Breakingviews

Nokia will struggle to cut through Alcatel tangle

April 14, 2015

An all-stock takeover by the Finnish company would create a roughly 40 bln euro telecoms equipment giant. Nokia investors are understandably sceptical. A deal would mean another big restructuring and stretch the buyer’s industrial expertise. The French connection adds complexity.

Charter deal may not be final word on Bright House

March 31, 2015

The $10.4 bln acquisition, contingent on Comcast buying Time Warner Cable, suggests some confidence those rivals will get approval. If not, however, the U.S. cable puzzle could realign. Charter again might chase Time Warner Cable, which actually has first dibs on Bright House.

ZTE’s turnaround not as impressive up close

March 26, 2015

The Chinese telco equipment maker’s earnings almost doubled in 2014 – an improvement on the losses it was making three years ago. Yet revenue increased just 8 percent. ZTE is banking on smartphones and wearables to drive growth, but users don’t yet seem to be taking the bait.

French telco buyout shows dealmaker in a hurry

March 2, 2015

Vivendi is selling its residual 20 pct in Numericable-SFR to the mobile operator itself and parent Altice for 3.9 bln euros. This helps Altice’s billionaire boss Patrick Drahi prepare for a follow-on deal with Bouygues. It’s harder to see why Vivendi would accept a big markdown.

Time Warner Cable’s deal risk goes down to wire

February 20, 2015

A $45 bln sale to larger rival Comcast hangs in regulatory balance. Time Warner Cable’s stock price implies a 40 pct chance of collapse. A Breakingviews calculator shows how longer odds of success might hurt investors. The lack of a break fee would add insult to injury.

Small print debases $41 bln U.S. spectrum sale

February 3, 2015

The biggest bandwidth auction in years raised about twice as much as expected for Uncle Sam. But a 25 pct “small business” discount claimed by Dish Network is helping the $33 bln pay-TV company add to its unused stockpile and outbid rival operators that badly need capacity.

More than Slim odds America Movil buys T-Mobile

December 22, 2014

Carlos Slim’s telecoms empire needs to reduce its dependence on Mexico. The fourth U.S. wireless carrier is cheap, parent Deutsche Telekom doesn’t want it and there’s strategic logic to a deal. The increasingly frightful competition in U.S. telecoms may be a sticking point.

European telecoms will dial up more deals

December 16, 2014

Investors have brightened as M&A has swept the sector. Thanks to BT, Britain is up next. More mergers could follow in France, Italy and Belgium. What’s not to like? Well, windfalls from big cross-border deals looks distant and valuations already price in most of the good news.

Xiaomi founder weaves a tangled web of investments

December 16, 2014

A $32 mln fund backed by the Chinese smartphone maker gives an insight into the mysterious empire of founder Lei Jun. His four listed companies and Xiaomi trade and invest closely together. If Xiaomi has plans for a stock market listing, more simplicity might be useful.

If Vodafone wants Liberty it has to get creative

December 1, 2014

The mobile giant is eyeing cable group Liberty Global for a $90 bln-plus takeover. The strategic case is easier to make than the financial one. Regulators may be persuadable. Investors and Liberty Chairman John Malone could be colder. Vodafone has to be resourceful.