Conglomerates

Honeywell puts Dan Loeb in his place

10 Oct 2017

The conglomerate is spinning off two small, low-margin risky businesses rather than the aerospace unit the activist had targeted. It’s a smarter way for new CEO Darius Adamczyk to improve returns without much pain, especially on top of the better margins he’s already producing.

GE needs Nelson Peltz’s help – and takes it

9 Oct 2017

The $200 bln U.S. industrial giant, now with a new CEO, still seems unable to get people excited about owning its shares. A board seat for the activist investor’s top lieutenant may help. It’s a contrast with P&G, which is resisting Peltz – potentially to shareholders’ detriment.

Cox: P&G counting on an investor electoral college

6 Oct 2017

There's no strong reason for the insular consumer-goods titan to deny Nelson Peltz a board seat. Hedge funds will back him, but as in U.S. elections only half the retail shares may vote. That leaves Vanguard, BlackRock and State Street to play Wisconsin, Ohio and Pennsylvania.

Siemens and Alstom put European engine on track

26 Sep 2017

The German firm is merging its rail unit with its French rival. It's a deal that has long made strategic sense but stumbled over turf issues. That the two countries are pulling it off after Angela Merkel’s election setback suggests fresh steam for the continent's political unity.

United Tech avionics bid may start bigger dogfight

7 Aug 2017

The $95 bln conglomerate is mulling an offer for Rockwell Collins, right after Boeing’s margins-sapping entry into the business. Honeywell is under pressure to sell its unit. The combination of earnings and activist pressure leaves aviation executives with some tough choices.

Brazil pork mongers find comfort in flip-flops

31 Jul 2017

Selling trendy sandal maker Alpargatas to wealthy banking families will help meatpacking-to-pulp firm J&F pay a huge fine for bribing politicians. The original purchase, from a company also embroiled in scandal, is being probed by authorities too. It's a Brazilian microcosm.

Free phones power Mukesh Ambani’s tech ambitions

21 Jul 2017

India's richest man has seriously upped the ante in the country’s mobile war. His Reliance Jio network is offering free internet-enabled handsets, potentially reaching 500 mln more people. A strong oil refining business means he can worry about recouping the investment later.

Peltz goes for the close shave at Procter & Gamble

17 Jul 2017

Unlike his last proxy fight at DuPont, the activist is taking a more surgical approach, lobbying for one board seat at the $223 bln razors-to-detergent conglomerate. Trian is also supporting management and not calling for a breakup. Shareholders would be daft to turn him down.

Refiner uses crude tactics in Japanese M&A tussle

4 Jul 2017

Idemitsu’s bosses are trying to clinch a merger with a rival, over objections from Idemitsu’s own founding family. Diluting the family through a $1.2 bln share sale is a value-destructive workaround. The move reflects corporate Japan’s disdain for investor rights.

GE’s CEO choice pushes the boundaries

12 Jun 2017

By anointing John Flannery to succeed Jeff Immelt the industrial titan is doubling down on a strategy that transcends its U.S. roots. Flannery knows restructuring and has run GE units from India to Argentina. Geographically and structurally, the company's lines may be redrawn.

HNA slowdown makes financial and political sense

5 Jun 2017

The Chinese conglomerate plans less M&A this year, after spending tens of billions of dollars on everything from aircraft leasing to a stake in Deutsche Bank. That should let managers get a handle on their vastly expanded empire. It’s a good time to adopt a lower profile, too.

HNA sees Value in connecting East and West

23 May 2017

The deal-hungry Chinese conglomerate reportedly wants to buy into Value Partners. The $2 bln fund manager trades on a lofty percentage of assets under management, thanks partly to high fees. Still, if HNA wants to link Chinese investors with the wider world, this could be handy.

Toshiba pays price for bad Japanese habits

11 Apr 2017

The energy-to-electronics giant says there is doubt about its survival, with shareholders' equity going negative and further huge exposure to bankrupt nuclear-construction unit Westinghouse. Conglomerate sprawl, weak governance and ill-judged overseas M&A all played their part.

Toshiba’s $18 bln sell-off breaks the mould

3 Apr 2017

Foreigners rarely get to buy big Japanese outfits. Even when they do, the company is either in deep trouble or at least needs some attention from a new owner. Toshiba's memory chip unit is a huge, healthy business in a concentrated market. No wonder bidders are queuing up.

Empire-building sets HNA on a risky trajectory

3 Apr 2017

The Chinese travel firm has snapped up land, hotels, leasing firms and even part of Deutsche Bank. These are just opening gambits by an outfit aspiring to own trillions of dollars in assets. Diversifying is all well and good - provided it does not end in a hard landing.

Fosun may hit M&A trail again after CEO leaves

29 Mar 2017

The co-founder of Club Med’s Chinese owner suddenly quit, citing health reasons. He had helped improve the insurance-to-leisure giant's finances. Power is now concentrated with acquisitive chairman Guo Guangchang. A new deal binge could unsettle both creditors and shareholders.

Li Ka-shing sails through choppy global seas

23 Mar 2017

The Hong Kong tycoon’s CK Hutchison saw net profit rise 6 pct in the full year. That is impressive given stuttering growth at home and Brexit pains. Globally, the allure of conglomerates is fading. But the results vindicate the East-West strategy of Asia's "superman".

Sceptics of Vodafone’s Indian merger have a point

21 Mar 2017

A big merger of the British telco's India unit with Idea Cellular should create $10 bln of synergies. Yet Idea investors are pricing in barely one third of the benefits. It underscores fear that the new entity will not be in a much better position to take on cut-throat rival Jio.

Toshiba has bigger headaches than share stigma

15 Mar 2017

Relegation to a lesser section of Tokyo's stock market would be humiliating, and prompt some forced selling. A delisting would hit investors harder. Whatever happens to the shares, management has more existential problems to fix, especially in its nuclear unit.

SoftBank loses focus with $100 bln Vision fund

9 Mar 2017

The Japanese giant may inject an $8 bln stake in chip designer ARM into the tech fund, at the behest of the latter. Other recent buys will also be offered. That would help SoftBank pare debt. But the benefits of Vision are tainted by a related deal frenzy and murky relationship.