Posts from Monday Jul 13 2009

“Fraud victims” want $24bn from the government of Antigua and Barbuda

They are not going to get it.

On Monday, a group of plaintiffs identifying themselves as victims of the Sir Allen Stanford’s alleged $7bn Ponzi scheme filed a class-action lawsuit against the Government of Antigua and Barbuda that claimed (among other things): Read more

Meredith on Goldman – (re-)re-redacted (updated)

Finally… (H/T GP)

Earlier on Monday the media were fed an expurgated version of Meredith Whitney’s “buy” recommendation on Goldman Sachs — issued ahead of the investment bank’s Q2s on Tuesday.  All we got was news that MWAG saw the stock as attractive in a bear market, and that she’d slapped a $186 price target on the paper. Read more

United Colours of Emerald Energy

Independent investment firms are taking a greater share of advisory fees than ever as companies turn to old-fashioned skills in an uncertain market. Boutique banks, which provide advice on mergers and acquisitions and restructurings, accounted for 14 per cent of global M&A fees so far this year – the highest level since records began, according to Dealogic.

That was from Monday’s FT and boutique banks don’t come any more boutique than the one advising Emerald Energy, a £350m exploration company, on its bid takeover approachRead more

Dear Paul, the greatest monetary crisis of all times is coming

Gold-bug academic extraordinaire Antal Fekete is worried about the world economy. He’s so worried in fact he’s posted an open letter to former Federal reserve chairman Paul Volcker on his website calling for imminent intervention:

Permanent gold backwardation (negative gold basis) is staring us in the face. The gold basis is trying to tell you something. It heralds the greatest monetary crisis of all times. It warns about the possible collapse of the international monetary and payments system. Read more

One small, faltering step for China…

And these people want to dethrone the dollar?

At a seminar for 150 clients today Standard Chartered Bank (Hong Kong) announced that the bank has completed the first cross-border trade settlement transactions in RMB, following the official signing of the pilot program with Bank of China (Shanghai) and Bank of China (Hong Kong). Read more

Who saw it coming and the primacy of accounting

Massive hat tip to Chris Cook for pointing out this fascinating paper.

In it, Dirk J Bezemer of Gronington University attempts to show that certain contrarian economic models — and economists — anticipated the credit crisis and the ensuing recession. In contrast, mainstream economic models, and by extension most economists, did not. Read more

Correction to trading statement

Strong stuff that Magners Irish cider:

Dublin, London, 13 July 2009: C&C Group plc (‘C&C’ or the ‘Group’), today issued the following correction to the trading update for the four months ended 30 June, 2009 issued on 8 July, 2009. Read more

MWAG ♥ GS

Trouble is, we don’t know why.

9786.jpg Read more

Not your average crisis in corporate credit

From Goldman Sachs.

GS chart of BBB spreads in current and previous crises

Lunch Wrap

On FT Alphaville Monday morning,

- Morgan Stanley’s teenage scribblerRead more

Markets live transcript 13 Jul 2009

Live markets commentary from FT.com 

What’s really moving the energy markets

Supply? Bleh.

Demand? Bleh. Read more

Beware the out-of-office indicator

Wise words of warning from Dennis Gartman of the Gartman Letter on Monday regarding the potential for summer-trading complacency.

He n0tes that while it is true the summer months are ‘quieter’, inferring a time of rest for many a financial professional, the savvy operator should not be caught off guard.  For, as the out-of-office reply count mounts, so too does that most furtive of market killers: illiquidity. As he reminds readers: Read more

An amicable Resolution?

No cash, a small premium, and no management change. Having read the weekend press, Resolution’s tilt at Friends Provident looked to be a non-starter.

All the more so because the deal just looked like a way to enable Clive Cowdery and his management team, which includes former FSA chief executive John Tiner, to get rich. (Under Resolution’s articles of association its management share 10 per cent of any value they create, you see). Read more

The UKFI gravy train? No

And so to the UKFI remuneration report, cos that’s the first thing journalists do when they pickup an annual report…

9766.jpg Read more

Bank of Kingman annual report

Just out – the UK Financial Investments annual report, and accompanying guff.

Some quick links: Read more

Matthew Robson, the teenage scribbler

We’re not quite sure what the novelty is here (FT Alphaville has been employing teenagers for some time), but Morgan Stanley have used the talents of an intern – one Matthew Robson, 15 and seven months – to tell them how tomorrow’s adult generation are consuming media.

