CPPIB and Onex Eyes Bid for UK-based Tomkins

The Canada Pension Plan Investment Board (CPPIB) and Onex Corp are working together to propose a takeover of UK-based car parts maker, Tomkins Plc, just as the weakening British pound attracts more North American investors eager to take assets off of UK companies’ hands.

While the CPPIB and Toronto-based Onex have not released a formal bid, the companies have proposed a deal, which is worth over $4 billion.

After Tomkins reported receiving the proposal on July 19, 2010, the possible takeover lifted the car parts manufacturer’s shares 33.1% to 306.6 pence by mid-morning in London, thereby valuing Tomkins at approximately £2.7 billion ($4.1 billion).

The stock reached 314 pence - the highest Tomkins has obtained since 2006. However, it didn’t make it to the 325 pence cash offer that potential buyers considered.

In May 2010, Onex CEO Gerard Schwartz expected the current economic situation to create investment opportunities for Canada’s largest private equity firm. At that time, the company possessed about C$1 billion ($950 million) in cash, as well as third party uncalled capital worth C$3.9 billion ($3.8 billion) for acquisitions.

The CPPIB is Canada’s second largest pension fund manager and oversees assets worth C$127 billion. It is also one of the top private equity investors in the world.

Survey: SMEs of Middle East Report High Business Confidence Level

Even in the midst of a global economic crisis, small businesses continue to exude confidence, especially those in Turkey and the Middle East. A recent survey revealed that Middle Eastern small and medium enterprises (SMEs) are planning to hire more people and boost investment.

HSBC’s semi-annual monitor on global small business confidence showed that 49% of SMEs in these areas keep a positive perspective of the next six months, while 50% are looking forward to increasing capital expenditure by the end of the year.

The data, which included results from UAE for the first time, suggested a positive outlook among many businesses in all Middle Eastern countries. Saudi Arabia ranked second (after Vietnam) in the global rankings, and for the second time, the Middle East scored higher compared to developing and emerging markets.

HSBC’s bi-annual Small Business Confidence Monitor looks at the outlook of SMEs regarding capital investment plans, local economic growth and recruitment. The latest monitoring session covered more than 6,300 SMEs in North America, Europe, Latin America, the Middle East and the rest of Asia.

Saudi Arabia scored 145, the highest among all Middle Eastern countries. While Qatar’s score dropped from 159 in 2009 to 137 in 2010, it’s still well above the regional average (132) and the global average (118).

UK Falling Behind in Energy Industry Investment

A government advisory organization said that the UK is falling behind other wealthy countries in terms of developing new technologies for energy, and this hampers the creation of green jobs in the country.

The Committee on Climate Change, a statutory body that provides emission reduction advice, said that the UK used up only 0.01% of GDP on energy in 2007, which is the latest year wherein comparative data is available, whereas Japan spent 0.09%, France 0.05%, and the US 0.03%

In 2009, the government spent about £550 million of public money for low carbon technologies. Only about £260 million of this money was used on energy.

The committee also quoted the International Energy Agency, saying that investment on energy should be two to five times more than the current levels so that climate targets can be met.

Furthermore, the committee called on UK’s government to focus on six areas, namely: wave and tidal power, offshore wind, carbon capture and storage, electric vehicles, smart grids and meters, and aviation.

The advisory group warned that without support from the government, an array of low carbon technologies will be trapped in a point termed as “valley of death,” a situation that the private sector isn’t willing to take the risk of investing in.

Sara Lee to Sell Bakery Unit

In line with Sara Lee’s plan of revamping the company, it is currently looking at selling its struggling North American bakery and bread business. Sara Lee, famous for producing Jimmy Dean foods, hopes that this move would bring about a broader change for the company.

Sara Lee, a major player in the food industry, has been courting possible buyers of the bread unit, which has been seeing dwindling sales throughout the recession, according to sources that refused to be mentioned, for this matter isn’t public. The company has obtained the services of Bank of America, Corp to get financial advice on the bakery unit, which includes one of the largest fresh bread brands in the country.

