Miles Johnson
AV after dark
On FT Alphaville late Thursday,
- Hochtief Concessions IPO on a knife edge (later pulled).
- Goldman Sachs raises its 12-month gold forecast to $1350/toz.
Overheard in the Long Room,
- China supporting the wood rally.
Bank of England’s QE – the beginning of the end?
The Bank of England published a consultation paper on Thursday morning discussing the possibility of extending the Bank’s Asset Purchase Facility scheme for corporate bonds to allow sales as well as purchases.
Snap news
Breaking pre-market news on Thursday,
- Xstrata approves development of $542m operation for Ernest Henry Mining – statement.
- Phytopharm launches placing and open offer worth ₤25.2m – statement.
Dragon Oil big vote countdown
Emirates National Oil Company said on Wednesday morning it was sticking with its Scheme of Arrangement (SoA) structure for its ₤1.1bn bid for Dragon Oil.
This is a key development in the deal for one reason — an SoA requires a shareholder vote in which ENOC cannot participate with its own 52 per cent stake.
Want work experience on the trading floor of a major bank?
That will be 550 quid please.
From a press release from charity for charities Pilotlight on Wednesday:
UK Follows US Example Of Auctioning Work Experience For A Good Cause
With so many students now graduating from university without a job,
Snap news
Breaking pre-market news on Wednesday,
- Cisco says it owns 84 per cent of Tandberg, says can waive 90 per cent acceptance condition, offer period will not be extended past Dec 3 closing date – statement.
The wisdom of Sheikh Mohammed bin Rashid
Sheikh Mohammed bin Rashid is in a contemplative mood.
Instead of lashing out at the parades of guffawing international press presently camped out in his kingdom’s crumbling hotels, Sheikh Mohammed has taken to expressing his thoughts in haiku form.Only the tree that
Bears fruit becomes a target
For the stone throwers
DISCLAIMER:
Port in a storm: DP World’s London Gateway struggles for funds
The flagship UK development of DP World, the port arm of the troubled Dubai World, looks to be sinking as it struggles to raise financing for the project, based on the Thames at Thurrock in Essex.
The London Gateway project,
Could the Dubai debacle trigger a Dirham devaluation?
Highly unlikely, is the sensible answer.
The UAE dirham, which has been pegged to the US dollar at a rate of 3.6725 since 1997, has the full faith and wallet of the state of Abu Dhabi behind it.
With Abu Dhabi estimated to have billions of dollars of foreign currency reserves,
UAE post-holiday hit
As expected, the Abu Dhabi and Dubai stock exchanges have been hit with a wave of selling on their first day open since the Dubai debacle broke.
But with brokers having predicted the indices to be suspended limit down,
Further reading
Elsewhere on Monday,
- A pick n’ mix bailout for Dubai is the most sensible option.
- Iran vs the US in the Dubai crisis.
- An empire at risk.
- Factbox: What assets Dubai could be forced to sell.
Caveat emptor: Risk factors from the Nakheel prospectus
A quick perusal of the risk factors section in the Nakheel ’09 bond prospectus shows investors were warned about many things.
Firstly, Dubai World, the parent company of Nakheel, “is not required to,
Can nothing go right for Dubai?
Hello, is anybody there?
From Reuters on Thursday afternoon:
A conference call for bond holders of Dubai-owned property firm Nakheel was postponed on Thursday after phone lines were overwhelmed by too many people calling in.
Dear Vodafone
Bernstein analyst Robin Bienenstock has opened her heart to the management and board of Vodafone — via an open letter.
And she does not hold back.
In it she laments the fact that Vodafone “has the potential to become the most compelling transformational story in European Telecoms,”
Further reading
Elsewhere on Wednesday,
- Peak Oil: the media’s new version of shark attacks.
- Does CEO envy drive M&A?
- “Die Robin Hood Bankerin”: A German banker transfers money from rich to poor.
- A professional opinion on The Rajaratnam Defence.
Congressional Alpha
US legislators appear to be rather shrewd stock pickers.
Congressional equity portfolios outperformed the wider market by an average of 55 basis points per month from 1985 to 2001, according to research cited by the Washington Post.
M&A boardroom buddies work both ways
Maybe Jorge Cosmen, deputy chairman of National Express, should have waved this paper in front of the board of the UK transport group.
Transactions involving companies sharing board members perform significantly better than other deals,
Snap news
Breaking pre-market news on Tuesday,
- Lloyds Banking Group announces terms of 1.34 for 1 rights issue, priced at 37p per share – statement.
- Informa confirms it is in discussions about acquiring Springer Science and Business Media – statement.
Then and now, Heritage Oil edition
What a difference a week makes.
Heritage Oil interim management statement, Tuesday, November 17:
Discussions with Genel are continuing with the terms of the merger nearing formal agreement. Both sides remain committed to completing the proposed transaction.
Further reading
Elsewhere on Monday,
- China, the vampire squid of commodities?
- Saturday Night Live does Obama’s trip to China.
- Carlyle Group goes clean.
- Janet Tavakoli rescinds her apology and calls for more regulation of Goldman Sachs.
Snap news
Breaking pre-market news on Monday,
- Heritage Oil-Genel merger terminated, Heritage issues letter of intent to sell its Ugandan assets to Eni for $1.3bn – statement.
- Lloyds Banking Group says it has accepted offers to exchange £8.8bn of non-US securities – statement.
Cadbury-Hershey merger: the Carnival solution
The hurdles to a Hershey-Cadbury tie-up are by now well aired.
Hershey has a smaller market cap than Cadbury, would need to take on crippling amounts of debt to finance a deal, and the Hershey Charitable Trust would be loath to relinquish control in any new company.
Hershey CDS update: Thar she blows (wider)
Hershey’s market capitalisation: $8.6bn
The amount of debt HSY needs to buy Cadbury: $9bn
Jump in HSY 5-year CDS price move after HSY confirmed its interest: 33 per cent
A pretty chart of Hershey’s equity versus 5-year CDS,
Goldman: There is no dollar-funded ‘carry bubble’
So Nouriel, you are being asked here to please calm down. Yup, you heard it here first. (And here, but let’s ignore that for now).
“There has,” says Goldman Sachs strategist Mark Tan, “been a lot of focus recently on the extent of Dollar-funded carry trades contributing to the decline in the USD”.
Hershey-Cadbury data points du jour
So, Hershey has entered the fray.
From RNS on Wednesday:
The Hershey Company (“Hershey”) notes the recent press speculation regarding a potential offer for Cadbury. Hershey confirms that it is reviewing its options and at this stage there can be no assurance that any proposal or offer from Hershey will be forthcoming.
Snap news
Breaking pre-market news on Wednesday,
- KBC asks for its shares to be suspended, European Commission expected to decide on asset sale 12pm CET Wednesday – statement.
- ITV appoints Archie Norman as chief executive officer – statement.
Re-equitisation vs de-equitisation
At the start of this decade the amount of listed equity in Europe weighted against total market capitalisation began to drop off.
The explanation for this was three-fold. Firstly, debt was cheaper than equity,
Kinder Surprise for Kraft?
Ambassador, you are really spoiling us with these bid stories.
Various European press reports of the possibility of a Kraft-melting Ferrero-Cadbury tie-up have set chins a wagging in London on Tuesday morning.
Snap news
Breaking pre-market news on Tuesday,
- KiFin (Nathan Kirsh and family) makes 50p per share hostile cash offer for Minerva – statement.
- Cable and Wireless announce details of proposed demerger, launches £200m convertible bond – statement,