Restructuring

Och-Ziff truce and rejig are small mercies

6 Dec 2018

Daniel Och is finally giving up his pioneering listed hedge-fund creation. After massive value destruction and a power struggle, he is ceding control and a big ownership stake. The firm will also be taxed as a corporation, not a partnership. For investors, the road back is long.

GM top-tier reshuffle may both boost and backfire

29 Nov 2018

The $52 bln carmaker’s second-in-command Dan Ammann is taking the wheel at Cruise, the unit that makes self-driving vehicles. The ex-Wall Streeter is the right person to whip it into shape and prepare for a possible IPO. But GM boss Mary Barra is losing her chief problem solver.

Hello concentration, goodbye conglomeration

27 Nov 2018

United Technologies is splitting into three while also closing a deal that creates an aerospace-parts giant. Like DowDuPont and others, activists and a need for competitive heft leave companies little choice – though tariffs and economic concerns stole $96 bln UTC’s show.

Michelangelo deal is work of abstract art

23 Nov 2018

Chinese waste hauler Yulong Eco-Materials has decided to become an owner of paintings and gems instead. It’s paying $75 mln for the Italian master’s “Crucifixion” after it bought a $50 mln sapphire. Bringing art investing to public markets is a risky form of creative destruction.

GE may be canary in credit market’s coal mine

15 Nov 2018

The firm’s bonds tanked this week even as an asset sale briefly lifted its shares. That’s a warning shot for all credit investors. U.S. companies carry more debt than ever, and quality has deteriorated. Rising interest rates and slowing growth could make this a big problem.

GE eases blow with Baker Hughes share sale

13 Nov 2018

The $70 billion industrial company is selling a chunk of its 62 percent stake in the oil-services firm a day after it said it urgently needed cash. The timing isn’t optimal. But it is better to do something than nothing, and GE can test the waters while saving dignity.

P&G lathers up for a close shave

9 Nov 2018

The $230 bln consumer-goods giant is reorganizing into six groups, each with its own CEO. Boss David Taylor argues that’ll give them greater focus. But it also makes it easier to trim off any groups that fail to perform. Grooming may be first for the barber’s chair.

UK landlords’ lifeboat has a Debenhams-shaped leak

11 Sep 2018

As British retailers flounder, the groups that rent them floor space have been pointing to continuing robust demand for prime locations. Debenhams’ potential restructuring not only threatens a key source of rental income. It also undermines landlords’ main counterargument.

Greece needs a governance reboot

21 Aug 2018

International lenders forced Athens to clean up its banks. Yet non-financial companies and their boards are still often dominated by large shareholders. Better protections for minority investors would attract more foreign capital, and help the economy recover from its bailout.

Hammerson tinkering reflects strategic impasse

24 Jul 2018

The UK landlord needed to atone for an Intu deal U-turn and its spurning of a Klepierre merger. A buyback and flogging 1.1 bln pounds of assets doesn’t quite do so. The problem is that even at their lowly valuation selling more UK assets looks hard to do.

HNA’s market thaw provides only cold comfort

20 Jul 2018

Three listed units of the troubled Chinese conglomerate lost a combined $1.5 bln in value after long trading halts ended. It signals a lack of confidence about HNA’s restructuring plans as it regroups without its late chairman. Pity investors trapped by a 10 pct downside limit.

Steinhoff swaps sovereignty for a lifeline

19 Jul 2018

A debt deal with creditors means the scandal-hit retailer is close to removing the imminent threat of default. Lenders have to wait three years to get paid. But on paper they get a higher payout, a say on asset sales and returns that might otherwise go to shareholders.

John Malone could still snag iHeartMedia

10 Jul 2018

Even though lenders to the bankrupt U.S. radio operator snubbed his last offer, the media tycoon has a chance thanks to the potential for a merger with his own Sirius XM. As iHeartMedia edges toward a $20 bln debt restructuring, there should be room for a harmonious deal.

Telstra’s slashing falls short of a full strategy

20 Jun 2018

The $26 bln Australian telco will cut one in four jobs, sell assets and put infrastructure in a standalone unit that could raise fresh capital. CEO Andy Penn’s austerity beats past scattergun attempts at reinvention. But there is no clear growth plan to get investors fired up.

Rolls-Royce investors wisely keep the seat belt on

15 Jun 2018

The plane engine-maker aims to generate 1 pound of cash per share over the mid-term, quadruple this year’s estimate. Despite the bullish new target, shareholders don’t look to be pricing it in fully. A distant horizon and history of one-off costs explain why.

Rolls-Royce has partial flight plan to destination

14 Jun 2018

The UK engine maker announced plans to cut 4,600 jobs ahead of its investor day in London. The resulting cost savings are welcome. The bigger question for investors is how CEO Warren East can more than double free cash flow in under two years to hit his 1 billion pound target.

Deutsche Bank’s misleading CDS hide a wider truth

12 Jun 2018

The cost of insuring the German bank’s debt has doubled this year and unlike peers stayed elevated after recent Italian tensions. In the short term this doesn’t affect Deutsche’s funding as much as it might look. But it still highlights the weakness of the lender’s outlook.

Fixing Deutsche’s retail bank is the easier part

30 May 2018

New boss Christian Sewing wants the German lender’s domestic unit to earn an economic return by 2021. That’s doable as long as Postbank delivers promised savings of 900 mln euros a year and higher interest rates help. It’s less daunting than turning around the investment bank.

Deutsche Bank de-flabbing cuts to the bone

24 May 2018

The German lender plans to cut more than 7,000 jobs by 2019, including a one-quarter reduction in equities trading headcount. It’s a bold move by boss Christian Sewing to get costs to 22 billion euros. It could also end up damaging Deutsche’s more profitable investment banking businesses.

Latest M&S overhaul lacks a clear price tag

23 May 2018

The UK retailer will close 100 stores in an attempt to reverse falling like-for-like food and clothing sales. The revamp, sped up by new Chairman Archie Norman, set the group back half a billion pounds last year. With few details about future costs, investors can shop elsewhere.