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Nov 10, 2011

Insight: Firms find it hard to think outside the euro

LONDON (Reuters) – German travel group TUI AG is going where the world’s biggest financial firms have yet to venture.

It has decided to protect itself from the risk that Greece could leave the euro zone by asking Greek hoteliers to sign new contracts which would apply if this were to happen.

Nov 10, 2011

Firms find it hard to think outside the euro

LONDON, Nov 10 (Reuters) – German travel group TUI AG is
going where the world’s biggest financial firms have yet to
venture.

It has decided to protect itself from the risk that Greece
could leave the euro zone by asking Greek hoteliers to sign new
contracts which would apply if this were to happen.

Nov 1, 2011

Special Report: In Japan, a foreigner speaks out

LONDON (Reuters) – Michael Woodford makes an unlikely fighter.

As he tucks his tie into his shirt and digs into a plate of Dover sole in a London restaurant, it’s hard to imagine that this down-to-earth 51-year-old Englishman is at war with one of Japan’s biggest corporations.

Woodford is taking on the leaders of Olympus Corp., one of Japan’s most venerable camera makers. He was made CEO of the company in early October. But two weeks later, on October 14, the board sacked him for what chairman Tsuyoshi Kikukawa said was Woodford’s failure to understand the company’s management style and Japanese culture.

Nov 1, 2011

In Japan, a foreigner speaks out

LONDON, Nov 1 (Reuters) – Michael Woodford makes an unlikely
fighter.

As he tucks his tie into his shirt and digs into a plate of
Dover sole in a London restaurant, it’s hard to imagine that
this down-to-earth 51-year-old Englishman is at war with one of
Japan’s biggest corporations.

Woodford is taking on the leaders of Olympus Corp., one of
Japan’s most venerable camera makers. He was made CEO of the
company in early October. But two weeks later, on Oct. 14, the
board sacked him for what chairman Tsuyoshi Kikukawa said was
Woodford’s failure to understand the company’s management style
and Japanese culture.

Oct 19, 2011

Olympus ex-CEO calls for Japan probe into fees

LONDON (Reuters) – The sacked chief executive of Olympus Corp (7733.T: Quote, Profile, Research, Stock Buzz) has written to Japan’s securities industry watchdog calling for an investigation into an “extraordinary” $687 million fee the company paid to advisers for an acquisition.

Michael Woodford told Reuters on Wednesday he had written to Japan’s Securities and Exchange Surveillance Commission (SESC) detailing his concerns over payments linked to the $2 billion purchase of UK medical equipment maker Gyrus Group.

Aug 12, 2010
via Breakingviews

Vedanta’s Indian oil interest is hard to fathom

Vedanta Resources’ Indian oil interest is hard to fathom. No doubt Cairn Energy will have plenty of ideas for any cash it may raise by selling a stake in the UK oil explorer’s Indian subsidiary. But it’s harder to see what Anil Agarwal’s mining group has to gain from dipping its toe into the oil business.

Vedanta’s interest is in Cairn India, which pumps oil in the Rajasthan desert and has had a separate listing since January 2007. A full takeover would be a stretch. Cairn Energy’s 62 percent stake is worth $8.5 billion at current market prices. Add in a control premium, and a possible offer to minority shareholders, and a deal could easily cost twice that amount.

Jun 12, 2010
via Breakingviews

Paying the penalty for World Cup fever

Spain, Portugal and Greece could all do with a good World Cup run. Economists reckon that the further a team progresses in the tournament, the greater the boost to its national economy. For all the hype, however, any benefit outside host South Africa will be short-lived. Some of the golden ball’s shine may rub off on the victors. But, with 32 teams competing, there will be many more losers.

ING economist Charles Kalshoven says that the further the Dutch team advances, the better it will be for the Netherlands economy, because retailers and restaurants will earn a better return on investments they have made to capture the benefits of the tournament. Improved consumer confidence will also lead to higher spending.

Mar 4, 2010
via Breakingviews

No chemistry for Reliance at LyondellBasell

There’s no sign of chemistry between Reliance Industries and LyondellBasell. The Indian oil and petrochemicals group has already increased its offer for the bankrupt U.S. chemicals group. It could afford to go higher.
Some creditors would be tempted by a $15.5 billion offer. But there’s no certainty despite the high price. Reliance, which is known for not over-paying, should take its experiment elsewhere.

At the current offer price of $14.5 billion, Reliance — controlled by Mukesh Ambani — is already valuing Lyondell at a hefty 10 times 2010 forecast EBITDA. Dow Chemical, one of few reasonable benchmarks, trades on a multiple of just over eight times. Admittedly Lyondell’s earnings are at the bottom of the cycle, but a multiple of between 5.5 and six times would be more normal.

Jan 11, 2010
via Breakingviews

Heineken squares circle with FEMSA beer deal

Dutch brewer Heineken has managed a delicate balancing act in clinching the auction for the beer business of Mexico’s FEMSA. Despite outbidding SABMiller, the deal is in line with prices paid for growing Latin American markets. Meanwhile, Heineken’s all-share offer keeps debt under control while leaving its founding family in charge.

Heineken wanted the additional emerging market exposure offered by FEMSA. But because it’s still paying down debt from previous deals, it wasn’t in a position to offer cash. Investors feared Heineken would turn to them for fresh capital. But the FEMSA deal side-steps the issue.

Dec 23, 2009
via Breakingviews

2010 won’t be the real deal for mergers

Ask an investment banker about mergers and acquisitions in 2010, and the optimism is infectious. Except that it seems that few corporate bosses have caught the fever.

The bankers think they could do with a break. Global M&A hit a five-year low of $1.97 trillion in 2009 — 53 percent below the 2007 high. But now that financing is not as squeezed, confidence is supposedly returning and business conditions are apparently improving.

    • About Alexander

      "I am a Reuters columnist specialising in financial services -- particularly investment banking, M&A and corporate finance. I am based in London, but have lived and worked in Spain and South America. I have been a journalist and editor for almost 19 years and before moving into commentary at the beginning of 2009 I was the editor responsible for Reuters coverage of company news in Europe, Middle East and Africa."
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