Israel may give Canada taste of own M&A medicine 31 Oct 2012 Potash wants to buy the rest of Israel Chemicals it doesn’t own. That would give a foreign firm control over one of the country’s few natural resources and a big role in the iconic Dead Sea. Canada has nixed such overseas takeovers for less - and may now be on the receiving end.
Petronas return may herald Canada M&A clarity 30 Oct 2012 Ottawa botched its initial veto of the Malaysian oil group’s $5.2 bln bid for gas producer Progress. Nerves over CNOOC’s bigger offer for Nexen played a part. Petronas is back, but if the government wants the benefit of the doubt next time it needs to make the rules less fuzzy.
Canada banks give local M&A advisers hope 23 Oct 2012 Zealous watchdogs have nixed several deals, or talked of doing so. While Chinese buyers face the heaviest fire, locals aren’t immune. But the risk should be low for RBC’s $4 bln purchase of Ally’s Canadian auto finance arm and TD’s of Target’s credit card business for $6 bln.
Is everything sacred in Canada? 20 Oct 2012 At first it was a hole in the ground - then the stock exchange and a DIY chain. Now the government has blocked a $5.2 bln shale gas deal - signalling to investors that the market for corporate control is effectively shut.
ArcelorMittal uses iron ore to dodge the junkyard 19 Oct 2012 The world’s biggest steelmaker is on the edge of full relegation to “junk” credit status. A rights issue would be one - painful - solution. It’s easier to sell a minority stake in its Canadian iron ore unit for $2 bln or so, even though Arcelor likes to feed its own steel mills.
No need to dress up Exxon gas deal as an oil play 17 Oct 2012 The energy titan says it is buying Celtic to spur crude production. But the Canadian firm’s assets are 75 pct gas. The feint is understandable, given investor grumbling over Exxon’s splurge on gas producer XTO. With exports to Asia looking up, though, the $2.6 bln deal makes sense.
Where will the secession fashion spread to next? 9 Oct 2012 With independence movements heating up in Catalonia, Quebec, Venice and Scotland, split-watchers should turn their attention to Texas, where secession stirred after Barack Obama’s election. The economy could prosper alone, but U.S. traditions don’t allow an easy way out.
Even one-sided Chinese investment has its benefits 5 Oct 2012 Canadian politicians mulling CNOOC’s $15 billion bid for Nexen want equal rights for their companies to pile into China. That seems only fair. But workers and investors in the west gain even if money flows only one way. It’s the Middle Kingdom that misses out by being closed.
Nixing China’s oil bid may create Canada discount 26 Sep 2012 The market reckons there’s a one-in-four chance politicians will scupper CNOOC’s offer for Nexen. Takeovers by state-owned companies raise tricky questions. But hoisting the Canadian flag over a company of little strategic importance risks further alienating outside investors.
Quebec separatism not an economically foolish idea 29 Aug 2012 Coming elections could return to power the political party that lost independence referendums in 1980 and 1995. Though the impulses of Parti Quebecois may be cultural, an independent Quebec would boast abundant resources and a surplus of clean energy. It could potentially be rich.
China’s oil giant may need pricey Canadian boost 21 Aug 2012 CNOOC’s $15 bln tilt at Canada’s Nexen seems an expensive distraction, especially since the Chinese oil major has cut its dividend, has flat output and rising costs. Yet CNOOC needs a booster. Nexen’s drilling expertise could help it squeeze more out of its domestic business.
Lowe’s Canadian target can’t build solid defense 31 Jul 2012 Quebec home-improvement chain Rona missed the domestic housing boom. That makes a $1.8 bln bid from Lowe’s a nice upgrade. The board can’t be blamed for putting the screws on its U.S. rival for a higher bid. But protectionist cries à la Potash and TMX don’t have much foundation.
China Inc not letting politics get in way of M&A 24 Jul 2012 A once-a-decade changing of the Communist Party’s top guard was supposed to hold back the ambitions of state enterprises, at least temporarily. But CNOOC has now kicked off a hefty $15 bln outbound takeover. Maybe, seen from Beijing, there’s no such thing as a bad energy deal.
CNOOC has work cut out to justify Nexen premium 23 Jul 2012 At $17.9 bln, the Chinese oil giant is valuing its Canadian rival’s enterprise at almost 4.5 times estimated 2012 EBITDA. That’s on par with Nexen’s peers even though it has been trading at a big discount. For CNOOC to get its money’s worth will require a major turnaround.
CNOOC pulls out stops to make Nexen bid palatable 23 Jul 2012 The Chinese oil giant is paying $15.1 bln for the Canadian producer, a whopping 61 pct premium. The deal also comes with sweeteners to placate protectionists, including CNOOC promises of a secondary HQ in Calgary and a listing in Toronto. It will be hard for Ottawa to say no.
Petronas may outsmart market on $4.7 bln gas deal 28 Jun 2012 By paying a 77 pct premium for Canada’s Progress, the Malaysian state firm would seem to confirm clichés about dumb government money. But the world’s third-largest liquefied gas exporter is taking a longer view. Gas-hungry Asia can pay top dollar for Canada’s exported energy.
US hot money’s new crush: Canadian, Japanese banks 25 Jun 2012 It’s hard to blame US money market funds for seeking safer harbors than the turbulent euro zone. Yet Canadian and Japanese lenders - as well as the National Australia Bank - must remember not to become too enamored with the attention from their fair-weather friends.
Canada scraps to sidestep U.S.-like housing woes 22 Jun 2012 A new set of mortgage reforms will make it ever harder for Canucks to borrow. Yet ultra-low interest rates keep feeding a housing boom that three previous government initiatives haven’t stopped. Prudent regulation can only limit by so much the distortions created by easy money.
Arctic “Great Game” needs careful management 4 Jun 2012 The U.S., Russia and Canada are among the governments limbering up. Boundary rights in the Arctic are fuzzy, and potential benefits huge. Future conflicts over energy and other resources could turn nasty. An international effort to set firm rules is needed before it’s too late.
RIM doesn’t need to remain Canadian 31 May 2012 The struggling BlackBerry maker is weighing its options, from joint ventures to a sale. Despite past form, some officials’ preference to keep the company Canadian shouldn’t worry would-be foreign buyers too much. RIM’s declining sales and significance present a bigger challenge.