The European Securities and Markets Authority has squinted at the amount of goodwill on the balance sheets of 235 listed European companies, and it’s not happy with what it found. Not only were the companies seemingly too optimistic, given prevailing economic conditions, but some of their disclosures contained insufficient detail. It’s the sort of thing that makes it hard for investors and analysts to understand what’s going on.
That’s the boring explanation. Let’s go over it again, but this time with pictures! Read more
Microsoft posted the first quarterly loss, of some $0.06 per share, in the company’s publicly-listed history on Thursday. Its flagged $6.2bn writedown of goodwill on the acquisition of aQuantive got the blame.
(Actual underlying earnings were $0.73 per share, while net cash generation is worth highlighting: $31.6bn) Read more
On Friday morning when a report landed in FT Alphaville’s inbox with the headline “Lagging Corporate France… The French – at least their brands are popular”, our interest was piqued. It’s a one-pager from independent equity research firm AlphaValue. It contains interesting snippets about how French companies have a lot of goodwill booked on their balance sheets when compared to their European peers.
As Investopedia tells us: Read more
… because Unicredit is passing round the begging bowl.
It’s asking shareholders to back a €7.5bn cash call and trying to make it all look a bit better by pulling the old reverse stock split trick. Read more
Here’s a capital curio for investors in Credit Suisse’s Monday-announced CoCos issue.
It’s probably not a surprise that a transition from the Basel II to Basel III regulatory regimes might create some scope for capital confusion. But here’s a concrete example picked out by Cannacord Genuity banking analyst, Cormac Leech. Tier 1 common equity ratios under the supposedly-stricter Basel III could end up being bigger than the ratios under Basel II definitions for some banks during the transitional period. Read more
Morgan Stanley and Cerberus, the US private equity fund, have agreed to invest at least Y20bn ($194m) in Goodwill, a Japanese staffing company whose shares have been hit by a series of scandals. The deal could be worth as much as Y100bn, roughly the amount Goodwill owes to Mizuho, the Japanese bank, its main creditor. Mizuho is selling an undisclosed portion of its outstanding Goodwill loans to Morgan Stanley and Cerberus, part of which will be converted to equity. Morgan and Cerberus will pay Y9,000 a share for the new stock – well below Goodwill’s Wednesday closing price of Y26,400 but above its Feb 1 low of Y4,740. Read more