Blackstone shows restraint with Travelport IPO 2 Feb 2010 The airline reservation group's IPO will raise about $1.78 bln to pay off debt. Private equity owned firms have a poor stock market record. But the valuation looks undemanding. And with other IPOs in the pipeline, Blackstone has good reasons to make sure Travelport takes off.
Buffett changes habits for railway deal 4 Nov 2009 To buy Burlington Northern, he is paying a full price, issuing precious Berkshire Hathaway stock, and splitting each of the company s baby B shares into 50 pieces, taking their price down from $3,000plus into the doubledigit realm of normal stocks. Whatever next a dividend?
Buffett’s $34bn buy is barely a bargain 3 Nov 2009 The US value investor has a name for buying dollar bills for 50 cents. His deal to buy the Burlington Northern railway group doesn t appear to fall into that category. True, Buffett is going big in a company and industry he likes. But it is a bet on growth rather than on value.
What does Buffett see in railways? 3 Nov 2009 He s paying a big premium to swallow Burlington Northern Santa Fe, a US railroad operator. It s not necessarily a signal to buy the sector in a hurry. But the Berkshire Hathaway chairman does seem to think rail transport could be building a bit of a head of steam.
Ferrovial’s loss on Gatwick is price of past excess 21 Oct 2009 The Spanish construction group will take a E142m hit selling the London airport to infrastructure rival GIP at below regulated asset value. The deal is the cost of Ferrovial being allowed to keep flagship airport Heathrow. And it's a reminder of the crazy prices paid in the boom.
National Express right to travel alone 2 Sep 2009 The struggling UK train and bus operator turned down what looked like a juicy offer from private equity, preferring to press ahead with a discounted rights issue. For this troubled company, the board s decision might look barmy. But rejecting the conditional offer was prudent.
Ferrovial still on better side of improved Cintra deal 31 Jul 2009 The Spanish infrastructure group is absorbing Cintra, its 68%owned motorway subsidiary, on terms that are better for minority investors than had been expected. The merger has some logic. But Cintra needs the deal less than its parent. The minorities will have to lump it.
Rail woes give UK chance to rethink privatisation 29 Jul 2009 The crisis hasn t done any favours to the old private good, government bad thinking. The return of one big privatised rail franchise to the UK government provides a good opportunity for a privatestate comparison. Who knows, the Tories might end up the party of nationalisation.
Tui problems bigger than Hapag-Lloyd financing 28 Jul 2009 The German group s 43%owned shipping unit is set for a E330m liquidity injection. But Tui itself generates little cash and may be in a precarious position. With Hapag in serious trouble, Tui is relying heavily on its travel subsidiary for cash to repay its debts.
UK’s off-balance-sheet liabilities crash home 2 Jul 2009 The government has renationalised a failing rail franchise, sold in a flawed auction, while delaying the partprivatisation of the useless postal service. Both moves reflect current economic reality and past bad policy. The pressure on public finances is only going to intensify.
UK sticks to one sound principle in LDV rescue 6 May 2009 The government will lend £5m to the Deripaskacontrolled ailing vanmaker. The state support means taxpayers may well end up owning a bunch of trucks. But at least the UK s statebacked banks weren t coerced into helping against their better judgment. That s a good precedent.
TCI retreat hands win to critics of activists 28 Apr 2009 The hedge fund fought hard and scrappily to get on the board of CSX, the US railway group. Now a weakened TCI has bailed. Such outcomes boost those who criticise activists as shortterm profitseekers. Unfortunately, they also risk silencing legitimate shareholder concerns.
Deripaska makes himself hostage to fortune 23 Feb 2009 The Russian oligarch says he s not worried about his home country s refusal to help Rusal, the cornerstone of his empire, with its $14bn debt burden. But a vanmaker under his control is looking for a mere $45m of UK state aid. Deripaska s optimism is hard to fathom.
Harley fills up the tank with pricey Buffett fuel 3 Feb 2009 The billionaire has added the motorcycle maker to Berkshire s shelf of iconic American brands. He s buying half of Harley s $600m unsecured debt offering. But rather than Buffett handing over a trophy price, Harley is paying the premium for his vote of confidence.
Trash deal shows market’s cleansing power 14 Jul 2008 Garbagecollector Republic Services launched a bid for Allied Waste that shareholders thought reeked. Now Republic is on the receiving end of a $6bn takeover from trash king Waste Management. It just goes to show markets work even when managers stink.
CSX deserves its new directors 26 Jun 2008 The US railway group is stalling over the results, but it looks like at least two of the five candidates put up by activist funds TCI and 3G have been voted in. CSX is no basket case, but its attempts to stave off the funds revealed an entrenched board that needed a shakeup.
Holier-than-thou CSX misses the point 19 Jun 2008 The US railway company is trying to fend off directors nominated by two activist hedge funds. RiskMetrics is now backing four of the dissidents five nominees. By slinging mud at the proxy adviser s analysis and judgment, CSX is again avoiding the real governance issue.
US road deal shows infrastructure’s edge on LBOs 20 May 2008 Citigroup partnered with Spain's Abertis to buy Pennsylvania's turnpike. It will have a large debt offering and will tap several different markets. The deal won t be easy. But stable cash flow and lower return expectations make these deals more feasible than buyouts.
How disconnected are China’s investors from reality? 13 Mar 2008 Very, if China Railway Construction s poor debut up just 28% is any indication. Nothing changed in China s huge infrastructure story. That the retail investors who determine the price baulked at this IPO shows just how divorced they are from the fundamentals.
Children’s fund throws tantrum over train set 8 Feb 2008 The Children s Investment Fund wants CSX shareholders to have more influence in choosing the US railway company s directors, and says a recent bylaw change is disingenuous . It s part of a valid US governance debate. But this particular complaint doesn't look wellaimed.