Tata Steel JV pays ThyssenKrupp four dividends 20 Sep 2017 A historic joint venture with India's Tata will unshackle the German group from the fickle, capital-intensive steel industry. Lower pension liabilities, a share of synergies worth 3 bln euros and a more robust balance sheet are further benefits. Workers will fare better too.
DowDuPont gives blueprint for activist compromise 12 Sep 2017 It hasn't been pretty. But several activists, lots of money, plenty of fighting and years later, the merging Dow-DuPont reached a plan that shareholders, even both Dan Loeb and Nelson Peltz, now support. Somewhere in this chemical romance, there's a lesson for P&G and others.
Pirelli’s mooted IPO valuation looks overinflated 5 Sep 2017 The Italian tyremaker plans to relist. Pirelli’s high-end business may deserve a premium to peers, but an estimated enterprise value of 12 billion euros, far above what owner ChemChina paid in 2015, looks optimistic. High debt and complex ownership may also spook investors.
United Tech breathes rarefied air to bulk up 5 Sep 2017 The conglomerate is paying $30 bln including debt for Rockwell Collins. The combination makes sense but, with a weak 5 pct return on investment, UTC is paying up for aerospace scale. Elusive revenue benefits or a lucrative breakup are needed to prove the deal's potential.
Rebooted UK-French software merger rewards patience 5 Sep 2017 After two botched attempts in as many years, French industrial group Schneider and UK software maker Aveva are trying to hook up again. The $3.9 bln deal is as complex as it is financially alluring. With past glitches ironed out, the merger has a good chance of becoming reality.
United Technologies’ avionics bid looks airworthy 30 Aug 2017 The conglomerate’s potential acquisition of Rockwell Collins should deliver enough cost savings to justify paying a reported $23 billion. Greater size also promises increased negotiating heft with Boeing and Airbus. Investors have good reason to clear this deal for takeoff.
Elliott finds part-victory in Akzo defeat 16 Aug 2017 The U.S. activist failed to arm-twist the Dulux paint maker into a merger with PPG. The Dutch group has, though, committed to a full breakup and put two solid new members on the board. It’s a decent result for Akzo’s investors – although less than Elliott’s might have wanted.
Marchionne’s Maserati spinoff lacks traction 15 Aug 2017 Fiat Chrysler’s boss is considering selling the group’s premium brands, according to a report. He staged a similar trick with the firm’s high-end Ferrari brand. Yet Maserati and Alfa Romeo are tiny and need Fiat’s production lines. Staying part of a larger group makes more sense.
Akzo and Elliott are trapped in a lose-lose battle 11 Aug 2017 The Dutch paint maker has won a legal victory over its biggest shareholder, which is trying to oust the chairman. The increasingly pointless fight is likely to drag on beyond September’s shareholder meeting unless new CEO Thierry Vanlancker can make both sides see sense.
Growing Siemens will be harder than rewiring it 11 Aug 2017 CEO Joe Kaeser has delivered higher margins and healthy shareholder returns by making the engineering behemoth slimmer and more agile in his first four years. He has four more to build on his success. The risk is he will repeat past mistakes by indulging in costly acquisitions.
Glencore’s debt purge creates enviable problems 10 Aug 2017 Surging commodity prices are helping Chief Executive Ivan Glasenberg to slash debt faster than planned and restore profitability. That gives the mining giant scope to hand more money back to investors or make bigger bets on growing demand for resource-hungry electric vehicles.
United Tech avionics bid may start bigger dogfight 7 Aug 2017 The $95 bln conglomerate is mulling an offer for Rockwell Collins, right after Boeing’s margins-sapping entry into the business. Honeywell is under pressure to sell its unit. The combination of earnings and activist pressure leaves aviation executives with some tough choices.
Shipyard spat shows Macron will put France first 31 Jul 2017 The French president angered Italy and exposed the limits of his ardor for the European Union and free markets by nationalising STX France. The silver lining is that he has a better chance of pushing through reform if he makes a show of protecting jobs and the national interest.
U.S. Steel forges best argument against trade war 26 Jul 2017 Rising demand and restrained imports led to blowout earnings at the $4.7 bln steelmaker. While management's hopes for tariffs on bogus national-security grounds are receding, investors are better served by a focus on upgrading high-cost production over protectionist lobbying.
Carmakers need more collaboration, not less 24 Jul 2017 Germany’s VW, BMW and Daimler may have illegally colluded on emissions cleaning systems. The scale of potential misconduct is hard to judge. But if consumers don’t suffer, big technological change and bloated R&D budgets suggest more carmaker cooperation is nothing to be feared.
GE’s new boss may find inspiration from Honeywell 21 Jul 2017 Jeff Immelt’s weak earnings swan song underscores the challenge for John Flannery atop the $222 bln industrial giant. Making quick progress on early goals is key, as Darius Adamczyk is doing several months in at Honeywell. With activists in both stocks, it should be a no-brainer.
ACS and Benettons pitch patriotism against brawn 21 Jul 2017 The Spanish construction firm is eyeing a bid for toll-road operator Abertis, rivalling a 16 bln euro offer from the Benetton family’s Atlantia. ACS is smaller and has less firepower, though would keep Abertis Spanish. But the financial logic of a bid is stretched, whoever wins.
Free phones power Mukesh Ambani’s tech ambitions 21 Jul 2017 India's richest man has seriously upped the ante in the country’s mobile war. His Reliance Jio network is offering free internet-enabled handsets, potentially reaching 500 mln more people. A strong oil refining business means he can worry about recouping the investment later.
Elliott renews totemic siege of Dutch boardrooms 7 Jul 2017 The U.S. hedge fund has launched a new legal bid to dismiss Akzo Nobel chair Antony Burgmans. The move may not revive the Dutch group’s sale to PPG that Elliott wants. Yet after defeat in a separate case, it shows activist investors haven’t given up on the Netherlands just yet.
Philips deal healthier for patients than investors 28 Jun 2017 The Dutch healthcare equipment maker is buying loss-making US rival Spectranetics for more than 6 times next year's revenue in a $2.2 bln deal. Ramping up expertise in treating cardiac disease makes strategic sense, but the high price adds unhealthy financial side-effects.