Excessive UK tax giveaways risk longer-term harm 5 Mar 2024 Finance minister Jeremy Hunt may spend some 15 bln pounds in pre-election fiscal gifts in Wednesday’s budget. He could be tempted to do more – and make life difficult for the next government – by further cutting public services. But that would put the country in a bind.
EU’s $2 bln Apple bite is still more of a bark 4 Mar 2024 Brussels is fining the US giant more than expected for hurting streaming competition. That leaves $2.7 trln Apple open to similar cases. But as with other EU bids to rein in Big Tech, it hikes the cost of doing business more than it shakes up the sector.
Cosmetics IPO application calls for a steady hand 4 Mar 2024 Buyout firm CVC is braving uncertain markets to list retailer Douglas, possibly for 7 bln euros. Shoppers’ appetite for premium makeup despite inflation is a positive sign. Yet the group’s high leverage and competition from Sephora call for a valuation discount to US rival Ulta.
Elliott has limited ammo in UK retail bidding war 4 Mar 2024 The US investment group’s latest $951 mln offer for retailer Currys could have yielded an adequate return. But the target has rejected it. Hiking the offer looks tricky given the ropey UK economy, reduced scope for leverage, and potential rival bidder JD.com’s deep pockets.
EIB backing would add spark to EU mini-nuclear bid 1 Mar 2024 Europe’s bid to develop smaller, cheaper nuclear reactors as part of its plan to cut carbon emissions needs cash and political support. European Investment Bank financing for next-generation projects would make a difference. Even so, green benefits may take years to materialise.
European telcos’ new deal hopes face reality check 1 Mar 2024 Executives gathered in Barcelona this week to plead for lighter regulation, cheaper spectrum and some financial help. Policymakers are unlikely to agree. Deutsche Telekom, Telefónica and others will have to convince investors that future growth requires more investment today.
Capital Calls: Airline recovery, AMS Osram 29 Feb 2024 Concise views on global finance: A travel boom lifted 2023 operating profit at the $10 bln parent of British Airways and Iberia above its pre-pandemic level; shares in the sensor company, a supplier of Apple, fell 43% after the group cancelled a major micro-LED project.
LSEG’s big data dividend is still in the cloud 29 Feb 2024 Three years after absorbing information purveyor Refinitiv, CEO David Schwimmer has hit his growth and margin targets. Yet investors still value the $60 bln London Stock Exchange owner like a bourse operator. An upgrade depends on persuading Microsoft users to pay for LSEG data.
UK $4 bln insurance mash-up may yet motor 28 Feb 2024 Direct Line rejected a cash and share offer from its $8 bln Belgian rival Ageas. The target’s depressed share price suggests it has good reason to hold out for more. And synergies related to the two groups’ capital should give Ageas scope to hike its offer.
Klarna IPO now makes less sense than one later 28 Feb 2024 Decent growth and lower losses mean the Swedish buy now, pay later group can justify a $20 bln valuation. Given that’s three times the level of its last cash injection, there’s an argument for a speedy listing. Still, Klarna’s messy governance suggests a 2025 IPO is more logical.
St James’s Place mess may spark a Lloyds reunion 28 Feb 2024 The UK wealth manager’s shares fell 33% after a $539 mln charge to compensate angry clients. Given these payouts may not worsen, St James’s Place looks to be in play. Lloyds Banking Group, which once owned part of SJP and wants to expand in wealth, could be first in the queue.
Vodafone’s Italy exit puts speed before valuation 28 Feb 2024 The UK telco looks poised to sell its hard-pressed local business to Swisscom for 8 bln euros in cash. The price tag is lower than a previous Iliad offer. But it’s a cleaner exit, and advances boss Margherita Della Valle’s goal of prompt M&A to make her company less sprawling.
European bank property buffers rest on two big ifs 28 Feb 2024 Lenders like BNP and ING sit on $1.5 trln of commercial property loans, which look vulnerable to high interest rates. Longer leases give EU players more breathing space than US counterparts. Yet averting a crisis requires a mixture of falling inflation and a revival of offices.
Capital Calls: Charter and Altice 27 Feb 2024 Concise views on global finance: Tying up Charter, the cable giant backed by the media mogul, with rival Altice USA would form the country’s largest broadband player. That isn’t worth bearing the burden of regulatory hurdles, Altice’s mountain of debt, or its over-rich valuation.
Europe defence push requires clearing M&A barriers 27 Feb 2024 The region is hiking military spending to aid Ukraine and become less dependent on the US. Yet governments are squandering investment on incompatible weapons and systems. Creating more regional champions, like aerospace giant Airbus and missile maker MBDA, is a top priority.
Why central banks risk making more mistakes 27 Feb 2024 Western rate-setters were late in fighting inflation. In this Exchange podcast, TS Lombard economists Dario Perkins and Davide Oneglia argue that, as price growth abates, the US Federal Reserve and European Central Bank may be too slow in easing monetary policy.
UAE makes $35 bln bet on Egyptian virtuous circle 26 Feb 2024 The Gulf state is amping up support for Cairo by investing in a huge coastal tourist scheme. Prompt cash may make the recipient’s IMF loan deal more likely, and the UAE gets most of the project’s upside. But the plan reflects the scale of regional concern about an imploded Egypt.
Europe shares’ granola rush will become thin gruel 26 Feb 2024 The STOXX 600 Index has hit a record, but local funds are seeing outflows. As in the US a small bunch of companies – the so-called GRANOLAS group – are behind the good news. But in the Old Continent they’re more dependent on weak economic growth rather than the AI revolution.
How a syndicated loan can funnel cash to Ukraine 26 Feb 2024 Western allies could extend credit backed by Kyiv’s claim for war damages against Russia, and then use $300 bln of frozen assets to pay off the loan if Moscow refuses to pay reparations. The widely recognised principle of ‘set-off’ can help overcome legal and practical hurdles.
StanChart is a permanent work-in-progress 23 Feb 2024 The Asia-focused bank inched past its 2023 returns target, bagging longtime boss Bill Winters a 22% pay boost. But he's downgrading or postponing his next goals. And the years-long promise to simplify the lender is back. Persuading investors to boost its valuation will be hard.