Germany

P&G drug deal needs vitamin shot to persuade Peltz

19 April 2018

The U.S. consumer giant is paying 3.4 bln euros for the consumer arm of Germany’s Merck. For it to make sense P&G will have to crank up sales of Seven Seas vitamins while cutting out costs. Board member Nelson Peltz’s criticism of past acquisitions further raises the stakes.

VW truck IPO may squander $20 bln opportunity

19 April 2018

The German carmaker might list its trucks and buses unit next year. The flotation could boost the group’s shares by nearly a fifth, if the market values the division more highly than the rest of it. Yet a partial listing and Volkswagen’s messy governance would limit the upside.

Volkswagen overhaul may give Carl Icahn a lift

16 April 2018

New CEO Herbert Diess is mulling an IPO for its truck unit. It’d be a smoother ride if VW boosts its minority holding in U.S. peer Navistar to a controlling stake. Icahn and two other pushy investors own 40 pct of the $3.9 bln outfit - and are likely to want a hefty premium.

VW changes boss to better effect than Deutsche

13 April 2018

Both companies replaced their boss mid-term. The automaker also unveiled management changes to help reduce costs and is preparing its trucks business for a potential listing. Volkswagen’s messy governance endures, but unlike Deutsche, its strategy has a better chance of success.

Cerberus Alitalia carve-up would not fly with Rome

11 April 2018

The private equity firm is reported to be plotting a three-headed bid for the Italian airline. It would see easyJet take short-haul routes and Air France-KLM long ones, while Cerberus puts up the cash. But a breakup plan will not pass muster with a new nationalist government.

Trump trade war risks European carmaker backfire

10 April 2018

BMW and Daimler sell a surprising number of American-made vehicles in China. Were the U.S. president’s tariff-war rhetoric to become reality, carmakers could shrink stateside production. If Trump wants to keep rather than lose jobs, he should seize Beijing’s latest olive branch.

New VW boss would only part-solve its problems

10 April 2018

The German carmaker may replace CEO Matthias Mueller after just two-and-a-half years. Probable successor Herbert Diess brings a welcome outside perspective having only joined 2015. His difficulty will be getting the conservative board’s approval for radical moves like spinoffs.

Bayer investors get unwelcome antitrust present

10 April 2018

The German company has struck a deal with U.S. regulators to clear its $60 billion acquisition of seed group Monsanto, the Wall Street Journal reported. After EU approval in March, a two-year saga is almost over. Bayer’s sagging stock price means shareholders can hold the cheers.

Swiss treasure helps AXA pay for XL folly

10 April 2018

The French insurer is restructuring its Swiss life insurance business, freeing up $2.6 bln of capital. The move provides some extra funding for its $15 bln takeover of Bermuda reinsurer XL. Reduced financial risk is welcome, but doesn’t help justify what remains a pricey deal.

Aston Martin can race Ferrari in IPO test

9 April 2018

James Bond’s carmaker is eyeing a listing six years after an emergency pit stop. Rich margins and racy growth make it a close match for the prancing horse, justifying a $7bln valuation, and sixfold return for rescuer Andrea Bonomi. But Ferrari’s scarcity premium could be dented.

New Deutsche Bank CEO fails to fill strategic void

8 April 2018

The struggling German lender picked retail bank chief Christian Sewing to replace John Cryan. Investment bank co-head Marcus Schenck will also depart. The reshuffle suggests a further retreat from global trading. But Deutsche’s domestic unit is a poor base from which to rebuild.

Wanted: candidates for Europe’s toughest bank job

6 April 2018

Deutsche Bank Chairman Paul Achleitner is seeking to replace CEO John Cryan. The lender needs someone who can motivate traders while slashing costs, and take on Wall Street without neglecting Germany. Breakingviews imagines the pitch headhunters have sent to potential candidates.

Siemens’ slimming strategy is half-hearted

3 April 2018

A part-sale of medical unit Healthineers has failed to shrink the German company’s conglomerate discount. After all, the 84 bln euro group still spans trains, energy and factories. Siemens’ exit from the lighting and mobile businesses offers CEO Joe Kaeser a useful template.

Hadas: Populist economics can be sensible

28 March 2018

U.S. President Donald Trump, Italy’s 5-Star Movement and other modern populists are floundering with outdated or bad economic plans. They would do more to help those left behind by globalisation if they used higher taxes to create better jobs and strengthen welfare security nets.

Deutsche CEO quest will be hard work

27 March 2018

The German lender has begun looking for a new boss. Replacing John Cryan may prove difficult until the company figures out whether to be a global investment bank or return to its more modest corporate lending roots. Nor are there obvious fixes for an ailing business model.

Deutsche fund IPO flaunts sickly bank

23 March 2018

The German bank’s IPO of asset management arm DWS has failed to create value. The rump bank and listed manager are worth at least 3 bln euros less than Deutsche was before the spinoff. The loss shows the limits of corporate rejigging, and upheaval still facing CEO John Cryan.

Facebook crisis could bust digital-ad duopoly

23 March 2018

Advertisers may pull money from the social network, which together with Google sucked up 84 pct of digital ad spending in 2017. That cash is likely to stay with data-rich platforms rather than older media. Amazon could benefit if CEO Jeff Bezos can avoid raising antitrust fears.

Basel tweak gives global banks another helping hand

22 March 2018

Global regulators have proposed relaxing the amount of capital banks must hold against some forms of market risk. If implemented, the changes would further shrink the 28 bln euro shortfall big lenders face under new rules. After a decade of tightening, watchdogs are easing up.

Hadas: Taking on the Chinese new world order

21 March 2018

The People’s Republic lacks the political and cultural appeal to supplant the U.S. as all-round hegemon. Even so, it could soon set many global economic standards. The right response is cognitive empathy and careful choice of battles. Western countries too often choose wrong.

Time for Germany to make Deutsche/Commerz happen

21 March 2018

The country’s two biggest banks are projected to scrape mid single-digit returns on tangible equity by 2019. A merger that cut a tenth of joint costs could get that closer to double-figures. It could also stabilise Deutsche and give Berlin an excuse to sell its Commerzbank stake.