Publicis pleasant surprise flags ad world’s plight 20 Jul 2017 The French ad group’s top line grew 0.8 percent. But even that looks good: in the previous two quarters Publicis’ organic revenue shrank, and analysts were expecting it to do so again. The challenges to media buying make the industry’s low valuation look justified.
Carrefour unit shows way to Brazil IPO revival 19 Jul 2017 The French supermarket chain’s local unit raised $1.6 bln in the country’s biggest stock offering in four years. Rising deal flow suggests growing confidence Latin America’s largest economy is getting back on track. But the recovery’s pace is tepid, and sensible pricing is key.
Greek bonds are a bet on euro zone support 18 Jul 2017 Athens wants to issue bonds just after receiving another bailout tranche. If Greece had to finance itself at market rates it would struggle to stay solvent. But debt relief from European governments and ECB bond-buying will reduce the risk. Investors may find the wager appealing. Full view will be published shortly.
German climate change policy takes Trumpian turn 18 Jul 2017 Angela Merkel has castigated the U.S. President for pulling out of the Paris accord. Yet two German states are putting mining jobs ahead of cutting carbon emissions. If they don’t reconsider, the Chancellor’s green credentials – and the global agreement – will suffer a blow.
Central banks oust politicians as market fixation 17 Jul 2017 Investors are worrying about interest rates rather than elections. Statistics are a more reliable guide to the economic outlook than polls to political outcomes. But the path for monetary policy remains uncertain. Expect asset prices to be jumpy and their moves more synchronised.
Macron’s choice: Europe or Gallic exceptionalism 13 Jul 2017 The French President and Germany’s Angela Merkel are keen to revamp the euro zone. It’s hard for Macron to be a role model as long as France’s budget deficit is too big – and harder still given the pressure to cut taxes quickly. This fiscal dilemma is the euro zone’s problem.
Why Europe can’t beat Google on corporate taxes 13 Jul 2017 A court has ruled the search giant is not liable for French back-tax after all. Google will face other battles over how it arranges its profits. Tech companies will always have an advantage, though. Unlike competing European countries, they can put their global interest first.
Fickleness hampers French seduction of bankers 11 Jul 2017 Gallic politicians are scrapping taxes and tweaking labour laws in an attempt to lure London-based financiers to Paris after Brexit. Though the gifts are appealing, memories of past banker-bashing are fresh. Today’s charmers could be replaced by unfriendly characters tomorrow.
Danone could be next serving for hungry activists 5 Jul 2017 Low margins and poor investor returns mean the French maker of Activia yoghurt is a logical target. While an earlier campaign by U.S. activist Nelson Peltz had modest success, Third Point’s new stake in Nestlé and President Macron’s pro-business agenda argue for a fresh look.
Stonyfield deal whipped up by U.S. yogurt frenzy 3 Jul 2017 France's Lactalis is paying 20 times EBITDA for Danone's yogurt brand, or $875 mln. While American demand has propelled upstarts like Chobani to multibillion-dollar valuations, growth has slowed. It may be hard for the old-school label to woo new consumers.
Altice discount a dubious buying opportunity 30 Jun 2017 A float of its U.S. arm has made the Dutch telco’s discount to the sum of its parts more visible. It’s a good time to invest in the parent if founder Patrick Drahi can succeed at running it more as an integrated group. Limited synergies and questionable governance raise doubts.
Bolloré clan’s deal sums don’t add up 23 Jun 2017 Vincent Bolloré’s Vivendi is buying ad group Havas, run by his son Yannick. The younger Bolloré says it may create at least 390 mln euros of value, justifying the premium. That’s dubious: the premium is arguably bigger than he claims, and the return on investment still looks low.
RWE can sparkle with a dirty energy merger 20 Jun 2017 The German utility risks turning into a mere holding company after spinning off clean power unit Innogy. It can avoid this fate by bulking up on coal and gas. An 8.4 billion euro bid for rival Uniper would create value even before synergies and fire up the group’s revival.
Orange has grounds to lose confidence in BT 20 Jun 2017 The French telecoms company is cutting its stake in the British firm. That is a wise move. BT, whose shares have fallen nearly 40 percent in two years, is at the mercy of regulators and faces increasingly high costs as it battles to keep up with rivals such as Sky.
Publicis broadcasts ad world’s shortcomings 19 Jun 2017 A shareholder group says the French media agency flattered its operating margin by including a one-off compensation payment. The company defends its accounting but the case is a dose of unhelpful publicity for an industry facing a bid-rigging probe and claims of opaque pricing.
Macron has the levers to transform French economy 18 Jun 2017 The Gallic president’s talent for upending politics is beyond doubt after his party won a huge parliamentary majority. He now has a free hand to pass labour and tax reforms. His legacy hinges on whether he can lay the foundations for future prosperity without jeopardising growth.
Greece still dancing to Europe’s political discord 16 Jun 2017 Euro zone governments have rewarded Greek reforms and austerity with 8.5 bln euros of loans and promises of future relief. Political factors, including German elections, mean losses must remain vague. The lack of clear debt restructuring denies Greece the boost it needs.
Italian shipping deal torpedoes single market myth 16 Jun 2017 French President Macron is griping over Italian shipbuilder Fincantieri’s bid to buy a stake in a French firm. The deal could create an EU champion, but compromise French jobs. Macron is a fervent believer in Europe – but domestic concerns don’t sit easily with idealism.
Carmaker emissions scandal finds exec pay sequel 14 Jun 2017 Advisers have designed a hidden scheme that would let Renault-Nissan secretly pay bonuses to Chairman Carlos Ghosn and others. It’s unthinkable that such a plan can be implemented. Recent scrutiny over exhaust emissions has already shown that exploiting loopholes doesn’t pay.
Altice IPO offers new reason to dislike cable guy 13 Jun 2017 Entrepreneur Patrick Drahi is seeking a $23 bln valuation for his U.S. unit while giving investors almost no voice. With hefty debt and few assets to buy, it’s hard to see Altice achieving its grand ambitions. There are plenty of reasons to be a cord-never, financially speaking.