DSM’s China de-risking plan hinges on booster shot 15 Feb 2024 Shares in the $30 bln Dutch firm surged 14% on plans to hive off its unit that makes vitamins for cattle. DSM is right to steer away from a business hurt by Chinese competition. But management needs it to recover to justify investors’ enthusiasm.
Heineken dilutes beer’s merrier future 14 Feb 2024 The $54 bln group’s higher prices led to lower volumes, at odds with Carlsberg’s cheerier numbers. Diageo reckons drinkers are shifting from spirits to beer, which should help brewers. Still, without clear evidence investors may not price in the growth a windfall should imply.
TikTok and Universal will stage reunion tour soon 5 Feb 2024 The music giant’s decision to yank its catalog off the social-media app hurts singers and bands more than either business. And yet mixing tunes, both new and old, with a powerful algorithm is harmonious. There are plenty of financial reasons for the duo to get back together.
Philips sees dim light at end of tortuous tunnel 29 Jan 2024 The $19 bln Dutch medical-kit maker faces a lengthy ban on selling ventilators in the US. Despite the hit, CEO Roy Jakobs is confident he can meet his business goals. Yet a possible fine, as well as litigation arising from faulty machines, will keep weighing on investors’ minds.
ASML is underplaying its strengths 24 Jan 2024 The semiconductor giant kept its 2024 outlook reined in despite hefty quarterly earnings. US and Dutch export controls that affect chipmaking tools have begun to dip into China sales. But a hefty orders backlog and rising chip demand should help the $330 bln group fly higher.
Stellantis will cruise with GM and Ford 18 Dec 2023 The maker of Jeeps and Opels run by Carlos Tavares is one of Europe’s lowest-valued carmakers. Yet it generates much of its income in the US, and boasts industry-leading profit margins. Keeping a single New York listing could see its valuation match Detroit rivals.
Dutch shock points to tremors in Europe’s core 23 Nov 2023 Geert Wilders’ anti-immigrant, anti-EU Freedom Party came first in Netherlands elections. That means long coalition talks leading to an unstable, unpredictable government. His ascent hurts European policymaking and boosts chances of once fringe parties in states like France.
Payments sector comedown creates opening for M&A 17 Nov 2023 The once-hot industry has slumped amid rising competition and a possible regulatory clampdown. For online specialists like $34 bln Adyen, the solution is to boost their customer offerings by buying startups. Older players like Nexi and Worldline, meanwhile, are ripe for mergers.
Adyen shows being an open book pays off 9 Nov 2023 Shares in the Dutch payment firm jumped 35% despite less ambitious revenue growth and profit margin targets. That seems inconsistent. But investors cheered Adyen’s promise of more frequent updates and its clearer business roadmap. It proves the benefits of being transparent.
West’s latest China corporate risk: medical graft 23 Oct 2023 Beijing is cracking down on corruption in the supply of healthcare products. Western groups like Siemens Healthineers and Philips source over 10% of sales from the People’s Republic. The risk is that domestic rivals use the situation to grab market share.
Prosus CEO exit leaves Tencent elephant in room 18 Sep 2023 Bob van Dijk has quit as boss of the $380 bln Chinese giant’s top investor. Interim CEO Ervin Tu can call for more asset sales to boost Prosus’ returns. But without a plan to move on from a status quo where Tencent makes up three-quarters of the portfolio, its valuation will lag.
Grocers learn lessons of ‘greedflation’ drama 12 Sep 2023 Food-price rises are easing, which is good news for supermarkets that stand accused of profiting from consumer pain. In this Exchange podcast, Ahold Delhaize CEO Frans Muller explains why demand for own-brand goods gives the Dutch group an upper hand in supplier negotiations.
Samsung’s ASML sale highlights vexing cash bind 18 Aug 2023 South Korea’s $330 bln chipmaker more than halved its stake in the Dutch group to raise an estimated $2 bln for its expansion plans. Yet the company already has $66 bln in the bank. Trouble is, much of that is probably trapped abroad, necessitating some creative funding choices.
Shell may as well try green plug for valuation gap 27 Jul 2023 The $204 bln group’s shares have outperformed US rivals since it flagged a renewed focus on oil, but still lag Chevron and Exxon Mobil. New boss Wael Sawan could try to close the gap by listing his green energy bits. It’s not certain to work, but is better than more buybacks.
Prosus’ juggle leaves bigger worries up in the air 27 Jun 2023 The $147 bln Dutch investor is ending its complex shareholder structure with South African parent Naspers. It’s simpler for investors, and enables more buybacks. But the group will still have a stake in Tencent it can’t easily sell and lopsided governance, meriting a discount.
Dutch chip export saga exposes EU shortcomings 13 Jun 2023 The Netherlands is limiting exports of high-end semiconductor gear to China, after a US push to curb Beijing’s AI and military prowess. While the EU will soon unveil a plan, it looks hard to strike the right power balance in the defense arena. Brussels needs a clearer role.
Europe’s oil major sweet spot could yet turn sour 4 May 2023 Shell, BP and Total are still making fat profits, and investors seem fine with a slower route out of oil. Rising rates also make wind projects look even less enticing than fossil fuel ones. But longer term, Europe’s oil titans may lose their head start in the shift to net zero.
Germany’s electricity headache has an M&A cure 6 Mar 2023 Berlin may spend over 20 bln euros on the local unit of Dutch-owned TenneT. Every country’s power grid needs an overhaul to make it fit for the green transition, but Germany’s need is especially pressing. Still, relatively low debt also makes it easier to take swift action.
Banks’ state shareholders can afford slow selldown 2 Mar 2023 The Belgian and Dutch governments took advantage of a market rally to offload chunks of BNP and ABN. Valuations have risen but are still low relative to lenders’ returns. That means Britain and Germany would be wise to move gradually with their NatWest and Commerzbank holdings.
Euronext may have to dig deeper to snare Allfunds 22 Feb 2023 The 8 bln euro exchange offered 5.5 bln euros for the wealth technology group, the latest in a slew of deals. Boss Stéphane Boujnah would get much-needed diversification away from sluggish markets. Yet the price is not a knockout, and rivals like Deutsche Boerse could barge in.