Showing posts with label ABN Amro. Show all posts
Showing posts with label ABN Amro. Show all posts
[UNITED KINGDOM] BG Group, offers £6bn for gas firm after profits leap 78%
Published | 03-May-2008
BG Group has made a £6bn approach to buy an Australian gas company - its biggest takeover bid ever - after reporting a 78% increase in first-quarter profits from soaring oil and gas prices.
The approach to Origin Energy is aimed at bolstering its position in the fast-growing Asia-Pacific liquefied natural gas (LNG) market by taking control of the Australian utility's reserves.
Shares in BG fell 5% in early trading as City analysts worried about its outline offer of A$14.70 (£7) a share in cash, a 40% premium to Origin's closing price of A$10.47 on Tuesday.
BG said yesterday that net profit rose to £767m from £432m in the same period last year and its results compare with a 12% rise in first-quarter profit at Shell and a 48% rise at BP.
BG's core upstream, gas and oil production unit had a 50% jump in profit thanks to a more than 10% rise in average gas prices and a rise of about 70% in crude prices. Frank Chapman, chief executive of BG, denied that the company was profiting at the expense of British homeowners, who have faced energy price increases of about 17% recently. Analysts said the purchase of Australia's second-largest energy retailer would help fill a hole in BG's LNG business, which is booming and soaking up shipments originally expected to land in the US.
David Thomas, a Citigroup oil analyst, said: "Strategically, such a purchase looks sound, based on BG's aspirations to have regional supply of LNG to Asia-Pacific markets."
But others fretted about the value being put on Origin. "It's a pretty high price and premium," said Sydney-based Jason Mabee, a utilities analyst at ABN Amro. Colin Smith, analyst at Dresdner Kleinwort, said the market would also need to be convinced about the logic of BG, Europe's fourth-largest non-government-controlled oil and gas company by market value, buying Origin's electricity assets.
The approach to Origin Energy is aimed at bolstering its position in the fast-growing Asia-Pacific liquefied natural gas (LNG) market by taking control of the Australian utility's reserves.
Shares in BG fell 5% in early trading as City analysts worried about its outline offer of A$14.70 (£7) a share in cash, a 40% premium to Origin's closing price of A$10.47 on Tuesday.
BG said yesterday that net profit rose to £767m from £432m in the same period last year and its results compare with a 12% rise in first-quarter profit at Shell and a 48% rise at BP.
BG's core upstream, gas and oil production unit had a 50% jump in profit thanks to a more than 10% rise in average gas prices and a rise of about 70% in crude prices. Frank Chapman, chief executive of BG, denied that the company was profiting at the expense of British homeowners, who have faced energy price increases of about 17% recently. Analysts said the purchase of Australia's second-largest energy retailer would help fill a hole in BG's LNG business, which is booming and soaking up shipments originally expected to land in the US.
David Thomas, a Citigroup oil analyst, said: "Strategically, such a purchase looks sound, based on BG's aspirations to have regional supply of LNG to Asia-Pacific markets."
But others fretted about the value being put on Origin. "It's a pretty high price and premium," said Sydney-based Jason Mabee, a utilities analyst at ABN Amro. Colin Smith, analyst at Dresdner Kleinwort, said the market would also need to be convinced about the logic of BG, Europe's fourth-largest non-government-controlled oil and gas company by market value, buying Origin's electricity assets.
Source: The Guardian|by Terry Macalister
SOUTH AMERICA: Petroleos de Venezuela Bonds Plunge as Exxon Mobil Wins $12 Billion Asset Freeze
Published | 10-Feb-2008
Petroleos de Venezuela SA bonds plunged after Exxon Mobil Corp. won court orders yesterday in the U.S., U.K. and the Netherlands freezing more than $12 billion of the Venezuelan oil company's assets. Exxon Mobil sought the freeze because of its concern that the Venezuelan state oil company would shift assets to other nations, putting them out of reach of an international arbitration commission. Petroleos de Venezuela, as the company is known, last year seized joint ventures it had with foreign energy companies as part of President Hugo Chavez's drive to increase government control of energy resources.
