Only a week to go before decision time and it looks increasingly as though Xstrata boss Mick Davis has already made up his mind and opted to walk away from making a formal bid for mining rival Anglo American.

Reuters correspondent Raji Menon quotes an unnamed top-10 shareholder in Xstrata saying: "They have pretty much indicated to us that they will be walking away".

This makes sense -- nothing has changed since Xstrata got a "put up or shut up" notice from the UK's Takeover Panel, giving it until October 20 to make a formal offer or walk away for six months.

If Xstrata has indeed made up its mind, it should waste no time in telling investors that it has no plans to make an offer. Why wait?

The repayment date for Ukrainian state energy group Naftogaz's $500 million Eurobond came and went on Wednesday, but all bondholders got was a coupon payment.

Talks to restructure the five-year bond have resulted in Naftogaz presenting its solution to the problem -- swapping the old 8.125 percent bonds for new five-year ones which pay a slightly higher coupon of 9.5 percent and come with a government guarantee.

Given the way Naftogaz has approached its obligations to the Eurobond holders, it's hard to see what comfort "an irrevocable and unconditional sovereign guarantee from the Government of Ukraine" will give them.

The reality though is that bondholders have little choice. Vote against the proposed exchange and they could end up with nothing at all -- and a lengthy and expensive court battle on their hands.

Naftogaz knows this and its statement leaves little room for interpretation:

Naftogaz of Ukraine continues to believe that the best course for bondholders is to review the proposal and carefully consider the terms of the offer.

Bondholders have until Oct 8. to make up their minds on whether or not to accept the Naftogaz exchange. If they reject it and the deal is then accepted by a majority of fellow investors, they get stung with a penalty.

Not much of a choice really.

So Cadbury has succeeded in convincing the UK's Takeover Panel -- the City of London body which polices M&A -- to slap a "put up or shut up" order on Kraft.

Kraft now has until Nov. 9 to decide whether to make a formal offer for the British confectionery group. If it decides to walk away, it is not allowed back for six months.

Cadbury shares are still trading above the price of Kraft's informal stock and cash offer. At just over 8 pounds per share, the current price is some 10 percent above the indicative offer, which is now worth just 7.20 pounds. But shareholders in Cadbury -- which is a household favourite in the UK -- aren't being that ambitious in their expectations for an improved offer. The shares are trading at nowhere near the multiples which were initially bandied about after Kraft's approach became public.

And despite noises about Kraft finding it difficult to raise the money it needs for the 11 billion pound bid -- of which some 4.1 billion pounds would be in cash -- bankers seem to think there won't be any problem getting lenders to make the necessary loans.

The real question is how far Kraft shareholders are willing to let CEO Irene Rosenfeld stretch to get her hands on Cadbury's famous chocolate and chewing gum brands.  Kraft stock fell another 1 percent following the Takeover Panel ruling, having dropped around $2 from above $19 to $17.6 since it went public with its approach to Cadbury.

Cadbury, which has rejected the approach, will be hoping that based on the performance of Kraft shares, Rosenfeld will be kept on a fairly tight leash.

There's an almost palpable sigh of relief in the statement from Blackstone and Lion Capital confirming the two private equity firms have received a "binding offer" from Japan's Suntory for Orangina Schweppes.

It discloses little beyond Blackstone and Lion saying they will only be able to decide whether to accept the offer "once the necessary social, legal and
regulatory steps will have been completed".

All that of course involves lots of red tape -- so it may take some time -- but you can be sure Blackstone and Lion will be doing everything they can to speed the process along -- wishing the days away and hoping that their luck holds.

Finding a buyer like Suntory apparently willing to pay somewhere between $2.6 and $3 billion for Orangina at this point in the cycle gives Blackstone and Lion the perfect exit. Suntory could be paying them up to twice 2008 sales and more than they paid in 2006 to get hold of Orangina and its European brands.

The duo crow that since they took over in 2006, Orangina has "achieved industry-leading growth, both organically in its core countries and by expansion into new markets, and through strategic acquisitions of leading brands". Volumes and sales have both risen and Orangina Schweppes is now the second largest producer in Europe's still soft drinks market.

