts hits the mark

30 Apr 2007

The Boots chairman blames stupid analysts for failing to spot the true value of the UK pharmacy echoing the complaints of other bosses. Too many analysts are prisoners of oldfashioned thinking. The result has been huge opportunities for private equity and hedge funds.

ITV stake referral only a distant cloud in Murdoch’s Sky

29 Apr 2007

Even if the regulator ends up forcing the UK satellite firm to sell its ITV stake, it has already served its purpose: foiling Virgin s bid. The current £120m paper loss on the stake could even be reversed if another firm bids for ITV.

Another bank falls victim to becalmed markets

27 Apr 2007

Bank of Montreal just lost upwards of $404m on energy trading. But not because the market was whipsawing. Quite the opposite. Falling natural gas price volatility was the culprit. Calm markets are one risk banks often overlook.

VTB offers investors hopes of Russian growth

27 Apr 2007

The bank, the country s second largest, is the successor to the foreign trade bank of the USSR. But its expansion plans are domestic. It s being offered at a lower pricetobook ratio than larger rival Sberbank. That makes sense its returns are lower.

Moberg departure draws line under the old Ahold

27 Apr 2007

The Ahold boss cleared the decks after a major accounting scandal. But he contributed little to the supermarket group s recovery. With Moberg gone, Ahold can focus on more valueenhancing moves such as a full breakup, or strategic deal with rival Delhaize.

Sweden picks good moment for TeliaSonera sale

27 Apr 2007

The Nordic telecom group is in great shape, not to mention underleveraged. But the government will hold onto some of its E12bn stake. Why? Because a full sale would trigger an offer for the E30bn group. Few trade buyers could swallow it and an LBO is politically risky.

Santander plays it coy with Capitalia

27 Apr 2007

Spain s biggest bank says it is not interested in ABN s almost 9% stake in Italy s Capitalia. But it would be out of character for Santander s boss Emilio Botin not to extract value from such a key piece in Italy s banking power game.

US private equity tax hike is a long-shot

27 Apr 2007

A new critique of the industry is circulating on Capitol Hill. Buyout shops are worried it will embolden politicians to raise their taxes. But that's unlikely. Private equity has an ace up its sleeve: the real estate industry, which enjoys similar tax breaks.

RBS might unlock LaSalle

27 Apr 2007

The Dutch bank has done its damnedest to lock the UK bank and their allies out. But a side door may be ajar. The key is for RBS to bid for LaSalle, and to make its bid conditional on a wider offer for the ABN group.

Slow productivity growth suggests lower stock prices

27 Apr 2007

Productivity figures continue to disappoint. That reflects slowing capital intensity in the economy. If economic growth trends lower, inflation is likely to pick up. At some stage, investors will have to wake up to this dismal prospect.

BCE faces huge hurdle drumming up bidders

27 Apr 2007

The $40bn telecoms giant must be Canadiancontrolled. But there s not enough buyout cash in Canada to raise two bidding groups. Shareholders must insure BCE manages the process to effectively cobble together more than one horse in the race.

KKR has the best of both worlds

27 Apr 2007

Although the buyout firm is taking on larger targets and spending money like crazy, it s war chest still isn t depleted. That s because KKR brings partners into the deals. What s more it cleverly finds way to avoid sharing control.

Falling dollar pays off for US mega-caps

26 Apr 2007

US blue chip stocks have underperformed their smaller brethren for donkeys years. That looks set to change due to the dollar s swoon. Nearly every big US multinational is showing extraordinary growth in overseas sales.

HSBC should take the Bocom money and run

26 Apr 2007

The bank is now blocked from taking a bigger stake in China s Bank of Communications. And Bocom s Shanghai float has diluted its position. With Bocom trading at an eyepopping multiple, and HSBC s stake now worth five times what it paid, this might be a good time to sell.

Sports Direct’s silence speaks volumes

26 Apr 2007

The newlyfloated retailer has put out what looks like a profit warning. But the astonishing lack of transparency makes it hard to tell. Throw in shonky corporate governance and mysterious share deals, and Sports Direct's fitness for the public markets looks questionable.

ABN supervisory board needs to ensure fair play

26 Apr 2007

Opening its books to the RBS consortium is a good start. But the bank now needs to show rival bidders how to unpick the LaSalle sale to BoA. Shareholders distrust the ABN's impartiality. The supervisory board figures like Baron Rothschild, Eni's Scaroni should provide balance.

Stub equity makes first grand US appearance

26 Apr 2007

KKR and Goldman are offering shareholders of hifi maker Harman a chance to take a ride alongside them in the $8bn buyout. In theory this approach should mitigate MBO conflict concerns and head off protracted negotiations on price. That may be wishful thinking.

Ackermann shamed by Kleinfeld ouster

26 Apr 2007

Deutsche Bank stood by Ackermann when he faced two trials. Yet the Deutsche boss used his own role on Siemens board to edge Kleinfeld out. Ackermann doesn t have to back Kleinfeld just because Deutsche backed him. But Kleinfeld's case is as strong as his was maybe stronger.

ABB moves from sick list to predator

26 Apr 2007

The Swiss engineering group posted stellar firstquarter results. In five years, its market cap has jumped from a washout $1bn to $33bn. This well managed turnaround proves ABB is ready to go on the prowl. Indeed, it has almost $15bn of buying power.

Jobs’ tenure atop Apple looks secure

26 Apr 2007

An exofficial fighting SEC charges claims Jobs knew of options backdating. But Apple and the SEC sources affirm he'll avoid prosecution. With this in mind, investors can properly celebrate an amazing secondquarter performance and hope for more to come.

Merrill’s investment in Resona looks a good punt

25 Apr 2007

The Japanese bank s struggling to repay a heap of government debt, but making good money while it does so. At a fullyconverted 7 times earnings, Merrill s investment looks good value. Maybe Japan s bank bailouts weren t so stupid after all.

Boardrooms don’t need permanent revolution

25 Apr 2007

ISS, the advisory firm, has recommended Carl Icahn s bid for a seat on Motorola s board on the grounds Motorola needs change. But Motorola s board hasn t shied away from conflict. And the quality of Icahn s advice is questionable. Dissent alone isn t reason enough.