- By Region
As Europe continued its slow-motion disintegration, many companies were busy getting together. US industrial group Eaton made the biggest move of the week with an $11.8bn offer for Cooper Industries as it tried to transform itself into a power management powerhouse. A smaller deal is at the centre of a humdinger of a battle between Shell and Thailand’s PTT for the Mozambican offshore gas assets of Cove Energy. By contrast Accor, Europe’s largest hotel operator, seems to be in permanent restructuring mode, selling its US Motel 6 chain to Blackstone for $1.9bn.
However, most of the action was in the TMT sector. German software company SAP sought to boost its presence in cloud computing with a $4.3bn offer for US business-to-business ecommerce network Ariba. In the media sector, China’s largest owner of cinemas, Dalian Wanda, tried to buy in Hollywood knowhow with a $2.6bn bid for AMC Entertainment. Meanwhile Yahoo and Chinese ecommerce company Alibaba were unwinding their alliance as the latter bought back half of the US internet company’s 40 per cent stake for $7.1bn. Also in the tech sector, HP admitted to a failure of execution in its $10bn acquisition of UK enterprise search company Autonomy, and Dell struggled to adapt to the rapid decline of the PC business as low-end competitors such as Lenovo eat into its profits.
Pressures of a different kind dominated the skies as Australian airline Qantas split its international and domestic businesses, and Europe’s biggest airline, Ryanair, has moved shrewdly to gain market share as the industry consolidates. In the UK, Vodafone turned out largely flat results while both Burberry and SABMiller benefited from growth in emerging markets. The contrast between a stagnant Europe and dynamic emerging markets is as stark as ever.
John Casey, Lex Publisher