Divestment

U.S. intruder cranks up European phone mast party

13 January 2021

American Tower is paying 7.7 bln euros for Telefonica’s 31,000 sites in Europe and Latin America. The rich price tag makes the Spanish firm a clear winner. By creating a new rival to leader Cellnex, the deal may also help peers like Orange or Deutsche Telekom sell their assets.

Corona Capital: Poverty, Beer cans, Budget hotels

24 December 2020

Concise views on the pandemic’s corporate and financial fallout: Hong Kong’s poverty problem was getting worse even before the virus struck; AB InBev sells the family aluminium to cut debt; Whitbread, owner of hotel chain Premier Inn, tries to get its landlords to share the pain.

Repsol stake sale could speed up green shift

16 December 2020

The 13 bln euro Spanish oil group may offload 25% of its gas stations arm. Flogging a chunk of what is a relatively highly valued business could raise 2.5 billion euros. That would provide critical firepower to get Repsol’s renewable energy capacity closer to rivals like Total.

Payments is a wrinkly bow on Walmart’s India deal

3 December 2020

PhonePe was an afterthought when the U.S. retailer bought it with Flipkart in 2018. Now the star money-transfer app is being partially spun out of the e-tailer at a $5.5 bln price tag. It’s a deliberately conservative valuation for a business with enormous potential.

Gatecrashers join Europe’s telecom tower M&A bash

17 November 2020

Vodafone’s mobile mast unit might be worth 14 bln euros when it lists. Telefonica, Orange and Deutsche Telekom are carving out their businesses. With half of Europe’s 700,000 towers still potentially up for grabs, acquisitive Spanish operator Cellnex faces some stiff competition.

Controversial museum sales set messy precedent

16 November 2020

The Baltimore Museum of Art is one of many institutions that has considered flogging art amid Covid-19 upheaval. Goals to diversify collections and clean out staid archives are laudable. Still, museums aren’t as good at selling art as curating it.

Private equity can sprint ahead in Adidas castoffs

11 November 2020

Buyout groups are considering buying Reebok from the German sportswear group, the FT says. Chunky returns are possible despite the brand’s dismal growth. But after a failed turnaround, the maker of Kanye West Yeezy trainers will need to accept much less than the $3.8 bln it paid.

Corona Capital: GM earnings, Third-quarter readout

5 November 2020

Concise views on the pandemic’s corporate and financial fallout: General Motors swerves around Covid-19 potholes; and U.S. companies look to have emerged from a difficult three months in better shape than expected.

Corona Capital: Quibi

22 October 2020

Concise views on the pandemic’s corporate and financial fallout: Video streaming company Quibi’s failure is in spite of – not because of – the Covid-19 pandemic.

Nestlé without KitKats is logical next step

21 October 2020

The $340 bln Swiss giant’s food and drink business is shrinking, while CEO Mark Schneider is bulking up in pet care and health science. Covid-19 is accelerating the shift. Selling or spinning off confectionery, worth say $30 bln, could unlock value and sidestep a sugar backlash.

UniCredit spinoff offers a 3 bln euro reward

14 October 2020

CEO Jean Pierre Mustier may split the 16 bln euro bank’s German lender from its Italian business. A demerger could boost UniCredit’s stock by 20%, Breakingviews calculations show. In a deal with Commerzbank or outright sale to BNP or Santander, the returns could be even higher.

IBM drops weight for tough race to the cloud

8 October 2020

The $110 billion Big Blue is spinning off its legacy infrastructure services unit to zero in on high-margin, fast-growing cloud computing. New CEO Arvind Krishna is clearly not shackled by history. Even a more focused IBM will struggle to overhaul powerful rivals like Microsoft.

Europe’s banks smother their fund offspring

8 October 2020

Asset management units at Deutsche, UBS and Natixis risk being squashed by low-cost U.S. giants like $90 bln BlackRock. M&A may help, but no banks want to sell one of the few businesses that’s resilient to low interest rates. It’s a recipe for stasis and continued low valuations.

AT&T needs Dish to save DirecTV face

7 October 2020

The satellite-TV unit could fetch an enterprise value only a fifth less than the $67 bln the U.S. cellphone giant paid five years ago. But that assumes a strategic suitor. A private equity firm buying DirectTV for its declining cash flow would probably offer under $30 bln.

Preferred wheels of nouveau riche worth a fortune

1 October 2020

Volkswagen is mulling a sale of Lamborghini, the beloved marque of crypto-traders and youthful sheikhs, Reuters reports. It might fetch $8 bln – a fat return on the reported $100 mln VW paid in 1998. CEO Herbert Diess’s battery-car focus makes disposing gas guzzlers an easy call.

Walmart pays price for late UK checkout

30 September 2020

The retail giant may sell grocer Asda to buyout firm TDR and two petrol station tycoons for $8.3 bln. It’s a cheaper and riskier exit than a planned union with peer J Sainsbury, thwarted by watchdogs last year. Online competition, a pandemic, and Brexit have weakened its hand.

Siemens energy spinoff emits faint value pulse

24 September 2020

The 96 bln euro engineer’s energy carve-out is a curious mix of wind and hydrocarbons. Worth perhaps 17 bln euros, it will barely dent Siemens’ chunky conglomerate discount. For that, CEO-in-waiting Roland Busch needs to take a bigger knife to the remaining corporate sprawl.

SocGen surrender may spark ETF M&A wave

21 September 2020

The French bank may sell its Lyxor unit, which manages index-tracking exchange-traded funds. That could give CEO Frederic Oudea over 1 bln euros to absorb Covid-19 losses. Brutal fee pressure and BlackRock’s dominance mean punier rivals will need to scale up or get out too.

Iliad’s Polish jaunt could become an odyssey

21 September 2020

The French telecom firm is offering $4.2 bln for Play, the eastern European nation’s top mobile operator. Despite the 39% premium, Chairman Xavier Niel is hardly overpaying. The bigger worry is the cost of completing his target’s journey from mobile upstart to multi-media player.

Euronext gain is LSE loss in flawed Italian sale

18 September 2020

The French group is in exclusive talks to buy Borsa Italiana despite submitting a lowball bid. Open meddling by Rome has skewed the London Stock Exchange’s attempts to run an auction. Still, avoiding a state veto and completing its $27 bln Refinitiv deal may justify the discount.