September, 2009
GLG launches company debt fund
GLG Partners, one of London’s largest hedge funds, has launched a new fund to invest in the debt of troubled UK and European companies. The fund will be one of the most significant launches in London this year,
Xerox shares fall on ACS deal
Shares in Xerox tumbled more than 14% on Monday after news of the printing group’s $5.7bn cash-and-stock deal to buy Affiliated Computer Services, a leader in back-office outsourcing. The deal, coming after Dell’s purchase last week of Perot Systems and Hewlett-Packard’s 2008 acquisition of EDS,
UBS wants to cut state ties
UBS aims to cut its ties with the Swiss government by buying its way out of a “bad bank” deal and to return to health in a year, Oswald Grübel, chief executive, told the FT. The bank has clashed with Finma,
Moody’s hit by short selling
Short sellers have increased their positions in Moody’s, one of the biggest credit rating agencies, amid growing scrutiny of the sector by US lawmakers. This week, a series of Congressional hearings will consider whether the agencies require more regulation.
Buy-out groups face fight over fees
Private equity groups are squaring up for a battle over fees amid pressure to lower the cost of their next fundraising. About 220 investors with up to $1,000bn in private equity have grouped together to demand buyout funds apply a framework of best practice including guidelines they have adopted as members of the Institutional Limited Partners Association.
J&J buys 18% stake in Crucell
Johnson & Johnson signalled its diversification into vaccines on Monday with an equity and investment deal in excess of €302m ($442m) in Crucell that could secure it control of the world’s first universal flu jab.
Abbott reinforces consolidation trend
Abbott, the US pharmaceutical company, reinforced the growing trend of consolidation in the global pharma sector with a €4.5bn ($6.5bn) agreed purchase of the drugs arm of Belgium’s Solvay Group on Monday.
FDIC considers tapping banks
US banks will have to advance tens of billions of dollars in industry fees to the fund protecting depositors at the FDIC under a proposal to be to be put forward by regulators on Tuesday. The FDIC’s fund has been depleted this year after the failure of 95 lenders and now stands at about $10.4bn,
EBRD seeks 50% capital increase
The European Bank for Reconstruction and Development has appealed for a 50% capital increase to expand lending in central and eastern Europe. The multilateral bank, controlled by some 60 governments, including EU members,
UK mutuals urge on Northern Rock
UK building societies are urging the government to consider returning Northern Rock, the nationalised bank, to the mutual sector when it is sold off. The Building Societies Association cited an academic report that makes a case for converting troubled banks into mutual organisations.
Assets drop 20% at Singapore’s GIC
Government of Singapore Investment Corp’s assets fell more than 20 per cent in the year to March 31 as the collapse in financial markets drove down the value of its stake in UBS, reports Bloomberg. GIC,
Orange wins UK iPhone deal
Orange, the UK’s third largest mobile operator, has signed an agreement with Apple to sell its popular iPhone in Britain. The deal, announced Monday, is a blow for O2, the UK’s largest mobile operator,
Overnight markets: Up
Asian stocks rose on Tuesday from a two-week low, led up by oil and technology companies, as some investors bet the MSCI Asia Pacific Index’s drop to a two-week low had been overdone. Futures on the S&P500 rose 0.80% after the gauge rose 1.78% in New York on Monday.
That shattered Humpty-Dumpty of mortgage securitisation
FT Alphaville has been reporting recently on the latest contrarian thinking on mortgage markets in general and securitisation in particular. In the spirit of thoroughness, here’s a contra-contrarian view on mortage securitization,
The great Lehman derivatives muddle
Every now and then, a bit of news comes around that threatens to turn the world as we know it on its head. The purported decision by a US bankruptcy court to overrule one of the fundamental tenets of the derivatives market – the ISDA Master Agreement – may turn out to be something of a game-changer.
Banks (still) making money on derivatives trading, OCC says
The Office of the Comptroller of the Currency has released its quarterly report on bank trading and derivatives activities for Q2 2009, and as usual, it makes for interesting reading.
Some highlights:
The synchronous lateral excitation of markets (or pseudo-wobbles)
John Cassidy, writing in the latest edition of the New Yorker, tells the story of London’s Millennium Bridge in a long, slow-burn introduction to a longer and (by now) very familiar discussion of what went wrong in the Great Crunch.
[The Stanford Series] Jail proving a big headache for Sir Allen [UPDATED]
Sir Allen Stanford, the fallen financier accused by the US Securities and Exchange Commission of operating a $7bn Ponzi scheme, is not having an easy time adapting to his new, yacht-free life.
The Texan businessman,
Deflation dead and deader, Federal Reserve-style
Here’s an interesting little chart from BofA Merrill Lynch.
Economy watchers should by now be familiar with the concept of the output gap – a measure of the amount of ‘slack’ in the economy; the bigger the output gap,
Good news for banks, IAS 39 edition
Remember the International Accounting Standards Board’s proposed revisions to IAS 39?
The organisation wants to update the accounting standard, which sets out how banks and other companies should value and categorise their financial instruments.
Lunch Wrap
On FT Alphaville Monday morning,
- Take a ride on the financials magic bus tour.
- The Saudis come to Merseyside.
- Attack of the hedge fund clones!
- Iceland beats Ireland.
- Gotcha! QE and devaluation.
Markets live transcript 28 Sep 2009
Markets live chat transcript for the chat ending at 12:12 on 28 Sep 2009. Participants in this chat were: Neil Hume, FT (NH) Bryce Elder (BE)
NH:
Good morning and welcome to Markets Live
Saudis come to Merseyside
How much is a leading Premier League club worth in these straightened times?
We could be about to find out.
RTRS-SAUDI FIRM F6 IS IN “DIRECT TALKS WITH GEORGE GILLETT” TO BUY BETWEEN 25 AND 50 PCT OF LIVERPOOL FC- COMPANY OFFICIAL .
Financials magic bus tour
If you’re a financials CEO, the highlight of your week will no doubt be Bank of America Merrill Lynch’s ginormous banking and insurance CEO conference in London.
The agenda is available here. Sharp-eyed readers will note that every major European bank CEO is scheduled to speak except one.
Iceland is now better off than Ireland, German bank says
That’s Deutsche Bank, to be exact, in a note entitled “Iceland v Ireland: Is the difference really only one letter?”
In it, DB is exploring the differences between the two island economies — starting with a bit of historical background:
TPG exits down under
“Exit” is the theme of the month in Asia, as Australia becomes the latest spot for private equity groups to take advantage of greatly improved market conditions and monetise their regional portfolios.
In what will be Australia’s biggest IPO in more than two years (since Boart Longyear,
Gotcha! QE and devaluation
Here’s an interesting tidbit on the sterling weakness front, courtesy of Citi analyst Michael Saunders.
Saunders has done a rundown of UK institutional investment (that’s by non-bank organisations like pension funds and life insurance companies) in the second-quarter of this year,
The scourge of hedge funds: Attack of the clones
It’s hardly surprising, perhaps, that synthetic hedge fund clones are putting an increasing amount of pressure on the “real” hedge fund industry and on the fees it charges. But a recent paper on the nascent,
Further reading
Elsewhere on Monday,
- Who is Zero Hedge in 5,500 words.
- Why global imbalances matter, G20.
- Was the G20 summit actually dangerous?
- “AIG is an analyst’s nightmare.”
- A tool for tracking troubled assets.