ABN Amro IPO merits discount for ugly structure 10 Nov 2015 The Dutch state is hawking up to 23 pct of its erstwhile problem child, valuing the bank at up to 18.8 bln euros. The price range seems attractive relative to listed peers. But a markdown is warranted given an anti-takeover provision that could rescind investors’ voting rights.
Vodafone could break new ground with India IPO 10 Nov 2015 The mobile giant has taken a step towards listing its India unit, which could be worth $14 bln. With a 25 pct free-float, it could be the country’s largest ever offering. An outgoing wrangle over tax and new competition could prove thorny, but this is the kind of listing India’s bankers dream about.
Dud IPO adds fuel to Rocket’s downward trajectory 10 Nov 2015 Cash-burning e-commerce investor Rocket Internet pulled the listing of startup HelloFresh. A $2.8 bln valuation for a loss-making delivery firm of ready-to-cook meals rightly did not sway investors. Rocket shares have more than halved this year, but may have further to fall.
Match’s IPO profile is alluring but with strings 9 Nov 2015 The dating-sites owner pegs its worth as high as $3.6 bln. Much of that derives from Tinder, its fast-growing swipe-to-like app. The numbers make for an attractive and credible stock. It’s a risky proposal, though, and Barry Diller’s IAC looks like an overbearing chaperone.
New York coal settlement could be climate canary 9 Nov 2015 Peabody’s deal with state prosecutors over misleading atmospheric risks may inform a similar probe of Exxon. Though the lack of fines is a weak sign, the miner at least must share its assessment of possible climate rules. That could expose the danger of stranded energy assets.
Yahoo needs truth rather than report from McKinsey 9 Nov 2015 The struggling internet site has hired the firm for advice on new opportunities. It’s unclear, though, what management consultants can do to arrest the company’s descent that a procession of CEOs hasn’t already tried. A blunt memo recommending a sale would make better reading.
Lonmin buys time but platinum is bigger problem 9 Nov 2015 A $407 mln rights issue at an eye-popping 94 pct discount will allow the South African miner to postpone a day of reckoning with its creditors. Lonmin has bought itself a reprieve, but this won’t fix the platinum price, or help it avoid another strike at its Marikana mines.
China’s stock market marches to its own merry tune 9 Nov 2015 Mainland stocks are up more than a fifth since the end of September. International investors are less bullish. Even after the summer’s harsh lessons, Chinese buyers still pay more attention to cheap cash and state support than slowing growth and weak corporate earnings.
Square’s down round offers cautionary unicorn tale 6 Nov 2015 Jack Dorsey’s payments firm may go public for $3.5 bln, or 41 pct below its last private valuation. Rising competition, losing Starbucks’ business and deflating markets are only partly to blame. It’s a sign to well-funded upstarts that good ideas don’t always guarantee success.
Exxon investors may rue climate-risk indifference 6 Nov 2015 The oil major’s shares barely budged on news New York is investigating whether the company misled owners about global warming. The probe adds legal teeth to the carbon-bubble debate and may spread to rivals. Shareholders seem more worried about oil prices. That looks shortsighted.
Valeant CEO gets called on $100 mln excess 6 Nov 2015 Paying bosses in equity nudges them to serve shareholder interests. The pharma giant went to extremes, allowing chief Michael Pearson to borrow heavily against his shares. The tumbling stock forced him to repay the debt - an example of how skewed incentives have rocked Valeant.
Brazil dam disaster tests BHP’s mega-mining model 6 Nov 2015 Investors ditched BHP Billiton shares after a jointly owned dam failed in Brazil. While mining is much safer than it used to be, such catastrophes are an inherent risk. A big balance sheet and diverse income streams mean it can absorb the financial consequences better than most.
Telecom Italia tidy-up won’t fix strategic clutter 6 Nov 2015 The Italian telco is converting its outdated saving shares and raising 572 mln euros. Stake-building by French tycoons Vincent Bollore and Xavier Niel may have made conversion more attractive. But other shareholders remain in the dark about what the billionaires really want.
Richemont shows luxury doesn’t run like clockwork 6 Nov 2015 The Cartier owner reported a disappointing 3 percent increase in first-half sales. Hong Kong watch sales slumped. It’s tempting to look for economic trends, but the best explanation might just be that after a decade of runaway growth, luxury is returning to its old, faddish ways.
Allianz’s Pimco recovery looks largely priced in 6 Nov 2015 The German insurer’s bond fund Pimco saw inflows in October for the first time in 30 months. That takes the edge off a slightly disappointing set of third-quarter numbers and legal challenges from founder Bill Gross. The catch is Allianz shares already trade at a premium.
Bill Ackman pushes limits of activism at Valeant 5 Nov 2015 The hedge fund boss hinted the drugmaker’s CEO may need to go and was invited into the boardroom mid-crisis, according to a newspaper report. Ackman also seems to have usurped Valeant’s defense. The $55 bln of quickly lost market value suggests his involvement isn’t helping much.
Electra heat shifts from the board to cage rattler 5 Nov 2015 Edward Bramson has won two director seats at the UK private equity fund. Electra’s chairman, who argued firmly against Bramson’s charge, has resigned. But the shareholder vote was close. Before, the incumbents were under pressure. Now Bramson has to prove he can create value.
BTG Pactual earnings flatter its performance 5 Nov 2015 The Brazilian investment bank’s lower costs and 28 pct ROE put its U.S. rivals to shame. The country’s interest-rate hikes and the firm’s increasing diversity help. But Pactual often pays little or no tax – or gets a benefit. Strip that out and its returns are more pedestrian.
SocGen and Credit Agricole are deceptively similar 5 Nov 2015 The two French lenders’ share prices headed in different directions after third-quarter results. Societe Generale did well in French retail banking, while Credit Agricole suffered in asset management. But with both light on capital, the divergent reaction looks overdone.
AstraZeneca goes two steps forward, one step back 5 Nov 2015 The UK drugmaker’s third quarter beat expectations. It raised forecast sales and earnings. But Astra was helped by old medicines declining less quickly than expected, and some one-off gains. The mixed performance shows why its discount to peers is deserved.