Conglomerates

KKR powers ahead with Japan dealmaking

13 January 2017

The U.S. buyout firm has offered $1.3 bln for Hitachi's power-tool unit Hitachi Koki, KKR's second Japanese deal in three months. The PE group is winning its long game as Japan Inc. slims down. Hitachi benefits too earning a generous premium selling a business distraction.

Tata’s new chief is good step toward redemption

13 January 2017

IT whizz Natarajan Chandrasekaran is the closest thing to an outsider to lead the Indian group; he gives Tata Sons a real shot at fixing thorny governance issues. He can also help his successor at cash cow Tata Consultancy tackle a tough job as the U.S. cools on visas.

Korea scandal shows risk of pension giant

29 December 2016

Prosecutors detained the head of South Korea's $450 bln pension fund over suspicion that it voted for a Samsung merger under government pressure. The case highlights how the country's largest investor could be manipulated at shareholders' expense. Korea could use a safeguard.

Tata is $10 bln poorer post-Mistry

20 December 2016

Ousted Chairman Cyrus Mistry has ended his boardroom battles at India's Tata. The value of Tata's main listed firms has shrunk over the two-month saga, underperforming a weak market. The damage illustrates the value of good governance and a strong reputation to public companies.

3G will take another bite of Corporate America

15 December 2016

The Brazilian investors behind AB InBev and Kraft Heinz look poised for another mega-deal in 2017. After a failed bid for Hershey, Mondelez makes for a hefty, attractive $66 bln target. Kellogg and General Mills could also be tempting if the Oreo maker proves too big to digest.

KKR burnishes establishment credentials in Japan

21 November 2016

Buyouts are nearly taboo in Japan and blue chips hate selling non-core businesses. So KKR's 2013 purchase of Panasonic Healthcare broke new ground. Now Mitsui, a pillar of Japan Inc, has sunk $500 mln into the healthcare firm. That further validates KKR's collaborative approach.

Ratan Tata lowers the tone for fights to come

11 November 2016

A rambling press release from India's top conglomerate attempts to justify Tata Sons' recent sacking of its chairman. The personal and defensive style raises questions about the role of the firm's star-studded board and foreshadows messy struggles over the group's listed units.

Ratan Tata’s old partner is a $12 bln problem

9 November 2016

A bust-up at India's Tata Sons has set the patriarch against Cyrus Mistry, whose family has a decades-old 18 pct stake. A minority bet on a private group beset by governance issues won't appeal to activists or sovereign funds. Ratan Tata needs to dig deep if he wants Mistry out.  

Shenanigans at Tata taint India’s governance wins

1 November 2016

Corporate oversight is improving despite a messy spat at a conglomerate people thought represented the highest standards in the country. There is a long way to go, but investors are becoming more vocal, proxy firms are on the rise, and tycoons are on shorter leashes.

Tata ex-chairman turns rebel without a clear cause

27 October 2016

The ousted Cyrus Mistry has penned an activist-worthy letter outlining problems at the Indian conglomerate, including over-priced deals and poor governance. Long term, the family-controlled holding apparatus might reform itself. Short term, it may only create more mess.

Tata’s head hunt calls for clarity on governance

26 October 2016

A search is on for a leader of the $100 bln Indian conglomerate after the sacking of its chairman. Big names like Indra Nooyi and Arun Sarin are doing the rounds. But to attract top talent, Tata needs to address governance. A commitment to limit meddling would be a good start.

LVMH results showcase benefits of mixed luxury bag

26 July 2016

A pop in demand for champagne and cognac boosted sales of the fancy French conglomerate in the first half and offset declines at its core fashion division. As travel fears and lower demand for designer goods bite, LVMH's diversity allows it to hold its own better than rivals.

Mondelez can stomach a richer bid for Hershey

30 June 2016

The confectioner rejected a lowball offer from Cadbury's parent. Mondelez could pay $26 bln without hurting its shareholders or incurring excessive debt. The jubilant reaction from investors to the initial bid may tempt CEO Irene Rosenfeld to sweeten the terms of her offer.

GE’s 50 billion reasons not to be a SIFI

29 June 2016

That's the dollar amount of market cap the U.S. conglomerate has added since it said it would wind down the finance arm that watchdogs said posed a systemic financial risk. Relative to the market and rivals, the gain is bigger still. Complacent mega-bank shareholders, take note.

Life lessons from a German corporate failure

3 June 2016

With six profit warnings, four CEOs and its share price halving over two years, German industrial services group Bilfinger is a huge corporate disappointment. Now it is finally dismantling itself. Other companies can learn from some of Bilfinger's more glaring mistakes.

Tata’s portfolio power still just about adds up

24 May 2016

Problems at its British steel unit raise questions about the direction of India’s most respected conglomerate under Chairman Cyrus Mistry. The performance of the group’s other big listed companies has been a mixed bag. But viewed as a collective, Tata’s performance stacks up.

ABB’s soul-searching is dragging on too long

20 April 2016

The Swiss engineer says it needs until October to decide what to do with its Power Grids unit, under review since the autumn. CEO Ulrich Spiesshofer deserves credit for improving the division’s operational performance. But the decision to sell the unit looks clear enough now. 

Li Ka-shing brings funding finesse to telco M&A

18 March 2016

The tycoon may sell 20 pct of his UK mobile unit to outsiders. That could raise 1 bln pounds to help buy Telefonica’s O2, on top of the 3.1 bln pounds sovereign funds are already chipping in. That would let Li complete the 9 bln pound deal with no fresh investment.

M&A cycle reaches "running out of ideas" phase

23 February 2016

Time Inc’s interest in Yahoo’s bits, a Deutsche Boerse-LSE marriage and merger talks - however unlikely – between Honeywell and United Technologies are all variations of deals that have been tried but failed for regulatory and other reasons. They may fare no better this time.

Samsung investors schooled on restructuring bets

29 January 2016

The heir to South Korea’s top conglomerate is selling part of his stake in Samsung SDS. That’s a disappointment for shareholders hoping for a merger between the IT services company and flagship Samsung Electronics. Guessing what Jay Y. Lee will do next is risky business.