Mergers & Acquisitions

Old rich send message to Zuckerberg’s ilk

30 May 2012

Acquainted for five decades, the Rothschild and Rockefeller patriarchs are finally launching a transatlantic investment alliance. It’s slower, quieter, more dispersed money than the Facebook founder’s. But it has staying power even hoodied tech billionaires may one day crave.

Private equity may owe Obama a debt of gratitude

30 May 2012

Mitt Romney has weakly rebutted the president’s attacks on his Bain Capital tenure. But others who see the good side of buyouts are gradually speaking up. Election-year mud-slinging could end up boosting the industry, especially if LBO firms themselves seize the moment.

Gavilon sale brings Ospraie happier crisis memory

29 May 2012

The commodities hedge fund has doubled its money with the $3.6 bln sale of the grain trader it bought from ConAgra in 2008. Co-investors including George Soros should also be pleased. And for Ospraie, which was nearly crushed as the crisis unfolded, it’s a cheerier bookend.

Japan’s $3.6 bln Gavilon buy goes with the grain

29 May 2012

Marubeni’s swoop on U.S. agricultural specialist Gavilon can be put down to a strong yen and commodity traders’ quest for scale. As long as China’s appetite for commodities keeps growing, so will M&A among its suppliers.

General Mills doubles down on Brazilian consumer

25 May 2012

The U.S. producer of Lucky Charms cereal and Yoplait yogurt has snatched privately-owned Brazilian-Japanese food group Yoki for some $1 bln, a move well timed with a weak real. The current economic slowdown aside, Brazil’s growing middle class is still attractive.

CIC investment could improve Alibaba’s prospects

25 May 2012

A possible $2 billion investment from China’s sovereign fund would help Alibaba fund its buyback of half of Yahoo’s stake. Alibaba can appear patriotic by becoming more Chinese. It might also help the group reclaim its valuable and politically sensitive payment division, Alipay.

SAP showers more cash on the "cloud"

23 May 2012

The German software giant is buying e-commerce outfit Ariba at a $4.3 bln enterprise value. A price of nearly 10 times last year’s sales looks rich - as did December’s $3.4 bln purchase of Successfactors. But SAP is desperate to keep up as clients shift to online applications.

Hot infrastructure auctions drive down returns

22 May 2012

Investors want big, predictable assets in the less rickety bits of Europe. While debt is cheap, there isn’t much for sale. So auctions like E.ON’s 3.2 bln euro sale of gas grids run pretty hot. Even if the bets are less extravagant than in the credit boom, returns will suffer.

Wanda goes fishing for cinema know-how

21 May 2012

The Chinese property giant’s $2.6 bln deal to buy AMC probably won’t bring “Beginning of the Great Revival” to 5,000 U.S. movie screens. If anything, it will help Wanda crack the burgeoning market for urban multiplexes back home. It also boosts the PRC company’s global profile.

Eaton-Cooper deal needs revenue synergies to work

21 May 2012

The U.S. industrial group’s $11.8 bln purchase of Cooper nearly defies the norm, where takeovers punish the acquirer’s shareholders. The net present value of future synergies is comfortably higher than the premium on offer, but only if additional sales are to be believed.

Barclays kills two birds with one Rock

21 May 2012

The UK bank is placing its 20 pct stake in BlackRock. Swapping shares in the asset manager for cash escapes new regulatory charges and boosts capital as the euro zone crisis hots up. But it’s a shame Barclays didn’t exploit stronger markets in March for this long expected trade.

Long-awaited Yahoo deal heaps pressure on Alibaba

21 May 2012

The Chinese e-commerce giant wants new investors to fund a $7 billion buyback of shares from Yahoo. Takers may include funds who just cashed in from Facebook’s IPO. But Alibaba’s valuation leaves little room for error. New investors will want growth and, one day, an exit.

Buffett’s investing gets sappy – read all about it

17 May 2012

The Oracle is doubling down on newspapers, buying 63 local rags. The cost is negligible for Berkshire, but Buffett’s thesis is behind online trends. Revenue may fall faster than he thinks, as other buyers have learned the hard way. The bet seems more about sentiment than value.

Brazilian meddling threatens shareholders, again

15 May 2012

Dilma appears to be widening her interventions from the industrial sector to the banks. Having ousted Banco do Brasil execs this weekend, it’s hard to miss the state’s hand in a worrisome plan for the bank to take control of troubled car-lender Votorantim. Investors, look out.

Avon punishes its own investors with its dawdling

15 May 2012

The cosmetics group’s hapless board compounded its enabling of failed former CEO Andrea Jung by offering a wishy-washy response to Coty’s compelling $10.7 billion merger offer. The deal is dead for now: No wonder shareholders’ mascara is running.

Qatar takes Shell friendship to next level

11 May 2012

Adding a stake in the UK oil major to holdings in Total, Xstrata and European Goldfields adds a degree of diversification to the emirate’s resource exposure. But strategic ties are strong. Qatar is home to two Shell projects. Formalising the relationship is a natural next step.

Coty’s freshened offer hard for Avon to resist

10 May 2012

The down-in-the-dumps U.S. makeup firm has until Monday to engage with Coty’s persistent advances. With the offer raised to $10.7 bln, the addition of Warren Buffett’s cash and blessing, and the possibility of a still higher price, Avon’s European suitor deserves a hearing.

Hong Kong’s LME bid is big bet on China flows

10 May 2012

Hong Kong’s bourse has joined the bidding for the London Metal Exchange. If it can attract more volume from China, that would make up for the lack of obvious cost savings. But Beijing may open up anyway. HK’s lack of metals expertise makes the move look ambitious.

Judges can be tough without getting personal

9 May 2012

Few can chill U.S. business spines faster than Delaware’s Leo Strine. He honors a tradition of tart lectures from the state’s bench. But his scolding of Martin Marietta and its spin doctors, though on target, sounded catty. Too much of that and he could leave his audience cold.

GSK’s hostilities may follow Genentech playbook

9 May 2012

Britain’s biggest drugmaker is bypassing the Human Genome Sciences board with its $2.6 bln offer - and has implied the price is firm. The GSK-HGS links probably rule out a white knight. But echoes of Roche’s 2008 tilt at Genentech suggest there may yet be a sweetener.