Brazil

Latam oil opening demands hedged bets

2 May 2018

The region's growing receptiveness to foreign investment in its energy assets could be a dream come true for oil majors. Political winds can change, though, and there is no perfect blend of hydrocarbon potential and legal certainty. Brazil and Mexico will do better than the rest.

Enel and Iberdrola’s Brazil war lacks restraint

30 April 2018

The two companies’ rival bids for Eletropaulo have nearly doubled the market value of Brazil’s top utility in a month, to $1.6 billion. The Europeans want to boost their presence in Latin America’s biggest nation. But the deal is too pricey to create much value for the winner.

UK slide raises Santander’s modest bar to success

24 April 2018

Net profit in its British unit dropped 21 pct, blotting the Spanish bank’s solid first quarter. Strong growth in Brazil and Spain, however, more than made up for Brexit-related jitters. More of the same should allow Santander to hit its full-year earnings and dividend targets.

Brazil’s anti-graft drive may hamper fiscal reform

12 April 2018

The jailing of the country's most popular politician, Lula, and voter disgust at corruption among the powerful will give outsiders with clean reputations a chance to shine in October elections. That's welcome, but could mean needed spending cutbacks are less likely to happen.

Hadas: Even Trump can’t make graft great again

11 April 2018

Resistance to corruption is evident in cases against ex-leaders of South Korea, Brazil and South Africa. Old royal privileges make no sense in modern economies. U.S. officials and the corporate elite have strayed, but rising middle classes will keep straightening out the crooked.

Wall Street gets its money-mining canary back

9 April 2018

Jefferies’ owner, the $8 bln Leucadia, will offload non-financial units, take its traditionally trading-heavy investment bank’s name, and move to a November year-end. The industry will again have an early-warning stock – and long-time boss Richard Handler’s task will be clearer.

Meirelles’ sanity will be a hard sell in Brazil

26 March 2018

The man running Latin America's biggest economy is resigning and wants to be president. His competence and pro-market stance are a welcome addition to a wide-open field ahead of October’s election. But voter disgust for establishment figures could mean rejection for his approach.

Latin America’s pro-market forces need young blood

22 March 2018

Pedro Pablo Kuczynski, a 79-year-old ex-banker, has resigned as Peru’s president amid graft allegations. His junior by two years, Brazil's Michel Temer, has failed to deliver key pension reforms to spur the region’s biggest economy. Latin populism needs more vigorous enemies.

Abertis rethink would avoid bidder roadkill

8 March 2018

Rival bidders Atlantia and ACS are mulling a breakup of the Spanish group, reports say. It would nix the idea of a European champion. But if Atlantia forgets Spain to focus on Abertis’ other assets, it would be politically easier – and avoid a pricey bidding war.

Telecom Italia investors find two reasons to cheer

7 March 2018

Boss Amos Genish has kicked off the separation of the telco’s fixed-line network, and will slash debt. A rerating of the network could help the group’s valuation, and a step-up in free cash flow brings the prospect of long-awaited dividends. Both should please shareholders.

Cowed LafargeHolcim sets sights appropriately low

2 March 2018

The new boss of the world’s largest cement maker has scrapped a share buyback and set the group’s EBITDA growth target at 5 pct. Jan Jenisch can probably do better. Still, given LafargeHolcim’s various headaches since its merger the conservatism is understandable.

AB InBev is one step short of a strong footing

1 March 2018

The world’s top brewer served up better-than-expected EBITDA in the fourth quarter and a welcome chaser of volume growth. That will soothe investor worries that ruthless cost cuts are hurting sales. Now it needs to reverse falling market share in its most important U.S. market.

Heineken’s number two status brings marginal costs

12 February 2018

The Dutch brewer is one of the few global groups still increasing beer volumes. However, acquisitions will weigh on operating margins in 2018. Heineken needs to invest in its new Brazilian brands to take on market leader AB Inbev. That limits the scope for boosting profitability.

Boeing tries market route to competing with Airbus

6 February 2018

The $200 bln U.S. giant may buy up to 90 pct of Embraer’s commercial-aircraft business. That would give Boeing effective control while leaving sensitive military hardware in Brazilian hands. It’s a better answer to the Airbus-Bombardier threat than pushing for trade tariffs.

Santander’s Brazilian samba drowns out UK blues

31 January 2018

A rebound in the Spanish bank’s largest market by profit offset rising UK bad debts, enabling an annual 11.8 percent return on underlying tangible equity. This year should see a stronger Brazil and fewer one-offs. That should mean Santander’s returns stay ahead of European peers.

Boeing needs Embraer deal to fly after tariff crash

26 January 2018

A U.S. trade agency surprisingly rejected calls by the aerospace giant and the Trump administration to slap duties on Bombardier’s C Series jet. It shifts the regional-airplane dogfight back to the marketplace, upping the pressure on Boeing to seal a tricky merger with Embraer.

ADM bite at Bunge would be meal of many courses

22 January 2018

A $30 bln-plus merger of the two grain traders would boost profit in an unhelpfully oversupplied market. It would, though, also give rival Glencore, regulators and farmers a chance to push their own recipes. A single, clean takeover isn’t likely – but a few smaller ones could be.

Boeing’s stealthy Embraer approach has big aims

2 January 2018

The U.S. aerospace giant is considering joint ventures with the Brazilian planemaker rather than a takeover bid. That’s smart. A lower altitude should allow it to sidestep political and financial turbulence while forging more extensive links than rivals Airbus and Bombardier.

Boeing’s tie-up with Embraer brings co-pilot risk

21 December 2017

The $177 bln aerospace giant is in talks to acquire the $3.7 bln Brazilian jetmaker. It makes strategic sense, given rival Airbus’s deal with Bombardier. But Embraer’s government shareholder means the deal may come with a high premium and low returns.

Chile reinforces Latin American pro-business pivot

18 December 2017

Billionaire Sebastian Piñera won the copper-rich nation's presidential election with a stronger showing than expected. That will lend succor to like-minded leaders in Argentina, Brazil and Peru for whom fiscal discipline is proving a long slog and graft allegations a danger.