Industrials

GE’s new boss may find inspiration from Honeywell

21 Jul 2017

Jeff Immelt’s weak earnings swan song underscores the challenge for John Flannery atop the $222 bln industrial giant. Making quick progress on early goals is key, as Darius Adamczyk is doing several months in at Honeywell. With activists in both stocks, it should be a no-brainer.

ACS and Benettons pitch patriotism against brawn

21 Jul 2017

The Spanish construction firm is eyeing a bid for toll-road operator Abertis, rivalling a 16 bln euro offer from the Benetton family’s Atlantia. ACS is smaller and has less firepower, though would keep Abertis Spanish. But the financial logic of a bid is stretched, whoever wins.

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.

Elliott renews totemic siege of Dutch boardrooms

7 Jul 2017

The U.S. hedge fund has launched a new legal bid to dismiss Akzo Nobel chair Antony Burgmans. The move may not revive the Dutch group’s sale to PPG that Elliott wants. Yet after defeat in a separate case, it shows activist investors haven’t given up on the Netherlands just yet.

Philips deal healthier for patients than investors

28 Jun 2017

The Dutch healthcare equipment maker is buying loss-making US rival Spectranetics for more than 6 times next year's revenue in a $2.2 bln deal. Ramping up expertise in treating cardiac disease makes strategic sense, but the high price adds unhealthy financial side-effects.

London fire hits at Arconic’s weakest spot

27 Jun 2017

Fear of lawsuits over cladding involved in a deadly high-rise fire knocked the company’s stock. The blow to its image may compound the damage. A recent proxy fight revealed an insular corporate culture. With only an interim management, Arconic will struggle to contain the crisis.

Germany can jump growth hurdle courtesy of Brexit

27 Jun 2017

Europe’s biggest economy is expanding so quickly that there’s a growing dearth of skilled labour. The shortage may be severe enough to depress the long-term growth rate, the Bundesbank says. One way to plug the gap is to attract EU workers who no longer feel welcome in Britain.

Italian shipping deal torpedoes single market myth

16 Jun 2017

French President Macron is griping over Italian shipbuilder Fincantieri’s bid to buy a stake in a French firm. The deal could create an EU champion, but compromise French jobs. Macron is a fervent believer in Europe – but domestic concerns don’t sit easily with idealism.

Hexagon would be a pointy-edged takeover target

14 Jun 2017

At a price of almost $20 bln, the Swedish manufacturing software group offers a poor return for a buyer. That may not deter a rival such as ABB tooling up for the switch to automated factories. If globalisation goes into retreat, such a deal could even prove forward-thinking.

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.

Franco-British laundry deal hinges on spring clean

8 Jun 2017

French group Elis is forking out 2.2 bln pounds for struggling UK rival Berendsen. A 45 pct premium secured the support of the target’s board but gives the buyer a measly 6 pct return on capital. The deal only creates value if the new owner has a plan to clean up its purchase.

Private equity bets water will wash its face

6 Jun 2017

Clayton, Dubilier & Rice is paying $2.5 bln for Waterworks, HD Supply’s pipes, sewer, storm and fire unit. It’s a wager on the need for upgrades to U.S. infrastructure – and in a sector where dealmaking is coming to a boil. That should give CDR options to engineer a clean exit.

Linde-Praxair back Big Gas, investors don’t yet

2 Jun 2017

Both gas-makers’ boards have approved their $74 bln transatlantic merger. Even Linde’s sceptical worker representatives backed down. Yet shareholders aren’t pricing in the benefits of the tie-up. They may be partly right, but at least neither side is putting cash on the table.

Akzo is emblem for new “fortress Europe”

1 Jun 2017

The Dutch maker of Dulux paint thwarted a generous 25 bln euro takeover attempt from U.S. rival PPG without putting forward a convincing financial defence. As European governments reach for more power to fend off unwanted mergers, Akzo has shown how shareholders can lose out.

Safran engineers itself halfway out of a hole

24 May 2017

The French engine maker has re-sculpted its offer for hapless peer Zodiac. The price has been cut by around 15 percent to $7.7 billion, and some of the original bid’s complexity is ironed out. The main unresolved issue: a bad investment now looks like a mediocre one.

Elliott’s hard work is just starting at Arconic

22 May 2017

The activist fund’s deal ending its bitter fight with the car- and plane-parts maker strengthens its grip on the board. It also puts one of its picks into the ring to be CEO. That shifts Elliott’s role from attacking poor results and governance to showing it can improve them.

Clariant-Huntsman tests formula for big M&A

22 May 2017

The $14 bln Swiss-American chemicals merger stacks up strategically, is fairly priced and could create $2.6 bln in post-tax savings. Yet the market initially factored in only half of the upside. The unpredictability of antitrust vetting and U.S. politics may explain the gap.

French laundry’s $2.6 bln UK raid leaves stains

18 May 2017

Berendsen has rejected a cash-and-share bid from French rival Elis that values the British group at a 36 pct premium. The approach looks opportunistic given the weak pound and the target’s battered share price. Even so, Elis will barely cover its cost of capital.

Viewsroom: CEO presidency needs boardroom pushback

17 May 2017

Donald Trump’s promise to run the government like a business is proving difficult but Congress could act like strong independent directors to rein in his wayward management.  China’s ambitious Silk Road project could leave its people holding the bag. Plus: job cuts at Ford.

France makes life too easy for pushy bosses

12 May 2017

Vivendi, Christian Dior and Safran are all doing complex deals driven by big shareholders’ interests – and minority investors can’t do much about it. Muting dissent is meant to make French companies more nimble. It does, but at the cost of helping insiders get their way.