Kevin's Feed
Dec 12, 2012
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Corporate carbon bubble may start to deflate

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Next year could see markets start to wake up to a proper carbon bubble: the inflated value of hydrocarbon-heavy corporates.

Nov 14, 2012
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Anglo needs a dealmaker CEO to unlock value

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Anglo American needs a dealmaker chief executive to unlock value. It may be tempting to replace Cynthia Carroll with an operational obsessive who can deliver big projects. That’s where the outgoing boss struggled. But what the miner really needs is someone who can think the unthinkable – like demerging its troubled South African platinum business and finding a strategic buyer for the rest.

Nov 13, 2012
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UK gas price probe another jolt to cosy markets

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Free-wheeling capitalism has a knack for self-destruction. Allegations that traders rigged UK wholesale gas prices, if true, would be another blow to the public’s faith in market indicators. Libor was bad enough. Anger at rising home heating bills makes a gas scandal more politically explosive in the UK, even if the financial stakes look smaller.

Nov 9, 2012
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Lonmin doesn’t have to surrender to Xstrata – yet

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Xstrata has long been considered a private equity house in miner’s clothing. Now it’s taking on the role of activist investor, too. The miner owns 25 percent of struggling platinum producer Lonmin, and is being far from supportive in its role as a lead shareholder. Lonmin says Xstrata will back the company’s $817 million emergency rights issue but only if it gets to hand-pick a new chief executive and other top managers. Lonmin is rejecting those demands and for now, it can afford to.

Nov 8, 2012
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Russian economy could lose in state energy grab

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

It may be tempting to view Vladimir Putin’s drive to reassert state control over Russia’s energy sector as comeuppance for the oligarchs who benefited from the looting of the country’s natural resources in the 1990s. But restructuring the industry around two national champions, Gazprom and Rosneft, is ultimately bad for competition. International oil companies may benefit from greater opportunities to bring their expertise to Russia, but investors ogling opportunities in the shifting landscape should apply a hefty Kremlin discount.

Oct 26, 2012
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Cynthia Carroll’s departure won’t fix Anglo

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Cynthia Carroll is riding into the sunset. Anglo American and its chief executive are parting ways. Missteps early in her tenure hurt Carroll, but she did deliver needed cultural change. A new broom is unlikely to have an easier time. Anglo’s biggest problems are largely beyond the control of management.

Oct 24, 2012
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Rosneft buy may leave Russian oil industry wanting

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Rosneft will become the world’s biggest listed crude producer following its $55 billion swoop on Russia’s third-biggest oil company. Igor Sechin’s new behemoth also expects to generate $3 billion to $5 billion of cost synergies from scooping up its smaller rival. If Rosneft can apply TNK-BP’s oilfield know-how to improve production at its own fields, the cost and revenue benefits of the Russian oil shake-up could indeed climb high.

Oct 11, 2012
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Bumi should grit teeth and engage with Bakries

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

No one trying to maximize shareholder value at Bumi Plc would want to start from here. Financier Nat Rothschild’s bid to create an emerging markets coal champion has been a disaster, thanks to clashes with the group’s backers in Indonesia. Now the country’s powerful Bakrie family says it is willing to exit the venture in return for a stake in coal assets they sold to Bumi last year. It’s fiddly and humiliating, but it’s probably a good deal for Bumi Plc’s shareholders.

Oct 4, 2012
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No easy fix for South Africa platinum crisis

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Platinum looks like a commodity from hell, and not just because it is dug from especially deep mines. The economics and the politics point to a long crisis.

Sep 19, 2012
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South Africa platinum crisis not over yet

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By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

South Africa’s platinum crisis isn’t over yet. A pay deal struck by Lonmin will, if it holds, end a violent six-week strike that has claimed 45 lives. That’s good for the workforce. And it solves an immediate, potentially existential problem for the world’s third-biggest platinum producer. But it sets up other big challenges for Lonmin and the industry. The big wage hike will hurt already weak margins. And the response may only encourage further strikes.