Anglo-Australian mining group BHP Billiton led the charge last week with a £35 billion (US$54.4 billion) bid for Potash Corp of Canada.
Analysts say British companies in the takeover frame include television company ITV, targeted by NBC; BG, the gas and exploration group, which is being stalked by oil majors such as Shell; insurance company Prudential, a possible target for a break-up bid by Aviva and Resolution; miner Xstrata, which is being eyed by Swiss commodities group Glencore; AstraZeneca, the drugs company, which could attract interest from GlaxoSmithKline or European rivals; and the supermarket group Sainsbury, where the Qataris have built up a minority stake.
Potential counter-bidders for PotashCorp, such as Vale of Brazil and Chinese companies such as CIC (中國投資公司) and Sinochem (中國中化) were this weekend reviewing their options.
Banking sources say PotashCorp executives are “actively courting possible white knights” to save the firm from the clutches of BHP, headed by Marius Kloppers. Another option is to persuade a Middle Eastern sovereign wealth fund to buy a blocking stake.
The mining and resources sector is attracting a flurry of activity as firms seek to cash in on demand from Asia and South America.
“Predators are seeking to secure potentially lucrative supplies of minerals and oil as industrialization continues apace in emerging countries,” Charles Kernot at Evolution Securities said.
On Friday, British oil explorer Dana Petroleum found itself at the receiving end of a hostile £1.9 billion offer from South Korea’s state-owned KNOC.
Bloomberg published research showing that this month could be one of the busiest months for mergers and acquisitions (M&A) since the financial meltdown in the autumn of 2008. By the end of last week, proposed deals tabled over recent weeks topped US$175 billion.
Ian Richards, head of European equities strategy at RBS, said companies that had been hoarding cash during the recession were now willing to spend because “corporate cash flow is very high.”
Richards said attractive targets were likely to be firms with strong export potential and with exposure to emerging markets. He added that “the sweet spots” were mining and resources; industrial goods and services; personal household goods; and food and beverages.
However, Royal London Asset Management chief investment officer Robert Talbut said there was wariness about the ability of banks to provide credit lines and that doubts lingered about the strength of the recovery.
However, Andrew Milligan, head of global strategy at Standard Life, told Bloomberg he thought there would “another wave of M&A” and that “a robust trend” was beginning to emerge. Milligan does not believe there will be a double dip recession.
Paul Parker, head of global acquisitions at Barclays Capital, said cash on corporate balance sheets was at “historically high levels,” while other analysts point out that stock market valuations are relatively low, making target companies look cheap.
The Philippines is working behind the scenes to enhance its defensive cooperation with Taiwan, the Washington Post said in a report published on Monday. “It would be hiding from the obvious to say that Taiwan’s security will not affect us,” Philippine Secretary of National Defense Gilbert Teodoro Jr told the paper in an interview on Thursday last week. Although there has been no formal change to the Philippines’ diplomatic stance on recognizing Taiwan, Manila is increasingly concerned about Chinese encroachment in the South China Sea, the report said. The number of Chinese vessels in the seas around the Philippines, as well as Chinese
‘A SERIOUS THREAT’: Japan has expressed grave concern over the Strait’s security over the years, which demonstrated Tokyo’s firm support for peace in the area, an official said China’s military drills around Taiwan are “incompatible” with peace and stability in the Taiwan Strait, Japanese Minister of Foreign Affairs Takeshi Iwaya said during a meeting with his Chinese counterpart Wang Yi (王毅) on Thursday. “Peace and stability across the Taiwan Strait is important for the international community, including Japan,” Iwaya told Wang during a meeting on the sidelines of the ASEAN-related Foreign Ministers’ Meetings in Kuala Lumpur. “China’s large-scale military drills around Taiwan are incompatible with this,” a statement released by the Japanese Ministry of Foreign Affairs on Thursday cited Iwaya as saying. The Foreign Ministers’ Meetings are a series of diplomatic
URBAN COMBAT: FIM-92 Stinger shoulder-fired missiles from the US made a rare public appearance during early-morning drills simulating an invasion of the Taipei MRT The ongoing Han Kuang military exercises entered their sixth day yesterday, simulating repelling enemy landings in Penghu County, setting up fortifications in Tainan, laying mines in waters in Kaohsiung and conducting urban combat drills in Taipei. At 5am in Penghu — part of the exercise’s first combat zone — participating units responded to a simulated rapid enemy landing on beaches, combining infantry as well as armored personnel. First Combat Zone Commander Chen Chun-yuan (陳俊源) led the combined armed troops utilizing a variety of weapons systems. Wang Keng-sheng (王鏗勝), the commander in charge of the Penghu Defense Command’s mechanized battalion, said he would give
‘REALISTIC’ APPROACH: The ministry said all the exercises were scenario-based and unscripted to better prepare personnel for real threats and unexpected developments The army’s 21st Artillery Command conducted a short-range air defense drill in Taoyuan yesterday as part of the Han Kuang exercises, using the indigenous Sky Sword II (陸射劍二) missile system for the first time in the exercises. The armed forces have been conducting a series of live-fire and defense drills across multiple regions, simulating responses to a full-scale assault by Chinese forces, the Ministry of National Defense said. The Sky Sword II missile system was rapidly deployed and combat-ready within 15 minutes to defend Taiwan Taoyuan International Airport in a simulated attack, the ministry said. A three-person crew completed setup and
RSS