Carol Ryan
ReutersBreakingviews
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Past articles by Carol:
Private equity could scratch Nestlé skin-care itch – Breakingviews
The KitKat maker is selling a unit specialising in psoriasis and acne treatments. Rival consumer groups may be put off by the business’s tricky mix of products and low margins. Private equity firms, already piling into the dermatology sector, would make a more logical owner. → Read More
Reckitt’s best activist repellent is out of reach
The Dettol maker faces sluggish sales and falling margins, with factory disruptions only part of the problem. Its hygiene division could be worth 22 bln pounds but spinning that off in the next year or two would incur a big tax bill. Pushy investors may want action before then. → Read More
Tesco gives investors reason to shop elsewhere – Breakingviews
Britain’s biggest grocer is charging lower prices in its home market to fend off discounters, making it harder to hit operating profit margin targets. Doubling down with the launch of a new bargain chain may push shareholders into the arms of smaller rivals, such as Sainsbury’s. → Read More
Unilever should delay its head office vote – Breakingviews
A growing number of UK shareholders oppose the Persil maker’s choice of Rotterdam as its base. Postponing the vote would give investors more clarity on Dutch tax changes, and Unilever more time to spell out the benefits of the shift. Pushing ahead risks an embarrassing defeat. → Read More
Unilever has itself to blame for investor revolt – Breakingviews
A growing group of shareholders want to block the Pot Noodle maker’s plan to pick Rotterdam over London as its global HQ. The move’s benefits are overshadowed by uncertainty over how UK investors will be taxed. Rushing the decision has left Unilever more vulnerable to opposition. → Read More
Versace gives Blackstone a suitably flash exit – Breakingviews
Fashion group Michael Kors may pay 2 billion euros for the Italian label. The deal adds a high-profile name to CEO John Idol’s growing stable of luxury brands, but may take years to pay off. Minority investor Blackstone has stitched together a clean sale, and respectable return. → Read More
Banks double down on Casino’s owner – Breakingviews
The French supermarket’s heavily indebted parent got a fresh 500 mln euro unsecured loan. That buys Rallye time to sell assets and avoid handing over its 51 pct stake in the grocer to creditors. For banks which are already on the hook, it’s an attempt to avert a messy collapse. → Read More
Unilever shows wisdom of snubbing Kraft’s recipe – Breakingviews
The Dutch maker of Ben & Jerry is expanding faster, becoming a leaner company, and its investments are paying off. Kraft, meanwhile, looks light on ideas. Had Unilever accepted a merger offer two years ago, shareholders would be 15 pct worse off today. → Read More
Chinese $5 bln winter sports bid is hard to beat – Breakingviews
Fujian-based Anta has approached Finnish ski-wear maker Amer. The offer values the group at a hefty 17 times EBITDA. Anta’s need to fend off U.S. peers in its home turf suggests it will pay more than any rival. Still, the target’s share price suggests investors aren’t convinced. → Read More
Bondholders face risky last bet at Casino owner – Breakingviews
Credit markets are growing increasingly nervous about Rallye, the indebted parent of the French grocer. Luckily, owner Jean-Charles Naouri can draw on bank lines to repay debt. But the more Rallye borrows from lenders, the fewer assets will be left if it eventually collapses. → Read More
Coca-Cola pays big price for global coffee fix – Breakingviews
The soda giant is spending $5.1 bln on the Costa chain of cafes. Justifying the frothy 16 times EBITDA multiple requires Coke to order up new markets for hot drinks. It’s another reminder of consumer groups’ lust for coffee. Investors in seller Whitbread are the big winners. → Read More
Hays gives dismal performance review for UK plc – Breakingviews
The British division of the 3 billion pound recruiter is cutting staff, and barely growing. Luckily, the sluggish UK economy was offset by hiring in Germany and Australia. Like Hays, UK companies will increasingly have to seek their fortune overseas. → Read More
Consumer giants have bigger problems than Turkey – Breakingviews
Unilever and Nestlé can resist a crisis in Turkey, which accounts for little of their revenue. But both will suffer if troubles spread across emerging markets, which account for about half of group sales. All the more so since Western shoppers are unlikely to take up the slack. → Read More
Mulberry hits every luxury branch on the way down
Almost three-quarter of the bagmaker’s sales are in the tough UK market. That, and a costly push into Asia amid the threat of a China-U.S. trade war, explains why Mulberry’s shares are down 60 pct this year. A fresh hit from House of Fraser’s demise is par for the course. → Read More
Carlsberg’s drinking game victory looks temporary
The Danish brewer’s second-quarter sales grew a better-than-expected 7.6 pct. The World Cup turned its big Russian business from a drag into a boon. While Carlsberg now trades at a premium to Heineken and AB InBev, less exposure to emerging markets means the bump is temporary. → Read More
Casino shares go wrong way in risky debt punt
The grocer’s shares fell 9 pct after an analyst flagged its related party deals. A sinking price may force its indebted parent to pledge stock to repay bonds, which could end up on the market. Investors have more to worry about than a grim outlook for French supermarkets. → Read More
Luxury investors take benign view on trade wars – Breakingviews
A growing spat between China and the U.S. threatens sales in the sector’s two most important markets. A weaker yuan would make overseas shopping pricier for spendthrift Chinese tourists too. With share prices near record highs, investors are exposed to anything but all-out peace. → Read More
Heineken short on ideas to close AB InBev chasm
The Dutch brewer’s shares fell after it said operating margins would dip this year instead of rise. The gap between its profitability and that of bigger rival AB InBev is widening. And beyond more craft beer, Heineken has few convincing ways to close it. → Read More
Baby food will only briefly sate consumer giants
The best second-quarter sales performer for Reckitt Benckiser and Danone was infant formula. Demographics are favourable in China, and parents are less tempted by cut-price brands. But with so many companies homing in on this lucrative market, competitive pressures are growing. → Read More
Nestlé has easier wins ahead in activist battle
New products in the U.S. and an overhaul of baby foods boosted growth in the first half. There are early signs that CEO Mark Schneider’s strategy is working, in the face of pressure from investor Dan Loeb. Yet to keep Loeb at bay Schneider needs to do more to prune tired brands. → Read More