Peugeot shareholders take capital hike in stride 21 Jan 2014 The stricken carmaker is seeking to repair its battered balance sheet with a 3 billion euro capital increase partly subscribed by Chinese peer Dongfeng and the French government. Given painful dilution and uncertain future earnings, investors’ reaction looks remarkably subdued.
Euro QE puzzle misses French and Italian pieces 16 Jan 2014 Mario Draghi’s dovish stance has raised hopes the European Central Bank could launch asset purchases. Europe’s fragmented money markets and weak lending mean the payoff could be significant. But it can only be done if France and Italy embrace reform.
Hollande finally gets it. Can he do it? 15 Jan 2014 The French president launched a pro-business plan to restore profits and create jobs while cutting public spending. Acknowledging that France needs more supply-side reforms is sound. Whether Hollande has the political strength to implement the new policies is another matter.
Big Pharma should nourish biotechs, not eat them 13 Jan 2014 Productive drug labs rarely survive M&A intact. The market rightly loves Alnylam’s purchase of assets from Merck and simultaneous $700 mln sale of a chunk of itself to Sanofi. Instead of killing the golden goose to try to harvest eggs, Sanofi’s deal could encourage production.
Boss-napping shows need for stronger French unions 8 Jan 2014 The kidnapping of two Goodyear executives is a sign not of strength, but of weakness, in French employee groups. That explains why labour relations are among the poorest in the OECD. The country badly needs constructive private-sector unions along German or Nordic lines.
Altice IPO asks cable investors to get bolder 7 Jan 2014 The cable and telecoms operator wants help to de-gear and then buy more assets. Good job Europe’s IPO market is hot, as is the sector. Owner and Chairman Patrick Drahi has a good track record. But an odd mix of businesses makes Altice a harder sell than rivals.
Hollande could use electoral defeat to change tack 23 Dec 2013 No French president has been more unpopular than François Hollande, and the economy is stalling. Major defeats loom for his Socialist party at the municipal and European elections. That needn’t be such a bad thing if terrible results prompt him to change both style and substance.
BNP Paribas pays up for Polish promise 5 Dec 2013 The $1.4 bln deal for Rabobank’s retail business in Poland is what cross-border banking M&A looks like post-crisis. BNP is paying a premium to book value for a business with low returns. The French bank avoided a costly auction but needs synergies and growth to make the deal pay.
Peugeot picks right time to switch CEOs 25 Nov 2013 The ailing French carmaker is about to hire Renault’s former No. 2, Carlos Tavares, as its next CEO. A fresh face was needed to drive the company’s strategy forward, and to liaise with new shareholders. Tavares’ experience of the Nissan alliance will be useful.
Markets may one day notice depth of French funk 21 Nov 2013 France’s stalled economy is a drag on Europe. But the government doesn’t seem to care about the bad numbers, and can point to the financial markets’ insouciance. That could change when the Fed moves - or when investors discover the renewed charms of Europe’s periphery.
Tarkett’s Russian heft could prove an IPO weakness 18 Nov 2013 The KKR-backed flooring firm aims to raise up to $837 mln in a Paris IPO. Buyers need to scratch beneath the surface. The equity story is underpinned by the firm’s strength in the CIS and Russia, where an economic slowdown is adding to well-known legal and political risks.
French banks’ strategies smack of déjà vu 8 Nov 2013 BNP Paribas is expanding conservatively in low-growth markets. SocGen prefers racier climes and investment banking. And Credit Agricole is retrenching to the certainties of asset management, licking its wounds. Despite France’s ratings downgrade, its banks are reverting to type.
Stock market is best stop for Alstom trains 6 Nov 2013 The struggling French engineering group is considering selling a stake in its transport unit to raise money. Hiving off 30 percent of the division could raise about 1 billion euros. Strategic buyers would be hard to find for a minority stake. A public listing looks like the best option.
France won’t meet its deficit target. No problem 5 Nov 2013 The European Commission’s latest forecasts show that France will not be able to shrink its budget deficit to the mandated 3 percent of GDP by 2015. But that isn’t bad news. Like the rest of the euro zone, the country will gain by breaking free from the austerity straitjacket.
Alcatel-Lucent picks a good time to raise equity 4 Nov 2013 The telecoms-equipment maker plans a 955 mln euro capital increase. CEO Michel Combes has timed this well: his turnaround is beginning to bear fruit; the sector is strengthening; investor sentiment has improved. A stronger balance sheet should help avoid cut-price asset sales.
Numericable will be a harder sell than rivals 28 Oct 2013 The French cable firm is preparing an IPO at an enterprise value of up to $7.7 bln. M&A and rising valuations in the sector are a helpful backdrop. Yet customer uptake has been low in France and satisfaction patchy. Numericable needs to show its fast broadband offers real growth.
Orange rally suffers reality check 23 Oct 2013 The former France Telecom had gained 38 pct in two months, before quarterly results prompted a wobble. The stock still looks cheap versus peers, so investors may see the selloff as a buying opportunity. But the discount reflects a tough and unpredictable home market.
M&A could help Nestle tackle sales slowdown 17 Oct 2013 The Swiss food group is said to covet Ferrero, the maker of Nutella chocolate spread valued at roughly 10 bln euros. The Italian company says it’s not for sale. Yet it is easy to see why Nestle might want to do big deals. It can afford to buy its way out of a saggy sales profile.
LVMH’s move upmarket more painful than planned 16 Oct 2013 Sales growth in the French conglomerate’s flagship luxury division unexpectedly slowed in the third quarter. That knocked LVMH shares. It wants to make Louis Vuitton more exclusive and profitable. But the high-end handbag market is proving as crowded as the Champs-Elysees.
Shareholding mishmash is new risk for Peugeot 14 Oct 2013 The French carmaker is mulling a 3 bln euro capital hike subscribed by state-owned Chinese peer Dongfeng and the French state. Peugeot needs the cash, but not two governments in its share register. And the deal could put its cooperation with the U.S.’s GM at risk.