New Zealand

Australian pension giant braves steep M&A curve

9 December 2020

New Zealand infrastructure investor Infratil snubbed a $3.8 bln takeover bid from AustralianSuper. Its first solo acquisition target enjoys a solid negotiating position and Goldman on defence. For this to be more than a learning experience, it will have to dig deeper.

Kiwis test limits of overburdened rate setters

26 November 2020

New Zealand Finance Minister Grant Robertson has suggested the central bank, which targets inflation and employment, might consider taking house prices into account when setting monetary policy. Interest rates are a blunt instrument that can’t hit too many goals at once.

Subpar Asian trade deal shines in splintered world

16 November 2020

Fifteen nations accounting for 30% of global GDP will slash tariffs and ease the movement of goods in the region. India’s absence is among the disappointments of the long-awaited pact. Even modest progress counts for a lot considering the sad state of U.S. and UK trade affairs.

New Zealand rebound depends on healthy contagion

18 June 2020

The $200 bln Kiwi economy suffered its worst quarterly contraction in 29 years. Prime Minister Jacinda Ardern’s lockdown worked, but her country will struggle with less tourism and immigration. It’s a prime example of how even successful virus control can have daunting costs.

New Zealand airline rescue puts taxpayers in first

24 March 2020

The national carrier has received a $514 mln state lifeline that ensures its survival. A high interest rate should ensure any loan is repaid quickly, while shareholders share the pain through suspended dividends. It’s a model for other countries considering bailouts to follow.

Boomeranging dairy CEO milks the past

10 December 2019

New Zealand’s $7 bln a2 Milk is following a well-worn corporate playbook. Companies from Apple to P&G have brought back former bosses, with mixed results. In this case, Geoffrey Babidge’s track record should reassure, even if succession and strategy concerns cloud his return.

Farmers will turn activists to mop spilt Kiwi milk

26 September 2019

New Zealand's Fonterra, reeling from writedowns and its worst ever annual loss, will cut back overseas. Battered investors can press for more from the world’s largest dairy exporter. That includes fixing the $3 bln giant’s contradictory structure by carving out consumer brands.

Irish central banker job glitch may be a blessing

11 June 2019

The government was thrilled to recruit a New Zealand Treasury official as its new governor. Now he faces an investigation about how he handled early accessing of budget information. If things go wrong, Ireland has a second chance to give Deputy Governor Sharon Donnery the job.

Uber steers around its Asian innovation conundrum

13 February 2019

After exits from China and Southeast Asia, the ride-hailing giant's eastern footprint hinges on India and promising spots, like Taiwan. Emerging market problems force a rapid pace of change. Safety buttons and a "lite" app are encouraging, but local rivals are moving faster.

Apax may have clicked on $1.8 bln Kiwi bargain

13 December 2018

The buyout group has won a rare New Zealand bid battle, buying Trade Me, a mix of Craigslist and eBay. That's fair, for a local champion with little debt and chunky margins. Apax has similar assets elsewhere, too. Only Amazon's looming spectre should unsettle.

Wesfarmers exposes its conglomerate discount

24 April 2018

By opting to spin off Coles Supermarkets, the $35 bln Australian group invites scrutiny of its coal-to-clothes hodgepodge. A Breakingviews analysis suggests a gap of 11 pct between its market value and the sum of its parts. It's enough to spur a fresh strategic review.

Kiwis test new formula in central bank petri dish

20 October 2017

New Zealand was the first nation to give independent rate-setters an inflation target. Now a new government wants to add employment as an objective. The less painful the switch, the more likely others will adopt goals that better suit today’s economic and political realities.

Australian media buyout might need an edit

8 May 2017

TPG and an Ontario pension fund want to buy and break up Fairfax Media for $2.1 bln, keeping the group's property portal and some big newspapers. Long-suffering investors are being offered a decent headline price. But a fiddly cash-and-stock structure makes for awkward reading.

Markets are wary of new blot on Japan Inc’s image

21 April 2017

Fujifilm has discovered dodgy accounting in its Kiwi unit. It is merely a $200 mln flub. But investor anxiety is understandable. What looked like a manageable accounting problem at Toshiba spiralled out of control. The photocopier-maker's mediocre governance is unhelpful too.

Rugby fumble will hurt Vodafone’s NZ partner most

23 February 2017

New Zealand's antitrust tsar has blocked a planned merger between Vodafone's Kiwi unit and Sky Network. That's irksome for the UK giant but far worse for its local partner. Despite owning rugby and other great sports rights, Sky is bleeding pay-TV subscribers. It needs a Plan B.

Vegemite tastes better on Australian cheese

19 January 2017

Australian dairy company Bega Cheese will buy the national staple as part of Oreo-maker Mondelez's grocery business for $345 mln. Australia's addiction to the yeasty paste gives Bega a patriotic new profit line plus diversification. But the new generation seems sour on Vegemite.

Vodafone’s $2.4 bln deal makes a bundle Down Under

9 June 2016

The mobile giant is injecting its New Zealand unit into local pay-TV operator Sky Network in return for a 51 pct stake. Joining forces should help as phones, television and the internet converge. Vodafone is giving Sky shareholders a helping hand to get the deal done.

Kiwis teach Koreans a lesson on inflation targets

11 June 2015

Both New Zealand and South Korea have cut interest rates by a quarter percentage point. But while Governor Graeme Wheeler reacted to just six months of sluggish prices, Korean inflation has been below target for three years. Timidity has been the central bank’s biggest failure.

China dairy correction churns Fonterra profits

24 September 2014

A 76 percent fall in earnings for the New Zealand dairy group shows the China milk bubble deflating. Record milk prices have tested consumers’ tolerance, and traders may have overstocked. The underlying trends are still positive, but it will take a while to skim off the froth.

Reverse takeover gives New Zealand a Mega headache

25 March 2014

The cloud storage company founded by Kim Dotcom is planning a $179 mln backdoor IPO. The internet entrepreneur, who is fighting extradition for online piracy, has already caused much embarrassment for local authorities. A stock market listing for Mega would add a financial sore.