Asian and European stocks climb as a flurry of takeover news raises hopes of a recovery in markets.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 12:15 pm
CHICAGO (Reuters) - Archer Daniels Midland Co , a leading U.S. food processor and ethanol producer, posted higher quarterly profit on Monday, boosted by demand for oilseeds and improved results in its wheat and malt processing operations.
Source:
Reuters: Business News | 4 Feb 2008 | 12:11 pm
SYDNEY (Reuters) - Aluminum Corp of China (Chinalco) sought to douse speculation on Monday that it was preparing to mount a counter bid to BHP Billiton for Rio Tinto , saying it was happy to stick with the $14 billion stake it bought last week.
Source:
Reuters: Business News | 4 Feb 2008 | 12:03 pm
AP - The World Bank cut its 2008 economic growth forecast for China to 9.6 percent from 10.8 percent on Monday due to cooling global export demand and said storms battering southern China should have little long-term impact.
Source:
Yahoo! News: Business | 4 Feb 2008 | 12:01 pm
The World Bank cut its 2008 economic growth forecast for China to 9.6 percent from 10.8 percent on Monday due to cooling global export demand and said storms battering southern China...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 12:01 pm
WASHINGTON (MarketWatch) -- President Bush on Monday sent Congress a $3.11 trillion budget request that sees a worsening deficit over the next two years but projects a balanced federal budget by 2012.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 12:01 pm
Reuters - Aluminum Corp of China (Chinalco) sought
to douse speculation on Monday that it was preparing to mount a
counter bid to BHP Billiton for Rio Tinto ,
saying it was happy to stick with the $14 billion stake it
bought last week.
Source:
Yahoo! News: Business | 4 Feb 2008 | 11:59 am
U.S. stocks headed for a largely flat open Monday after stocks posted their best week in four years and as investors try to determine whether Wall Street will continue to show signs of...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:59 am
Ryanair says net income fell 27% and warns high oil prices and a weak pound may cause an earnings storm this year.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 11:59 am
France's finance ministry calls for tighter banking controls after the Societe Generale trading scandal.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 11:57 am
AP - Managed care provider Humana Inc. said Monday its fourth-quarter earnings surged 57 percent due to a lower-than-expected income tax rate and a gain on the sale of a venture capital investment, and the company raised its profit outlook for 2008.
Source:
Yahoo! News: Business | 4 Feb 2008 | 11:57 am
Managed care provider Humana Inc. said Monday its fourth-quarter earnings surged 57 percent due to a lower-than-expected income tax rate and a gain on the sale of a venture capital...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:57 am
When Jerry Yang answered the phone on a rainy Silicon Valley Thursday night in January and heard the hoarse voice of Microsoft's Steve Ballmer on the other end, it was simply the last in a string of disappointments the Yahoo co-founder has confronted over the past two years.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 11:56 am
U.S. stocks headed for a largely flat open Monday after stocks posted their best week in four years and as investors try to determine whether Wall Street will continue to show signs of...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:54 am
U.S. stock futures were little changed Monday after the previous session's rally as investors waited to see how Microsoft efforts to buy Yahoo develop and looked ahead to a batch of economic reports due out this week.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 11:52 am
Reuters - Health insurer Humana Inc said
on Monday that fourth-quarter profit soared 57 percent, beating
Wall Street's expectations, on strength in its Medicare plans
for older Americans.
Source:
Yahoo! News: Business | 4 Feb 2008 | 11:49 am
NEW YORK (Reuters) - Health insurer Humana Inc said on Monday that fourth-quarter profit soared 57 percent, beating Wall Street's expectations, on strength in its Medicare plans for older Americans.
Source:
Reuters: Business News | 4 Feb 2008 | 11:49 am
The impact on China's economy of the worst snow in decades could be limited and may even spur a new round of investment, local and foreign analysts said Monday. Three weeks...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:48 am
Google Inc. raised the specter of Microsoft Corp. using its proposed $42 billion acquisition of Yahoo Inc. to gain illegal control over the Internet, underscoring the online search...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:44 am
US computer giant Microsoft said Monday it was launching a cheaper version of its Xbox 360 in Japan in an attempt to make inroads into the game-loving nation that has shunned the console.
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:31 am
A roundup of the latest corporate earnings reports and what companies are saying about future quarters.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 11:31 am
NEW YORK (Reuters) - Health insurer Humana Inc posted higher fourth-quarter profit on Monday, helped by a strong performance in its Medicare plans for seniors.
