U.S. farm tariff antidote would be fiscal venom 20 Jul 2018 President Trump wants a government credit agency to help farmers hurt by tariffs. It can borrow up to $30 bln from Treasury and is already in the red. Estimates show the U.S. deficit hitting $1.1 trln next year. What’s more, farmers prefer trade deals over Uncle Sam handouts.
Brazil’s truckers drive toward a fiscal hole 29 May 2018 Protesters demanding lower fuel prices have won concessions from the Temer government. But the specter of revived subsidies and state meddling in oil giant Petrobras hit investor confidence and the real currency, part of the truckers’ problem. Fiscal laxity is not a solution.
U.S.-China trade gap is best filled with software 23 May 2018 Beijing plans to shrink the $375 bln surplus by buying commodities like oil and soybeans. Better to import intellectual property, and pay for the millions of unlicensed copies of Microsoft and Adobe products running in China. Local firms could use the productivity upgrade.
Cuba rings changes while trying to stay the same 18 Apr 2018 Raul Castro's coming handover of Cuba's presidency is an effort to prolong beyond his own life span the communist revolution he built with late brother Fidel. Trying to modernize could also destroy it, though. And with neighbor Venezuela getting less able to provide cheap oil, economic reform can't wait.
Trump spins trade wheel in friendlier direction 13 Apr 2018 The U.S. president is thinking of rejoining the TPP – an 11-member group set up in part as a bulwark against Trump's trading bugbear, China. Sharing should make that easier, while also appeasing American farmers. The question is whether Trump can compromise for long – or at all.
Chinese visitors can hit nerve tariffs don’t reach 5 Apr 2018 Levies on imports will slow the flow of TVs and medical devices into the United States. They could also thin the already-falling influx of tourists from China. America collects more from them than from all its exports of soybeans, and that number could pass $50 bln by 2022.
Tyson saves water reform from the slaughterhouse 4 Apr 2018 The largest U.S. meat producer aims to improve environmental practices on 2 mln acres of suppliers’ land, weeks after Tyson’s founding family used supervoting stock to nix a shareholder resolution along similar lines. The company has much more to do, but at least it’s listening.
DowDuPont stock lacks activist chemistry 14 Feb 2018 The $166 bln industrial group is exceeding revenue estimates and planned merger cost cuts. Crunching two companies together and splitting into three should be worth more, according to activist Dan Loeb last year. He has gone quiet – and investors seem to have forgotten the story.
ADM bite at Bunge would be meal of many courses 22 Jan 2018 A $30 bln-plus merger of the two grain traders would boost profit in an unhelpfully oversupplied market. It would, though, also give rival Glencore, regulators and farmers a chance to push their own recipes. A single, clean takeover isn’t likely – but a few smaller ones could be.
ABF’s sweet tooth will weigh on valuation 7 Nov 2017 The beets-to-boots seller is doing well in fashion as its Primark stores win market share from rivals. But profit in the sugar business will fall as EU prices dip. The exposure to commodity price swings makes it hard to justify a valuation approaching that of Zara owner Inditex.
BASF plants fertile crop from Bayer’s blighted M&A 13 Oct 2017 The German chemicals group will pay 5.9 bln euros for a seeds business that Bayer must sell to clinch a takeover of Monsanto. A pledge to keep staff means few cost savings, but the deal should work in time. BASF shareholders will reap a better harvest by eschewing mega-mergers.
Bunge makes itself slipperier target for Glencore 12 Sep 2017 The ag trader inked a $946 mln takeover of a majority stake in Malaysia’s IOI Loders Croklaan, expanding its business in higher-margin edible oils. The deal looks justifiable. But investors were hoping Ivan Glasenberg's conglomerate would hand them a juicy takeover bid.
India’s pesticide kings have fertile base for M&A 25 Jul 2017 UPL may bid more than $4 bln for part of Platform Specialty, the U.S. group backed by Bill Ackman's hedge fund, Reuters says. While overseas deals have led many Indian companies astray, a trim balance sheet and a solid deal-making history offer a chance to rewrite the record.
ABF deserves more credit for retail flair 6 Jul 2017 Primark clothing stores, which generate half of group operating profit, are faring better than expected. Market share is rising even though the chain shuns online sales and is offering fewer discounts. That kind of retail flair bodes well for ABF’s valuation.
Deere deal is paved with good intentions 1 Jun 2017 The $40 bln U.S. farm-equipment maker is diversifying further into road building, paying $5.2 bln for Germany's Wirtgen. It's a big deal and overseas, but Deere's pitch on strategy and price sound reasonable. It will need to work out better than Caterpillar's Bucyrus bet, though.
ChemChina creates new strain of LBO funding 26 May 2017 The chemicals giant is refinancing the debt backing its $44 bln purchase of Switzerland’s Syngenta. This involves less equity than a typical leveraged buyout, and $18 bln of perpetual bonds sold to three Chinese entities. This is M&A finance cross-bred with government policy.
Glencore food binge could leave investors hungry 24 May 2017 An offer to merge with U.S. agricultural trader Bunge has strategic vision but lacks obvious financial returns. A full acquisition could cost the Swiss group’s food unit at least $15.3 billion, and that could affect Glencore’s ability to pay dividends later.
Jump at Bunge shows Glencore has its M&A mojo back 24 May 2017 The commodity giant's agricultural arm approached the $11 bln U.S. grain trader about a friendly deal. A takeover may not be the goal, and Bunge is cool on a tie-up. But after some tough balance-sheet repair, Ivan Glasenberg’s trading powerhouse is clearly back on the offensive.
China’s dealmakers edge out Trump in first round 12 May 2017 American cattlemen and financiers will get more access to mainland markets in exchange for chicken imports and a potential opening for Chinese banks. It's a good start but Beijing didn't give up much. U.S. negotiators will have to push harder if they want a better bargain.
Bayer exemplifies Germany’s too-powerful boards 28 Apr 2017 A big institution is unhappy the chemicals group didn’t give it a say on its value-burning $66 bln purchase of Monsanto. German companies can do deals without putting them to a vote and often have carte blanche to raise capital. The wound is self-inflicted and possibly avoidable.