Deals

Gulf bank’s growth push takes wrong turn in Turkey

21 May 2024

After briefly pursuing StanChart last year, First Abu Dhabi Bank may now pay $8 bln for 61% of Istanbul-based Yapi Kredi, Reuters reported. Deepening Turkish-UAE trade links offer a thin rationale. A high price, volatile lira and lack of cost savings make the deal a bad idea.

Chevron has chance to save doubtful Hess deal

17 May 2024

If Hess shareholders are sensible they will vote down Chevron’s uncompelling $51 bln offer. The premium is small and closure is uncertain. Besides, Hess’s offshore crown jewel in Guyana may be gaining in value. Chevron has a brief opportunity to up its game.

Hotpot IPO looks too mild without China spice

17 May 2024

Singapore-based Super Hi has distanced itself from its Chinese roots ahead of a $50 mln US offering. That's prudent, given scrutiny on companies like Shein and ByteDance. Yet without support from former parent Haidilao, the firm may struggle to stand apart from larger peers.

Oscar Mayer offers peek at how M&A sausage is made

16 May 2024

Kraft Heinz may offload the hot-dog and bologna maker as it refocuses on faster-growing fare in its pantry. The 140-year-old brand, potentially worth some $5 bln, already has been processed and repackaged by multiple owners. It’s largely a tale of changing financial tastes.

Czech tycoon gets a red-letter day, second class

16 May 2024

Daniel Kretinsky hiked his offer for the owner of Royal Mail to $4.4 bln. The board is minded to accept, even though International Distributions Services may be worth more. Yet IDS shares trade far below the bid, suggesting the UK government may find a way to block the deal.

Wood Group is parable for takeover-wary UK boards

16 May 2024

Shares in the energy-services group have languished since Apollo ditched a $2 bln proposed bid last year. The board is struggling to get a new suitor to match the old price. With UK firms facing record takeover interest, it’s a reminder that cash premiums are often hard to beat.

AMC is the worst, and best, of public markets

15 May 2024

The theater chain’s shares leapt 135% on the return of a key 'meme stock' cheerleader. It promptly swapped debt for bubbly equity. For aspiring CFOs, the idea that public markets can randomly spit out cheap capital is tempting. For everyone else, the trade is a loser.

Anglo breakup gives investors a free option on M&A

14 May 2024

The $40 bln miner plans to offload coal, diamond, nickel and platinum assets to help fend off takeover interest from BHP. The standalone strategy may be worth more to shareholders than what its Australian suitor proposed. Yet if it flops, a future takeover might be even easier.

Timid post-Covid tech cleanup begins with mini-LBO

13 May 2024

Website builder Squarespace is going private, the latest deal for a tech firm in a post-pandemic funk. A price of 20 times EBITDA looks more modest when accounting for investors sticking around and improving cash flow. Opportunistic dealmakers aren’t yet swinging for the fences.

BHP-Anglo impasse more about structure than price

13 May 2024

Anglo American spurned an improved $43 bln bid from its Australian rival. A key obstacle is that BHP wants its target’s investors to bear the risks attached to spinning off unwanted South African units. CEO Mike Henry can remove it by making an offer for the whole company.

Geely’s $5 bln carve-out slows down to speed

13 May 2024

The automaker's electric-vehicle unit Zeekr rose 35% after pricing its IPO at less than half its 2023 valuation. That suggests group Chair Li Shufu has learned from his overpriced deals to take Lotus and Polestar public and found a way to coax investors wary of China risk.

Peloton buyout would involve both pain and gain

10 May 2024

The exercise company might struggle to get funding for an LBO given it has little cash flow. But if lenders believe a turnaround story, decent returns are possible. Plus Apple might be a ready buyer in a few years. For private equity firms, returns and exits are a welcome rarity.

Rio Tinto may be dark horse in BHP-Anglo saga

10 May 2024

The $120 bln miner may yet crash the Big Australian’s $39 bln merger. Still, if BHP does win Anglo and Glencore is busy integrating its $7 bln Teck deal, Rio’s key mining rivals will be distracted. That may give CEO Jakob Stausholm a clearer run at the likes of First Quantum.

Brookfield’s rose sits amid growing thorns

9 May 2024

The parent company’s $929 bln asset manager has a model rivals crave: a pure fee-earning machine with stable income. Yet it sits amid a web of listed entities and its fee structure is getting complex. As deals come to the fore, its unusual model will weigh on valuation yet again.

EQT strikes a deal for post-Covid tech hangover

9 May 2024

Despite a 75% premium, the buyout shop’s take-private of IT consultancy Perficient values it on par with peers thanks to a sagging share price. The collapse of giddy Covid-era tech valuations and deals has lingered enough for some buyers to swoop back in without overstretching.

BBVA’s hostile $13 bln M&A bet faces long odds

9 May 2024

Chair Carlos Torres Vila is going ahead with his all-share offer for Sabadell despite a rebuff from the smaller Spanish bank’s board. Yet Madrid firmly opposes a deal, and BBVA’s sliding stock is denting the bid’s appeal. Success seems unlikely.

Sumitomo offers a glimpse of activism future

8 May 2024

The shares of the powerful $34 bln trading house surged on Warren Buffett's support. US investor Elliott is using the momentum to squeeze more value out of the company. The next big targets for pushy investors in Japan are marginal, not blatant, underperformers.

Spanish minnow upsets EU bank bosses’ M&A dreams

7 May 2024

Sabadell rejected BBVA’s 12 bln euro proposal, citing its strong standalone prospects. If the boards of other small lenders feel the same, it’s hard to see more deals. That’s a shame, particularly since UBS’s rescue of Credit Suisse is demonstrating the value of consolidation.

Cotton gins up competitive M&A spirits

7 May 2024

Louis Dreyfus and Olam have between them made five bids for Australia's Namoi Cotton. And the two commodity trading giants may yet go a few more rounds. The $120 mln deal may be a small battle, but it can set the tone for the broader market. The trick is not to get carried away.

Green spending strain boosts infrastructure buyers

6 May 2024

GIP, soon to be part of BlackRock, is buying Allete, an energy firm that is set to spend over $4 bln on clean power. Listed utilities’ funding costs are rising while green upgrades demand big outlays, a tasty opportunity for infrastructure funds with $350 bln of capital.