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:17 am
U.S. stock futures point to a slightly lower open after recording gains in four of the previous five sessions.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 11:16 am
Read full story for latest details.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 11:14 am
A deadline on private bids for Northern Rock, the British bank almost ruined by the squeeze on global credit, was to expire on Monday amid speculation that three proposals will be made to...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:13 am
The U.S. dollar was mixed against other major currencies in European trading Monday morning. Gold prices fell. The euro was quoted at $1.4812, up from $1.4803 late Friday in New York.
Source:
Infocious RSS raw feed - channel BNewsBusiness | 4 Feb 2008 | 11:13 am
BOSTON (MarketWatch) -- If you think Microsoft's acquisition of Yahoo is a big deal, think again. It's an even bigger deal than it appears.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 11:13 am
The yen lost ground on Monday as a surge in Asian equities markets boosted fragile risk appetite, weighing on safe-haven assets such as the low-yielding Japanese currency. The yen fell 0.3 per cent to...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 11:12 am
Reuters - Wall Street is expected to open slightly
lower on Monday after rallying on Friday after Microsoft Corp.
bid for Internet media firm Yahoo Inc. .
Source:
Yahoo! News: Business | 4 Feb 2008 | 11:07 am
LONDON (Reuters) - Wall Street is expected to open slightly lower on Monday after rallying on Friday after Microsoft Corp. bid for Internet media firm Yahoo Inc. .
Source:
Reuters: Business News | 4 Feb 2008 | 11:07 am
China's furious growth should cool off a little this year according to a new study from the World Bank.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 11:00 am
PARIS (Reuters) - France has proposed tighter risk controls on banks after a rogue trading scandal cost Societe Generale 4.9 billion euros ($7.3 billion), saying the bank was warned last year its security systems were not up to scratch.
Source:
Reuters: Business News | 4 Feb 2008 | 10:55 am
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 10:51 am
Read full story for latest details.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 10:51 am
Internet giant Google urges regulators to scrutinise Microsoft's proposed $44.6bn move to buy Yahoo.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 10:48 am
Some critics are convinced that any tax rebate checks from Congress will go straight to China if Americans take the extra money and splurge at the mall.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 10:48 am
SAN FRANCISCO/NEW YORK (Reuters) - Yahoo Inc would consider a business alliance with Google Inc as one way to rebuff a $44.6 billion takeover proposal by Microsoft, a source familiar with Yahoo's strategy said on Sunday.
Source:
Reuters: Business News | 4 Feb 2008 | 10:46 am
One of the last sources of ready cash for homeowners looking to get money from their house appears to be shutting down and the results aren't likely to be pretty for the economy.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 10:33 am
The Australian dollar rallied on expectations surging inflation will force the nation's central bank to increase interest rates. Traders will also be eyeing monetary-policy decisions from the Bank of England and the European Central Bank later this week.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 10:28 am
U.K. pub operator Punch Taverns said it has proposed a merger with rival Mitchells & Butlers that would create the country's biggest pub operator.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 10:23 am
Read full story for latest details.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 10:22 am
Reuters - Billionaire Richard Branson and two
rival teams are set to pitch offers for ailing British bank
Northern Rock by Monday's deadline, as the government
moves to resolve the crisis in the next month.
Source:
Yahoo! News: Business | 4 Feb 2008 | 10:15 am
LONDON (Reuters) - Billionaire Richard Branson and two rival teams are set to pitch offers for ailing British bank Northern Rock by Monday's deadline, as the government moves to resolve the crisis in the next month.