The formal transaction process hasn’t started and advisers have only begun to focus on interest from private equity funds.

Over the last decade, Sara Lee has been constantly developing the expansion of the unit. The company started with closing a $2.8 billion deal to acquire Earthgrains in 2001, and then a $72 million deal to obtain Butter Krust Baking in 2006. However, due to tighter competition, the bakery division encountered challenging times. Eventually, its profit and sales significantly dropped. In February 2010, company CEO Marcel Smits announced to investors that the bakery business isn’t the company’s main source of profit.



More info:

http://www.thestreet.com/story/10812216/1/sara-lee-examines-sale-of-bakery-unit.html?cm_ven=GOOGLEFI
http://articles.chicagotribune.com/2010-07-20/business/ct-biz-0721-sara-lee-bread-20100720_1_bakery-sales-sara-lee-bread-business

Apple’s Revenue Lifted Thanks to iPad, Mac Sales

The iPad’s strong debut and the new iPhone’s popularity helped gadget manufacturer Apple achieve its best quarter ever, the company reported.

Apple’s sales soared to an astonishing $15.7 billion, which is 61% greater compared to the same period last year. Net income increased up to $3.25 billion, which is higher by 78% from last year.

In the second quarter, the electronics company sold 3.47 million Mac computers - more computers than it has ever sold in a three-month span. Apple also sold 3.27 million iPad tablet computers, which was released into the market on April 3, 2010.

The iPad returned $2.17 billion in revenues, which represents about 14% of the California-based company’s total income for the second quarter.

As stated by Apple CEO Steve Jobs, users love the revolutionary iPad and the company has more products up its sleeves to hit the market this year. The CEO added that more people are purchasing Macs than ever before.

As for the iPhone, 8.4 million units were sold during the quarter, which is up by 61% from more than a year ago. The latest version of the touch screen smartphone, the iPhone 4, went on sale on June 24, 2010 in five countries, although Apple has been receiving complains about poor reception because of the mobile device’s unusual antenna styling.

BP to Sell Assets to Pay for Oil Leak

BP Plc, the British energy company in the midst of an oil spill crisis, agreed to sell some of its assets to Apache Corp for $7 billion to pay for one of the worst oil leaks in history. These assets include production and exploration facilities in Egypt, Canada and the US.

The $7 billion deal is part of BP’s plan of raising $10 billion by selling some of its assets. Apache will pay a cash deposit of $5 billion on July 30, 2010.

As of July 20, BP’s share price decreased 1.54% in New York. Earlier that day, the energy company reported that it would sell assets in Pakistan and Vietnam worth $1.7 billion.

The gruesome disaster in the Gulf of Mexico remains on the priority list of both British and American governments.

British Prime Minister David Cameron commended BP for its continuing efforts in plugging the leak and paying for the spill’s damages. On July 20, US officials reported BP’s latest step in stopping the spill – a cap that prevented oil from gushing out.

Fishing and tourism industries operating in the area around the Gulf have been devastated by the millions gallons of oil that hit marshes and beaches. Natural environments and habitats have been threatened and as a result, the Obama administration received negative feedback and ties with Britain were affected.


More sources:
http://finance.yahoo.com/news/BP-to-sell-assets-for-7-apf-3900764604.html?x=0&sec=topStories&pos=3&asset=&ccode=
http://www.google.com/hostednews/ap/article/ALeqM5g9wOfmmrQmVwnYqaM5OpN5B3mxXgD9H319B80

Fiat Makes Second Quarter Profit

Fiat, the Italian automaker that controls Chrysler, returned to a second quarter profit due to improved sales of agricultural vehicles and equipment. The company also reported that it may raise its 2010 forecast later this year.

The carmaker reported a net income of $115.6 million (or €90 million) for the second quarter of 2010, whereas the company had a €168 million loss last year for the same period. Net revenues rose 12.5% to €14.8 billion. In addition to this, earnings before interest or trading profit, taxes, and one-time losses or gains more than doubled and reached €651 million, which significantly trumps the €359 million estimate of 11 business analyses gathered by Bloomberg.