``There's huge uncertainty over the real extent of this issue because this is now in the hands of lawyers,'' Henry Stipp, who helps manage $10 billion of assets for Threadneedle Asset Management in London, said in a telephone interview. ``Investors may not see this as a cash-flow event for Petroleos de Venezuela, but a situation that raises their eyebrows over the company's worsening legal and management risks.''
The yield on Petroleos de Venezuela's 5.25 percent bond due in April 2017 soared 40 basis points, or 0.4 percentage point, to 11.13 percent at 1 p.m. New York time, according to composite data compiled by Bloomberg. The yield rose 1.3 percentage points to 11.95 percent earlier today, its biggest jump ever since trading began last April. The price dropped 2.25 cents to 66.75 cents on the dollar.
Venezuelan Energy and Oil Minister Rafael Ramirez, also the Petroleos de Venezuela president, vowed to fight Exxon's ``bluff'' to freeze the assets and guaranteed the company's operations and cash flow won't be affected. Ramirez, speaking at a press conference in Caracas, said the only asset that has been frozen is a New York account with about $300 million.
`Judicial Terrorism'
Exxon Mobil's 41.7 percent stake in a heavy oil project in Venezuela's Orinoco Belt region had a net-book value of about $750 million, according to a September filing with the U.S. Securities and Exchange Commission. Irving, Texas-based Exxon Mobil is the world's largest oil company and last year was the most-profitable U.S. corporation in history.
``This is pure judicial terrorism,'' Ramirez said of the freeze. ``If they think we will backtrack on our nationalization policies after this, well, gentlemen from Exxon Mobil, you are wrong again.''
The freeze won't disrupt supplies of oil, Ramirez said.
Default Potential
The cost of buying five-year default protection on $10 million of Petroleos bonds rose to $702,500 today from $690,000 yesterday, according to Morgan Stanley & Co. Credit-default swaps are financial instruments used to speculate on the ability of countries or companies to repay their debt. An increase in price suggests deterioration in credit quality.
Petroleos de Venezuela is unlikely to default on the debt following the freeze, ABN Amro Inc. analyst Aaron Holsberg and Lehman Brothers Holdings Inc. economist Gianfranco Bertozzi wrote in separate notes to clients. In a ``worst-case scenario,'' in which assets remain frozen, the company could arrange payment through a trustee, Bertozzi said.
``There's huge uncertainty over the real extent of this issue because this is now in the hands of lawyers,'' Henry Stipp, who helps manage $10 billion of assets for Threadneedle Asset Management in London, said in a telephone interview. ``Investors may not see this as a cash-flow event for Petroleos de Venezuela, but a situation that raises their eyebrows over the company's worsening legal and management risks.''
The yield on Petroleos de Venezuela's 5.25 percent bond due in April 2017 soared 40 basis points, or 0.4 percentage point, to 11.13 percent at 1 p.m. New York time, according to composite data compiled by Bloomberg. The yield rose 1.3 percentage points to 11.95 percent earlier today, its biggest jump ever since trading began last April. The price dropped 2.25 cents to 66.75 cents on the dollar.
Venezuelan Energy and Oil Minister Rafael Ramirez, also the Petroleos de Venezuela president, vowed to fight Exxon's ``bluff'' to freeze the assets and guaranteed the company's operations and cash flow won't be affected. Ramirez, speaking at a press conference in Caracas, said the only asset that has been frozen is a New York account with about $300 million.
`Judicial Terrorism'
Exxon Mobil's 41.7 percent stake in a heavy oil project in Venezuela's Orinoco Belt region had a net-book value of about $750 million, according to a September filing with the U.S. Securities and Exchange Commission. Irving, Texas-based Exxon Mobil is the world's largest oil company and last year was the most-profitable U.S. corporation in history.
