DealZone Daily
Wednesday’s highlights:
Ford Motor Co (F.N) and China’s Geely are set to report progress as soon as Wednesday in talks to sell Ford’s Volvo unit to the Chinese automaker, two people with direct knowledge of the matter say.
Spyker Cars presses ahead with efforts to cut a deal for Saab with General Motors, with talk of possible backing from a Dutch billionaire fanning the Swedish carmaker’s faint hopes of an eleventh-hour reprieve.
Chinese Internet firms are eyeing more spin-off offerings after raising nearly $1.5 billion this year as they bank on strong foreign interest in high growth China plays.
Australia’s Macquarie agrees to acquire the derivatives business of private bank Sal. Oppenheim as a way to boost its presence in Europe, the companies say. Neither gives financial terms, but one source close to the matter said the deal valued the business — which focuses on equity derivatives and structured products — in the double-digit million euro range.
For more on these stories and the rest of the latest deal-related news from Reuters, click here.
And elsewhere:
Agrium CEO makes a plea for kindness
“Be kind in your article. I read this morning I wasn’t going to get the deal across,” said Agrium CEO Mike Wilson, referring to an article in Canada’s Globe and Mail about his company’s hostile bid for rival fertilizer maker CF Industries. “What the hell is that?”
Speaking on the sidelines of a BMO Capital Management agriculture, protein & fertilizer conference, Wilson said he was frustrated by CF’s unwillingness to discuss his company’s bid, but “frustration won’t make us go away.”
Agrium bumped its cash-and-stock bid for CF to around $85 a share on Monday, increasing its previous bid more than 6 percent.
“At $85, I can’t believe (CF CEO Steve WIlson is) not going to come to us and say let’s talk,” Agrium’s Wilson said. “I’d be amazed.”
First Reserve’s deal war-chest expands
First Reserve is sitting on another $9 billion of spending money for energy deals after finishing raising its latest buyout fund, Fund XII. The private equity giant, which specialises in energy investments, said the fund is the largest ever raised in the energy sector and exceeds its previous fund, Fund XI, which raised $7.8 billion in 2006.
The fund appears to be lower than target, however. London-based private equity intelligence firm Preqin said in a recent report that the fund had a $12 billion target.
“Energy remains a large, dynamic and complex industry where change creates new, attractive investment opportunities,” said William Macaulay, Chief Executive Officer of First Reserve in the press release (below).
Private equity firms have been struggling to raise new money for funds as the pension and endowment funds that invest in them have been hit by slides in the equity markets.
Some sectors and funds have been more successful than others. Secondary firms, which typically buy investors’ positions in buyout funds at a discount, have been particularly successful at raising capital.
from Funds Hub:
The art of investment
A fund investing in the works of Banksy and Damien Hirst is the sort of thing you might expect to be launched at the height of a bull market, but Castlestone Management has chosen the depths of the current bear market to debut its Collection of Modern Art fund.
The fund, an 8-year investment vehicle with a minimum investment of $10,000 or 10,000 pounds, will buy up art in genres such as impressionist, post-war, contemporary, sculpture, urban art and photography, while its managers will be supported by experts from auction houses, dealers and artists.
Castlestone points to diversification, a lack of correlation with stocks and bonds, and research from Mei and Moses showing strong performance from art since 1875.
The firm backs up its investment case with rather more unusual examples than normally appear in investment literature, such as French financier Andre Level who in 1904 apparently persuaded 12 other investors to contribute 212 francs to a fund called La Peau De L'Ours (The Skin of the Bear), which bought up modern art. Selling the collection in 1914 (which probably proved good timing), he made an annualised return of 14.8 percent.
Any other reasons as to why people should put their money into modern art? Again, another I rarely see in fund literature.
"Right now, the prospects for art prices look excellent," enthuses Castlestone. "Increasing urbanization around the world has led to a boom in museum construction globally."
