Neil's Feed
Dec 31, 2014

Breakingviews: Goldman/Espirito Santo mess raises valid question

By Neil Unmack

LONDON (Reuters Breakingviews) – Goldman Sachs’ Banco
Espirito Santo mess raises valid questions. The U.S.
bank is threatening legal action after a loan to failed lender
Espirito Santo was moved by Portugal’s regulator into BES’ bad
bank. Goldman has fallen foul of Portuguese law, and may be a
victim of its own complexity, but the fiasco highlights the need
for greater clarity over European bank resolution schemes.

The fight between Goldman and the Portuguese central bank
dates back to a deal in June, 2014, whereby the U.S. bank loaned
BES $835 million to finance a refinery in Venezuela owned by
local oil company PDVSA. Goldman intended to sell
down $785 million of the loan through a vehicle called Oak
Finance. As BES’ situation soured in the following weeks, it was
stuck with some of the debt.

Dec 24, 2014
via Breakingviews

Euro zone will flit between crisis and catharsis

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By Neil Unmack

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

The euro zone will flit between crisis and catharsis in 2015. Populist parties are on the rise, the economy is stalling and governments are paralyzed by their divisions. On the other hand, the euro zone has stronger banks and an activist European Central Bank. There is cause for hope, but it is tiny.

Dec 5, 2014

Breakingviews: Pharma’s dying assets lack M&A remedy

By Neil Unmack

LONDON, Dec 5 (Reuters Breakingviews) – Pharma’s dying
assets lack an M&A remedy. GlaxoSmithKline has just
scrapped a planned sale of mature drugs that were expected to
fetch over $3 billion, not long after a similar move by Sanofi
. The aims of the UK and French pharmaceutical groups
differ, but the deal failures highlight the challenge of finding
suitable owners for such portfolios.

Sanofi’s decision to scrap its sale process took place amid
strategic chaos – a boardroom coup and the ouster of its chief
executive. GlaxoSmithKline’s looks purely economic. It is though
surprising that pharma spinoffs are proving hard to turn into
reality when buyout firms were queuing up to do due diligence.

Dec 5, 2014
via Breakingviews

Pharma’s dying assets lack M&A remedy

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By Neil Unmack

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

Pharma’s dying assets lack an M&A remedy. GlaxoSmithKline has just scrapped a planned sale of mature drugs that were expected to fetch over $3 billion, not long after a similar move by Sanofi. The aims of the UK and French pharmaceutical groups differ, but the deal failures highlight the challenge of finding suitable owners for such portfolios.

Nov 18, 2014
via Breakingviews

AstraZeneca struggles to advance value defence

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By Neil Unmack

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

AstraZeneca is struggling to advance its value defence. The UK pharma group fought Pfizer’s unsolicited $119 billion bid earlier this year by promising growth. It is now reiterating its punchy revenue targets. But Astra is only inching forward. The chances of seeing off another assault by its U.S. rival have been improved more by American curbs on tax-driven M&A than by self-help.

Nov 11, 2014
via Breakingviews

BNP Paribas could make an MPS merger work

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By Neil Unmack

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

BNP Paribas should be thinking seriously about Banca Monte dei Paschi. After this year’s $8.9 billion fine from U.S regulators, the French bank’s shareholders probably feel they’ve had enough excitement. But looking past the risks, there would be logic to swooping on the Tuscan lender.

Oct 15, 2014
via Breakingviews

AbbVie U-turn shows Shire was mostly about tax

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By Neil Unmack

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

AbbVie’s U-turn shows its Shire deal was mostly about tax, after all. Despite initially holding firm as the Obama administration clamped down on tax-driven “inversions,” the American group has now cooled on a $55 billion takeover of its Dublin-based peer. There’s an unwelcome read-across for AstraZeneca.

Sep 23, 2014
via Breakingviews

Tax clampdown could deter half-baked pharma M&A

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By Neil Unmack and Robert Cyran

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

The U.S. clampdown on tax-driven cross-border M&A should deter half-baked pharma deals. Some U.S.-led transactions, like AbbVie’s recent agreement to buy UK-based Shire, may survive on strategic logic. But pure tax-avoiding combinations look tricky.

Sep 17, 2014
via Breakingviews

ECB’s trillion-euro race may start slowly

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By Neil Unmack

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

The latest parlour game in financial markets is guessing the size of the European Central Bank’s upcoming four-year targeted long-term liquidity operations (TLTROs): how many banks will tap the ECB, for how much?

Aug 21, 2014
via Breakingviews

Blackstone finds way to outsource skin in the game

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By Neil Unmack

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

Blackstone has devised a novel definition of ”skin in the game”: other people’s money. The buyout and debt management firm is taking advantage of newly relaxed rules on how much risk needs to be retained in securitisations, to improve its returns. Its structure looks acceptable – but regulators and investors should still watch for sharp practice from future copycats.