``This is pure judicial terrorism,'' Ramirez said of the freeze. ``If they think we will backtrack on our nationalization policies after this, well, gentlemen from Exxon Mobil, you are wrong again.''
The freeze won't disrupt supplies of oil, Ramirez said.
Default Potential
The cost of buying five-year default protection on $10 million of Petroleos bonds rose to $702,500 today from $690,000 yesterday, according to Morgan Stanley & Co. Credit-default swaps are financial instruments used to speculate on the ability of countries or companies to repay their debt. An increase in price suggests deterioration in credit quality.
Petroleos de Venezuela is unlikely to default on the debt following the freeze, ABN Amro Inc. analyst Aaron Holsberg and Lehman Brothers Holdings Inc. economist Gianfranco Bertozzi wrote in separate notes to clients. In a ``worst-case scenario,'' in which assets remain frozen, the company could arrange payment through a trustee, Bertozzi said.
``Our view is that Petroleos de Venezuela's operations and debt service will be unaffected, that court rulings are an Exxon Mobil negotiating tactic and that this will drag on for a few months,'' New York-based Holsberg, the head of Latin America credit research for ABN Amro, wrote in his note. ``Petroleos de Venezuela is likely to settle for far less than Exxon's demanding but more than is currently on the table.''
`Socialist Revolution'
Petroleos de Venezuela has become the biggest source of revenue for Chavez's ``socialist revolution,'' which aims to provide low-income Venezuelans with free health care and education and subsidies for housing. Petroleos de Venezuela spent $11.8 billion on social programs last year, compared with $5.8 million on its domestic oil and natural-gas operations, a document released March 5 by the Energy Ministry showed.
Concern that Chavez has forced Petroleos de Venezuela to spend more on his policies than on company operations triggered a 23 percent drop in the price of the company's debt since April, traders including Interacciones Mercado de Capitales SA's Nelson Corrie say.
Petroleos de Venezuela's debt rose almost eightfold last year to $16 billion from $2.3 billion, according to company statements released last month. The company last year sold $7.5 billion in 10-, 20- and 30-year bonds to finance a five-year expansion to more than double production capacity, and borrowed about $5 billion from banks to pay for current projects. The Petroleos de Venezuela bond sale was the largest-ever Latin American domestic corporate bond offering.
The company has to make a $200 million coupon payment for bondholders in April, the statements showed.
Petroleos de Venezuela last month refinanced a $1.125 billion one-year revolving credit facility with BNP Paribas SA, regulatory documents showed. In February 2007, it received a $3.5 billion loan from a group led by the Japan Bank for International Cooperation. In exchange, Petroleos de Venezuela agreed to supply as many as 30,000 barrels a day of oil and refined products for 15 years to Japan's Marubeni Corp. and Mitsui & Co.
`Socialist Revolution'
Petroleos de Venezuela has become the biggest source of revenue for Chavez's ``socialist revolution,'' which aims to provide low-income Venezuelans with free health care and education and subsidies for housing. Petroleos de Venezuela spent $11.8 billion on social programs last year, compared with $5.8 million on its domestic oil and natural-gas operations, a document released March 5 by the Energy Ministry showed.
Concern that Chavez has forced Petroleos de Venezuela to spend more on his policies than on company operations triggered a 23 percent drop in the price of the company's debt since April, traders including Interacciones Mercado de Capitales SA's Nelson Corrie say.
Petroleos de Venezuela's debt rose almost eightfold last year to $16 billion from $2.3 billion, according to company statements released last month. The company last year sold $7.5 billion in 10-, 20- and 30-year bonds to finance a five-year expansion to more than double production capacity, and borrowed about $5 billion from banks to pay for current projects. The Petroleos de Venezuela bond sale was the largest-ever Latin American domestic corporate bond offering.
The company has to make a $200 million coupon payment for bondholders in April, the statements showed.
