Industrials

Capital Calls: Schneider’s sustainable CEO

16 Feb 2023

Concise views on global finance: Jean-Pascal Tricoire’s departure as chief executive of the French industrial software group after nearly two decades at the helm defies the trend of short-lived or underperforming corporate bosses.

European gas savings success hides darker reality

27 Jan 2023

Spurred by soaring prices, the continent used 12% less of the fossil fuel in 2022. Despite a push to conserve energy, much of the drop was due to companies switching to other pollutants or shutting plants. Gas-hungry sectors like chemicals and steel face a protracted struggle.

Adani’s buy now, pay later fundraise could sting

26 Jan 2023

The world’s third-richest man Gautam Adani won anchor investor backing for a $2.4 bln share sale by his flagship company, including from Abu Dhabi’s wealth fund. Yet an Adani group selloff resulting from a short attack means terms that were meant to reward buyers could hurt them.

German economic engine is due an overhaul

23 Jan 2023

Slowing global trade hit the country’s exports while higher energy prices boosted imports. The current account surplus shrank last year to 4% of GDP, its lowest level since 2003. As globalisation recedes, Berlin has to reassess the old export-led economic model.

Orsted increasingly merits its investor blowback

20 Jan 2023

The $38 bln Danish wind farm group flagged lower-than-expected 2023 targets as its key offshore arm struggled. Shareholders always granted Orsted a premium valuation, due to growth expected from new projects. Construction delays and rising rates are putting that in question.

Emerson’s hostility tests aggressive M&A tools

17 Jan 2023

Disclosing its unsolicited $6.9 bln offer for NI ends a quiet eight-month standoff. Going public forces the issue, but along with the target’s strategic review also inflates the price. A bid battle threatens the potential value of a deal and may inform takeover tactics elsewhere.

Cheaper gas is temporary salve for Europe Inc

9 Jan 2023

Warm winter days and enough reserves to offset Russian imports have halved the fuel’s cost. Yet Europe’s energy security also hinges on abundant liquefied natural gas purchases. As China’s fuel-guzzling economy reopens post-Covid, industrial giants like BASF may still suffer.

Chip mergers are more urgent and awkward in 2023

5 Jan 2023

Western Digital has revived talks with Japan's Kioxia after efforts for a $20 bln deal stalled in 2021. Price wars plague sales of semiconductors storing data and M&A can help as demand plunges. The duo will have to be creative to convince politicians fretting about chip wars.

GE healthcare spinoff gets unduly glum prognosis

4 Jan 2023

The industrial giant’s newly listed MRI-to-ultrasound division flatlined on its debut as a $25 bln listed company, trading 40% below what peer valuations would suggest it’s worth. A discount plagues parent GE too. The apple hasn’t yet fallen far enough from the tree.

Friendshoring makes sense if done in the right way

5 Dec 2022

The United States and its allies want to build up suppliers of goods such as solar panels in friendly countries so they’re not vulnerable to Chinese disruptions or blackmail. To avoid self-harm they should define friends broadly and not attack China economically, says Hugo Dixon.

Capital Calls: Fuzzy Fedspeak, Dr. Martens

24 Nov 2022

Concise views on global finance: The U.S. central bank has left traders guessing the meaning of the word “various”; shares in the recently listed British bootmaker fell 20% after sales missed expectations, and a warning that its investment needs will hurt profitability.

Nickel IPO puts Jakarta at centre of China EV boom

23 Nov 2022

China’s Lygend Resources, a trader-turned-producer of critical battery ingredients, is eyeing a $600 mln Hong Kong listing. A huge presence in Indonesia gives it an edge over rivals at home, where supply is scarce. That should help the company navigate a bumpy stock market.

Capital Calls: Japan baulks at U.S. car credits

7 Nov 2022

Concise views on global finance: Tokyo warns America’s Inflation Reduction Act could discourage Japanese investment into the world’s biggest economy.

Capital Calls: Ocado in South Korea

1 Nov 2022

Concise views on global finance: The $6 bln online grocer’s shares surged almost 40% after it announced a partnership with Lotte Shopping, showing that its strategy of building warehouses for global supermarkets may have legs.

Europe’s industrial mess has protectionist endgame

26 Oct 2022

Manufacturers like Germany’s $42 bln BASF face a toxic brew of high energy prices at home and rising risks in China. That implies a freeze on new investment, and a loss of market share to foreign players. To stop that, European states may ultimately intervene with tariffs.

GE is hurting but Larry Culp’s legacy has hope yet

25 Oct 2022

The $80 bln industrial conglomerate’s renewable business dragged on earnings. Free cash flow is falling, and the company cut earnings guidance. But a $370 bln U.S. spending package should help. And CEO Culp is about to head up the aerospace division, GE’s only bright spot.

Beware spins from Danaher’s well-oiled M&A machine

4 Oct 2022

The $200 bln conglomerate plans to separate yet another division, this time packaging and water filtration. Its acquisition nous generates strong returns, but recent castoffs have disappointed. Transferring the parent’s kaizen-based system to its progeny is proving difficult.

South Korea gets short end of U.S. trade stick

3 Oct 2022

Seoul wants to sell more chips and other goods overseas, but Washington is luring Samsung and compatriots to make in America. A trade deficit and crashing won offer a glimpse at what a U.S. revival in high-tech manufacturing means for the $1.8 trln trade-dependent Asian economy.

Capital Calls: ECB rate hike

8 Sep 2022

Concise views on global finance: Europe’s central bank risks recession to combat inflation.

Capital Calls: Schneider/Aveva

24 Aug 2022

Concise views on global finance: The $73 bln French group tries to benefit from its UK unit’s falling share price to bring it in-house.