Fiat produces cars under the Fiat, Alfa Romeo and Lancia names, as well as trucks, construction equipment and farming machines.

Revenues at agriculture and CNH construction increased 16% to €3.3 billion as improved sales in South and North America compensated for the weak markets in the former Soviet Union, Australia, and Europe, according to Fiat. Iveco trucks climbed 18.3% to €2.1 billion with the number of deliveries up 32% to 34,318 vehicles.

In a release, Fiat added that recovery in the lightweight commercial vehicle division compensated for the decrease in sales of passenger cars, especially in Germany and Italy, following a cease in European eco-incentive programs.

Nokia Rises After Report on Search for New CEO

After the Wall Street Journal reported that Nokia Oyj is planning to replace current CEO Olli-Pekka Kallasvuo, the major phone maker’s trading numbers in Helsinki rose up to 5.2% July 20, 2010.

Nokia has approached several US-based technology companies for the position of CEO and will decide by the end of July, according to the Wall Street Journal report, which mentioned unidentified people who had known about the situation. Arja Suominen, Nokia’s spokeswoman, refused to comment.

According to Ulf Moritzen, who works with Hamburg-based Aramea Asset Management and helps manage Nokia’s shares, getting a new CEO will do the company good. He added that it is important for Nokia to react quickly to economic changes.

A new chief executive officer can help in delivering products that can compete with leading portable devices, such as Research In Motion’s Blackberry and Apple’s iPhone, especially when Nokia has not been able to provide a smartphone that has all the mass appeal that the iPhone possesses.

To protect its market share, the Finnish phone manufacturer has focused on cutting prices and sacrificing profits.

Nokia’s stock increased as much as 35₵ to €7.115, which is the biggest gain ever since May 10, 2010. As of 10:23 of July 20, the stock was up 3.45%. Before this rise, shares declined by 24% this year.

KKR Green Portfolio Project

The Deal has released a video featuring KKR's Green Portfolio Project.



This video shows how KKR is realigning its investments to encourage more environmentally friendly practices while helping its portfolio companies cuts costs (not jobs). We should all definitely support this great trend!

Paul Allen

Paul Gardner Allen was born on January 21, 1953. Along with Bill Gates, he is the associate founder of Microsoft. He is one of the richest people in the world and the founder and chairman of Vulcan Incorporated, which is his private asset management company. He owns three professional sports teams: the Seattle Seahawks of the NFL, the Portland Trail Blazers of the NBA, and the Seattle Sounders FC franchise in Major League Soccer.

Raised in Seattle, Washington, Paul Allen is committed in giving back to communities in the region he still calls home. He founded the Paul Allen Institute for Brain Science and The Paul G. Allen Family Foundation, which supports the work of effective nonprofit organizations involved in arts and culture, community development and social change, economic relief, education and youth engagement, and scientific and technological innovation.

• He has donated to organizations that focus on human and health services, and toward the improvement of technology and science.
• The Paul G. Allen Family Foundation was founded in 1986 to disseminate most of his donations. Through this body, Paul Allen confers approximately $30 million in grants every year. About 60% of the organization’s finances go to non-profit organizations in Washington and Seattle; twelve percent goes to Portland, Oregon. The other 28% is disseminated to other locales within the Pacific Northwest.
• Allen has donated $900 million of his money, as of 2007. Allen also contributes through other charitable projects known as "venture philanthropy." The most famous of these projects are Experience Music Project, the Science Fiction Museum and Hall of Fame, the Flying Heritage Collection (airworthy vintage military aircraft) and the Allen Telescope Array.
• Allen has donated money in both Washington State University and University of Washington. In the late 1980s, Allen donated $18 million to construct a library named after his forebear, Kenneth S. Allen. He donated $5 million in 2003 to establish the Faye G. Allen Center for Visual Arts, named after his mother. Allen was also the top private contributor, with $14 million in donations to the "Paul G. Allen Center for Computer Science & Engineering," which was completed in 2003.
• Throughout the years, Allen has contributed millions of dollars to the University of Washington Medical School. The Foundation awarded $3.2 million for prostatitis research in 1997, followed by an additional $1 million grant in 2002. More recently, the Foundation contributed $5 million for an early cancer-detection project by the Fred Hutchinson Cancer Research Center.
• On November 19, 2008, Allen appeared at the Experience Music Project/Science Fiction Hall of Fame to present the second annual Founder's Award for musical achievement.