Petroleos de Venezuela last month refinanced a $1.125 billion one-year revolving credit facility with BNP Paribas SA, regulatory documents showed. In February 2007, it received a $3.5 billion loan from a group led by the Japan Bank for International Cooperation. In exchange, Petroleos de Venezuela agreed to supply as many as 30,000 barrels a day of oil and refined products for 15 years to Japan's Marubeni Corp. and Mitsui & Co.
Source: Bloomberg|By Guillermo Parra-Bernal
[image from flapsblog.com]
UNITED KINGDOM: Eni to Buy Burren Energy
Published | 30-Nov-2007Eni SpA, Italy's biggest oil company, agreed to buy Burren Energy Plc for 1.74 billion pounds ($3.6 billion) in cash to add production in Congo and Turkmenistan.
Eni offered 1,230 pence for each Burren share, after a previous bid was turned down, the Rome-based company said today in a statement distributed by the Regulatory News Service. Burren surged as high as 1,246 pence in London, suggesting investors expect a higher bid may emerge.
``It's a good bid, but it may not be the end of the story yet,'' Phil Corbett, a London-based analyst at ABN Amro Holding NV, said by phone. ``Bids in the range of 12.50 pounds to 13 pounds could be justified.'' Corbett said he has a ``buy'' recommendation on Burren stock.
Oil companies are stepping up the search for assets as resources in the North Sea and Alaska age and countries such as Venezuela demand a greater share of output. Buying Burren will expand Eni's stake in the M'Boundi field in the Republic of Congo and give it access to deposits in Turkmenistan.
The offer represents a 51 percent premium to Burren's average closing share price in the three months through Oct. 8, Eni said in the statement. The offer was accepted by all of Burren's directors and some management, Eni said.
Burren shares surged as much as 9.1 percent. They traded 100 pence higher at 1,242 pence as of 1:21 p.m. local time, valuing the London-based company at 1.75 billion pounds.
Burren Reserves
Burren produces 35,000 barrels of oil a day from fields in the Republic of Congo and Turkmenistan and had 217 million barrels of reserves at the end of 2006, according to its Web site. The company is also exploring for crude and natural gas in Egypt and Yemen.
``With high oil prices, Eni did well to buy the company for its reserves,'' said Gianluca Ferrari, who manages $370 million in assets at Banca Valsabbina in Brescia, Italy. ``It's always best to diversify and expand.''
Burren rejected Eni's initial 1,050 pence offer last month, saying it had received more than one approach.
Eni is seeking acquisitions to meet its target of boosting production by an average of 4 percent a year. Output this year will be in line with 2006's daily average of 1.77 million barrels, Eni said last month.
`Increasingly Attractive'
``The transaction will increase our production in Congo,'' Eni Chief Executive Officer Paolo Scaroni said in the statement. The Central Asian state of Turkmenistan offers an ``increasingly attractive growth potential,'' he said
This year, Eni has agreed to pay about $10 billion for oil and gas deposits in the Gulf of Mexico, Africa and Russia to make up for lost production in Nigeria and delays at the Kashagan field in Kazakhstan. Eni and partners are now in negotiations with the Kazakh government over delays at that field.
In February, Eni bought most of Establissements Maurel & Prom SA's assets in the Republic of Congo for $1.4 billion, to raise production in the African country to 100,000 barrels a day in 2010 from 67,000 barrels a day last year. Burren is a partner with Maurel & Prom in some production deposits in Africa.
Via: Bloomberg| by Anthony DiPaola
Eni offered 1,230 pence for each Burren share, after a previous bid was turned down, the Rome-based company said today in a statement distributed by the Regulatory News Service. Burren surged as high as 1,246 pence in London, suggesting investors expect a higher bid may emerge.
