Orsted increasingly merits its investor blowback 20 Jan 2023 The $38 bln Danish wind farm group flagged lower-than-expected 2023 targets as its key offshore arm struggled. Shareholders always granted Orsted a premium valuation, due to growth expected from new projects. Construction delays and rising rates are putting that in question.
Emerson’s hostility tests aggressive M&A tools 17 Jan 2023 Disclosing its unsolicited $6.9 bln offer for NI ends a quiet eight-month standoff. Going public forces the issue, but along with the target’s strategic review also inflates the price. A bid battle threatens the potential value of a deal and may inform takeover tactics elsewhere.
Cheaper gas is temporary salve for Europe Inc 9 Jan 2023 Warm winter days and enough reserves to offset Russian imports have halved the fuel’s cost. Yet Europe’s energy security also hinges on abundant liquefied natural gas purchases. As China’s fuel-guzzling economy reopens post-Covid, industrial giants like BASF may still suffer.
Chip mergers are more urgent and awkward in 2023 5 Jan 2023 Western Digital has revived talks with Japan's Kioxia after efforts for a $20 bln deal stalled in 2021. Price wars plague sales of semiconductors storing data and M&A can help as demand plunges. The duo will have to be creative to convince politicians fretting about chip wars.
GE healthcare spinoff gets unduly glum prognosis 4 Jan 2023 The industrial giant’s newly listed MRI-to-ultrasound division flatlined on its debut as a $25 bln listed company, trading 40% below what peer valuations would suggest it’s worth. A discount plagues parent GE too. The apple hasn’t yet fallen far enough from the tree.
Friendshoring makes sense if done in the right way 5 Dec 2022 The United States and its allies want to build up suppliers of goods such as solar panels in friendly countries so they’re not vulnerable to Chinese disruptions or blackmail. To avoid self-harm they should define friends broadly and not attack China economically, says Hugo Dixon.
Capital Calls: Fuzzy Fedspeak, Dr. Martens 24 Nov 2022 Concise views on global finance: The U.S. central bank has left traders guessing the meaning of the word “various”; shares in the recently listed British bootmaker fell 20% after sales missed expectations, and a warning that its investment needs will hurt profitability.
Nickel IPO puts Jakarta at centre of China EV boom 23 Nov 2022 China’s Lygend Resources, a trader-turned-producer of critical battery ingredients, is eyeing a $600 mln Hong Kong listing. A huge presence in Indonesia gives it an edge over rivals at home, where supply is scarce. That should help the company navigate a bumpy stock market.
Capital Calls: Japan baulks at U.S. car credits 7 Nov 2022 Concise views on global finance: Tokyo warns America’s Inflation Reduction Act could discourage Japanese investment into the world’s biggest economy.
Capital Calls: Ocado in South Korea 1 Nov 2022 Concise views on global finance: The $6 bln online grocer’s shares surged almost 40% after it announced a partnership with Lotte Shopping, showing that its strategy of building warehouses for global supermarkets may have legs.
Europe’s industrial mess has protectionist endgame 26 Oct 2022 Manufacturers like Germany’s $42 bln BASF face a toxic brew of high energy prices at home and rising risks in China. That implies a freeze on new investment, and a loss of market share to foreign players. To stop that, European states may ultimately intervene with tariffs.
GE is hurting but Larry Culp’s legacy has hope yet 25 Oct 2022 The $80 bln industrial conglomerate’s renewable business dragged on earnings. Free cash flow is falling, and the company cut earnings guidance. But a $370 bln U.S. spending package should help. And CEO Culp is about to head up the aerospace division, GE’s only bright spot.
Beware spins from Danaher’s well-oiled M&A machine 4 Oct 2022 The $200 bln conglomerate plans to separate yet another division, this time packaging and water filtration. Its acquisition nous generates strong returns, but recent castoffs have disappointed. Transferring the parent’s kaizen-based system to its progeny is proving difficult.
South Korea gets short end of U.S. trade stick 3 Oct 2022 Seoul wants to sell more chips and other goods overseas, but Washington is luring Samsung and compatriots to make in America. A trade deficit and crashing won offer a glimpse at what a U.S. revival in high-tech manufacturing means for the $1.8 trln trade-dependent Asian economy.
Capital Calls: ECB rate hike 8 Sep 2022 Concise views on global finance: Europe’s central bank risks recession to combat inflation.
Capital Calls: Schneider/Aveva 24 Aug 2022 Concise views on global finance: The $73 bln French group tries to benefit from its UK unit’s falling share price to bring it in-house.
Geely’s export success warns global rivals 19 Aug 2022 The $21 bln Chinese carmaker is growing overseas, despite political headwinds and consumer skepticism. Electric vehicles are targeted to make up half its sales by 2023. Boss Li Shufu is best known for acquiring Volvo, but now his own brands can compete in Europe and beyond.
CATL can pull off its risky reshuffle 2 Aug 2022 A director and second-largest shareholder at the $194 bln battery maker has quit and founder Robin Zeng is now both chair and general manager. Such moves can be red flags for investors. But as CATL goes global, a familiar face at the top is for now more reassuring than not.
GM and Ford are now juggling three crises 27 Jul 2022 The U.S. automakers are starting to figure out Covid-driven shortages – that was the first pickle. But long-term risks to both pricing and lithium supplies will make it more difficult to efficiently grow EVs. Plus pent-up demand only covers for a weakening consumer for so long.
VW’s CEO ouster heralds less noise, more muddle 25 Jul 2022 The $86 bln carmaker replaced Herbert Diess with Oliver Blume. It loses a bold champion of electric vehicles, but also one prone to gaffes and weakened by union battles. The decision to keep Blume in charge of both VW and Porsche, meanwhile, muddies the latter’s looming IPO.