Blackstone's chief operating officer Tony James said last week that the private equity group would look to get out of investments if there was an opportunity for long-term value and noted that flotations are once again a possibility.

That begs the question why Blackstone -- with $28 billion in its coffers to invest -- and Lion have decided to go with Suntory rather than an IPO for Orangina.

The answer may well be in some of James' other comments on the prospects for the economy. He expects a few quarters of stronger earnings as inventory is rebuilt, but sees the recovery as "grudging and slow".

Unlike Suntory's binding offer, there's nothing certain at this point about how European consumer spending will develop. No wonder the private equity partners are happy to bid farewell to their soft drinks empire. It could easily turn out to be flatter than Suntory is hoping.

Magna International seems to be taking seriously threats from Volkswagen to pull its business following the Canadian car parts maker's Opel victory.

Magna's co-CEO Donald Walker is saying that after talking to them, most of his other customers are happy that the car parts group -- which along with Russian backer Sberbank is buying a 55 percent shareholding in GM's Opel -- is able to protect their technologies.

Apparently VW is still unconvinced, so Magna will "finalising the internal procedures" and will have more talks with the German carmaker.

Walker is also stressing that Magna is not looking to compete with its clients but is simply aiming to get a good return on its investment in Opel, reiterating that Magna will remain a parts company.

There seems little doubt that Magna can manage potential conflicts, after all it already builds cars for BMW, Chrysler and Mercedes as well as making parts for Toyota, Ford and VW.

But to say Magna won't be competing with other carmakers once it starts building Opel cars is stretching the point. Why else would you buy Opel if it wasn't to take market share from VW and others?

The number of London's trademark black taxis booked and waiting outside the European headquarters of Goldman Sachs -- meters running -- was once used by some as a barometer of the health of London's investment banking business.

When times were good, the queue was long and it was impossible for anyone else in the vicinity to hail a cab. But when the fees dried up, or markets turned, the cabbies who'd been at Goldman's beck and call suddenly had to find new customers.

Last year, Goldman was reported to have stopped free taxis home for staff working in the office after 9pm, extending this to 10pm.

Now it looks as though taxis may be in vogue again at Goldman, at least indirectly.

Goldman Sachs Capital Partners -- is that a taxi in the picture on the website? -- now appears to be following in the tracks of the maker of many of London's black cabs by cosying up to Geely Automotive -- China's 10th largest vehicle maker.

For Manganese Bronze -- which has made more than 100,000 London taxis at its Coventry plant since 1948 -- it was a case of turning to Geely for help and selling it a stake as well as entering a joint venture.

But in this case, it is Goldman that is providing the money -- buying about $250 million of convertible bonds and warrants. Geely will use the proceeds to ratchet up its production.

Geely Automotive will no doubt be pleased with the celebrity endorsement. By persuading the U.S. investment bank to buy its convertibles, the Chinese carmaker is showing it is a force to be reckoned with.

Until recently, Geely has been seen as a somewhat optimistic "me-too" carmaker that was doing little more than window-shopping.

But it is one of the few privately-owned Chinese carmakers with a green light from Beijing to go shopping abroad. And its recent interest in buying Ford's unwanted Volvo brand and its approach to Magna about an Opel production partnership shows its real ambitions.

So the Goldman Sachs private equity fund could end up owning Geely shares. Goldman may soon have taxis made by a UK firm in which it has an indirect stake through China queueing at its London doors.

That's assuming its clampdown on taxi use is lifted by then of course.

Chinese carmakers are seeking to step into the gaps left by U.S. companies in Europe -- but while acquisitions may give them access to badly-needed technical know-how, global brands and exposure to new markets, the question is whether they have learnt from past failures.

With China now the world's largest car market, it's no surprise that Chinese carmakers -- which have few if any really solid brands within their home market -- want to start making more of a mark.

In theory, foreign acquisitions offer a quick way to do so. Meanwhile the credit crunch has thrown world-renowned but now distressed car marques such as Volvo, Opel or Saab onto the block at what look like rock-bottom prices.

