Thoma Bravo UK cyber deal looks a little too good 26 Apr 2024 The buyout firm finally agreed a takeover of long-term target Darktrace, an IT security specialist. Despite the generous-looking 44% premium on offer, the buyer’s returns seem juicy given a nascent US push. That may raise the chance of shareholders asking for more money.
BHP investors throw CEO too short an M&A leash 26 Apr 2024 The miner’s stock fell 4.6% after the company proposed to buy Anglo American at a $39 bln valuation. It suggests shareholders fear boss Mike Henry will end up overpaying. But with his low-ball opener leaving plenty of wriggle room to justify upping the bid, that looks premature.
Anglo American has grounds to play hard to get 25 Apr 2024 The London-listed miner has received an all-share $39 bln bid from BHP. Anglo’s recent woes explain why, but its jumble of assets could be worth more. If boss Duncan Wanblad can show as much by outlining a plan B, he may yet see its $149 bln rival off – or extract a higher offer.
Vote no to bashing proxy advisers 25 Apr 2024 Corporate leaders at JPMorgan and AstraZeneca bridle when ISS and Glass Lewis criticize their governance. No wonder: Some high-stakes shareholder votes this year will be uncomfortable for feather-bedded bosses. Proxy firms are problematic, but they do more good than harm.
European banks have little to lose from rate cuts 25 Apr 2024 Tighter monetary policy boosted revenue at BNP Paribas, Deutsche and Barclays, who now face ECB and BoE loosening. Markets expect some 50 basis points of rate cuts, but that shouldn’t hurt bank income much. Deposits may get cheaper, while old loans keep rolling onto higher rates.
World economy’s star athlete may run out of puff 23 Apr 2024 The IMF crowned the United States as the champion of global growth at last week's summit. A predicted rise in GDP of 2.7% this year is welcome as Europe and China struggle. But high debt and hard-to-repeat gains in productivity and the workforce will limit American staying power.
European airlines’ hot summer belies sector clouds 23 Apr 2024 Jet shortages mean that carriers may be able to charge higher fares this summer, ending years of overcapacity. For stronger players like $25 bln Ryanair, that could mean fatter margins. But it’s likely to be a short-term reprieve for a sector that’s grappling with other costs.
Private credit paints a new scream for banks 22 Apr 2024 Lending against wealthy patrons’ art has been dominated by financial institutions. Sotheby’s $700 mln sale of bonds backed by such loans offers non-bank rivals a template to upend the status quo. A rebounding securitization market can feed this machine, if it fits a careful mold.
Winner’s curse unfairly haunts $7 bln paper deal 19 Apr 2024 UK-based Mondi dropped its pursuit of DS Smith, handing victory to rival US bidder International Paper. The victor’s shares have lagged the sector, suggesting its investors see little value in the deal. If the promised cost savings appear, that view may be too pessimistic.
ESG is ghost at global retailers’ annual feast 19 Apr 2024 LVMH, Amazon and peers gathered in Paris for the industry’s yearly shindig. The growth areas in the $30 trln sector are Shein-style cheap garments and the Middle East. Both jar with retailers’ previous focus on environmental, social and governance factors.
Shell’s value gap is more strategy than geography 19 Apr 2024 CEO Wael Sawan may shift the $230 bln UK oil giant’s listing to New York if a discount to rivals like Exxon Mobil persists beyond 2025. But Shell’s shifting priorities, slower growth, and unreliable dividends weigh on its valuation. Those factors defy a superficial fix.
UK music fund may walk off stage without encore 18 Apr 2024 Hipgnosis Songs Fund accepted $1.4 bln in cash from US rival Concord Chorus. The 32% premium pitches songs by Neil Young and Shakira at the lower end of their shrunken fair value. With higher-for-longer rates, it’s far from clear that its Blackstone-owned manager will pay more.
Czech Sphinx may need to pay up for UK mail morsel 17 Apr 2024 Daniel Kretinsky has been rebuffed in a bid to buy the 72% of 3 bln pound International Distributions Services he doesn’t already own. The Czech billionaire has deep enough pockets to pay more for the owner of Royal Mail. But his target’s board has grounds to dig its heels in.
Luxury’s great divide will get more striking 17 Apr 2024 Sales at $420 bln LVMH rose a dull 3% in the first quarter. The Tiffany-to-Dior behemoth’s insipid performance points to a broader fragility within the sector. With revenue in the luxury industry flattening, the gap between winners and losers is set to grow wider.
Microsoft’s G42 deal puts UAE in America’s AI tent 16 Apr 2024 The $3 trln software giant is paying $1.5 bln for a minority stake in Abu Dhabi-based artificial intelligence group G42. Microsoft gets years of cloud storage business. But it also implies an end to the Gulf state’s effort to be a neutral AI counterparty to China and the US.
Gulf bank’s M&A hunt risks shareholder injury 15 Apr 2024 First Abu Dhabi, worth $40 bln, may be eyeing Turkish lenders following a short-lived pursuit of Standard Chartered. An overseas deal would help to diversify away from corporate and investment banking, but the cost savings look slim. Better to focus on growing at home.
Bernanke partly mends cracks in BoE’s crystal ball 12 Apr 2024 The former Fed chair’s review of the Bank of England’s economic forecasts contains some sensible ideas. He correctly urges the central bank to stop relying on market predictions of future interest rates. But he could have pushed harder for UK policymakers to climb off the fence.
BP takeover is both appealing and daunting 12 Apr 2024 Abu Dhabi National Oil Company recently considered buying its $110 bln British peer. It’s unlikely to be the only suitor. BP trades at a discount to other oil giants and recently installed a new CEO. But UK security concerns and EU antitrust rules present formidable hurdles.
Powell’s rate cuts may go from steady to steep 10 Apr 2024 Inflation hit 3.5% in March, making a June cut to borrowing costs unlikely. But Fed Chair Jay Powell is running out of time. A decrease in September would be seen to favor President Biden. The November decision is one day post-election. The only other option: take bigger whacks.
How new stock rules are boosting Europe’s startups 9 Apr 2024 Young companies in the European Union have traditionally lagged US rivals in both value and numbers. But in this Exchange podcast, Index Ventures Partner Hannah Seal explains how friendlier regulations on employee share ownership are helping EU-based entrepreneurs fill that gap.