London fire hits at Arconic’s weakest spot 27 Jun 2017 Fear of lawsuits over cladding involved in a deadly high-rise fire knocked the company’s stock. The blow to its image may compound the damage. A recent proxy fight revealed an insular corporate culture. With only an interim management, Arconic will struggle to contain the crisis.
Germany can jump growth hurdle courtesy of Brexit 27 Jun 2017 Europe’s biggest economy is expanding so quickly that there’s a growing dearth of skilled labour. The shortage may be severe enough to depress the long-term growth rate, the Bundesbank says. One way to plug the gap is to attract EU workers who no longer feel welcome in Britain.
Italian shipping deal torpedoes single market myth 16 Jun 2017 French President Macron is griping over Italian shipbuilder Fincantieri’s bid to buy a stake in a French firm. The deal could create an EU champion, but compromise French jobs. Macron is a fervent believer in Europe – but domestic concerns don’t sit easily with idealism.
Hexagon would be a pointy-edged takeover target 14 Jun 2017 At a price of almost $20 bln, the Swedish manufacturing software group offers a poor return for a buyer. That may not deter a rival such as ABB tooling up for the switch to automated factories. If globalisation goes into retreat, such a deal could even prove forward-thinking.
GE’s CEO choice pushes the boundaries 12 Jun 2017 By anointing John Flannery to succeed Jeff Immelt the industrial titan is doubling down on a strategy that transcends its U.S. roots. Flannery knows restructuring and has run GE units from India to Argentina. Geographically and structurally, the company's lines may be redrawn.
Franco-British laundry deal hinges on spring clean 8 Jun 2017 French group Elis is forking out 2.2 bln pounds for struggling UK rival Berendsen. A 45 pct premium secured the support of the target’s board but gives the buyer a measly 6 pct return on capital. The deal only creates value if the new owner has a plan to clean up its purchase.
Private equity bets water will wash its face 6 Jun 2017 Clayton, Dubilier & Rice is paying $2.5 bln for Waterworks, HD Supply’s pipes, sewer, storm and fire unit. It’s a wager on the need for upgrades to U.S. infrastructure – and in a sector where dealmaking is coming to a boil. That should give CDR options to engineer a clean exit.
Linde-Praxair back Big Gas, investors don’t yet 2 Jun 2017 Both gas-makers’ boards have approved their $74 bln transatlantic merger. Even Linde’s sceptical worker representatives backed down. Yet shareholders aren’t pricing in the benefits of the tie-up. They may be partly right, but at least neither side is putting cash on the table.
Akzo is emblem for new “fortress Europe” 1 Jun 2017 The Dutch maker of Dulux paint thwarted a generous 25 bln euro takeover attempt from U.S. rival PPG without putting forward a convincing financial defence. As European governments reach for more power to fend off unwanted mergers, Akzo has shown how shareholders can lose out.
Safran engineers itself halfway out of a hole 24 May 2017 The French engine maker has re-sculpted its offer for hapless peer Zodiac. The price has been cut by around 15 percent to $7.7 billion, and some of the original bid’s complexity is ironed out. The main unresolved issue: a bad investment now looks like a mediocre one.
Elliott’s hard work is just starting at Arconic 22 May 2017 The activist fund’s deal ending its bitter fight with the car- and plane-parts maker strengthens its grip on the board. It also puts one of its picks into the ring to be CEO. That shifts Elliott’s role from attacking poor results and governance to showing it can improve them.
Clariant-Huntsman tests formula for big M&A 22 May 2017 The $14 bln Swiss-American chemicals merger stacks up strategically, is fairly priced and could create $2.6 bln in post-tax savings. Yet the market initially factored in only half of the upside. The unpredictability of antitrust vetting and U.S. politics may explain the gap.
French laundry’s $2.6 bln UK raid leaves stains 18 May 2017 Berendsen has rejected a cash-and-share bid from French rival Elis that values the British group at a 36 pct premium. The approach looks opportunistic given the weak pound and the target’s battered share price. Even so, Elis will barely cover its cost of capital.
Viewsroom: CEO presidency needs boardroom pushback 17 May 2017 Donald Trump’s promise to run the government like a business is proving difficult but Congress could act like strong independent directors to rein in his wayward management. China’s ambitious Silk Road project could leave its people holding the bag. Plus: job cuts at Ford.
France makes life too easy for pushy bosses 12 May 2017 Vivendi, Christian Dior and Safran are all doing complex deals driven by big shareholders’ interests – and minority investors can’t do much about it. Muting dissent is meant to make French companies more nimble. It does, but at the cost of helping insiders get their way.
Bombardier clears Canadian funds for takeoff 11 May 2017 In a rare revolt, pension funds ejected the train and plane maker's executive chairman. But it took a long downward spiral and outrage over pay to prompt action. A successful siege at a family-controlled national champion should inspire action elsewhere earlier and more often.
PPG might as well go hostile on Akzo 11 May 2017 It has little to lose by taking its $27 bln bid for the Dutch paint maker straight to shareholders. If Akzo invokes its poison pill, the deal falls away anyway. And if the U.S. suitor wins shareholder support, Akzo’s board will face enormous pressure to make the tie-up friendly.
Shareholder battle weakens Akzo’s standalone case 9 May 2017 Activist investor Elliott is taking the Dutch paint maker to court in an attempt to oust chairman Antony Burgmans. Akzo’s defence against suitor PPG rests on its stock trading on a higher multiple after a corporate rejig. But bad governance could cancel out any upside.
Akzo board has painted itself into a corner 8 May 2017 The Dutch paint maker’s categorical rejection of rival PPG’s 24.6 bln euro bid creates two glaring problems for boss Ton Buechner. His self-imposed targets are fanciful, and many shareholders doubt his judgement on the deal. Should PPG go hostile, two battles will become three.
Dan Loeb’s Honeywell spin goes too far 5 May 2017 Hiving off the $100 bln conglomerate’s aerospace unit could boost the stock. But the activist’s argument that it would increase shareholder value by a fifth is a stretch and ignores the benefits the unit brings to Honeywell. New CEO Darius Adamczyk has other levers to pull first.