Source:
Reuters: Business News | 4 Feb 2008 | 10:15 am
Bid speculation kept London shares afloat on Monday, on hopes of further consolidation in the mining sector as Anglo American came under the spotlight. Anglo jumped 3.8 per cent to 30.20 after announcing...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 10:15 am
Bidders hoping to take control of Northern Rock must submit their proposals ahead of Monday's deadline.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 10:14 am
Punch Taverns on Monday launched its campaign to merge with Mitchells & Butlers saying its proposal offered "value, speed and deliverability". A deal would create the UK's largest pub operator. Under...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 10:11 am
Shares of Ryanair Holdings Plc decline 12% as Europe's largest low-cost airline reports a 27% drop in adjusted third-quarter profit because of lower ticket prices, and warns that higher fuel prices and weaker consumer spending could cut next year's profit by as much as 50%.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 10:09 am
Chinese shares soared more than 8 per cent Monday after optimistic statements by government officials eased concerns about an economic slowdown and the impact of recent severe winter weather. Other regional...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 10:03 am
Airline shares weaken in London after a poor outlook from Irish low-cost carrier Ryanair raises doubts about this year's performance.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 9:56 am
The New York Giants' victory over the New England Patriots Sunday night was one of the biggest upsets in Super Bowl history, but the advertising effort during the big game was not quite as inspiring.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 9:47 am
Shanghai-listed shares rebound strongly to lead a regionwide rally, after the Chinese market regulator approved the launch of two new stock funds for the first time in several months.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 9:42 am
Asian markets rallied Monday as investors were heartened by Wall Street's rebound last week and by reports downplaying the impact of disastrous winter storms on China's broader economy.
Source:
Business and financial news - CNNMoney.com | 4 Feb 2008 | 9:32 am
With February underway, it is not often that you can start a commentary, so early in the year, with a statement that celebrates a two week rally in the FTSE that has added 750 points to the index from the lows and then follows this up with the line 'only 400 more to get back to the starting point of the year'!
Source:
Telegraph Business | 4 Feb 2008 | 9:30 am
Punch Taverns puts forward plans for a possible merger with troubled rival Mitchells & Butlers.
Source:
BBC News | Business | World Edition | 4 Feb 2008 | 9:27 am
European shares pushed higher on Monday after Danish wind turbine maker Vestas Wind Systems lifted alternative energy stocks by raising its outlook for 2007 sales and profit margins. In early trade,...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 9:20 am
LONDON (Reuters) - World stocks hit 2-1/2 week high on Monday and emerging market assets rallied as last week's news of major company deals eased concerns that the credit crisis might be hurting corporate and economic activity.
Source:
Reuters: Business News | 4 Feb 2008 | 9:15 am
Higher oil prices, poor consumer demand, weaker sterling and higher costs could combine to form a "perfect storm" - Ryanair chief executive Michael O'Leary has warned.
Source:
Telegraph Business | 4 Feb 2008 | 9:04 am
LONDON (Reuters) - Oil nudged above $89 a barrel on Monday, taking back some losses from the previous session as worries over a possible U.S. economic recession continued to weigh.
Source:
Reuters: Business News | 4 Feb 2008 | 8:59 am
Virgin is losing ground in the battle for Northern Rock after failing to persuade shareholders in the final days before today's bid deadline to back its offer for the stricken bank.
Source:
Telegraph Business | 4 Feb 2008 | 8:57 am
Ryanair, the leading European low cost airline, warned on Monday there was a "significant chance" its profits would decline next year and could fall by as much as 50 per cent under the impact of rising...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 8:57 am
SINGAPORE (Reuters) - Platinum roared to another record high on Monday as supply concerns persisted in main producer South Africa, lifting sister-metal palladium to its best level in six years and overshadowing gold.
Source:
Reuters: Business News | 4 Feb 2008 | 8:55 am
LONDON (MarketWatch) - European stocks moved higher on Monday morning as investors picked up shares in mining, technology and industrial firms, although airlines were pressured after a bleak outlook from Irish low-cost airline Ryanair Holdings Plc.
Source:
MarketWatch.com - Top Stories | 4 Feb 2008 | 8:52 am
Chinalco, the Chinese state's aluminium producer, has no plans to increase its stake in Rio Tinto
Source:
Telegraph Business | 4 Feb 2008 | 8:25 am
We at Media City have urban sensibilities when it comes to guns, but we know there are plenty of red- blooded Americans in New York who love to hunt, fish and generally bear arms. We say live and let live...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 8:18 am
Top music downloads1. No One, Alicia Keys2. Cyclone, Baby Bash3. Ayo Technology, 50 Cent4. Crank Dat, Soulja Boy5. Apologize, OneRepublicTiVo favorites1. American Idol, Tuesday2. American Idol, Wednesday3....
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 8:18 am
As fashion models decked out in Vera Wang's new fall collection hit the runway in Bryant Park Thursday morning, another set of models across the street will be paid to lounge in bed. Designer Alice +...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 8:18 am
Google intensified the battle with Microsoft yesterday, saying the software behemoth's $44.6 billion hostile bid for Yahoo! "raised troubling questions." In a terse broadside of what could be a protracted...
