Eni need not fret over Enel comparisons 1 May 2007 Chattering classes in Italy are speculating what Eni's Scaroni might do after Enel s Conti, his former employee, bought Endesa. Repsol is the obvious target. But it doesn t look terribly appealing and Madrid is unlikely to let two champions go.
Oil price rally could endure 25 Apr 2007 The price of crude is up 30% since the January low. But higher prices are hardly slowing down demand, especially in Asia. Supply is held back by inefficient producers and bad politics. A global slowdown may be the fastest way for customers to regain control.
Enel gets easy ride on Endesa financing 23 Apr 2007 The Italian utility is borrowing heavily to finance a noncontrolling stake in the Spanish group. That means it ll be dependent on dividends to repay that debt even though it won t be able to control Endesa s dividend policy.
Enel incurs E2bn hidden Spanish liability 13 Apr 2007 That's the cost to the Italian utility of giving Acciona a put option over a 25% stake in Endesa, using a standard BlackScholes model. Enel's cost, by contrast, is Acciona's gain. No wonder the Spanish construction group's shares have done better.
Endesa carve-up shows worrying Italianisation of Spain 10 Apr 2007 How did Acciona gain control of a E40bn firm like Endesa with a mere E2bn outlay? Simple. It used an Italian style corporate cascade. The irony is that such structures are expanding in Spain just as Italy s most infamous example at Telecom Italia is on the edge of collapse.
Mirant looks to cash in on TXU 9 Apr 2007 The power producer is considering putting itself on the block. The decision doesn t look too hard. TXU's buyout shows its assets could be sold for a premium. Mirant is underleveraged. And about half of its shareholders want a quick sale.
Total chief caught in legal morass 5 Apr 2007 The oil company s CEO has admitted that money was paid to a facilitators lobby for an Iranian contract. He denies corruption was involved. But what looks like a duck and quacks like a duck might well be a duck. This sounds like the sort of behaviour anticorruption laws aim at.
Eni props up second Yukos auction 4 Apr 2007 Still, Eni gets a big chunk of reserves at rockbottom prices. And it solidifies its relationship with the Russians. Unlike TNKBP, the Italian company actually won. But Gazprom has the right to buy back 80% of the prize within two years.
Endesa carve-up: winners and losers 3 Apr 2007 The clear victor is Acciona, which has secured a lucrative deal. Enel, its partner, is also a winner, but it has paid a fancy price. The clear loser is Spain, whose protectionist meddling hasn t saved a national champion. Meanwhile, E.on s loss could be a blessing.
TNK-BP made to look silly in Yukos auction 28 Mar 2007 The RussoBritish venture pulled out of the auction for a 10% Rosneft stake. It's excuse that it was hard up looks plain ridiculous. But TNKBP may not mind that. It had other motives for bidding than the desire to buy anything.
Enel/Acciona launch surprise spoiler bid for Endesa 23 Mar 2007 The Italian utility and Spanish builder say they ll make a joint offer for Endesa if less than half of its investors accept E.On s bid. The timing is sharp indeed, and makes it unlikely that E.On will succeed. This longrunning saga has further to go.
Spain’s ACS turns itself into an investment trust 21 Mar 2007 Its 25% purchase of Germany s Hochtief adds yet another asset to its eclectic collection of stakes in large quoted companies. To be fair, the strategy has worked pretty well so far. But it s still far from clear ACS can add much value to its investments.
Halliburton finds a friendlier home 13 Mar 2007 The oilservice company will move its CEO to Dubai. The company should benefit in customers, tax and politics. Big companies find it easier to move HQs, as hometown roots get shallower. It s a challenge for governments.
Repsol looks set to rejoin Spanish energy M&A frenzy 8 Mar 2007 The latest rumour doing the rounds is that the oil firm may merge with two local utilities to form a Spanish champion . But this idea makes little financial sense. A better way to create value would be to breakup Repsol instead.
Suez’ great shape throws doubt on GdF merger 8 Mar 2007 The utility s earnings soared 44% last year and the company will boost shareholder returns with a 20% dividend hike and share buybacks. Suez says it is still intent on going ahead with the troubled merger with GdF. But its performance suggests it is doing fine on its own.
E.on can live with Endesa poison pill 7 Mar 2007 The German utility is no longer making its bid conditional on scrapping Endesa s 10% voting restrictions. This makes strategic sense. It doesn t want Acciona and Enel, which now hold a combined 43% stake, to take de facto control. Neither does Endesa.
Investors make wrong call on RWE boss 6 Mar 2007 Harry Roels contract wasn t renewed after he failed to deliver the kind of expansion strategy rival German utility E.on is pursuing. Had investors bothered to check, they might have notice that RWE has outperformed E.on by a mile since Roels took over.
Enel’s Spanish adventure is fraught with risks 2 Mar 2007 The worst scenario is that Madrid is merely using Enel to fend off a rival German bid for local utility Endesa. The best outcome might be a friendly Enel/Endesa merger. But jobsharing at the top could lead to Eadsstyle paralysis hardly ideal.
Enel crashes E.on’s bid for Endesa 28 Feb 2007 The Italian utility has taken a 10% stake in its Spanish rival and may go higher, making it impossible for E.on to win full control. This reeks of political meddling by both the Spanish and Italian governments. But the Germans won t go down without a fight.
Is Henry Kravis the next Brian Hunter? 27 Feb 2007 Of course not. But KKR s bet in the $45bn buyout of TXU isn t all that different from Amaranth s it s a play on natural gas prices rising. That s because returns on equity are capped for TXU s regulated businesses. All the juice must come from the power and supply businesses.