Air Transportation

BAA bondholders may skewer Ferrovial

22 Jun 2006

The Spanish group may have to buy back some of BAA's bonds at a fat premium because of the leverage it plans to load on the UK group. It is sometimes possible to negotiate around such clauses. But Ferrovial s highly geared bid makes bondholders likely to press for an exit.

Eads share sales require rigorous investigation

16 Jun 2006

The boss of the aerospace group says it was an unfortunate coincidence that executives sold shares ahead of a profit warning. Perhaps. But the French authorities need to establish exactly when the A380 delays first came to light. And if the board wasn t told, why not.

Ferrovial locks out Goldman in BAA battle

6 Jun 2006

The Spanish construction company s consortium has secured BAA s recommendation for its 950p offer and bought 14% of the UK airport operator. That makes life very difficult, but not impossible, for rival bidder Goldman.

Ferrovial’s dawn raid on BAA looks to have failed

2 Jun 2006

Nice try. If Ferrovial had managed to buy 14% of the British airports operator, it would have locked out rival bidders. But trading volumes suggests it managed to get less than 5%. As a result, the battle for BAA remains wide open.

BAA rejects more credible offer from Ferrovial

30 May 2006

It s one thing turning the Spanish construction group down at 810p a share. But at 900p, it s getting harder to justify. It may not be the more than 940p BAA was gunning for. But that was always an ambitious target.

OFT throws spanner in BAA bid battle

25 May 2006

The UK competition watchdog's review of the airport market could conceivably lead to a breakup of BAA's monopoly. It may undermine BAA's value. But it could also deter Ferrovial from sweetening its hostile bid.

Air Berlin does a high-cost IPO

16 May 2006

The low cost carrier spent 17% of its IPO proceeds on fees the bulk on advertising, even picking up investors tax bills. The aim was to woo retail investors. But they were conspicuous by their absence, making up only 10% of the deal.

German bosses may get their contracts cut

9 May 2006

The nation s corporate governance commission is reportedly proposing to cut senior executives contracts to three years from five. Bravo. But if firms tepid response to the voluntary disclosure of bosses pay is anything to go by, only a new law will end the golden handshakes.

Air Berlin is being too greedy

5 May 2006

Investors shunned the budget airline s IPO, forcing it to extend the offer period until next week. But that alone won t fill up order books. The loss making carrier might not make a profit this year as competition is fierce. It'll have to scale back the IPO to attract buyers.

BAA delivers flimsy defence plan

3 May 2006

The UK airports operator rightly believes Ferrovial s current bid doesn t deserve a stronger defence plan. But BAA can t afford to sit on its hands. Sooner or later it may well have to beef up its defences.

Austrians bail out Bawag

2 May 2006

It was the attempted coverup that brought on the liquidity crisis. Ironically, it was not the huge losses it made on derivatives trades that nearly sunk Austria s fourth largest bank.

Air Berlin IPO should fly – at a 25% discount

26 Apr 2006

The lowcost carrier has made a loss for the last 2 years as competition stays cutthroat and fuel prices high. Not the best IPO backdrop. But sales are growing well as Air Berlin opens up new routes to Eastern Europe. At a 25% discount to Easyjet, the IPO should fly.

Ferrovial could gear BAA to the hilt

13 Feb 2006

Given BAA's utilitystyle cashflows, Ferrovial could borrow £12bn against it close to the £14.6bn they'd need for a 900p a share offer. True, BAA's costly expansion plans could be a problem. But Ferrovial's seasoned financial engineers could park these offbalance sheet.

BAA shouldn’t change its E2.9bn bond deal

10 Feb 2006

Bond investors are up in arms because Ferrovial s highly leveraged approach to BAA has caused bonds to fall in value. They now want a change of control clause inserted into the deal, but doing so would be a poison pill that isn t in shareholders interest.

BAA gives in on bond deal

10 Feb 2006

In agreeing to insert a changeofcontrol clause into its recent E2.9bn bond, it may seem that the group is selling shareholders short. But the bondholders have been able to argue that Ferrovial s leveraged approach to BAA gave them the ability to wriggle out of the deal.

Ferrovial mulls ballsy £8.5bn BAA bid

8 Feb 2006

It won t be easy for Spanish construction group to have its way with the UK airports group. BAA won t go down without a fight. And Ferrovial will need to find friends with deep pockets to foot the bill.

UAL’s return to the market could hit turbulence

2 Feb 2006

UAL s shares have recently traded at almost three times its bankruptcy valuation. But at this price, the airline is valued at a premium to its peers. It will have a hard time justifying it.

Bankrupt US bosses enjoy big paydays

24 Jan 2006

UAL's will share $480m when the airline exits Chapter 11. That appears repugnant yet bosses deserves a premium for staying put. The trouble is that it has to be paid on top of the already excessive levels of executive compensation at US companies.

Alitalia bankruptcy a pipe dream

24 Jan 2006

Italy s labour minister says bankruptcy may not be a disaster for Alitalia. He is right. In most industries, Alitalia would have been sold or shuttered years ago. But that won't happen while the government keeps writing cheques.

Don’t rule out a bid for Easyjet

10 Jan 2006

Easyjet shares may be at 400p, but the Icelandic group stalking the budget airline could pay more than 500p without destroying value. That might not get Stelios dashing for the exit, but the board would find it hard to ignore if minorities were keen.