The worry is that Chinese carmakers haven't always found it plain sailing abroad. SAIC Motor Corp is still feeling the pain of buying into Ssangyong Motor Co of Korea. Ssangyong has struggled to compete as South Korea's smallest carmaker, failing to develop new models and running out of cash. A debt-for-equity swap threatens to slash the Chinese company's holding in the South Korean carmaker from just over 50 percent to around 10.

Chinese companies have had more success when they have simply acquired technology and taken it back to China. SAIC had much more success when it bought Britain's MG Rover. In that case, SAIC closed most of the UK manufacturing and used the know-how to launch a mid-range sedan called the Roewe. This has proved successful in China.

It looks as if Chinese manufacturers are trying to emulate SAIC's Rover experiment rather than its Ssangyong adventure.

Although Chinese carmakers looked at Opel, they backed away from trying to buy it outright. Geely Automotive has now stepped forward as a possible partner for Opel's new owner, Canadian car company Magna. But it looks as if its role may be more as that of a supplier of manufacturing capacity than an outright owner of the brand.

In the case of Saab, Beijing Automotive Industry Corp (BAIC) has agreed a deal with supercar manufacturer Koenigsegg to help fund its purchase of the iconic Swedish company.

BAIC is shelling out 275 million euros ($406 million) and, according to a source close to the deal, will fund future development costs at Saab. The hope is that the Chinese carmaker's involvement could dramatically increase the number of cars Saab is able to produce and sell in China, while still preserving Swedish jobs.

Most Chinese carmakers have been wary of making a major step outside their own market. Chery Automobile, Hunan Changfeng Motors Co and others have all kicked the tyres of various European or U.S. auto brands but walked away. It still seems that they are wary of trying to manage large foreign manufacturing operations -- perhaps for good reason having seen how difficult it is even for indigenous managers.

The cherry picking approach -- tapping into brands and technology without full ownership -- probably makes more sense, especially at a time when prices are low. The key question is whether the Chinese can lift the brands they pick up off the scrapheap. BAIC will be hoping that, like Rover, Saab can find a new lease of life on the streets of Beijing.

With airlines around the world struggling to survive the economic downturn, the time should be nearing to break the taboo of consolidation in the sector.

Airlines around the globe face losses of $11 billion in 2009, according to IATA. Margins are expected to fall this year and next, with analysts predicting carriers are likely to struggle for years to reach levels needed to produce an acceptable return for capital market investors.

Societe Generale estimated in a recent note that margins would drop to -3.1 percent in 2010 before recovering to 1 percent in 2011, well short of the 10 percent needed.

Effectively we are back to the ice age of 2001-2.

Eight years ago, the collapse of Sabena and Swissair kicked open the door of cross-border consolidation -- within Europe at least. But while deals like Lufthansa's merger with the Swiss airline allowed for some rationalisation, the merged entities remain hamstrung by national aviation regulations.

Replacing this patchwork of national carriers with viable global companies able to withstand economic shocks is the necessary next step.

The European Union's open skies agreement has shown what is possible. It has allowed M&A to take place within the bloc, and this has led to the creation of four major players -- Air France-KLM, British Airways, Lufthansa and Ryanair.

The challenges now are even greater than they were at the turn of the millennium.

High and rising fuel costs, environmental pressures to reduce CO2 emissions, overcrowded and often inefficient airports, limited landing slots and planning constraints on building new terminals and runways mean yet more financial pressure to reduce the number of planes in the skies and make airlines more efficient.

But despite the pressure on the sector, airline reform is still creeping forward at a snails' pace. Instead of making dramatic changes to the model, airlines are forced to find ways around the rules to eke out savings and to line themselves up for consolidation when it comes.

This is why Air France-KLM, Delta Air Lines and AMR Corp's American Airlines are showing such enthusiasm for taking a stake in loss-making Japan Airlines Corp (JAL) in a bid to expand in Asia via code-sharing arrangements (common ticketing agreements).

For the Japanese government, which is engineering the JAL restructuring after bailing it out, the deal represents an opportunity to push an open skies deal with the United States.

