July, 2009
Snap news
Breaking pre-market news on Monday,
- Resolution says Friends Provident rebuffed takeover proposal – statement.
- Emerald energy confirms third party approach – statement.
- Philips Q2 EBITA beats expectations – statement.
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”.
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,
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,
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,
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,
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,
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,
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,
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,
China and Russia lead oil deals
Oil companies from emerging economies are responsible for more than half the sector’s biggest mergers and acquisitions by value this year, according to a PwC report. Emerging economy buyers, led by Chinese and Russian companies,
Overnight markets: Asia continues to fall
Asian stocks continued their declines on Monday, sending the MSCI Asia Pacific Index to a seven-week low, amid concerns a US economic recovery will be delayed, Bloomberg reported. The MSCI Asia Pacific Index dropped 1.3 percent to 99.35 by midday in Tokyo.
The Weekender
This week on FT Alphaville,
- Doomsville!
- Frustrated bulls.
- The Cold War in HFT turns Hot.
- The Virgin Atlantic CEO talks airlines.
- The details of corporate defaults.
- Some unQEasy drama.
CDS report: “Reaching the bottom of the slump is not when you start with exit strategies”
This CDS report was written by Markit’s Gavan Nolan
“Reaching the bottom of the slump is not when you start with exit strategies. We need to choose a point when we’ve already got some way out of the trough”.
Structured finance sets London afire
No, really.
A major fire has been blazing along Dean Street, central London, for most of Friday afternoon, forcing evacuations and causing Oxford Street to be closed to traffic in both directions.
As Sky News reported:
Lex: China and the US dollar
There is a lot of talk about the end of the dollar as the world’s reserve currency, but most of it is hot air…for the time being anyway.
For all the tough talk, foreign central banks are not yet turning away from the dollar.
Move over, Amero; presenting the “united future world currency”
What is Russia playing at? Talk of upsetting the global world order (at least as currency reserves go) has largely been reported as China’s domain, but Dmitry Medvedev is giving his neighbours a run for their money – literally.
Mr Bean on tour
Charlie Bean, the Deputy Governor for Monetary Policy at the Bank of England, is undertaking a seven-day tour of Britain, starting on 13 July. The plan is to visit 14 towns and cities – explaining quantitative easing as he goes.
Devil’s in the details for defaults
An interesting report is out from Standard & Poor’s on Friday, entitled “The Devil is in the Details: Understanding the Variation in Corporate Default Rates and Rating Transitions.” Now doesn’t that sound exciting?
(Ahem)
The thrust of the piece is that while it’s obvious global corporate default rates increase overall in times of crisis,
Lex: Hudunit
China’s heavy-handed tactics in arresting Stern Hu, Rio Tinto’s top iron ore executive in China, have done it no favours, but the effect on iron ore prices is still unclear.
The wider impact, meanwhile,
Lunch Wrap
On FT Alphaville Friday morning,
- Doomsville.
- The Cold War in HFT turns Hot.
- Those poor, frustrated bulls.
- A guest post by the Virgin Atlantic CEO.
- Mutual fund names in Further reading.
Markets live transcript 10 Jul 2009
Markets live chat transcript for the chat ending at 12:01 on 10 Jul 2009. Participants in this chat were: Paul Murphy, FT (PM) Neil Hume, FT (NH) PM:Hello PM:Can Neil and I just say thank you for inviting us on this morning
Doomsville
Lest anyone was thinking of turning bullish after listing to the siren calls of Bond and Winder, we present the following counterpoint.
From an email doing the rounds in the City of London on Friday morning (The author is an MD at one of the big banks):
The Cold War in high frequency trading turns hot
The Cold War in high-frequency trading seems to have escalated overnight.
July 9 (Bloomberg) — Citadel Investment Group LLC, the $12 billion hedge fund firm founded by Ken Griffin, sued three former executives and the firm they started,
Those poor, frustrated bulls
Cute, innit?
That’s the perfect ‘V’-shaped recovery envisaged by the UK strategy team at Cazenove, comprised of Darren Winder and Robert Griffiths. Trouble is, the London equity market is refusing to acknowledge such a rosy scenario – something that has rather meddled with the Cazenove maths:
People’s Friday – Markets Live
Bored of banks? Had your fill of the miners? Got a pressing request for Small Cap Corner?
Here’s your chance.
The Friday agenda for Markets Live, FT Alphaville’s daily markets discussion, is being turned over to our good readers the rabble.
Guest post: Steve Ridgway on the outlook for the airline industry
The Virgin Atlantic CEO writes:
Our industry has never seen anything like it. It’s been a year in which airline management teams have had to cope with major swings in oil prices and a swingeing cut in demand in recent months.
Further reading
Elsewhere on Friday,
- The mystery of Pimco and the PPIP.
- “There comes a time in every Federal Reserve chairman’s life when he must beg to be reappointed to his job.”
- Why AIG equity may be worthless.
Pink picks
Comment, analysis and other offerings from Friday’s FT,
Philip Stephens: Western awe and domestic anxiety, a tale of two Chinas
Amid the avalanche of summer reading crashing on to my desk falls another hefty tome about China’s re-emergence as a global power.