Australia

New backer would fuel Aussie hydrogen hype machine

25 Jan 2022

Fortescue’s ambitious plans to use the gas for renewable energy help it trade at a premium to mining peers. Scant detail raises concerns, however. Chair Andrew Forrest could ease them by selling a stake in the FFI green unit, as GM and Ford did with their self-driving outfits.

Serbia’s Rio smash dents EU electric-car dream

21 Jan 2022

The Balkan state nixed the $120 bln miner’s lithium project on environmental grounds. A looming election and spat over tennis ace Novak Djokovic didn’t help. Belgrade’s status as an investment destination is at stake. So are European hopes for reliable local battery ingredients.

Crown plays its cards well with Blackstone

13 Jan 2022

The embattled Aussie casino empire is ready to drop its poker face and back the buyout firm’s fourth bid, sweetened to $6.4 bln. Blackstone’s impressive turnaround track record in hospitality deals leaves it well-placed to maximise returns, even after the multiple price hikes.

Aussie proxy reform is wolf in sheep’s clothing

7 Jan 2022

The government is foisting new rules on firms like Glass Lewis and ACSI that offer voting advice for shareholder meetings. Some changes make sense, and one bad idea has been dumped. But on balance they go too far in some areas and not far enough in others.

The Aussies are coming! The Aussies are coming!

5 Jan 2022

Two pension fund managers Down Under are buying a New Zealand hospital chain for $500 mln. It’s a small sign of things to come. As the country’s $2.4 trln superannuation sector grows, consolidates and invests more directly, it will sail beyond the Tasman Sea for takeover targets.

Climate M&A will shift from risk to opportunity

29 Dec 2021

Defensive and green-signalling plays dominate ESG-touted deals, like BHP’s coal sales and Santos’ Oil Search swoop. SPACs are active, too. Next will be more ambitious, impactful tie-ups, from banks upping their skills to firms like Autodesk and Ecolab being predator or prey.

Capital Calls: Enel’s payments punt

24 Dec 2021

Concise views on global finance: The 70 bln euro utility is paying up to 361 mln euros for a relatively pricey punt on fellow Italian payments firm Mooney.

Rio and BHP wrestle with green M&A conundrum

22 Dec 2021

The two rivals are fighting over access to battery metals, including stakes in volatile startups. BHP just withdrew from a pricey battle for a wannabe nickel maker, but Rio is pressing on with an $825 mln bid for a nascent lithium firm. Investors are wise to be wary.

The Exchange: Australian Treasurer Josh Frydenberg

21 Dec 2021

With an election looming early next year, the Liberal Party’s deputy leader discusses everything from booster shots to Big Tech, climate change to China, immigration to inflation, and more. He tells Jeffrey Goldfarb how his country can overcome the many economic challenges ahead.

Rio Tinto’s new chair is an odd change agent

20 Dec 2021

The $105 bln miner has appointed Dominic Barton to run its board. China experience fits well with managing Rio’s key relationship, but scandal tainted McKinsey while he ran the consultancy. For a group trying to move on from its own controversies, it’s a strange choice.

Aussie climate ambition will restart at ballot box

20 Dec 2021

The $1.4 trln economy has all it needs to be an energy-transition leader, except a proactive government. The 2022 election will change that, making independent, global warming-savvy candidates the kingmakers. Stronger policy also will be lucrative for domestic and export markets.

Kidney transplant endangers healthy CSL

14 Dec 2021

The Australian flu-vaccine maker will buy Swiss nephrology specialist Vifor for about $12 bln in cash. It’s paying a 60% premium for a weaker peer and doesn’t expect much in the way of cost savings. The mid-pandemic diversification hardly justifies this elective M&A procedure.

Rio Tinto Mongolian hardball ends up looking soft

13 Dec 2021

The $105 bln miner has offered to write off a $2.3 bln loan to Ulaanbaatar linked to the Oyu Tolgoi copper project. Boss Jakob Stausholm is giving up billions of dollars in interest. But holding firm risked the company being chucked off a project that could bring in a lot more.

Fortescue unearths transition leadership challenge

10 Dec 2021

The Aussie miner’s CEO will step down, a year after Chairman Andrew Forrest unveiled his bold green-hydrogen plans. Straddling iron ore and new energy is no easy feat. Others trying to remake themselves for a new era also will wrestle with finding the right person for the job.

CSL’s Swiss drug punt looks like a bad trip

2 Dec 2021

The $99 bln Aussie jab maker is in talks to buy iron-deficiency specialist Vifor for around $7 bln. CEO Paul Perreault has a track record of strong growth and winning M&A. The prospect of subpar returns and a looming patent expiry suggest his golden touch is losing its lustre.

Pharmacy bidding war stands to get more feverish

2 Dec 2021

Aussie supermarket chain Woolworths has offered 13% extra to buy Priceline owner API over an agreed deal with Wesfarmers. The premium now stands at a whopping 53%. Deep-pocketed buyers, a frenzied M&A market and the implied returns are a prescription for additional sweeteners.

Blackstone’s raise makes it time for Crown to fold

19 Nov 2021

The buyout firm is back with a sweetened $6.2 bln bid for the embattled Aussie casino empire. Other suitors have fallen away, making the 26% premium even more appealing. The new management team and shareholders are better off letting Blackstone gamble with its lodging reputation.

Australia deserves to pay climate risk premium

18 Nov 2021

Canberra adopted a net-zero emissions target mainly to keep the country from being punished by investors. Its newly released assumptions on electric vehicles, mining and more confirm a lack of seriousness in the plan. Sustained pressure from fund managers could make a difference.

Bitcoin miner’s green patina is fool’s gold

17 Nov 2021

In a somewhat novel twist for the power-sucking cryptocurrency business, Iris Energy relies mainly on renewables. That probably helped boost its valuation in a $1.6 bln IPO, but it feels like style over substance. And the climate hype cannot mitigate some serious risk factors.

Electric-vehicle deals get racier than ever

10 Nov 2021

Even more revealing than Rivian’s immodest IPO price is the $1.4 bln sale of battery-powered-van maker Cenntro to a lingerie merchant. The SPAC-like transaction models rather flattering growth curves. Only in a risqué market could there be a hint of logic to such naked ambition.