Korean credit agencies hit by allegations of favoritism

Updated : 2014-06-23 17:51

Korean credit agencies hit by allegations of favoritism

By Park Si-soo
Korean credit rating agencies are under fire for giving “overly favorable” assessments to domestic companies.
There are many companies, including Hyundai Motor, Kia Motors, KT, SK Telecom, S-Oil and POSCO, whose credit ratings assessed by Korean agencies are six notches or more higher than those given out by internationally recognized agencies such as Moody’s, Standard & Poor’s (S&P) and Fitch.
GS Caltex shows the biggest gap of eight places, raising questions about how seriously investors should take Korean agencies’ evaluations into consideration when making decisions, according to CEO Score, a business consulting firm that compared 33 Korean firms’ credit ratings suggested by major agencies at home and abroad. Read more of this post

Having started life selling calcium supplements from above a shop in provincial England, Shire has emerged three decades later as one of the most prized assets in the European healthcare sector

June 23, 2014 9:39 pm

Shire a jewel in crown among drugmakers

By Andrew Ward, Pharmaceuticals Correspondent

Having started life selling calcium supplements from above a shop in provincial England, Shire has emerged three decades later as one of the most prized assets in the European healthcare sector.

On Friday, months of speculation over which big pharmaceuticals group would make the first move for Shire came to an end when AbbVie confirmed it had made a £27bn takeover proposal.

Flemming Ornskov, Shire chief executive, made clear on Monday that AbbVie – or any other suitor – would have to bid much higher than the latest £46.11 per share cash and stock offer made by the Chicago-based company. Read more of this post

European companies take on pre-crisis levels of debt

June 22, 2014 5:48 pm

European companies take on pre-crisis levels of debt

By Andrew Bolger

European companies that raise finance are taking on levels of debt not seen since the financial crisis as they adjust to the prospect of low interest rates for the foreseeable future.

The ratio of debt to company earnings, or “leverage multiples”, for all European transactions were 5.1 times earnings in the first quarter of 2014, above the 10-year average (4.8 times) for the first time since 2008. Read more of this post

Defining high-frequency trading’s US level of evil

June 20, 2014 7:28 pm

Defining high-frequency trading’s US level of evil

By John Dizard

John Dizard considers whether there is enough liquidity in equity markets

The Wall Street/Washington policy world tends to agree with its European counterparts that there is a worrying lack of liquidity in the credit markets. Most people do not worry much about that as long as the dryness goes along with rising prices; it is during the falling-price times that talking heads worry about liquidity. Read more of this post

India expects Narendra Modi-inspired equity spree

June 23, 2014 12:50 pm

India expects Narendra Modi-inspired equity spree

By James Crabtree in Mumbai

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With stocks still close to record levels one month after the election of prime minister Narendra Modi, might India’s long-dormant equity markets be about to open up in earnest? So far, the signs are good. Read more of this post

Asia turns on the taps for tech funding

June 24, 2014 2:52 am

Asia turns on the taps for tech funding

By Josh Noble in Hong Kong

When the bosses of US video messaging app Tango were on the lookout for a strategic partner, they turned in the direction of Hangzhou, China – home of ecommerce company Alibaba.

Within weeks, Tango’s founders met with Alibaba’s executive vice chairman Joe Tsai, before selling a quarter of the company for $215m.

Deals like this, where Asian capital goes into a young tech company from another part of the globe, are becoming increasingly common. The region is emerging as a key source of funding for the sector, putting Hong Kong and Singapore firmly on the map for tech startups seeking cash. Read more of this post

Business needs to make the case for capitalism; ‘Profit’ is popularly understood as being taken from consumers

June 23, 2014 6:48 pm

Business needs to make the case for capitalism

By John McTernan

‘Profit’ is popularly understood as being taken from consumers, writes John McTernan

British businesses urgently need to become actively involved in politics. There are serious short and long-term political threats to them and their profitability. This should worry them but it should worry the country even more.

The short-term threats are easily described and understood.

If Scotland were to leave the UK it would badly damage a range of companies, particularly in the banking and financial services sector. But the social, economic and trade links between Scotland and the rest of the UK would mean the crisis caused by independence would spread quickly and widely. The silence of almost all businesses on the September referendum is a scandal. The few interventions made to date were driven by stringent financial reporting requirements rather than a desire to play a public role. But corporations are actors and they should not be afraid to speak. Read more of this post

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