Open skies agreement not terribly open 5 Mar 2007 In theory, a pact to ease restrictions on transatlantic travel between the EU and US could make sense for both sides. But the US refuses to give up restrictions on foreign ownership of its airlines. It s hard to see why the EU should roll over.
Eads’ investors should take profits 20 Feb 2007 The FrancoGerman Airbus maker is in dire straits. Political meddling is preventing management from executing its turnaround plan. What s more, it is facing major industrial risks and its financial situation is shaky. The 20% discount to Boeing isn t enough.
American Airlines makes unlikely LBO candidate 16 Feb 2007 British Airways and Goldman are supposedly mulling a joint bid for the biggest US carrier, according to a report. Formidable legal obstacles stand in the way of such a bid. And AMR makes a poor buyout target too.
Everyone ends up in knots after Eads stake sale 9 Feb 2007 Daimler has sold a third of its 22% stake in Eads to a group of banks but is having to pay them to take it on. They assume the risk on Eads share price, but get no votes, and the aerospace s shareholder register is even more complex than before.
Alitalia deserves a bid discount 24 Jan 2007 The airline is the most expensive airline stock in Europe despite being the most unprofitable. Restructuring it looks risky and difficult. Any rational bidder would struggle to get anywhere near the share price. Alitalia shareholders are dreaming if they expect a premium.
Is Minc still a force to be reckoned with? 22 Jan 2007 The consultant and writer s traces are seen everywhere in machinations around Pinault, Suez and Vinci. But this might be misleading. The new generation of French CEOs doesn t rely on connections and friendships as much as their elders. Minc s model may be on the wane.
BA’s Walsh isn’t a second Ayling 18 Jan 2007 Ayling was binned by the UK carrier seven years ago partly because he couldn't handle the unions. Now Walsh is at war with them too. Could Walsh share his predecessor's fate? It would be harsh: BA is in better shape today than under Ayling, and Walsh's fight is necessary.
Alitalia board implodes 17 Jan 2007 This latest defection may hint at an Air France bid but what does it say about Alitalia that it can't muster a slate of directors? There are just two people left on the board after the resignation of Air France s boss. Technically, that means it has to be dissolved.
Northwest enters US Airways’ airspace 10 Jan 2007 Delta has done its best to keep US Airways on the tarmac. But its rival s sweetened $10.2bn offer has doomed Delta s goitalone strategy. After its overpriced acquisition of Skype hurt confidence in management and left investors puzzled, this looks like a smart deal. This may explain why Delta is cuddling up to its other rival in the bankruptcy court, Northwest.
Branson charm backfires in US 29 Dec 2006 The US regulator has tentatively ruled that the billionaire s latest Virgin airline spawn violates rules on foreign control. Virgin America needs to prove that Branson isn t in control. That will be tough without changing its financing.
American Airlines will benefit from merger wave 28 Dec 2006 Not being a likely merger candidate makes American a more appealing investment. It can reap consolidation benefits without execution risks. That might explain why Iceland's FL Group has bought 6% of American s stock. It seems to hope US airline mergers will boost its profits.
Delta strikes back meekly 20 Dec 2006 The bankrupt airline says that US Airways hostile bid is structurally flawed and that its standalone plan promises greater value. The plan has many questionable assumptions but looks just feasible enough to force US Airways to pony up some more dough.
Alitalia stake sale a step in the right direction 4 Dec 2006 It's about time the Italian state sold down its controlling stake. Its influence has hindered rather than promoted reform at the carrier. Finding a buyer for 20% looks hard. Perhaps the best bet is the Asian option: a cashrich, statecontrolled carrier looking for traffic.
Iberia tries to bounce British Airways into a deal 30 Nov 2006 European consolidation is finally taking off, and Iberia wants to join in before competition savages its home market. But BA is playing it cool. So the Spanish airline is flashing its eyes at other carriers to try and pique the ardour of its usual ally.
Willie Walsh is a man in a hurry 26 Nov 2006 The British Airways chief executive is making progress on the big problems, like the pension deficit and the sale of the regional business. But this is far from done and dusted. And crowing about such "successes" could easily backfire.
Berlin leans on German banks to buy Eads stake 23 Nov 2006 Or that s how it looks. There's no other reason why the banks would buy part of Daimler's unwanted Eads stake. The move means there's still a big "German bloc" in Eads. It would be surprising if the banks hadn't extracted something in return.
Macquarie, TPG in A$10bn Qantas LBO bid 22 Nov 2006 This looks like another sign of buyout mania. Few private equity investors have bought airlines, and even fewer have made money. True, TPG has been one of the lucky few. And Australia s Flying Kangaroo looks less risky than others. But it s far from an ideal buyout.
US Airways makes opportunistic $8bn bid for Delta 15 Nov 2006 More than half disappear if Delta emerges before bankruptcy first. And the merger could create more problems than it would solve. The airline promises its hostile bid would generate synergies worth a massive $8.3bn. But there s a catch.
Iberdrola approach sign of utility euphoria 9 Nov 2006 The European utility sector is feeling its M&A oats, and there are highpriced deals and rumoured offers everywhere. There was a similar frenzy four years ago, when many firms overpaid and learnt their lesson. But this time private equity is involved too.
Accountants’ self-serving ideas miss the point 9 Nov 2006 The chiefs of the big firms want constant disclosure of key business parameters. But that would only drive more companies to go private. The big problem with audits is conflict of interest. The best reform would be to get rid of them. Investors should get more involved.