``It's a good bid, but it may not be the end of the story yet,'' Phil Corbett, a London-based analyst at ABN Amro Holding NV, said by phone. ``Bids in the range of 12.50 pounds to 13 pounds could be justified.'' Corbett said he has a ``buy'' recommendation on Burren stock.
Oil companies are stepping up the search for assets as resources in the North Sea and Alaska age and countries such as Venezuela demand a greater share of output. Buying Burren will expand Eni's stake in the M'Boundi field in the Republic of Congo and give it access to deposits in Turkmenistan.
The offer represents a 51 percent premium to Burren's average closing share price in the three months through Oct. 8, Eni said in the statement. The offer was accepted by all of Burren's directors and some management, Eni said.Burren shares surged as much as 9.1 percent. They traded 100 pence higher at 1,242 pence as of 1:21 p.m. local time, valuing the London-based company at 1.75 billion pounds.
Burren Reserves
Burren produces 35,000 barrels of oil a day from fields in the Republic of Congo and Turkmenistan and had 217 million barrels of reserves at the end of 2006, according to its Web site. The company is also exploring for crude and natural gas in Egypt and Yemen.
``With high oil prices, Eni did well to buy the company for its reserves,'' said Gianluca Ferrari, who manages $370 million in assets at Banca Valsabbina in Brescia, Italy. ``It's always best to diversify and expand.''
Burren rejected Eni's initial 1,050 pence offer last month, saying it had received more than one approach.
Eni is seeking acquisitions to meet its target of boosting production by an average of 4 percent a year. Output this year will be in line with 2006's daily average of 1.77 million barrels, Eni said last month.
`Increasingly Attractive'
``The transaction will increase our production in Congo,'' Eni Chief Executive Officer Paolo Scaroni said in the statement. The Central Asian state of Turkmenistan offers an ``increasingly attractive growth potential,'' he said
This year, Eni has agreed to pay about $10 billion for oil and gas deposits in the Gulf of Mexico, Africa and Russia to make up for lost production in Nigeria and delays at the Kashagan field in Kazakhstan. Eni and partners are now in negotiations with the Kazakh government over delays at that field.
In February, Eni bought most of Establissements Maurel & Prom SA's assets in the Republic of Congo for $1.4 billion, to raise production in the African country to 100,000 barrels a day in 2010 from 67,000 barrels a day last year. Burren is a partner with Maurel & Prom in some production deposits in Africa.
Via: Bloomberg| by Anthony DiPaola
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BOLIVIA: Pan American Energy obtiene mayor préstamo otorgado a empresa privada
Published | 15-Jul-2007RUSSIA: Banks warned not to fund Sakhalin-2 project
Published | 03-Jul-2007Royal Bank of Scotland, ABN Amro and the government's export credit agency have been told by green campaigners not to consider funding or underwriting Shell's Sakhalin-2 gas project in Russia because of continuing danger to the future of western grey whales and wider environmental concerns.
Allegations that development of the $20bn (£10bn) energy scheme is still being undertaken in an irresponsible way undermines Kremlin arguments that past problems should all be laid at the feet of Shell and would end when Russian state-owned Gazprom took a controlling stake in the project, as it did in December.
A group of campaigners, including the WWF, Friends of the Earth and Russia's Sakhalin Environment Watch have written to the funding groups saying that violations of bank lending policies are continuing and urging them "to protect the integrity [of] your bank's commitment to social and environmental responsibility by declining financing of Sakhalin-2".
The note to Patrick Crawford, chief executive of the export guarantee department in Britain, argues that "financing of the enormously risky Sakhalin-2 fundamentally conflicts with the department's environmental policies and carries significant risks to your reputation".
They go on to include a recent submission from Sakhalin Environment Watch to the local Russian administration claiming fish stocks have been damaged by the disruption of river flows and there have been no measures put in place to stop soil erosion and oil spills.
Shell, Gazprom and its other Japanese partners, who run the liquefied natural gas project through the Sakhalin Energy Investment Company, are also accused of having a "lacklustre approach to the critically endangered western grey whale" which spawns in the offshore area around the gasfield.
