Ferrovial´s BAA gets modest shot in the arm 27 Feb 2008 The heavily indebted airports group will be allowed to raise airline charges by a biggerthanexpected 23.5% to pay for increased capex. It s nowhere near what BAA was hoping to get. But this gives it a bit more wiggle room to undertake its mammoth £9.5bn refinancing.
BAA finally starts to grapple with mess 27 Feb 2008 Jettisoning the retailer who was running the Heathrow airport owner and replacing him with a nutsandbolts guy looks like a good first step. But Ferrovial, which bought BAA in a highlygeared transaction, still needs to stabilise its financing.
Air France-KLM shouldn’t do two deals at once 15 Feb 2008 The FrancoDutch carrier is ready to take a significant stake in a merger of DeltaNorthwest, its two US allies while at the same time trying to take over nearbankrupt Alitalia. With the stock halved since its 2007 high, shareholders may feel they are getting shortchanged.
British Airways looks undervalued 1 Feb 2008 Investors have soured on BA, fearing the UK flag carrier faced turbulence from fuel prices, increased competition at its Heathrow hub and a feared recessioninduced demand drop. But its results look excellent. BA enjoys strengths which should help it ride out any tumult.
Air France’s bid for Alitalia hits turbulence 31 Jan 2008 The French carrier wants to shrink the Milan hub. That s good economics but bad politics, especially if Silvio Berlusconi returns to power. The Italian airline needs E750m this year to stay in the air. The threat of collapse should but may not help the French get their way.
Delta should choose Northwest over United 16 Jan 2008 A deal with Northwest looks better for shareholders and is the better fit. But extracting the juicy synergies would mean doing things regulators hate, like cutting routes. As so often with US airlines, that could hamper muchneeded consolidation.
How might Rudd fly to BAA’s rescue? 21 Nov 2007 The mess at Heathrow has improved since the veteran chairman took over. But BAA's finances haven t. The airport operator's credit rating has been junked and a mooted new runway won t come cheap. Here s an imaginary letter Sir Nigel might send to his Spanish boss.
Ryanair and the European Commission should stop feuding 13 Nov 2007 The EU is targeting lowcost airlines led by Ryanair for deceptive advertising. Europe s lowcost leader should clean up its act. Brusselsforced air deregulation allowed Ryanair to get off the ground and the Irish upstart has more to gain by working with Eurocrats rather than demonizing them.
Record orders don’t clear skies for Airbus – yet 13 Nov 2007 The FrenchGerman aircraft maker will surpass Boeing this year for orders and deliveries. The shares barely moved on the news. The company still has to a long way to go before investors give it as much trust as customers.
Ousted BAE chief wins battles, loses war 16 Oct 2007 Mike Turner managed to rebuild the UK defence group s tattered relations with customers, and grow in the US. BAE s shares have quadrupled in five years. That may have won over shareholders but not the board. They may hope that ousting Turner will help distance the company from the alleged bribery that has dogged it in recent years.
Eads scandal shows urgent need for serious shareholders 11 Oct 2007 The alleged insider trading scheme stems from the company s twisted governance. It has lousy shareholders in incompetent Lagardere and the evermeddling French state. And its top managers allegedly rushed to cash in when the company s troubles became apparent. Radical cleanup and reforms are becoming urgent.
BAA £11bn refinancing hits turbulence 3 Oct 2007 Refinancing the money Ferrovial borrowed to buy Heathrow's owner last year will be more problematic after the UK regulator came down hard on its allowed returns. Ferrovial can t be blamed for the credit crunch or Heathrow's appalling press. But its reliance on shortterm funding was foolish.
Eads’ insider trading scandal shows need for radical cleanup 3 Oct 2007 Massive insider trading at the aerospace group, before Airbus troubles came to light, was companysanctioned and approved by the state, French watchdog AMF says. Even major shareholders Daimler and Lagardere were in. They should get out, and speed up the sale of their remaining stakes. A cleanup of management ranks is also in order.
Airbus and Boeing will both be damaged by trade clash 2 Oct 2007 The US and EU look set to emerge with pyrrhic victories in their titfortat disputes over $34bn in alleged illegal subsidies to Boeing and Airbus. Although the WTO will declare both sides guilty, it s emerging Brazilian, Russian, Canadian, and Chinese rivals will win out.
Top ten reasons why Alitalia should go bankrupt 4 Jul 2007 The Italian government is considering putting Alitalia into liquidation, according to Italian press reports. Here's why that would be the most sensible way to reform Italy s beleaguered airline.
BAE at the mercy of politicians 26 Jun 2007 Ministers stepped in when the defence group faced a probe over Saudi dealings in the UK. A new US probe may be harder to squash. The worst case scenario is that BAE loses lots of Saudi/US business. That's unlikely. But its growth engines could end up starved of fuel.
Airbus’ record orders won’t help with its real problems 21 Jun 2007 The FrenchGerman aircraft maker is having a blast announcing orders for its A350 and A380 lines. But the real problems remain. Airbus has to outsource part of its production to lowercost countries. And its shareholder structure is a recipe for paralysis.
Sarkozy reassures markets with Airbus visit 21 May 2007 The French president s visit to the troubled aircraftmaker was an early test of whether he sticks by his protectionist campaign rhetoric. For investors, the result was a relief. Sarko refused to meddle in management and said the French state should one day get out. Quite right.
Smiths Group dips its toe into de-conglomeration 15 Jan 2007 The UK engineering group has secured a respectable £2.5bn for its aerospace division from General Electric. But why stop there? Smiths is still a disjointed conglomerate, albeit one open to generous offers. This deal will whet investors' appetites.
Stork’s defiance shouldn’t be end of matter 14 Nov 2006 The Dutch company has astonishingly rejected the overwhelming wishes of shareholders who want the company broken up. A legal fight which may help define Dutch shareholder rights may now be on the cards.