EMEA

Inditex’s golden era is coming to an end

3 May 2024

Asian disruptor Shein is threatening the $142 bln Zara owner’s fast-fashion crown with ultra-cheap wares. Dismissing the risk may threaten its market share. To protect the Spanish giant’s business, CEO Óscar García Maceiras has plenty of cash but no obvious M&A solution.

France’s Atos entrée heads for fuzzy denouement

2 May 2024

The French state wants to buy the defence assets of the IT group, which is trying to restructure 4.9 bln euros of debt. It should then be easier to sell what’s left of Atos. But it’s unclear how or when Paris might marshal private buyers to recoup its outlay of up to 1 bln euros.

M&A-shy EU bank investors are own worst enemy

2 May 2024

BBVA’s shares fell 8% over three days after it pitched an all-share acquisition of $10 bln Spanish rival Sabadell. But the returns look good, and the combined group’s capital ratio will remain high. If investors sink this deal, other CEOs in the fragmented sector may think twice.

Shrunken Vodafone has narrow path to growth

2 May 2024

The $24 bln telco’s stock is down since CEO Margherita Della Valle sold the slow-growing Spanish and Italian units. Outside core and mature UK and German markets, hopes for growth rest on corporate clients and Africa. That may not be enough to close Vodafone’s valuation gap.

Unilever and Nestlé offer two flavours of India

2 May 2024

Weak rural demand ate into earnings at the $63 bln local unit of the Dove soap maker. By contrast, its smaller and more-richly valued Swiss rival grew profit thanks to a larger share of urban customers. The divergent fortunes point to the limits of the Indian consumer’s wallet.

Clash of the mining titans will get more bruising

2 May 2024

Australian giant BHP’s $39 bln swing for Anglo American is a contentious, complex land grab for the metals key to a renewable future. In this Viewsroom podcast, Breakingviews columnists discuss the political and financial hurdles, and why this M&A contest has a way to run.

Hurricanes threaten to stir perfect economic storm

1 May 2024

Warmer oceans portend an unusually fierce 2024 season in the Atlantic, with two states already propping up their home insurance systems. The nightmare scenario is $200 bln of losses. Insolvencies would be a problem, but not as big as exorbitant premiums and lower property values.

EU bank holdouts are playing with fire in Russia

1 May 2024

Two years after the invasion of Ukraine, lenders Raiffeisen and UniCredit still have sizable businesses based in Moscow. Fearing lack of scrutiny in a sanctions-hit nation, the ECB is ratcheting up pressure to leave. A costly exit looks suddenly preferable to penalties.

Anglo breakup costs complicate a sweeter BHP deal

1 May 2024

The miner’s Australian suitor is mulling a hike to its $39 bln proposal. But if Anglo American were to demerge its listed South African units as part of the deal, BHP or any other buyer might inherit a $2 bln tax bill. That may limit BHP boss Mike Henry’s scope for generosity.

Satellite union will struggle to defy gravity

30 Apr 2024

Luxembourg-based SES agreed a $3 bln cash acquisition of US rival Intelsat. The news wiped a fifth off the buyer’s shares. Investors thought they were getting a ton of cash from the lowly valued satellite operator, but instead they’re getting a deal with questionable returns.

Overdue $80 bln Spain bank merger has new hurdles

30 Apr 2024

BBVA broached an all-share deal with $10 bln Sabadell. The smaller lender’s valuation has improved since the same merger was discussed in 2020, which could make it easier for the board to agree a sale. Yet it also makes the sums harder for the buyer, whose investors are spooked.

Global retailers are headed for Shein reckoning

30 Apr 2024

Zara owner Inditex, H&M and other apparel giants are holding ground against the Asian fast-fashion upstart. However, AlixPartners’ retail expert Matt Clark argues in this Exchange podcast that Shein’s focus on garment quality could threaten the dominance of pricier rivals.

CEO departure puts HSBC at risk of strategy drift

30 Apr 2024

Noel Quinn is retiring from the $164 bln bank after less than five years in charge. If Chair Mark Tucker picks an internal replacement the new broom risks looking like a second choice. Appointing an outsider could leave HSBC without clear medium-term targets for a year or longer.

Von der Leyen’s China plan is all bark and no bite

30 Apr 2024

To keep her job atop the European Commission, Ursula von der Leyen will talk tough but wield a small stick towards Beijing. Open supply lines from the People’s Republic are key to Europe’s economic well-being. Brussels’ rhetoric will likely be harsher than sanctions and tariffs.

The Agnellis’ risky Philips bet starts to pay off

29 Apr 2024

The Dutch group settled its US faulty sleeping aid claims for a manageable $1.1 bln, lifting its stock 35%. The relatively quick fix vindicates Exor CEO John Elkann’s $3 bln punt on Philips when legal worries kept investors away. It may also shift the thinking on big litigations.

Sánchez’s psychodrama leaves Spain at loose end

29 Apr 2024

PM Pedro Sánchez is staying on after threatening to resign over a court probe into his wife’s dealings. He appears weakened before a series of elections, raising doubt on his ability to push for reforms and ensure the country remains the fastest-growing major European economy.

Petrol station tycoon picks poor time to exit Asda

29 Apr 2024

TDR may buy Zuber Issa’s 23% stake in the UK grocer, increasing its own holding. Since their 2021 deal Asda has repaid a big chunk of its debt, but market struggles mean it merits a lower multiple. The buyout shop’s consolation is it can drive a hard bargain on price.

Ukraine’s $61 bln lifeline is not enough

29 Apr 2024

The United States last week cleared a vital aid package, but Kyiv still needs a medium-term funding plan to withstand Russia’s onslaught. Mobilising Moscow’s $320 bln of frozen central bank assets to provide compensation for war damages should be central to this.

Thoma Bravo UK cyber deal looks a little too good

26 Apr 2024

The buyout firm finally agreed a takeover of long-term target Darktrace, an IT security specialist. Despite the generous-looking 44% premium on offer, the buyer’s returns seem juicy given a nascent US push. That may raise the chance of shareholders asking for more money.

BHP investors throw CEO too short an M&A leash

26 Apr 2024

The miner’s stock fell 4.6% after the company proposed to buy Anglo American at a $39 bln valuation. It suggests shareholders fear boss Mike Henry will end up overpaying. But with his low-ball opener leaving plenty of wriggle room to justify upping the bid, that looks premature.