Cadbury takeover: Which British companies are next?

The weakness of the Sterling ensures easy takeovers of British brands. Next, you will find a brief explanation.

This week there was a surprising takeover bid of Kraft. They want to take over Cadbury for £10.2bn. This has a big influence on the stock market returns. Investors are happy, they have enjoyed the sweetest summer rally in decades. First, Cadbury refused the offer but FTSE 100 index surged to a new high for the year. It reached more than 40 pc above its low point of 3,512 in March.

The last weeks, there were going on a lot of big amazing deals. Next to Cadbury-Kraft, there was also a link between Orange and T-Mobile. Enthusiastic people thinks there may be more such deals to come. The market confidence returns and because of Sterling’s weakness, British brands become easier to reach for foreign predators. Some intelligent British fund managers have already marked up gains of several million pounds last week.

Robin Geffen of Neptune Income believes there will be a further consolidation in the tobacco sector. British American Tobacco is too large, but Imperial Tobacco might be attractive because it has the best potential position in China and eastern Europe.

On the other hand, Derek Stuart of Artemis Special Situations fund, thinks that any company with strong market share and brand are particular candidates for a takeover. Companies like Diageo and Unilever are very interesting. They improved the access to capital but they still obtain for a private equity.

Fund managers also believe that the global recovery is now becoming a reality. Because of high levels of cash, it is believed that the booming period after the crisis has started. Money flows are also likely to benefit equity markets. A little remark: A positive 12 month evolution also ensures a volatile experience because of the fragility of the macro economy.

I believe the opportunities of companies to takeover other brands, are an identification that the booming period after the crisis is slightly starting. Companies are able to put funds aside to place offers for takeovers. The fact of the restart of cash flow means there are more liquidities available for the companies. Companies with a liquid position are normally better for their economical growth. I’m just wondering if every company makes the good choice to takeover another one. On the short term, there will be certainly an economical boost, but I’m not sure this will reach into the long term. Another important aspect is the volatility. I propose 1 thing: let’s just all wait what the after-crisis-period brings and let’s just hope the best for the economy. A recovery of the economy is still a main requirement to get a better economical world!

Source: http://www.telegraph.co.uk/finance/personalfinance/investing/6166757/Cadbury-takeover-Which-British-companies-are-next.html

Posted by Joachim De Zutter

Merger of Metris

Metris is a Belgian developer of 3D hardware and software inspection systems for automotive and aerospace industries. Metris was founded in 1995 as a spin-off of the catholic university in Leuven. It announced its IPO on Eurolis by Euronext Brussel on the end of 2006.
Because of the financial crisis and the following recession in aerospace and automotive sectors in 2008, Metris couldn’t maintain revenues and control debt in the downturn.
Its net debt rose to 87 million euros. The shares fall to about 1 euro. Rumours about a merger made rise Metris shares to 2,66 Euros.

After Euronext Brussels suspended trading of its shares, on Wednesday 27, 2009 , the Chief Executive of Metris let know he was in merger talks with Japan’s Nikon and with Japanese precision measurement specialist Mitutoyo.

In June 3, Metris said it was set to accept takeover offer from Nikon. The conditional cash offer for all its outstanding shares would come to 5,5 Euros per share.
Annalists considered the takeover as positive for Metris and its stakeholders and advised investors to accept the offer.


Comment

The takeover price of Metris shares amounts to the double of its last closing price on May 26.
It’s evident that investors who bought shares at its lowest price can sell at a considerable profit.
But at the begin of its stock market quotation end 2006, Metris’s share price amounted to 12 Euros and after strengthening its international market position, the share price rose to 16,5 Euros. That means that many private investors have to sell at a loss and proves that shares are a very risk bearing investment.
Annalists agree that Nikon is the great winner of the whole transaction.

Source: http://www.forbes.com/feeds/afx/2009/06/03/afx6499557.html

Elise Van Praet
3FV1

Cadbury takeover turns nasty

In the weekend of September the 26th there has been an attack on the Cadbury directors by the directors of Kraft Foods. Irene Rosenfeld, one of the directors of Kraft Foods, has accused the Cadbury directors that the potential takeover of Cadbury has become a game to Cadbury. It seems that the board of directors of Cadbury are more interested in keeping their company independent then to acquire a higher price for their company.

In the week of September the 14th there has also been gossips that the board of directors of Cadbury has been to America to get in favour with larger investors.
Now most of the people think that Kraft Foods will put a potential bid on Cadbury.

In my opinion, I think that Cadbury has the right to keep their company independent eventually they have founded the company. But I do not agree with the fact that Cadbury has put their price lower to keep the company independent.

