Apple suppliers have few tools to defy gravity 3 Jan 2019 The iPhone maker’s profit warning has hurt shares in European chipmakers like AMS. Apple can appease investors with buybacks or extra software revenue. But suppliers are in a bind. Any attempt to diversify means they will have plough cash into new ventures that may easily flop.
German takeaway truce delivers tasty value treat 21 Dec 2018 Delivery Hero is selling its German business to rival Takeaway.com for 930 mln euros. As with Uber's capitulation to Didi in China's car-share wars, it means an end to cutthroat competition in another gig-economy market - and relief for both companies' investors.
Shell’s climate pay gesture lacks thermostat 3 Dec 2018 Linking executive bonuses to carbon targets, as the $258 billion giant has pledged to do, should focus bosses’ minds. Yet the goals and sums involved are unclear, and the plan only starts in 2020. Investors can do more to hold energy groups’ feet to the fire on emissions.
GSK looks like a better seller than buyer 3 Dec 2018 The UK drug giant is acquiring cancer specialist Tesaro for $5.1 bln and offloading its Horlicks unit to Unilever for about the same amount. It’s a neat way for CEO Emma Walmsley to reshape GSK. But the purchase will take years to pay off – and is much riskier than hot drinks.
New Unilever CEO’s hard graft will come later 29 Nov 2018 Insider Alan Jope has the right skills to deliver the sound strategy that he inherits from Paul Polman. But a share-structure change that the consumer giant had to ditch may need be revisited. The big deals needed to boost slow growth will be harder to clinch with a dual listing.
EU sends mixed signals to scale-hungry corporates 27 Nov 2018 Commissioner Margrethe Vestager may wave through a Dutch mobile merger but not the Siemens-Alstom rail deal. One decision hints at flexibility in the EU’s antitrust thinking. Still, politicians hoping to build regional champions to counter the U.S. and China will be disappointed.
Shell deserves to check out of investors’ doghouse 1 Nov 2018 The UK energy group slightly undershot earnings forecasts but generated oodles of cash in the third quarter. That compensates for a bigger disappointment earlier this year. Unless oil prices dive, Shell should be able to invest as much as it needs while rewarding shareholders.
Unilever and Nestlé’s growth tests pricing power 18 Oct 2018 Higher prices helped the consumer goods giants boost revenue in the third quarter. Both need to keep charging more to offset rising costs. The risk is that price-conscious customers go elsewhere. It ultimately depends on whether the world economy can cope with higher inflation.
Louis Dreyfus showcases downside of being private 10 Oct 2018 The commodity trader’s dividends are a bigger proportion of net profits than rival Cargill. The latter is demonstrating that non-listed status and success are compatible. But the short-term needs of Margarita Louis-Dreyfus jar with those of the French company that she controls.
Unilever bows to corporate version of Brexit revolt 5 Oct 2018 The Anglo-Dutch group ditched a vote to move its head office to the Netherlands after UK shareholders rebelled. The saga shows the limits of the special treatment that large multinationals can ask from politicians. It also demonstrates what investors can do when they join forces.
Altice financial invention is born of necessity 4 Oct 2018 Patrick Drahi may sell part of his telecom group’s fibre broadband business, having recently offloaded some mobile towers. The cash could reduce debt and increase capex. But ceding control over investment decisions to private equity could undermine the business model over time.
Unilever should delay its head office vote 3 Oct 2018 A growing number of UK shareholders oppose the Persil maker’s choice of Rotterdam as its base. Postponing the vote would give investors more clarity on Dutch tax changes, and Unilever more time to spell out the benefits of the shift. Pushing ahead risks an embarrassing defeat.
Buyout pass-the-parcel hands BC Partners a present 28 Sep 2018 The investment group is buying a stake in a $3 bln European cable company from KKR. It’s a good deal, thanks to the seller’s desire to cash out. Private equity funds’ limited investment terms mean managers can’t always choose when to sell. Longer-life funds are one solution.
TomTom is risky option on carmakers beating Google 27 Sep 2018 The $2 bln navigation group may sell a sideline business a week after key customer Renault said it would use Google Maps. After the sale, TomTom would look cheap – unless the search giant wipes the floor with rival mapmakers. The U.S. group’s track record makes that a dicey bet.
Unilever has itself to blame for investor revolt 25 Sep 2018 A growing group of shareholders want to block the Pot Noodle maker’s plan to pick Rotterdam over London as its global HQ. The move’s benefits are overshadowed by uncertainty over how UK investors will be taxed. Rushing the decision has left Unilever more vulnerable to opposition.
Banks belatedly realise money laundering is bad 11 Sep 2018 ING’s finance director will leave after the bank’s illicit fund failings incurred a 775 million euro hit from Dutch prosecutors. In the past, miscreants have got away with paying fines. Now shareholders are pushing the issue as well as politicians, accountability is improving.
Europe’s $50 bln payment upstarts can justify hype 10 Sep 2018 Investors can’t get enough of groups like Wirecard, which is replacing Commerzbank in Germany’s main stock index. As with peer Adyen, the risk is that a crowded sector caps growth. To hit their targets, the pair need to double their share of the payments pie. That’s doable.
Consumer giants have bigger problems than Turkey 28 Aug 2018 Unilever and Nestlé can resist a crisis in Turkey, which accounts for little of their revenue. But both will suffer if troubles spread across emerging markets, which account for about half of group sales. All the more so since Western shoppers are unlikely to take up the slack.
Unions the first of many fights for Air France CEO 17 Aug 2018 As the airline’s first foreign boss, Ben Smith will face labour strife that ousted his predecessor and has cost 335 million euros. But the former Air Canada executive must also tackle the weak governance, competition and soaring costs that threaten the carrier’s survival.
Franco-Dutch utility deal muddies U.S. M&A waters 31 Jul 2018 Suez is selling a fifth of its stateside unit to pension manager PGGM for 30 times earnings. The $601 mln transaction looks even pricier than the takeover battles for two other U.S. water utilities. With asset scarcity making the market frothy, buyers risk ending up high and dry.