Private Equity looking ahead

As the recession enters its second year, the Private equity industry is looking to 2014 to deal with the buyout spree of the past years. In this brief but incisive article by the Wall Street Journal's Liam Denning, the situation of the private equity industry know faces solid issues, not ambiguities.

Private Equity's Problems Fade From Red to Gray

Henry Kravis Prize awarded to Pratham

KKR, led by Henry Kravis, does more than just broker some of the world's biggest deals. Every year, the Henry Kravis Prize in Leadership recognizes innovations in nonprofits. Pratham, India’s largest education nonprofit, was awarded $250,000

Pratham has reached 34 million children across India through its Read India program, which works with governments and communities to improve the reading, writing, and basic arithmetic skills of children aged 6-14.

“We are delighted that a very high profile selection committee picked us after a thorough process without involving any of the organizations in the running, Of course, the award is for what we have done in the past and there are many bigger challenges ahead,” said Madhav Chavan.


Past honorees for the Henry Kravis Prize include Roy Prosterman, founder of the Rural Development Institute; Fazle Abed, founder of BRAC, the Forum for African Women Educationalists (FAWE), and Dr. Sakena Yacoobi, founder of the Afghan Institute of Learning.

Young Turks Comment on Health Care Bill

President Barack Obama just passed a landmark healthcare bill, but most people are still in the dark about precisely what the bill entails. Cenk Uygur of the progressive internet talk show The Young Turks weighs in on the pros and cons of the health care bill, and says that supporters' celebrations are premature; there are still some serious flaws in the bill.



via videosift.com

Kirk Kerkorian

Kirk Kerkorian was born on June 6, 1917, in Fresno, California. Instead of finishing high school, he chose to drop out in order to help his Armenian family. Eventually, he followed his brother’s footsteps and became a Pacific amateur welterweight boxing champion.

In 1939, he was hired to install wall furnaces for 45₵ an hour. Soon after, he developed an interest for aviation. Without having the means to pay for flight lessons, Kirk Kerkorian went to the Happy Bottom Ranch in the Mojave Desert to clean barns and milk cows in exchange for his lessons. After receiving his commercial pilot’s license six months later, Kirk Kerkorian went to Montreal, Canada to apply for the Royal Air Force. He was then hired to do the dangerous task of delivering Canadian-built bombers to Scotland. For the span of one and a half years, he successfully delivered 33 planes and traveled to four continents.

By integrating the Bellagio and Mirage properties in 1999, Kirk Kerkorian brought to life three of the most profitable gambling resorts in Las Vegas. Currently, he remains as the largest shareholder of the Los Angeles based investment company, Chrysler. He is also one of the major stockholders at the Metro-Goldwyn-Mayer Corporation.

In addition to being the richest Armenian in the world, Kirk Kerkorian is also notable for his feats in philanthropy. His charitable foundation, the Lincy foundation, was named after his daughters Linda and Tracy. So far, the organization has extended its donations to cultural center renovations, highway reconstructions, city beautification in Armenia, as well as to Armenian Churches and to the United Armenian Fund. For the past few years, the Lincy Foundation has granted a total of $165 million worth of donations to the Armenian government. The donations were used to help overcome the damage that was brought about by the earthquake in Spitak.

Avoiding Plastic Blunders

Anyone can make mistakes. Mistakes are a part of human nature and in this technology driven world of ours, some mistakes definitely have bigger repercussions than others. Making mistakes with regards to credit is more often the blunder that everyone has committed over the past couple of years. The recent global recession for example, is something that came to be from poor credit management.

But despite these, credit cards and other kinds of borrowing still fuel a lot of people’s lives nowadays. It is because of this dependence that one needs to keep a sharp eye on their credit card usage.