"Be it before, during or after the Gazprom takeover, Sakhalin-2 has never been close to complying with Russian law, international best practice and the policies of public private banks that are considering financing for the project," said Dmitry Lisitsyn, chairman of the Sakhalin Island-based Sakhalin Environment Watch.
There is particular anger at ABN Amro for backing a scheme that has been shunned by the European Bank for Reconstruction and Development because it was a founder of the Equator Principles which were meant to put strict guidelines on lending to environmentally sensitive projects.
"By financing Sakhalin-2, ABN Amro circumvented the Equator Principles and undercut environmentally responsible banks that have so far refrained from financing the project," said Paul de Clerck, corporate campaign coordinator at Friends of the Earth International.
The export credit guarantee department said no decision had been taken on underwriting the Russian project. No decision would be taken until an independent report had been completed.
"Before we could agree, the project would have to satisfy us that it complies with the social, environmental and sustainability criteria that we, as part of the UK government, consider acceptable for an infrastructure project," a spokesman said.
Neither RBS nor ABN were available for comment.
Shell said: "In April 2007 the ministry of natural resources assessed an environmental actions plan as satisfactory and compliant with the requirements of environmental legislation of the Russian Federation. Sakhalin Energy has a strong commitment to high environmental standards and principles.
"Onshore and offshore construction schedules have been shaped by environmental considerations to minimise impact. We realise that a project of this size and magnitude will have some impact but our view is that construction-related impacts are temporary and reversible."
UE: European shares steady, oil companies provide support
Published | 18-Apr-2007Chemical shares decline; Tesco shares firm after profit rises
European shares held steady on Tuesday, with gains from oil producers, British supermarket group Tesco and French automaker Peugeot offsetting some technology-sector declines ahead of key earnings releases.
The pan-European Dow Jones Stoxx 600 index (ST:SXXP: news, chart, profile) finished a fraction of a percentage point higher at 387.86, led higher by French oil giant Total (TOT : 73.40, +0.43, +0.6%) (FR:012027: news, chart, profile) , up 1% on strength in crude-oil futures and a 3.2% rise for Peugeot shares after a broker upgrade.
Regional indexes were mixed, with the U.K.'s FTSE 100 index (UK:UKX: news, chart, profile) down 0.3% at 6,497.80 as the pound rose over $2 for the first time in 15 years against the greenback after stronger-than-expected inflation data, potentially forcing the Bank of England's hand on interest rates. See full story.
The German DAX Xetra 30 index (DX:1876534: news, chart, profile) rose 0.2% at 7,348.83, while the French CAC-40 index (FR:1804546: news, chart, profile) lost 0.1% at 5,858.14 Tesco in focus Of earnings-related market moves, Tesco (UK:TSCO: news, chart, profile) saw its shares rise 1.3%. Britain's largest supermarket chain said fiscal-year net profit rose 20.5% to 1.9 billion pounds ($3.8 billion) as it continued its international expansion and fended off resurgent rivals in the U.K. See full story.
Tesco said that it has also made plans to increase its buyback program to 3 billion pounds, double the previous authorization.
However, department-store operator Debenhams (UK:DEB: news, chart, profile) wasn't doing as well, its shares trading down 15% in London. The company warned that profit for the year will be below market expectations following a slowdown in same-store sales. See full story. Technology shares softened ahead of key earnings reports from giants including Intel and IBM. Nokia (NOK : 23.92, -0.11, -0.5%) , which reports on Thursday, eased 0.3%.
On the M&A front, Telecom Italia (TI : 31.93, +0.18, +0.6%) (IT:TIT: news, chart, profile) shares lost 1.7% in Milan after AT&T Corp. (T : 39.19, -0.07, -0.2%) ended talks late Monday on acquiring a stake in holding company Olimpia. Telecom Italia parent Pirelli (IT:PC: news, chart, profile) said that AT&T's formed bidding partner, Mexican operator America Movil (AMX : 50.95, +0.23, +0.5%) , remains in talks to acquire indirect control of the company. Pirelli shares declined 1%.
