Canadians add imagination to GE’s buyout work 9 Jun 2015 CPPIB is spending $12 bln to buy the U.S. conglomerate’s mid-market private equity lender. The manager of pensions for half Canada’s population gets both an investment and scope to expand. Assets of C$265 bln allow it to scale in-house rather than paying up for outside managers.
Buyers hold cards in $6.4 bln Latam oil deal 26 May 2015 Investors opposed to the takeover of Pacific Rubiales have enough votes to knock the sale off course. But the dissenters would be crazy to push the button. The 34 pct premium looks fair. Without a deal, or a surge in oil prices, Pacific Rubiales’ future looks bleak.
Mexico oil sale gets $6 bln show of support 6 May 2015 A local conglomerate and private investors are offering a 35 pct premium for Pacific Rubiales. That sounds high for a company hit hard by oil’s plunge and a deal unlikely to have many synergies. But it’s a sign of confidence in Mexico’s pending, long-awaited oil liberalization.
Bombardier may be the little Canadian that can 30 Apr 2015 The manufacturer is mulling selling a majority stake in its rail unit to a Chinese rival. Political objections are likely: even home-improvement chains are off limits to foreigners. Using the proceeds to keep its aviation business flying, though, may keep critics in the hangar.
Deal junkie Valeant shoots up on $10 bln fix 23 Feb 2015 The drugmaker’s pledge last year to focus on organic growth and debt reduction didn’t last long. Cost cuts and tax savings from buying Salix proved irresistible. What Valeant’s injecting isn’t clear. Salix’s numbers are fuzzy after it admitted pumping clients full of inventory.
Easy money undermines Canada’s property prudence 17 Feb 2015 Sound lending and sensible regulation are formidable barriers against a housing crisis. Rising prices and debt weaken defenses. The Bank of Canada warns valuations appear too high – but its most powerful protection against a bubble, interest rates, are moving the wrong way.
Economic reality could upend Fed message, too 21 Jan 2015 Following last week’s Swiss upset, Canada’s central bank set investors spinning again. The oil price-inspired rate cut from Ottawa seems out of step with stable inflation. But it shows how changing conditions could yet make the Fed’s careful expectations management look futile.
Canada’s shock rate cut hurts global risk appetite 21 Jan 2015 First Zurich, now Ottawa. Days after the Swiss central bank abruptly reversed a cornerstone policy, the Bank of Canada upended market expectations with a 25 bps easing. The Canadian dollar plunged. Unpredictable policy generates volatility and fear, hurting economic prospects.
Target’s Canada retreat shows benefit of new broom 15 Jan 2015 Investors cheered the $50 bln U.S. retailer’s decision to close shop north of the border, where the poorly executed “cheap chic” concept didn’t take hold. At least it wasn’t the current CEO’s idea. That means he can safely take a $5.4 bln pre-tax loss and focus elsewhere.
Cheap oil lubricates Li Ka-shing’s corporate rejig 12 Jan 2015 Asia’s richest man is shifting a 6 pct stake in Canada’s Husky Energy to his holding company as part of a broader shake-up. The move is vital to keeping Li’s grip on the telco-to-property empire. Though shareholders may object, the falling oil price has worked in their favour.
Thai Union sets right flavour for Asian food M&A 19 Dec 2014 When little-known Asian buyers pounce on foreign companies, the resulting deals are often overpriced or lacking in strategy. The $1.5 bln Thai purchase of U.S. tinned seafood company Bumble Bee swims against the tide. Thai Union’s focused, low-key approach has lessons for others.
Repsol takes risky $13 bln bet on Talisman 16 Dec 2014 The Spanish oil group is paying a big premium for the Canadian producer. The deal adds diversification after Argentina expropriated its YPF unit but also brings problematic North Sea assets. Repsol is hoping for a Talisman turnaround and an oil price recovery. Both are uncertain.
Private equity shows signs of pre-crisis brio 25 Nov 2014 Canada’s Onex has bought Swiss packager SIG for up to $4.7 bln in a secondary buyout. It’s one of Europe’s biggest LBOs in five years and deploys pre-crisis levels of leverage. Private equity restlessness and a shortage of big targets created the conditions for a landmark deal.
Valeant’s activist deal too clever by half 17 Nov 2014 The $45 bln drug company’s tilt at Allergan alongside Bill Ackman’s Pershing Square leaves it with just a modest windfall to show for a seven-month campaign that risked legally questionable tactics. Valeant boss Michael Pearson’s M&A experiment is not one to repeat.
It’s easy to engineer $60 bln railroad merger math 13 Oct 2014 Canadian Pacific is interested in rival CSX. Since hedge fund boss Bill Ackman stepped in, the suitor’s operating efficiency has surpassed even Warren Buffett’s BNSF. CSX, also once an activist plaything, has improved but less so. CP’s strong valuation provides an opportunity.
Bankers get painful and needed conflicts reminder 13 Oct 2014 A $76 mln penalty against RBC for working both sides of a deal is the latest blow to skewed loyalties. Even with recent slaps at Goldman and Barclays, it isn’t clear the message is reaching Wall Street. Delaware courts seem up to the task of delivering it as loudly as it takes.
Sears’ Canada stake sale merits a discount 2 Oct 2014 Hedge fund boss Eddie Lampert’s struggling retailer wants to raise cash ahead of the holidays by selling a stake in its Canadian arm via a slimly discounted rights issue. If all goes to plan, Sears hopes to conjure up $380 mln. The market’s reaction suggests that’s optimistic.
Standard Life’s strategic revamp gets timely boost 4 Sep 2014 The UK insurer will return 1.75 bln stg to shareholders after selling its Canadian insurance arm. Standard’s shares had underperformed domestic peers. Offloading a non-core asset at a good price should make investors more cheery about the risks of shifting into asset management.
Buffett and tax outrage both diversions in BK deal 26 Aug 2014 The Sage of Omaha is lending Burger King money, at a lucrative 9 percent, but his imprint tells stock investors nothing. And contrary to social media hysteria, a new parent company in Canada isn’t going to fleece the U.S. taxman. The $11 bln purchase of Tim Hortons is just an LBO.
Fracking investors bury their heads in the sand 18 Jun 2014 Shares in miners of the fine rock debris used in modern oil and gas drilling have tripled this year as Fairmount Minerals mulls an IPO. Their valuations suggest over-exuberance. And MLPs look ill-suited to this sector. Shifting tides could wash these investment sandcastles away.