Oneworld and to a greater extent SkyTeam -- which includes Air France and Delta -- are both relatively under-weight in Asia and will seize on any opportunity that comes along. If winning the prize means providing cash to bail out an ailing airline such as JAL, then they see it as a necessary evil.

The barriers to rationalisation are many. Governments love having their "own" flag-carriers. Planes carrying the national flag are almost a statement of a country's prowess.

Airlines do come and go, but part of the problem is that the barriers to entry are low, while the barriers to exit are high.

In the United States, airlines fly in and out of Chapter 11 as their fortunes wane, while in Europe and elsewhere governments cannot resist protectionist intervention to save national carriers and the jobs that go with them -- just look at what Italy has done to keep Alitalia flying -- making market exits the exception.

Open skies agreements are meant to lead to further liberalisation, but nobody is holding their breath for the United States to relax its rules so far as to allow majority foreign ownership -- especially in the middle of a recession.

And attempts by British Airways and American Airways to ink their transatlantic deal have twice foundered at the hands of competition authorities. American is now seeking U.S. approval by next month to form a transatlantic alliance with BA and Spain's Iberia.

The EU has shown that cross-border consolidation is possible if the right structures can be put in place and governments are willing to accept losing economic control. Lufthansa has now bought Swiss, Austrian Airlines and bmi as it battles with rivals Air France-KLM and British Airways.

Japan's restructuring of JAL and the sale of a stake in the country's largest carrier could just be just another case of alliance pass-the-parcel. The brave thing to do would be to let a competitor buy and run the airline.

If nothing else, the economic crisis will force more airlines into alliances. But even the dire predictions for the industry probably won't be enough to get regulators and governments to contemplate fundamental change.

Kraft's offer for Cadbury got off to a sticky start on Tuesday when the U.S. food group's stock fell 6 percent, taking some of the buzz out of Cadbury's bid-fuelled share price.

Kraft's initial offer has raised expectations of a higher bid, but while it is likely to have to pay more to win, the take-out prices now being touted are stretching the value of the British confectionery group further than a Curly Wurly.

The multiple paid by Mars to Wrigley -- some 17.5 times EBITDA -- has encouraged analysts to look for a valuation of 15-16 times forecast 2009 EBITDA, implying a price of 10 pounds or more, against Kraft's 7.16 pound per share offer after the fall in the Kraft price. The Cadbury share price also gave up some of its gains, but is still well above the value of the bid.

But comparisons with the Wrigley takeover and recent deals -- the average multiple for big food deals has been 14 times EBITDA over the last 10 years -- do not adequately factor in the higher cost of capital since the Mars deal. As a private company, Mars could also pursue a fully-priced bid without rattling its shareholders.

Cadbury's shareholder base is now heavily skewed towards the United States and there will certainly have been changes since the offer was announced, with arbs leaping in at the prospect of a rare bidding war. Cadbury may be a British institution, but British institutional investors are conspicuous by their absence from the share register. This raises the chance of the company's fate being decided by these newly-arrived shareholders.

But while Cadbury is a natural fit with Kraft, those expecting more cash in a raised bid may be disappointed.

Kraft is going to be constrained in how far it can push without ringing alarm bells at the ratings agencies. Analysts estimate Kraft's net debt/EBITDA would rise from three times to four times based on the price it has already offered.

Kraft's expected annual pre-tax cost synergies of $625 million go some way to repay the premium it may pay for Cadbury, but it will need to find more cost and revenue savings to justify a significantly higher bid. These synergies won't come for free. Kraft anticipates one-off implementation costs of $1.2 billion in the first three years.

Expectations that the world's largest food group Nestle could team up with Hershey for a counter-bid have also helped the Cadbury share price. But the regulatory risk would be far greater, and the unhappy experience of the takeover of British brewer Scottish & Newcastle by Heineken and Carlsberg showed the pitfalls of a consortium bid.

 So Kraft may not have to raise its bid that much further to shake out enough Cadbury shareholders to win control and become the world's biggest sweet and chocolate group. It would do well to wait until the initial sugar rush has passed before making its next move.