UK’s best Russian riposte is hiding in plain sight 14 Mar 2018 Prime Minister Theresa May is expelling diplomats after Moscow ignored her ultimatum to explain its role in a nerve-agent attack in England. That is a fairly ineffective punishment. Better to use existing UK anti-corruption laws to target high-profile Russians with Kremlin links.
Natixis takes lower-risk route to M&A glory 13 Mar 2018 The French investment bank is spending about 100 mln euros on stakes in three boutique advisory firms including the UK’s Fenchurch. Lenders seeking to buy their way up the league tables have a poor record. But the low cost and arm’s-length management reduce the risk of an upset.
Slowing Iliad sorely needs success in Italy 13 Mar 2018 Xavier Niel’s telecom group is barely increasing the number of its French broadband customers and revenue growth slowed in 2017. A high valuation and slim payouts mean investors watch little else. Making a success of a delayed foray into the competitive Italian market is crucial.
Lagardère portfolio needs heavy editing 9 Mar 2018 Shares in Elle magazine’s publisher fell 7 percent after a sharp drop in 2017 free cash flow. Boss Arnaud Lagardère is promising disposals. That may be necessary to prop up future dividend payments. He only deserves credit when he reveals how much will be sold and at what price.
Mario Draghi faces tricky exit from bond buying 8 Mar 2018 The European Central Bank president has started laying the groundwork to end three years of asset purchases. But there’s a growing danger that his careful preparations will be thrown off course by U.S. protectionism, euro zone politics, or unwelcome market moves.
Abertis rethink would avoid bidder roadkill 8 Mar 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.
Renault-Nissan will struggle to lose third wheel 7 Mar 2018 The Japanese group may buy France’s 15 pct Renault stake, according a Reuters report the carmakers deny. It’d ease the French group’s heavily discounted share price and a full merger may allow the alliance to cut more costs. But it’s hard to see politicians yielding full control.
Trump tariffs risk more than just a new trade war 7 Mar 2018 Europe will retaliate if U.S. President Donald Trump slaps tariffs on steel and aluminium imports. A transatlantic trade fight is just one danger. By invoking a little-used national security loophole, Trump is setting a precedent of how to subvert international commerce rules.
Telecom Italia investors find two reasons to cheer 7 Mar 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.
Elliott’s tilt puts heat on Vivendi’s TIM strategy 6 Mar 2018 The activist fund has bought 6 pct of Telecom Italia, according to reports. A small stake could give Paul Singer’s group big influence thanks to investors’ faint support for top shareholder Vivendi. The French company may also have to contend with a more nationalist government.
Euro zone reform faces green and red lights 5 Mar 2018 Germany’s new ruling coalition has cleared the way for reforms to strengthen the single currency area. Yet proposals to backstop banks and governments remain contentious. Italy’s new government adds uncertainty. With the ECB’s firepower waning, delay may prove costly.
AXA pays XL premium to insure more stable future 5 Mar 2018 The French insurer is offering $15.3 bln for Bermuda-based XL to beef up coverage of storms and other catastrophes. Cost savings don’t even cover half of the 33 pct premium, while reducing debt depends on a successful IPO of AXA’s U.S. arm. It’s a hefty price for diversification.
Cowed LafargeHolcim sets sights appropriately low 2 Mar 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.
Peugeot’s purring engine has one rattle: Opel 1 Mar 2018 The French carmaker’s main brands hit a record operating margin last year thanks to a hot new SUV. But plans to revive its loss-making Opel unit look optimistic given carbon emission fines and a row with former owner GM. Boss Carlos Tavares needs to drum up more cost savings.
Accor’s hotel sale has unwelcome discount 28 Feb 2018 The leisure group sold half its property empire for 4.4 bln euros. The low price and a cut on the fees it earns to manage the hotels suggests its partners got the better deal. A buyback will keep investors sweet, but leave less firepower to fend off competitors like Airbnb.
Corbyn turns soft Brexit into hard politics 26 Feb 2018 The Labour leader says Britain should stay in a customs union when it leaves the EU. Though his Brexit vision is fuzzy, it may appeal to voters and galvanise a parliamentary challenge to embattled Prime Minister Theresa May. UK political instability looks set to step up a gear.
Orange’s home gains will juice up lagging shares 21 Feb 2018 The telco’s market share and revenue are rising in its domestic market at the expense of rivals like Altice-owned SFR. Signs that CEO Stéphane Richard is bypassing a long-running Gallic price war may erase the discount at which his company trades to European and French peers.
Spain’s ECB victory is really a win for Germany 19 Feb 2018 The only person left in the race to become European Central Bank vice president is Spanish Finance Minister Luis de Guindos. It’s thus likely that the top job will go to a northern European in 2019. That will please Germans keen for an end to unorthodox monetary policies.
French state is handbrake on Renault’s valuation 16 Feb 2018 Despite revenue rising 15 pct last year and a cost-saving alliance with Japan’s Nissan, the carmaker trades at a discount to rivals. Selling more cars and boosting margins will help, but the French government’s 15 pct stake is the main obstacle to CEO Carlos Ghosn boosting value.
Airbus’s sunnier skies still contain clouds 15 Feb 2018 Shares in the aerospace giant jumped by one-tenth on Thursday following an 8 percent rise in operating profit, higher than analysts expected. But its operating margin still lags those of U.S. rival Boeing. Closing the gap could be complicated by a fresh stateside corruption probe.