Some of the basic mistakes credit cardholders must avoid to avoid hurting their credit scores include:

• Asking banks or other lending institutions to lower the credit card’s limit. This is okay for people who do not have balances on their cards. In fact, lowering one’s credit limit will enable the user to be more in control of their credit spending. But when the card is full of outstanding balances, a lower limit will lessen the gap of what you owe and what you have.

• Making late payments will always be damaging to one’s credit scores. Passing out payments for a few days or worse, not making due payments at all will seem to be a sensible short term solution but will only hurt one’s scores in the future.

• Paying one credit card with another. Credit in payment for credit will always be a bad thing to do and this will reflect in the credit card scores.

• But so too is applying for a new credit card when one already possess many. More credit cards mean more temptations that will make one spend. More cards mean more rates to be handled; more balances to be paid out and more damage to one’s credit score in the future.

Avoiding all of these basic blunders is very important to be able to successfully manage credit accounts and not hurt the user’s credit score in the future.

Debit Cards and how to Properly Manage Their Usage

Responsible financial management is important in today’s world especially since consumers are faced with a variety of choices that they can use to go about their spending and needs. With credit cards, debit cards, and ATMs being offered by banks and financial institutions today, people need to know what to choose from these and be able to take full advantage of whatever the plastic cards offer.

Among all of these, debit cards seem to be the best avenue to take since the user is not borrowing but is rather spending money he saved for his purchases. Still, users need to be fully informed about these debit cards and should use them wisely to avoid falling into bad financial situations like large transacting fees and debts.

First thing that users need to know are the types of debit card that banks and other financial institutions might be offering. Some charge fees per transaction while others substitute their ATM cards for debit cards. Knowing the differences and fees involved will make consumers more informed on how and when it is fully advantageous to use their debit cards.

Next is to hold on to receipts from all debit card transactions. This is useful when reviewing monthly statements and making sure that charges one did not make are not included and shouldered by one’s bank account.

Other basics with debit card usage include memorizing the Personal Identification Number or PIN, and not just writing it down on a piece of paper or worse, on the card itself. Keep debit cards, or all cards for that matter, in safe places. In cases of lost and stolen cards, report immediately to your bank so that the lost card may be deactivated and a new one can be issued out. Also, make sure PINs are not basic numbers such as birthdates or telephone numbers.

Lastly, always check the balances of the cards in one’s possession. This is the very basic step for responsible financial management. Some debit cards allow you access to funds that you may have set aside to take care of a check that has not been cleared yet.

Hobson’s Financial Resolutions for 2010

Saving a significant yet manageable amount of money in a savings account might be one of the most important ways to enhance our financial standing in the future. However, that is not the only way to secure a clear financial future.

Mellody Hobson, the current president of Ariel Investments and personal finance contributor of “Good Morning America,” lays out some of the most sensible finance resolutions we can make for 2010.

Hobson thinks that investing in the stock market might be a good idea to start the year. According to her, the stock market was able to recover from hitting rock bottom last March 2009. In fact, the stock market was reported to have gone up an astounding 57% earlier this year.

Apart from that, Mellody Hobson also encourages people to consider reviewing the accuracy of their credit scores. According to her, credit reports are one of the most important items in each person’s financial life. Credit scores can bring most people bigger interest payments when getting loans for homes or new cars. In addition to that, Hobson also says that a person’s credit score can either make or break his/her bid for his/her dream job. However, to achieve all those, people need to give more importance to the accuracy of their credit scores. Mellody Hobson says that around 80% of credit reports are flawed. Major credit reporting agencies including Equifax, TransUnion, and Experian are not responsible for ensuring the accuracy of each person’s credit reports. Therefore, the owner of the credit report must take the responsibility himself.

In addition to those two, Mellody Hobson also advises people to prepare themselves for the possibility of rising minimum payments. Due to the new legislation, most credit card issuers including JP Morgan, Citibank, MBNA, and the Bank of America are increasing the amount of minimum payments.

Debit is the Way to Go

With the US and the global economy still feeling the tail-end of the recession, many consumers have kept mum with regards to their spending and have tried their hardest to keep all of their finances inside their households.