Source:
Infocious RSS raw feed - channel BNPaperBusiness | 4 Feb 2008 | 8:18 am
Unilever has acquired Inmarko, Russia's largest ice cream company.
Source:
Telegraph Business | 4 Feb 2008 | 8:02 am
Punch Taverns has confirmed that it has tabled a takeover offer for beleaguered rival Mitchells & Butlers - a deal that would create Britain's biggest pub company.
Source:
Telegraph Business | 4 Feb 2008 | 7:35 am
Gaze out your window at the cars going by. Now pretend you will be paid a quarter every time one passes.
These days, the world's largest investors are making similar calculations, and they like what they see. Stable cash flow is something to cherish, with volatility whipsawing stocks and the debt market nursing the sting of billions in collateralized debt obligations gone awry. So the once-sleepy backwater of infrastructure investment—the buying up of public roadways, utilities, airports, hospitals, and even prisons—has become fertile ground for Wall Street titans.
The problem is that the chief benefit of the investment—a safe long-term inflation-adjusted return—becomes harder to reach as more investors pile into the market seeking it.
Experts worry that prices have already been driven too high for many of the best assets. As evidence, they note that more deals are being loaded up leveraged-buyout levels of debt. At the same time, yield-hungry investors are increasingly willing to build or buy infrastructure in riskier corners of the world.
Is infrastructure fated to become the next asset bubble? Ryan J. Orr, executive director of Stanford's Collaboratory for Research on Global Projects, says: "We're already there."
Such concerns aren't stopping the party. Financial-services companies continue to flood the market with new infrastructure funds and new ideas about putting these funds to work. Some of those new ideas involve less-traditional assets like lotteries, gas stations, and old folks homes.
Stanford's Collaboratory estimates that more than 72 new infrastructure funds have been introduced since the beginning of 2006 and that more than $160 billion has been raised during that period for infrastructure investment.
Robert Dove, co-manager of Carlyle Infrastructure Partners, said new funds are cropping up because "there is certainly an appetite in the investment community for more stable, predictable investments." He adds that Carlyle, which closed its first infrastructure fund in November after raising almost $1.2 billion in about 18 months, sees "great opportunities" in the sector.
It's an opportunity based on hard times, as governments around the world will have difficulty paying for what is estimated to be $53 trillion in needed infrastructure investment over the next 25 years. This leaves the door open for private investors to offer a helping hand—for a price.
At the same time, some of private equity's biggest clients, pension funds and other institutional investors, are looking at the possibility that one day they might not meet growing needs going forward. Underfunded pension plans in the United States currently have liabilities of more that $1.2 trillion but assets of only $875 billion. Infrastructure investment is seen as playing an integral role in helping to close this gap.
"Our bottom line always has been and will be to maximize investment returns and thereby minimize contributions needed to fund our retirement benefits for 1.5 million members," says Clark McKinley, a spokesman for the California Public Employees' Retirement System, which earmarked $2.5 billion for infrastructure investment last month.
He adds that the people served by his fund, which is known as Calpers, depend on investment returns for 75 cents of every dollar they receive. "Prudent, smart infrastructure investments may help us sustain those kind of returns for the benefit of our people and other Californians," he explains.
But the easy money may have already been made by old hands like Macquarie Bank, the Australian company that pioneered the idea of the infrastructure fund in the early 1990s. It now controls billions of dollars worth of airports, toll roads, ports, and utilities.
When Macquarie got into the field, financial sponsors, like pension funds and private equity groups, accounted for only about 6 percent of infrastructure purchases. Now they measure closer to 20 percent. And, instead of partnering up, they're often competing madly against each other.
Calpers, for instance, says it is considering making direct investments in infrastructure assets, instead of buying through another sponsor like a private equity fund. Other pension funds have already entered the fray, competing directly with sovereign wealth funds, endowments, and their former advisers in the private equity and investment-banking world.
"We made a decision around 2002 to focus on direct investment," says Stephen Dowd, Ontario Teachers' Pension Plan's vice president for infrastructure investments, adding that many other pension funds have also benefited from the approach. "They all have strong teams, are able to compete, and are in fact ahead of the game when compared with a lot of the third party funds."
