Corporate Debt

GE tries to boost multiple by selling appliances

14 May 2008

The conglomerate is trying to sex up its business. It has sold its plastics business, now it wants to get rid of white goods . Selling lowgrowth industrial units may help, but investors still think GE s financial operations look dowdy.

Buffett bends his rules in quest for RBS Insurance

14 May 2008

The legendary US investor is eyeing the £7bn insurance business being sold by UK bank RBS. His Berkshire Hathaway is one of eight potential bidders yet Buffett usually shuns auctions. He could be bending that rule to go after a target that ticks other important boxes.

Credit derivatives work for Warren Buffett

2 May 2008

The Sage of Omaha is on the hook to the tune of $5bn if certain junk bonds default. For a man who called derivatives financial weapons of mass destruction that's quite an exposure. Buffett, however, isn't just a regular player in the credit default swap market.

Berkshire-style Sequoia Fund has pros and cons

2 May 2008

The fund started by Bill Ruane, a pal of Buffett's, is taking new investors for the first time in 26 years. It has a track record, a good manager and a nimble scale. Unlike Buffett s Berkshire Hathaway, it also pays cash out. But Berkshire stock might still have the edge.

Krumnow’s position at Tui looks untenable

2 May 2008

Dissident shareholders of the German travel group want the chairman to resign. He may be able to hold on in Wednesday s AGM vote, thanks to a cosy board structure. Yet after years of poor returns, and with almost 25% of the votes in open revolt, Krumnow s time looks short.

Wrigley timing is sweet – but Buffett needs more deals

28 Apr 2008

Two years ago, he announced a $4bn acquisition on the eve of Berkshire Hathaway s famous annual meeting. Saturday s crowd of mostly adoring shareholders will love his latest $6.5bn deal to help Mars buy Wrigley. But Buffett needs more deals at least that big.

Welch shows downside of supreme self-confidence

16 Apr 2008

Bold actions and minimal restraint helped the former GE boss become a business superstar. But Welch should have learned discretion with age. Then he might leave successor Jeff Immelt alone. The same goes for fading financial stars such as Sandy Weill and Alan Greenspan.

Hats off to Consob for giving Benettons bloody nose

11 Apr 2008

The ruling by Italy s stock market regulator against the textiles family presses all the right buttons. It punishes the Benettons for what looked like an offside ploy against activist investors in Generali. And it boosts Italy s governance record as the country goes to the polls.

GE’s grip on its model is weakened

11 Apr 2008

Just weeks ago, boss Jeff Immelt extolled GE s totality as its strength. Now that diversity looks rather like a recipe for mediocrity as declining financial earnings offset its infrastructure successes. Immelt's ability to maintain GE's model is compromised.

Buffett blunt as usual, except on Gen Re

29 Feb 2008

The Sage of Omaha s annual missive takes US home lenders to task and slams politicians squawking over foreign investments in the US. Perhaps not surprisingly, it s rather quiet on legal woes at Gen Re although Buffett s recent charm offensive helps ensure he won t get tainted.

Shareholders lose when moguls collide

29 Jan 2008

John Malone and Barry Diller are headed to court over the breakup of IAC. Both have irrational requests. The best outcome for shareholders would be a fair auction, or spinoff, of all the component parts.

Diller adopts good governance…to shaft Malone

25 Jan 2008

The IAC boss known for his excessive compensation is adopting a singleshare voting structure in the spinoffs of the web conglomerate s assets. But this looks more like a tactical attempt to get John Malone off his back than an aboutface for shareholders.

Has Buffett finally called a bottom for something?

23 Jan 2008

Well, maybe. Berkshire Hathaway s 3% stake in Swiss Re, bought on the open market, looks like a vote of confidence in the stock. But as usual with Buffett, other investors shouldn t take too much comfort. With a separate reinsurance deal, the wily investor has other angles too.

GE’s conglomerate strategy bucks market woes

18 Jan 2008

General Electric's robust results vindicate boss Jeff Immelt's reshuffling of the conglomerate's portfolio. Its financial arm will continue to suffer, but its tripleA credit rating and fat global infrastructure order book leave it much better off than its peers.

Even Sarko can’t buck the market

28 Nov 2007

The new French president thought he had some bright ideas to restructure French industry. But the ThalesSafran merger is rightly dead in the water and he s thinking twice about his plans to combine Areva with Alstom. Market realities are sinking in after all.

Candover deal ends well for Stork shareholders

28 Nov 2007

Candover has finally got Stork, at a small premium to its previous unsuccessful bid. That's great news for the Dutch firm's shareholders, who faced having no bid at all. What sealed the deal was Marel, the Icelandic firm, paying a full price for Stork's food systems arm.

Sarko’s claim to nationalise Suez may not be gaffe

16 Oct 2007

France's president told Gaz de France unions he'd nationalised Suez by approving the merger. Independent board members are irked. Joking or not, the comments underline his interventionist streak. He could end up treating GdFSuez like Putin treats Gazprom.

Emerging market capitalism may change some rules

24 Sep 2007

More money will be spent this year by companies from poor countries buying richcountry companies than the other way around. That s a massive shift in just a few years. Many of the rising companies are stateowned or politically motivated. Expect adjustment pains.

Vivendi’s play for Oger Telecom shows strategic muddle

14 Sep 2007

Investors will be rightly alarmed. Vivendi has underperformed the CAC40 in the last five years. It s time it settled on a single strategy. The French mediaandtelecom group is considering buying a stake in the Dubai telecom operator. That suggests it will remain a conglomerate. The French mediaandtelecom group is considering buying a stake in the Dubai telecom operator. That suggests it will remain a conglomerate. Investors should be concerned. Vivendi has underperformed the CAC40 in the last three years. It s time it settled on a single strategy.

Candover deal offers certainty for Stork shareholders

23 Aug 2007

Sure, Candover s E47 offer for the Dutch conglomerate is well below some valuations. Iceland s LME could yet launch a higher offer. But Stork s problems in aerospace make estimates tricky. And with no other bid in a gloomy M&A sector, the devil you know may be preferable.