Together with frugal spending and saving, more and more people are finding the advantages of using debit cards more appealing than using their counterparts, the credit cards. It is true that debit cards offer users a more responsible way of spending and is more convenient to use than most credit cards. But when used improperly, just like credit cards, they can seriously hurt users financially. And because debit cards are more loosely protected than credit cards, as they come with schedule of fees different from that of credit cards, knowing basic information about debit cards and their usage will make for better and responsible spending. Here are some things to remember for users with debit cards and frequently use them in their transactions.

Basic in the list is to know and understand everything written in the bank’s terms and conditions with regards to their debit card services. Users should take note the schedule of fees that their banks give. They should know the important rates such as basic transaction fees, over-limit fees, and cash-withdrawal fees among others.
Also, they should carefully review every billing statement that the banks send them. They should cross-check them with the transaction receipts to make sure that no dubious transactions are being debited to one’s name.

Since a debit card is always attached to an existing bank account, debit cards should be protected with utmost care and not just placed anywhere open and unsafe. PIN numbers should also be formulated in a way that not even the smartest thief or someone the user knows can figure them out.

Also, be aware of the rewards program that banks have for using their debit cards. Using debit cards is indeed a more responsible way of financing transactions than debit cards. But like credit cards, it should also be given the proper attention and due diligence that it deserves.

The Things People Should Avoid Doing During Economic Recessions

People should always be conscious of their spending habits in order to avoid making mistakes that can jeopardize their financial status. Although this should become a lifelong habit, it becomes more applicable during times of economic recessions.

Serving as a cosigner of a loan is one of the most risky things a person can do when it comes to personal finance. Becoming a cosigner entitles the person to make the schedule payments once the owner of the loan fails to do so. A cosigner may lose more than a great amount of money in order to pay the loan.

Although it might be rare for most people to purchase a home during recessions, there are some people who actually do. There are some individuals who choose to avail an adjustable rate mortgage when purchasing a home. This might make sense in some cases since most people would opt to choose mortgages that have lower interest rates. However, doing this during recessions is a financial risk. People should be aware that these interest rates are more likely to rise as the economy recovers. Homeowners might find it difficult to keep up with the increasing rates.

People are also discouraged from getting a new car loan or a new home loan or any similar obligation during recessions. Although it’s okay to avail of these loans when the economy is in a good condition, it is not advisable to do so when the economy is in the middle of turmoil. The borrower might get laid off or in some way or another might get affected by the downturn in the economy. Availing of these extra obligations might add complications to the person’s financial situation in the near future if the economy fails to recover in a long time. People should be cautious about taking on additional debts in the midst of a recessionary environment.

Spend Now, Pay Now

It is hard being levelheaded most of the time especially when being a little reckless can be more fun and enjoyable. But as much as many hate to say it, irresponsibility will soon pay back in the future and a little sacrifice now will not hurt your financial standing in any way.

The same principle also applies to credit card usage. People have the tendency to excessively indulge and overuse these plastics without knowing the long-term repercussions that await them. It will take a whole lot of discipline and presence of mind to control credit card usage especially since it offers a great many short-term rewards and satisfaction upon usage. Before being enthralled by the convenience that credit cards offer, one should always keep in mind that using them demands a huge responsibility. Here are some tips to always be on track with credit card usage.

1. Diligently settle balances monthly and avoid being tardy with them. Paying debts is not the most exciting thing to do but paying on time almost always outweighs the hassle. Creditors and banks know that by giving you credit, they are investing their money so a person can purchase what he needs. Needless to say, they will expect to be paid back in return and will take action if ever they are not.

2. Do not use one plastic to bail on another. Balances on credit cards should be paid with one’s own funds and not with another credit.

3. Don’t lend your credit card to family and friends. One balance is already something; splitting it to two or three monthly liabilities will only be a big blow to one’s credit score.

4. Keep receipts and other transaction proofs so that when billing statements arrive, cross-examining and validating them will be easier and unnecessary bills can be avoided ASAP.

5. Lastly, never borrow money that eventually cannot be paid off.