Breakingviews

Hudson’s Bay wangles way back to Teutonic roots

June 15, 2015

The Canadian owner of U.S. store Saks – once an English company headed by a German – has the best of a $3 bln deal to buy Cologne-based retailer Kaufhof. Offloading real estate will help it finance the trade. It also gives Hudson’s Bay a cushion against old world risks.

Ahold-Delhaize is a 25 bln euro deal full of hope

May 11, 2015

The shares of both Dutch-listed grocer and its potential Belgian-listed target were up strongly on reports of renewed merger negotiations. A combination of the two U.S.-centric companies makes sense. But financing could be an issue, and the American market will still be tough.

Pru’s lesson for investors: trust animal spirits

November 21, 2014

The UK insurer’s stock hit a record this week, leaving rival Aviva trailing in its wake. It is a painful reminder of how Aviva lost out by failing in its attempt to buy Pru in 2006. The main reason there was no deal? The bidder lacked investor support to pay a fair premium.

Glencore Rio takeover would be harder than Xstrata

October 7, 2014

Ivan Glasenberg’s miner-trader is stalking $90 billion iron giant Rio Tinto. Though there’s some logic to a deal, Glencore will be loath to pay much of a premium, and the clash of cultures would be extreme. Rio is also in a better position to resist than rival Xstrata in 2012.

Facebook is near-universal buyer in virtual world

June 6, 2014

The $160 bln website’s users are worth nearly $130 each. WhatsApp, at $19 bln or $42 per user, was a relative steal. Users of Twitter and Japan’s Line look cheap, too. Clamp on an Oculus Rift and there’s a case for Mark Zuckerberg to buy most of the planet’s social and chat apps.

Voracious buyers find the meat on Sara Lee’s bones

June 4, 2014

The conglomerate broke up into Hillshire and D.E Master Blenders in 2012 after spurning a $12 bln offer. That was a raw deal - until now. Add the latest bid in the war for the sausage maker to the coffee unit’s sale and a special dividend and owners may finally make good.

Kellogg might make Heinz-style Buffett target

June 3, 2014

The $25 bln cereal giant’s stock is up on M&A talk. Kellogg may be too big for a Hillshire-like takeover battle and has too much debt for an LBO to be palatable. But an equity-rich deal like the Sage of Omaha and Brazil’s 3G cooked up last year for ketchup-maker Heinz might work.

M&A targets can get stiffed when they “go shop”

May 23, 2014

The tactic of seeking bids after signing up a buyer is meant to ensure top dollar. More often, it leads to low offers and sale prices, new research shows. Deals like Media General’s buyout of Lin Media suggest sellers are wising up, though, portending better value for investors.

Alstom chase is distraction from Siemens revamp

May 7, 2014

The German engineering giant’s long-awaited new strategy sensibly focuses on improving efficiency and cutting slack. A possible Alstom deal comes at a bad time, even though the French rival would be a good industrial fit. Siemens management has enough to deal with in-house.

Lafarge-Holcim share jump has gone far enough

April 7, 2014

The planned $50 bln merger of the French and Swiss cement groups has added a combined $5 billion to their market capitalisations. Credible synergies could be worth much more. But uncertainty over completion and the risk of value-destructive forced disposals justify scepticism.