Indian hospital penta-scrum poses board quandary 9 May 2018 Five bidders want to invest in ailing Fortis, valuing it at up to $1.4 bln. Offers range from small stakes to a full takeover. Lenders and hedgies may want a quick exit, but in a critical care business, directors would do well to consider a treatment that works for the long term.
Hong Kong mall deal feeds economic-hub dreams 9 May 2018 New World Development will invest $2.5 bln to build a sprawling retail centre by the city's remote airport. The pricey project goes beyond wooing flyers, though. It's a bold bet that troubled infrastructure initiatives to link mainland China, Hong Kong and Macau will pay off.
A Fujifilm cash bid for Xerox would work on paper 8 May 2018 Carl Icahn is fighting the Japanese company's complex plan to take control of its U.S. partner, but he's open to a cleaner $11 bln deal. That just about stacks up for Fujifilm in terms of debt needed and an investment return. It'd be far harder to justify strategically, though.
Takeda swallows big dose of risk to buy Shire 8 May 2018 The Japanese drugmaker finally reached a deal to buy its Irish peer, for $62 bln. Takeda can just about make the deal math work with $1.4 bln of annual cost savings. It requires big cuts to R&D, however, and operating with excessive debt for a while. That's a dangerous mix.
UK bank wedding can justify more generous dowry 8 May 2018 Mid-sized CYBG has approached rival Virgin Money about a 1.6 bln pound all-share deal. The tie-up would enable the pair to more effectively challenge bigger banks. Even assuming modest cost savings, major shareholder Richard Branson can afford to hold out for a higher price.
Elliott weaves snare around subpar Athenahealth 7 May 2018 The healthcare-software firm is long on vision under founder Jonathan Bush, but it has been patchy on performance despite the activist’s presence. Elliott’s $6.9 bln bid, including debt, raises the pressure on the board to do more and may force other bidders out of the woodwork.
Blackstone stores up value in warehouse deal 7 May 2018 The buyout firm is paying $7.6 bln to buy Gramercy Properties. The dearth of other industrial real-estate companies and rising demand for space, fueled by the likes of Amazon, make it tempting to overpay. Blackstone is keeping a lid on overexuberance, even considering the risks.
Scent makers’ $7 bln M&A splash-on has funny smell 7 May 2018 IFF is touting cost cuts worth almost double the premium it’s paying for Frutarom. The deal also sprays the buyer with a healthy dose of products made with natural ingredients. But IFF’s investment return looks low. That may be why investors are turning their noses up at it.
Liberty Global is a $25 bln bet on EU telecoms M&A 7 May 2018 The group chaired by “cable cowboy” John Malone may sell its German and eastern European businesses to Vodafone. If regulators give the thumbs up, Liberty’s remaining assets would be prime targets in a wave of telecom dealmaking. Its valuation does not reflect that possibility.
Nestlé gets welcome jolt from Starbucks deal 7 May 2018 The Swiss food giant is paying $7.2 billion for the rights to sell Starbucks-branded coffee pods, beans and so on. With $2 billion a year in annual sales, the business will help Nestlé in its shift away from junk food, and towards healthier and faster-growing products.
France’s M&A boom is about more than Macron 7 May 2018 French companies were involved in deals worth $226 billion in the year since President Emmanuel Macron was elected, a decade high. Though his policies helped business confidence, a global merger wave also helped. And state meddling is still a deterrent for overseas buyers.
China offers miracle cure for Aussie cancer unit 7 May 2018 Beijing-based buyout firm CDH Investments is offering $1.4 bln for Sirtex, the liver cancer specialist. The non-binding bid is a 20 pct uplift on an agreed deal with U.S. suitor Varian. The rich valuation upsets the logic that a strategic buyer can pay more than a financial one.
Viewsroom: M&A gets carried away 3 May 2018 Dealmaking is breaking records. But more tie-ups are being pulled. And recent proposed unions like T-Mobile US with Sprint and Xerox with Fujfilm come with regulatory or boardroom drama. Crisis throwbacks and the careless brag-song of Sainsbury’s CEO are sending warning signals.
T-Mobile and Sprint’s 5G plea is believable 3 May 2018 John Legere says if regulators let his telecom group merge with Sprint, it will help America lead in wireless technology. Watchdogs thwarted a past attempt to merge on fears consumers would be hurt. The rationale this time is compelling, provided Legere sticks to his word.
UK tabloids’ dire top line strengthens M&A case 3 May 2018 Sales are down 9 pct this year at Trinity Mirror, whose acquisition of Express newspapers is under the regulatory microscope. Buying rivals and slashing costs seems the only viable option for the Daily Mirror parent. Blocking the deal would leave the media sector on the sickbed.
Flipkart bid would be rare defensive one by Amazon 3 May 2018 It'd be a coup if the e-commerce titan took control of its larger rival in India. Chasing the business started by former Amazon employees would suggest boss Jeff Bezos is worried by the idea of Flipkart uniting with Walmart. The battle underscores the significance of the market.
Water M&A wars leave investors unusually placid 2 May 2018 The four-way fight over SJW’s bid for Connecticut Water is boiling over with accusations, intransigence, governance issues and proxy battles - none of it from shareholders. They’re either taking a surprisingly long-term view, or assuming hostile offers for utilities never work.
Xerox effort to go quietly is thwarted on all sides 2 May 2018 Carl Icahn and Darwin Deason have ousted the CEO and board members at the struggling copier company, and at least delayed any deal with Fujifilm. The outgoing CEO, directors and advisers all look bad. Yet Xerox needs a credible final act, and the activists don’t have one written.
Sainsbury’s shows need for new antitrust approach 2 May 2018 The grocer, which is buying Asda for 7.3 bln pounds, wants UK competition authorities to vet retail mergers in a new way. The rise of discount rivals and online sales means it has a point. A revamp of the metrics used to make sure shoppers have enough choice looks inevitable.
Activist tests Lagardere disdain for shareholders 2 May 2018 Amber Capital is pushing for new board members at the $3.7 bln French group. That’s largely symbolic since a funky structure gives boss Arnaud Lagardere control. But the pressure is useful at a time when the unwieldy company is thinking of selling its peripheral media businesses.