Bond markets will be new climate vigilantes 27 Jan 2021 Booming demand for sustainable funds and new EU rules will make debt investors more wary of buying securities issued by polluters. There are already signs that is happening in the oil and gas sector. Higher funding costs should be a powerful spur for companies to get serious.
Naturgy offers cut-price route to green transition 26 Jan 2021 IFM is spending 5 bln euros on 23% of the Spanish utility. Naturgy’s depressed shares and the Australian fund’s use of debt will juice its returns. Moreover, it’s a cheaper way of surfing the renewable energy wave than boarding rivals like Iberdrola.
How to pick the hydrogen industry’s future Amazon 22 Jan 2021 The element could play a major role in decarbonisation, which has sent shares in related companies skyrocketing. As with the 1999 tech-stock boom, investors can’t tell which group can corner the market. But they can see which uses of hydrogen will become cost-competitive first.
Total’s Indian green energy splurge has two hedges 18 Jan 2021 The French giant is upping its exposure to renewable power by buying 20% of Adani Green Energy. The $2.5 bln price tag is well below the target’s market value. Teaming up with tycoon Gautam Adani may also help avoid problems suffered by other Western energy groups in India.
Viewsroom: Predictions and prescriptions (Part 1) 23 Dec 2020 Governments will become activist investors; U.S. airlines will merge; data centres will be the new ESG target; energy giants to consider renewable spinoffs; Tesla will buy Daimler; European soccer gets more American and more. Rob Cox, Peter Thal Larsen and Lauren Silva weigh in.
Big Oil will cash in on sun and wind 21 Dec 2020 Covid-19 and ESG have crushed the stock prices of companies like Total and BP. Listing their growing renewables businesses would help capitalise on inflated valuations. There’s a hedge of sorts: if the spinoffs don’t work they can be bought back on the cheap, Iberdrola-style.
Repsol stake sale could speed up green shift 16 Dec 2020 The 13 bln euro Spanish oil group may offload 25% of its gas stations arm. Flogging a chunk of what is a relatively highly valued business could raise 2.5 billion euros. That would provide critical firepower to get Repsol’s renewable energy capacity closer to rivals like Total.
Corona Capital: Gaming M&A, Beauty’s bold face 9 Dec 2020 Concise views on the pandemic’s corporate and financial fallout: Consolidation in video games reaches the next level as Sweden’s MTG buys Hutch Games for $375 million; and Spanish cosmetics, fashion and perfume group Puig predicts revenue will double by 2023.
UK’s cheaper zero-carbon route comes at right time 9 Dec 2020 Decarbonising the British economy could cost less than 1% of GDP a year, Britain’s climate adviser reckons, well below its previous estimates. Politicians still need to act on the plan. But a credible roadmap is a guide for others ahead of next year’s UK-hosted global conference.
Australian pension giant braves steep M&A curve 9 Dec 2020 New Zealand infrastructure investor Infratil snubbed a $3.8 bln takeover bid from AustralianSuper. Its first solo acquisition target enjoys a solid negotiating position and Goldman on defence. For this to be more than a learning experience, it will have to dig deeper.
Funky debt bonanza is breeding complacency 8 Dec 2020 Companies from BP to Gazprom are issuing more bonds that count as equity than ever before. Low rates and investors’ thirst for yield explain why, yet the benefits of such hybrids are modest. To avoid future strife, companies should sell debt that is better at absorbing losses.
Activist minnow needs bigger fish to fry Exxon 7 Dec 2020 The $176 bln oil major has rarely listened to past investor pleas, so demands from a $40 mln stakeholder seems a non-starter. Yet its recent record of capital destruction may be enough for bigger funds to join in. Taking on the oil giant is a way to justify ESG lip service, too.
Green investing’s killer app faces growing pains 7 Dec 2020 Sustainable finance types long for a single metric showing how well companies are aligned with net zero emission targets. The Holy Grail exists, but there are many different versions. A harmonised methodology ahead of next year’s Glasgow climate summit looks ambitious.
Eni’s UK wind farm tilt is cheap for a reason 4 Dec 2020 The Italian oil major is paying utility SSE and Norway’s Equinor just over 3 mln pounds per megawatt for a 20% stake in the first two phases of the Dogger Bank project. It’s cheaper than past offshore developments. That’s mainly because new farms don’t carry such big subsidies.
Corona Capital: Movie releases, Ads, Running 4 Dec 2020 Concise views on the pandemic’s corporate and financial fallout: HBO Max uses its muscle on movie releases; advertising wins some and loses some; Brooks’ beast year.
UK green revolution takes baby-step beyond slogans 18 Nov 2020 Britain is to ban new petrol car sales by 2030 and invest in hydrogen to hit its 2050 decarbonisation goal. The sums cited are modest and the targets lack detail. The plan’s success hinges on Prime Minister Boris Johnson convincing private investors to pick up the slack.
Renewable energy gets its very own Masayoshi Son 13 Nov 2020 Aussie mining mogul Andrew Forrest unveiled plans for his Fortescue to go big in green projects. Targets include competing with global oil giants in production capacity. The bold strategy will spark a frenzy – both helpful and harmful – just as the SoftBank boss did in tech.
Elliott takes power punch to greener pastures 12 Nov 2020 Paul Singer’s fund wants utility Evergy to engage with NextEra, the largest U.S. renewable energy firm. Regulators have frowned upon NextEra’s ambitions. But its valuation helps justify deals without tasking ratepayers. Elliott’s presence might help Evergy get over deal-phobia.
Corporate America prepares for life in purple 7 Nov 2020 From finance to tech to weed to transport, companies have had plenty of time to consider what a Joe Biden presidency means. Without a clear Senate shift one way or the other, legislative gridlock appears likely. Here is what the 2020 election will mean industry by industry.
Green energy valuations could use stiffer tailwind 5 Nov 2020 Siemens Gamesa and Danish rival Vestas now have over 60 bln euros of orders for wind turbines between them. But valuations look toppy even if they hit margin targets. A possible Joe Biden U.S. presidency is also less likely to supercharge renewables with a Republican Senate.