Highlights: Read more

Further reading

Elsewhere on Monday,

- The man who crashed the worldRead more

Pink picks

Comment, analysis and other offerings from Monday’s FT,

Pink picks illustrationClive Crook: Two cheers for US health reform
The Senate is struggling with the same issues: how to contain the cost of expanded insurance coverage, and how to pay for what remains, so that the reform adds nothing to the budget deficit over 10 years. Like the House, the Senate aims to broaden coverage with a mixture of mandates, regulation and subsidies. Read more

Snap news

Breaking pre-market news on Monday,

- Resolution says Friends Provident rebuffed takeover proposal – statementRead more

What the Sundays said: Xstrata, Lloyds, Terra Firma

Xstrata will offer a £5bn sweetener to seal its proposed merger with Anglo American,  The Observer said. Citing City sources, the Observer said Xstrata would raise the money via a rights issue. But Xstrata told Reuters the deal “remains a nil premium merger of equals”. Elsewhere, the Sunday Times said the Lloyds Banking Group is poised to write off as much as £13bn on its loans to commercial property, businesses and mortgage holders when its reports its first-half results in three weeks. The newspaper also said Terra Firma has asked Citi to inject up to £300m into its debt laden music group, EMI. The British buyout group, led by Guy Hands, has also asked the bank to write-off about £500m of the debt from the label’s more troubled recorded music division, the Sunday Times said.

US and UBS request court delay

The US government and UBS on Sunday stepped back from the brink of a damaging court battle – scheduled to start on Monday – over the Swiss bank’s refusal to reveal the names of thousands of its offshore customers to the US Internal Revenue Service, the FT said. The US Department of Justice, UBS and the Swiss government asked for a three-week delay to the hearing to allow time for an “alternative” resolution to US demands for the names of 52,000 US taxpayers holding offshore accounts.

Centrica bid for Venture snubbed

Two leading shareholders in Venture Production, the North Sea oil and gas company, have rejected Friday’s hostile 845p per share bid from Centrica saying it undervalued the business. Larry Kinch, a Venture founder who holds 7.4 per cent of the equity, and Arclight Capital Partners, a Boston-based private equity fund that has 5.4 per cent, told the FT they wanted £10 per share. Mr Kinch and Arclight have seats on Venture’s board, which rejected Centrica’s bid on Friday night. Centrica, which owns 29 per cent of its target, has said its offer is final, unless another bidder comes in. Its offer values Venture’s equity at £1.3bn.

RHJ prepares improved Opel offer

RHJ International will present General Motors with an improved offer for a controlling stake of Opel on Monday or Tuesday, the FT said, citing two people familiar with the plans. In May, GM signed a memorandum of understanding on the stake with Magna International, but RHJ now thinks it has improved chances of winning the deal as negotiations between the US carmaker and Canadian supplier, which is bidding with Russia’s Sberbank, have hit snags over intellectual property and other issues.

Resolution in takeover move for Friends

Clive Cowdery’s Resolution has launched its plan to restructure parts of the UK life and pensions industry with an all-share offer to take over Friends Provident, one of a handful of businesses likely to be targeted by the consolidation vehicle, the FT said. Both companies are likely to issue statements to the stock exchange on Monday and Friends is expected to rebuff the initial approach. According to a report in the Times, Mr Cowdery plans to bypass the Friends Provident board and take his £1.7bn bid directly to shareholders as he forges ahead with plans to create a super-sized insurer.

LSE’s Rolet seeks stake in Dutch clearing house

Xavier Rolet is looking to make his first acquisition as chief executive of London Stock Exchange Group PLC, with talks to buy a stake in Europe’s second largest clearer, Dutch supplier European Multilateral Clearing Facility NV, Financial News reported, citing three people familiar with the matter. One person familiar with the talks said they hadn’t extended to the size of the stake nor a price. The firm as a whole is valued at about €180m.

Swiss tax rules lure McDonald’s from UK

McDonald’s is to leave London for Geneva, joining the growing ranks of US companies moving their European headquarters to take advantage of preferential intellectual property tax laws, the FT said. The fast-food group, which will open its head office in the Swiss city in the autumn, said the move had been almost a year in the planning.

Note by ‘teenage scribbler’ causes sensation

A research note written by a 15-year-old, who was not born when former UK chancellor Nigel Lawson dismissed London analysts as “teenage scribblers”, has become the talk of middle-aged media executives and investors, the FT reported. Morgan Stanley‘s European media analysts asked Matthew Robson, one of the bank’s interns, to describe his friends’ media habits. His report proved to be “one of the clearest and most thought-provoking insights we have seen,” said Edward Hill-Wood, head of the team, who estimated that the note had generated five or six times more feedback than the team’s usual reports.

Boutique banks win bigger share of M&A fees

Independent investment firms are taking a greater share of advisory fees than ever as companies turn to old-fashioned skills in an uncertain market, the FT said, citing Dealogic data. Boutique banks, which provide advice on mergers and acquisitions and restructurings, accounted for 14 per cent of global M&A fees so far this year – the highest level since records began, according to Dealogic. The data show that top boutiques such as Lazard, Evercore and Gresham Partners are gaining ground in a market that is well off the highs of past booms. Global M&A volume totalled $1,140bn in the first half of 2009, the lowest since 2004.

European conglomerates struggle to provide returns

European conglomerates’ argument that they are a good investment in troubled times has been hurt by a string of below-average performances during the current recession, according to the FT’s annual snapshot of the world’s largest companies, ranked by market capitalisation. Eight of Europe’s 10 largest conglomerates – including Siemens, Philips and Saint Gobain – ranked in the bottom half for shareholder returns out of the 600 largest companies on the continent over the first six months of this year, the research showed.