Casino shares go wrong way in risky debt punt 8 Aug 2018 The grocer’s shares fell 9 pct after an analyst flagged its related party deals. A sinking price may force its indebted parent to pledge stock to repay bonds, which could end up on the market. Investors have more to worry about than a grim outlook for French supermarkets.
BNP’s targets have bite despite muzzled traders 1 Aug 2018 France’s biggest lender reported a sharp dip in quarterly investment bank revenue, hindered by an unhelpful trading backdrop. Yet robust European loan growth should boost overall revenue. If BNP can meet its cost targets it can still hit its 10 pct return goal a year early.
Franco-Dutch utility deal muddies U.S. M&A waters 31 Jul 2018 Suez is selling a fifth of its stateside unit to pension manager PGGM for 30 times earnings. The $601 mln transaction looks even pricier than the takeover battles for two other U.S. water utilities. With asset scarcity making the market frothy, buyers risk ending up high and dry.
Vivendi’s Universal sale offers cleaner fix to IPO 31 Jul 2018 The French media giant is looking to sell up to half of its music unit to new investors. Avoiding a listing, spares Vivendi Chairman Yannick Bolloré from the risk of an investor exodus to Universal. Uncertainty over valuation, and what he will do with the cash linger.
Vivendi disposals give Bolloré scary M&A war chest 30 Jul 2018 Vincent Bolloré’s acquisitive media group raised $2.7 bln from disposing of stakes in Ubisoft and Fnac Darty, and could borrow more. Possible targets are video games and live music. Yet given a dicey Italian foray and stretched valuations, investors may prefer cash to more M&A.
Orange and Telefonica tech credentials need proof 26 Jul 2018 The price of the pair’s shares have fallen this year despite rising cash flows. Plans to use automation to cut costs and make more money from customer’s spiralling data demands have yet to be reflected in their valuations. The companies only merit more credit if they deliver.
GM’s Mary Barra has a new yardstick 25 Jul 2018 The carmaker’s decent earnings seem to justify its CEO’s decision to eschew a big merger, sell GM’s Europe unit and focus on electric and autonomous cars. But Opel’s rapid recovery under new owner Peugeot could return to haunt Barra if her Autos 2.0 strategy careers off the road.
Atos picks good second best with $3.4 bln U.S. buy 23 Jul 2018 The French group is purchasing IT outsourcer Syntel after missing out last year on European peer Gemalto. Its original target was a more logical fit but the transatlantic deal gives Atos an entry pass to its new target’s U.S. bank clients and will create value after a few years.
Publicis setback is healthy dose of adland realism 19 Jul 2018 Despite an unexpected drop in revenue in the second quarter, the French group still expects to hit financial targets this year and beyond. It may well do so. Even so, the hiccup is a sign that outswimming rivals in treacherous media waters is proving harder than anticipated.
Europe airlines show strike pain is for passengers 18 Jul 2018 EasyJet expects a 45 pct rise in pre-tax profit in 2018 thanks to more passengers and charges on checked bags. The limited damage that French air controllers’ strikes inflicted on the company and its peers reveals such disruptions are more a problem for customers than carriers.
Supermarket buying pacts dodge primary problem 16 Jul 2018 Alliances to pool purchases, like one signed by Carrefour and Tesco, have in the past boosted grocers’ operating margin by up to 1.5 percentage points. Wringing savings without all the hassle of a merger is great. It does less to stop Aldi and Lidl grabbing market share.
French finance has new fizz inside its own bubble 13 Jul 2018 Parisian bankers have a spring in their step. Jobs are coming to the capital due to Brexit, difficult reforms are underway, and President Emmanuel Macron has a vision of which they are proud. But their country has cleavages that are reminiscent of Britain and the United States.
Airbus’ Brexit certainty drive is wishful thinking 22 Jun 2018 The nature of the planemaker’s business means that earmarked transition periods after a UK exit could be too short. But its call for clarity on future arrangements will fall on deaf ears. Even if UK politicians weren’t bungling the process and wanted to help, they can’t.
Chanel lifts lid on impressive treasure chest 21 Jun 2018 The private luxury brand opened its books for the first time to reveal larger-than-expected sales of $9.6 billion and a plush 28 percent operating margin. The display nixes fears the Parisian label is flagging. Claims it is not preparing for an IPO or sale are less convincing.
Altice’s $2.9 bln towers sale locks in 5G premium 21 Jun 2018 Patrick Drahi’s telecoms group has secured a high price for the possible sale of stakes in its French and Portuguese mobile towers. It’s a vote of confidence from private investors like KKR in new superfast networks. But it only makes a modest dent in Altice’s $36 bln debt pile.
Aussie ad deal offers signs of a frothy M&A market 21 Jun 2018 France’s JCDecaux is bidding $800 mln for APN Outdoor, disrupting the target’s own dealmaking. Australia is an appealing market and this could be a smart deal for the suitor. But the flurry of activity, and the exuberant reaction of JCDecaux shares, sends a worrying message.
Carrefour tin ear puts fat cats in Macron’s sights 18 Jun 2018 The supermarket’s ex-boss forwent part of a 13 mln euro payoff after pressure from the French government. It shows that the ex-banker President Emmanuel Macron is no slave to laissez-faire economics. His move to liberalise firing rules makes corporate excess a legitimate target.
French cable group suffers earnings power shortage 18 Jun 2018 Nexans lost almost a fifth of its value after saying EBITDA may fall 15 pct. The company’s racy growth plans rest on trends like offshore wind and soaring data use, but investors value it as a sector basket-case. Given the profit warning and a departing CEO, that looks fair.
Renault M&A race sidelines governance niceties 15 Jun 2018 Investors backed CEO Carlos Ghosn’s pay despite the French state’s opposition. His 7.4 million euro package was greased with soft targets. Yet the high proportion of shares at least gives Ghosn an extra incentive to push for a value-boosting merger with Japan’s Nissan.
Hermes loses niche status in fashion and finance 15 Jun 2018 The fashion group is joining rivals LVMH and Kering in France’s CAC 40 index. The Hermes family must get used to hoi polloi like ETFs and hedge funds crowding into its stock, and tougher disclosure norms. For companies, like luxury handbags, there’s a cost to going mainstream.