Also in Italy, shares of airline Alitalia (IT:AZA: news, chart, profile) declined 5.5% to 0.9780 euros, giving the company a market capitalization of around 1.4 billion euros.
According to the Italian treasury, three consortia have submitted business plans and non-binding first offers to buy the carrier. Alitalia's shares have made gains in recent weeks ahead of the bidding announcements.
However, a report out Tuesday said that the offers were about the 0.50 euro mark, valuing the company at around 670 million euros to 700 million euros, according to Dow Jones Newswires.
ABN Amro (ABN : 49.15, +0.32, +0.7%) (NL:30110: news, chart, profile) shares continued to make gains, trading up another 2.3% as investors speculated that it could get a better offer from three banks, Royal Bank of Scotland (UK:RBS: news, chart, profile) , Banco Santander Central Hispano (STD : 18.75, -0.16, -0.8%) and Fortis, than it could from Barclays (UK:BARC: news, chart, profile) (BCS : 60.24, -0.13, -0.2%) .
Brokers weigh in Shares of Peugeot (FR:012150: news, chart, profile) rose 3.2% to 58.87 euros in Paris after Morgan Stanley upgraded the company to overweight from equal weight. The broker also raised its price target 44%, to 65 euros a share. "We believe PSA is too important a player in fuel-efficient and low-emission automobiles not to be involved in secular industry trends driven by regulation," the broker said.
Morgan Stanley also said that it will leave earnings estimates unchanged for the company for now, saying 2007 is shaping up as a transition year. Also in the sector, Volkswagen (DE:766400: news, chart, profile) shares rose 1.8% after it said it sold 1.47 million vehicles in the first quarter of 2007, which is up 8% from last year.
In Germany, shares of Merck KGaA (DE:659990: news, chart, profile) traded down 2.2% after UBS cut its stance on the pharmaceutical company to neutral from buy, citing "limited potential for earnings upgrades currently, risk to the downside in key Erbitux growth drivers, only limited upside from the disposal of the generics division and little room to increase the liquid crystal valuation further."
Also in Frankfurt, shares of Premiere (DE:PREM11: news, chart, profile) jumped 6.9% to 17.23 euros after the company was upgraded to buy from hold at Deutsche Bank.
"Our re-assessment of Premiere's fundamentals shows the company in a better strategic position now than at any time before but its share price does not reflect this. We see several subscriber- and ARPU-driven upside scenarios to our 22 euro base case valuation and therefore upgrade to buy," the broker said.
L'Oreal (FR:012032: news, chart, profile) shares slipped 0.9% to 86.30 euros ahead of the cosmetics company's quarterly sales figures, due out after the bell. HSBC also downgraded the company to neutral from overweight on valuation grounds. It said that the current share price indicates only 5% upside to its 91 euros target price.
"While 2007 should be another year of organic sales-growth acceleration, we do not believe that L'Oreal will be able to exceed its historical organic sales growth rates of 7%-plus necessary to justify further multiple expansion," the broker said.
eNergy
BLOGINDIA: Suzlon ups REpower offer to e150/share
Published | 11-Apr-2007Suzlon Energy has upped the ante in the battle for REpower by increasing its offer to e150, or 7.14% higher than French giant Areva’s e140-per-share offer. The Tulsi Tanti company announced on Tuesday that its foreign joint venture with Martifer—Suzlon Wind Energie—raised the takeover offer for REpower Systems after its subsidiary purchased 7.7% in the German firm for that price.
ET had reported on March 16 that Suzlon, the fifth-largest wind energy firm in the world with a market share of 6%, is likely to revise its offer to buy out REpower, following the counter offer made by Areva, topping Suzlon’s earlier bid of e126 a share.
