Why aren’t more private equity firms buying banks? 2 Jun 2008 TPG is the only buyout shop to take a sizeable stake in a big US lender. That s odd, with cashrich buyout firms looking for leveraged investments. Regulations on control of banks are one barrier. Buyout firms might try to change the rules or find ways to work within them.
Thompson’s ouster no panacea for Wachovia shareholders 2 Jun 2008 Its board finally ejected the architect of the disastrous Golden West acquisition. But shareholders should remain wary. Wachovia kept Thompson around long enough to raise its latest slug of capital. But a new boss may decide it needs more further diluting investors.
TPG takes big gamble with B&B stake 2 Jun 2008 The US buyout group is buying a stake at a whopping discount to book value and can reasonably claim B&B has an adequate capital position and liquidity. But B&B has limited franchise value and the latest profit warning makes the risks in the business clear.
BG should consider quasi-hostile move on Origin 2 Jun 2008 The UK gas firm s heady $17bn offer for Australia s Origin Energy was rebuffed at the eleventh hour. Origin s defence looks specious. BG may not want to go hostile yet but it can still put its case to Origin shareholders in public.
B&B shareholders better off than some US bank owners 2 Jun 2008 The UK's Bradford & Bingley is raising capital from TPG after botching a rights issue. The private equity group is getting the best of the deal. But all B&B's shareholders will at least get the chance to buy in at the same price. That s better than in recent US capital raisings.
China’s forced telecoms shakeup may not stir competition 2 Jun 2008 China s government wants to rein in the dominant China Mobile. The shares have fallen in fear that a complex restructuring featuring fixedline operator China Telecom s $15bn expansion into mobile will hurt profits. But China Mobile s position won t be easily eroded.
Healthy US bank needs to split top roles 2 Jun 2008 Wachovia, Washington Mutual and Citigroup now all have separate chairmen and chief executives. That s good, but it makes the split look like a sign of trouble rather than everyday good governance. The board and boss of a big bank that s in decent shape need to set an example.
La Caixa hopes Slim makes better friend than enemy 2 Jun 2008 La Caixa Criteria has taken a 20% stake in the Mexican billionaire s financial services conglomerate in order to expand in Latin America. The key to the deal is Slim and his extensive influence. But such a powerful partner comes with drawbacks.
Bradford & Bingley’s buy-to-let bombshell spooks UK banks 2 Jun 2008 B&B s profits warning makes the UK buytolet market look precarious. Highly leveraged borrowers already in negative equity are now heading into arrears. A wave of forced selling would hit house prices and spell more pain for all UK mortgage lenders.
B&B rights issues shambles leaves it short of trust 2 Jun 2008 The UK mortgage lender already had lost credibility with investors by fumbling its original plan. By the weekend, its underwriters had lost faith too. The CEO s exit and TPG s entry may shore up B&B s image. But it may not be enough for investors to throw good money after bad.
US primary finale presents Hobson’s choice 2 Jun 2008 Assuming Obama wins the needed delegates in Tuesday s final state primaries, voters will be in a position to compare the candidates economic policies. But they won t find much difference higher taxes and more financial regulation are likely whoever wins in November.
Noose may be closing on high oil price 2 Jun 2008 The soaring oil price at last looks vulnerable to a significant correction. Waning global growth, demand cuts induced by skyhigh prices and reduced fuel subsidies in Asia and a US investigation into market manipulation could soon change the market s direction.