Unfortunately, all this competition is diluting returns from infrastructure investments for everyone involved, contributing to an increase in both the multiples being paid for assets and the aggressive financial leverage being used to fund them.
Standard & Poor's notes that while the number of global infrastructure deals increased 24 percent between 2005 and 2007, the value placed on those deals increased by 90 percent as investors offered more and more for less and less.
To take one example, regulated water companies in Britain fetch well over a 25 percent premium to their asset value.
"Some of these multiples are scary," says Orr, noting that funds "promising high double-digit returns on brownfield buy-outs—where they buy assets, lever them up with debt, do some fancy financial engineering and packaging—are never going to be able to achieve those aggressive performance targets."
Bidding wars have raised the level of risk to a point where investors like Stephen Dowd have become more cautious, forcing him to sometimes walk away from a deal.
"It's more of a challenge now and you have to be disciplined about the pricing of risk," Dowd says. "If you lose to someone who prices it differently, you have to just go on to the next one." The Ontario Teachers' Pension Plan currently has about 7 percent of its $103.6 billion in net asset in infrastructure investments.
Not everybody is dialing back the danger. There is too much new money sloshing around in the sector, much of it destined for marquee purchases and all of it needing to be put to work.
Some investors, hoping to avoid inflated prices in Europe and in the United States, are now looking to emerging markets, where infrastructure investment has been rising at a fast clip. More than $56 billion was spent on Russian infrastructure in 2007, compared with only $3.9 billion the year before, for example.
Other investors are taking what could be an even bigger gamble, partnering with construction companies to build the infrastructure of the future—known as greenfield developments—instead of bidding on what already exists.
All of these investors can draw comfort from reams of data projecting the risks and the rewards inherent in their decisions. But the world can change quickly and forecasting gets a lot harder the further out you go.
Just ask the investors who were forced to renegotiate Latin American infrastructure investments in the 1990s; those caught short when the Eurotunnel linking England and France defaulted on its debt; or anyone hit by boycotts of their sparkling new toll roads.
Related Links
Bipolar NationLawsuits as an Asset ClassWall Street Family Values
Source:
Portfolio.com: Top 5 | 4 Feb 2008 | 6:00 am
Reuters - Yahoo Inc would consider
a business alliance with Google Inc as one way to rebuff a
$44.6 billion takeover proposal by Microsoft, a source familiar
with Yahoo's strategy said on Sunday.
Source:
Yahoo! News: Business | 4 Feb 2008 | 5:05 am
The leveraged loan market begins the week in "disarray" following the collapse of efforts to syndicate $14bn of the debt used to finance the $27.8bn buy-out of Harrah's Entertainment, bankers say
Source:
FT.com - US homepage | 4 Feb 2008 | 3:33 am
Google raised a red flag over Microsoft's unsolicited takeover offer for Yahoo, arguing it could open the way for the software developer to extend its PC monopoly to the internet
Source:
FT.com - US homepage | 4 Feb 2008 | 3:17 am
Vale, the world's second-largest mining group, has fired Merrill Lynch as one of its two lead advisers after the investment bank decided not to help finance a potential $90bn takeover bid for Xstrata, the Anglo-Swiss miner
Source:
FT.com - US homepage | 4 Feb 2008 | 2:54 am
The UK's second biggest property company, British Land, is braced for a £1.7bn hit on the underlying value of its real estate portfolio when it reveals quarterly results this week.
Source:
Telegraph Business | 4 Feb 2008 | 1:01 am
With the date for the Budget set for March 12, the cottage industry that makes a living trying to figure out what will be in it is now limbering up for its annual outing. But this year there is a much more important issue - namely the big, strategic, question of whether taxes overall should be going up - or down.
Source:
Telegraph Business | 4 Feb 2008 | 12:01 am
UK corporate fraud may hit a record high this year as economic growth slows sharply, accountancy firm KPMG has warned.
Source:
Telegraph Business | 4 Feb 2008 | 12:01 am
Just seven days into his job, Ian Cheshire, the new chief executive of struggling DIY retailer Kingfisher, knows he has a mountain to climb.
Source:
Telegraph Business | 4 Feb 2008 | 12:01 am
Source:
CNBC Top News and Analysis | 4 Feb 2008 | 12:00 am
Microsoft's offer is meant to create a very competitive business, a company official told CNBC on Monday, after reports that Google offered to help Yahoo fend off the $44.6 billion bid. 