“The decision to increase the offer was taken after careful analysis and review of potential synergies that Suzlon can contribute to REpower, given our fully integrated business and control over component level technology and its integration with turbine technology,” Suzlon CMD Tulsi Tanti said.
A communiqué from Suzlon said SE Drive Technik, a company acting in concert with the bidding company, purchased REpower shares for up to e150 per share over the Easter weekend.
Thereby, the offer price of the public takeover offer of Suzlon Wind Energy made on February 28, 2007, has automatically been increased from e126 to e150 per share pursuant to the German Takeover Act. In total, Suzlon has acquired 627,000 REpower shares over the last weekend, corresponding to 7.7% of the share capital of REpower prior to the capital increase of REpower by up to 10%. The offer period expires on April 20, 2007, according to current conditions. The fresh offer from Suzlon constitutes a premium of 110% in comparison to the average weighted share price during the last three months prior to the announcement of Areva on January 23, 2007, to make a voluntary takeover offer for REpower.
Andre Horbach, group CEO of Suzlon based in the global headquarters at Amsterdam, said REpower remains a highly strategic asset from a geographical as well as onshore and offshore product mix point of view.
“The market has never been a concern for the entire industry and this will likely continue for the foreseeable future. Most of the industry faces challenges of a reliable and cost efficient supply chain and that is where the synergies with our vertically integrated supply chain are compelling. De-bottlenecking will lead to higher volumes for REpower at marginal costs, resulting in better operating margins. Together, we can strive for a top 3 position in all key wind markets,” said Mr Horbach.
Mr Tanti claimed that their existing credit facilities and internal accruals were sufficient to fund the obligations under the offer. “We have the support of our partner Martifer with whom we have a deferred purchase agreement.” Suzlon is being advised by Yes Bank and ABN Amro while Linklaters are the legal advisers.
ET had reported on March 16 that Suzlon, the fifth-largest wind energy firm in the world with a market share of 6%, is likely to revise its offer to buy out REpower, following the counter offer made by Areva, topping Suzlon’s earlier bid of e126 a share.
“The decision to increase the offer was taken after careful analysis and review of potential synergies that Suzlon can contribute to REpower, given our fully integrated business and control over component level technology and its integration with turbine technology,” Suzlon CMD Tulsi Tanti said.
A communiqué from Suzlon said SE Drive Technik, a company acting in concert with the bidding company, purchased REpower shares for up to e150 per share over the Easter weekend.
Thereby, the offer price of the public takeover offer of Suzlon Wind Energy made on February 28, 2007, has automatically been increased from e126 to e150 per share pursuant to the German Takeover Act. In total, Suzlon has acquired 627,000 REpower shares over the last weekend, corresponding to 7.7% of the share capital of REpower prior to the capital increase of REpower by up to 10%. The offer period expires on April 20, 2007, according to current conditions. The fresh offer from Suzlon constitutes a premium of 110% in comparison to the average weighted share price during the last three months prior to the announcement of Areva on January 23, 2007, to make a voluntary takeover offer for REpower.Andre Horbach, group CEO of Suzlon based in the global headquarters at Amsterdam, said REpower remains a highly strategic asset from a geographical as well as onshore and offshore product mix point of view.
“The market has never been a concern for the entire industry and this will likely continue for the foreseeable future. Most of the industry faces challenges of a reliable and cost efficient supply chain and that is where the synergies with our vertically integrated supply chain are compelling. De-bottlenecking will lead to higher volumes for REpower at marginal costs, resulting in better operating margins. Together, we can strive for a top 3 position in all key wind markets,” said Mr Horbach.
Mr Tanti claimed that their existing credit facilities and internal accruals were sufficient to fund the obligations under the offer. “We have the support of our partner Martifer with whom we have a deferred purchase agreement.” Suzlon is being advised by Yes Bank and ABN Amro while Linklaters are the legal advisers.
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