Pepsi bottlers’ $7.8bn deal looks reasonable 4 Aug 2009 PepsiCo boosted its cashandstock offer for the parts of the two bottling companies it doesn t already own by nearly $2bn. That may still undervalue synergies, but the bottlers get the chance to benefit from any upside. It s not a bad outcome for targets with little leverage.
BHP’s new chairman may need new style 4 Aug 2009 Jac Nasser would be an obvious choice to supervise a company in trouble. Ford s former boss likes to shake things up. But at BHP, he may need to be emollient. Happy investors don t need drama, while governments concerned about commodity prices will test his diplomatic skills.
Trump resurrection no bellwether for buyouts 4 Aug 2009 The Donald convinced a bank to bail out his Atlantic City casinos again. But that doesn t necessarily mean financing will start to flow for private equity restructurings, too. And buyout firms are less likely to invest the effort to resuscitate their cratered companies.
Commodity witch-hunt searches for wrong demons 4 Aug 2009 It s enough to excite any conspiracy theorist: commodity prices are up while the economy is still down. The UK s FSA is the latest to investigate. But new rules on transparency won t alleviate market volatility. The only durable cure is to stop relying so much on spot prices.
StanChart wisely skims off some market froth 4 Aug 2009 Months after a rights issue, the emergingmarkets lender is raising £1bn in a placing. At worst, this will absorb rising bad debts. At best, it could provide growth capital for StanChart s embryonic investment banking franchise. Either way, the opportunistic move should pay off.
SEC wrist-slap reinforces need for Ken Lewis to go 3 Aug 2009 The Bank of America boss is clinging on to his job even after the regulator accused the firm of misleading shareholders about Merrill bonuses. True, Lewis seems belatedly to be drawing up a succession plan. But that s slow going. And he should have been gone long before now.
Votes-for-loyalty shouldn’t be rejected outright 3 Aug 2009 Lord Myners, the UK City minister, has provoked outcry by proposing that longterm shareholders should have more votes than shortterm flippers. The plan might deter activists from shaking companies up. But it could also encourage shareholders to act less like absentee landlords.
Co-opetition runs course for Apple and Google 3 Aug 2009 Mutual backscratching among Silicon Valley s leading lights was already in the Obama administration s sights. Another federal government hot button, mobile telephony, is now in the frame, and Google s Schmidt is leaving Apple s board. A less clubby future looks likely.
PE returns aren’t so bad, but need validation 3 Aug 2009 Buyout fund values dropped less than stocks last year. But that's just on paper. Limited partners need more certainty and want some cash back, too. That means buyout firms need to sell assets. A return of investor interest in IPOs might help them start doing just that.
Commodity price surge could endanger world economy 3 Aug 2009 Commodity price spikes generally occur at the peak of economic cycles. This time, a sharp rebound coincides with an economic trough. Whether caused by monetary factors or Asian demand growth, a further commodity price advance could spark inflation and stall global recovery.
BarCap bonus bonanza shows need for tough reform 3 Aug 2009 A stellar first half has led to accruals for some big paydays. The public will rightly recoil. While Barclays didn t take taxpayer capital, it benefited indirectly from cheap state liquidity and loan guarantees. Investment banks need a more constraining regulatory regime.
Barclays begins to prove investors wrong 3 Aug 2009 Despite a Monday spurt, the Lehmanenhanced UK bank is still trading at a discount to forecast 2010 book value. For now, credit losses and an iffy UK macro outlook are offsetting Barclays Capital s spoils. But if revenues keep surging, investors scepticism may look unfounded.