If it’s true that Kraft Foods is interested to take over the company then they have to put a bid as soon as they can because there are rumours that American investors with a bigger capital may be interested too.

Finally I think that a takeover is a serious subject so Cadbury has to be clear and honest about it. Because otherwise the companies who want to takeover will not be interested in taking over the Cadbury.

Ruth Blommaert

Source: http://www.financialadvice.co.uk/news/5/investments/12152/Cadbury-takeover-turns-nasty.html

Wealth managers hiring as markets rise

The financial markets are recovering and because of this positive evolution, financial institutions are hiring managers again. The evolution even has an influence on takeovers because the banks are searching them to extend.

Thanks to the gradually recovery, there will be several advantages again like the increase of the bank client’s assets which has as result the rise of the advisors’ fees. Other advantages are the trade of stocks, the carry through of mergers and recruiting new staff.

Several financial institutions are hopeful and are making deals to expand their businesses again. They are having conversations with other firms to open new offices and seeking takeovers.

In my opinion this is a positive article. During the financial crisis there were always headlines of ‘company X cuts jobs’ and these decreases of the staff were enormous and catastrophic for all the fired people. It seems like we are at the end of the crisis. Companies are hiring people again, they are considering takeovers and the market recovers steady.

I think that companies should be attentive and should not want to grow fast. Because otherwise we will end up in the same situation like a year ago namely the financial crisis. It is important that financial institutions and all companies will regain the confidence of people. But I doubt it that people would find their 100 per cent trust again in banks. In my opinion the crisis has made too much damage in this confidence.

Posted by: SOFIE DE COOMAN

Source: http://www.reuters.com/article/GlobalWealthManagement09/idUSTRE5962XV20091007

Blackstone buys into the world of American theme parks.

Blackstone is a world leading private equity empire that already possess Merlin Entertainments, better known as Madame Tussauds, Legoland and the London Eye. They now decided to take over 10 US theme parks from brewer Anheuser - Busch InBev.

Anheuser-Busch Inbev is headquartered in Belgium and is a leading global brewer that has operations across six geographic zones. They also have a place in the top five of the world’s best consumer products companies. They became owner of the theme parks by taking over Anhauser-Busch, that produced Buddweiser.

By taking over the theme parks, Blackstone did a great job. They already have a lot of experience in the media and entertainment industries. Due to the expierence they can expand the parks into real successes. This transaction also is the biggest private equity buyout of 2009, it is probably a sign that the credit markets are recovering after a long time of troubles.
Blackstone is paying $2,3bn in cash and will further pay $400m depending on future profits at the park. Anheuser - Bush Inbev will pay of his debts with the amount they received from the takeover.

In my opinion it is a good decision of Anheuser – Bush Inbev to leave the theme parks. Amusement is not their business and it would only cost more money to make them profitable. With the money they are receiving from the takeover they can pay off their debts what is a good move and also better for appreciation of their shares. Blackstone at the other side can now strengthen their position on the market of entertainment, they have enough experience to make the parks profitable.

By: De Ridder Steffie

Source: http://www.guardian.co.uk/business/2009/oct/07/blackstone-buys-american-theme-parks

Abbott in €4.5bn deal for Solvay drug unit

Solvay is a Belgian, chemical and pharmaceutical company with headquarter in Brussels. They possess establishments over 50 countries, all over the world. Solvay produces several products for all kinds of pharmaceutical levels like drugs for cholesterol, Parkinson, …

After a 5 month long decision period, Abbott Laboratories decided to take over Solvay Pharmaceutical. The merger will invest €4.5bn into Solvay Pharmaceutical. So, they can strengthen their position on the pharmaceutical market. Because of Abbott’s strategic decision, they beated UCB of Belgium and Nycomed of Switzerland. Nycomed made an offer of €4bn. Due to this offer, they raised their debts about €2bn to finance it. Just like Nycomed, UCB offered €4bn, in the hope to become Belgian’s most important pharmaceutical company.

We think this takeover is a good decision of Abbott because the pharmaceutical market is rentable sector which grows year after year. Somewhere we regret that UCB failed to take over Solvay. Otherwise Belgium could accomplish a stronger position in the pharmaceutical sector. The main question is: “ What will Solvay do with all this money?!” We encourage Solvay to do (more) research on life-threatened diseases. So that they can discover remedies and help (more) people in need. The research will lead into 2 positive directions: Abbott will be able to increase their profit and they can also create a hopeful position for sick people.

Posted by: Ruth Blommaert, Sofie De Cooman, Steffie De Ridder, Joachim De Zutter and Elise Van Praet.

SOURCE: http://www.ft.com/cms/s/0/11d12820-ab7b-11de-9be4-00144feabdc0.html?nclick_check=1