Lloyds’ MBNA swoop works – unless Brexit bites 20 Dec 2016 The British lender is to pay Bank of America 1.9 bln pounds for its UK credit cards arm. Assuming cost savings materialise, Lloyds is bulking up cheaply. Absent hits from a market probe, or a surge in unemployment when the UK quits the EU, dividends should be largely unaffected.
Mega-merger market set for last gasp 20 Dec 2016 Cheap debt and falling hurdle rates will keep bosses on the hunt. Border-spanning acquisitions are harder to square with trustbusters, however, and big targets less affordable as an M&A cycle ends. That makes space for smaller deals, which in any case tend to create more value.
BP gets upper hand in Abu Dhabi hardball 19 Dec 2016 The UK oil major has handed the sheikhdom a 2-pct stake to regain access to its most prized oil fields. Abu Dhabi gains expertise and influence, but had looked to be distancing itself from Western groups. BP gains from the change of tack without having to pay hard cash.
EU’s de-stressed insurer test is self-defeating 16 Dec 2016 Life insurers look weak in their first stress test since so-called Solvency II reforms. Regulatory carve-outs mean they may not necessarily need capital. But the anonymous nature of the exercise means that investors can't be certain which are the ones to avoid.
Heineken can go another round in pub brawl 15 Dec 2016 The Dutch brewer and its partner have topped up a cash offer for Punch Taverns to 403 mln pounds. Investors are thirsty for more, possibly from a rival suitor. Heineken could keep up a bit longer in a bidding war before the financial return left any strategic merits tipsy.
Brexit transition deal offers Lloyd’s scant cover 15 Dec 2016 The London insurance market is pushing ahead with the launch of a subsidiary that could conduct EU business after Britain leaves the bloc. Lloyd’s of London is not waiting to see whether politicians can secure extended access to the single market. Banks may take a similar view.
Sky shareholders are close to maximum altitude 15 Dec 2016 Some of the pay-TV operator’s investors grumble that independent directors were too eager to accept an 11 bln pound bid from Rupert Murdoch’s Fox. But Sky’s share price wasn’t obviously beaten up, and the premium is generous. A small bump is the best they can hope for.
Heineken’s UK pub binge not as retro as it looks 14 Dec 2016 The Dutch group has offered 390 mln pounds for Punch Taverns in a bid to triple its holdings of British drinking houses. Though most brewers got out of the business long ago, pubs are a petri dish to try out new products. A rival bidder may force Heineken to pay more, though.
EU bank forbearance trade may get another boost 14 Dec 2016 Europe's lenders may need 276 bln euros of new debt to shield taxpayers from bailouts, says a regional watchdog. The market might struggle to absorb the volume. However, most banks are yet to face hard deadlines. It’s another area where regulators might help out investors.
LSE-Deutsche Boerse faces Hessian headache 14 Dec 2016 While Brussels' antitrust watchdogs are narrowing their probe into the exchanges' merger, some German policymakers are increasingly uneasy over the plan to locate the holding company in London. A fuzzy mandate could make politicians in the state of Hesse hard to please.
Basel set to fill bank capital holes – with fudge 13 Dec 2016 Global standard setters could allow lenders to hold less capital against assets than previously flagged. It's a predictable compromise to help the worst affected European banks, while heeding U.S. calls for more uniformity. Banks will be pleased; hairshirt supervisors less so.
Brexit transition may ease not remove uncertainty 13 Dec 2016 UK Chancellor Philip Hammond sensibly wants banks to have continued access to Europe's single market after Britain's departure to protect financial stability. That would give them longer to make alternative plans - but also risks prolonging doubts about the final arrangements.
Murdoch’s Sky sequel shorter on political thrills 12 Dec 2016 Twenty-First Century Fox's 11 bln pound bid for the remaining 61 pct of Sky looks easier than its failed 2010 attempt. Media plurality is still an issue, but can be remedied. The deal will face political opposition, but the prospect of more post-Brexit investment should help.
The Murdochs’ new reach for Sky is well timed 9 Dec 2016 Twenty-First Century Fox has offered to buy the 61 pct of Sky it doesn't own at a 40 pct premium, valuing the European pay-TV group at 18.5 bln pounds. Given industry consolidation like AT&T's plan to buy Time Warner, Fox has a far better chance than in 2010 of doing the deal.
Fintech’s transformation into banking draws closer 9 Dec 2016 UK regulators are mulling tougher rules for crowdfunding firms that would require greater risk disclosure and wind-down plans. Stricter regulation is good for investors. Yet it also means more loan-based platforms might follow peer-to-peer group Zopa in seeking a banking licence.
National Grid picks happy moment to let off gas 8 Dec 2016 China and Qatar are among buyers of a 61 pct stake in the utility’s UK gas distribution unit. The 3.6 bln pound deal matches a seller that does not need the cash and buyers content with low-yielding assets. Yet prices in infrastructure acquisitions may be nearing a peak.
City of London should woo not threaten on Brexit 6 Dec 2016 A bad-case Brexit might demolish some of the financial sector's record 71 bln pounds in tax contributions, outlined in a new report. Other bits of the economy could also suffer from the fallout. But bankers might gain more from an upbeat case for their salvation.
UK regulator makes brokers feel like their clients 6 Dec 2016 The FCA is set to cap leverage punters can take when spread-betting. It shouldn’t have been a shock given EU peers had questioned a product in which 80 pct of clients lose money. Brokers’ 30 pct share falls imply they suffer from the same mindless optimism as their customers.
Brexit Supreme Court case is a sideshow 5 Dec 2016 The UK's top court may force the government to give parliament a say on triggering Brexit. Yet this wouldn't necessarily change Prime Minister Theresa May's plans much. Two related legal matters - including whether the exit process is reversible - might provide firmer resistance.
Coach passes Burberry’s new CEO heavy baggage 5 Dec 2016 The UK trenchcoat maker has reportedly spurned takeover approaches from its U.S. rival. Burberry could fetch 8.1 bln pounds with a premium. New boss Marco Gobbetti doesn’t start until next year. His first task will now be to show why going it alone is the better option.