Capital Market Dialog during Restructuring – Meet and Miss Expectations
Unrestricted access to the capital market, efficient financing on the equity and credit side, creating a solid base of trust, all these are challenges ThyssenKrupp had to overcome in its restructuring process. Guido Kerkhoff, Chief Financial Officer of ThyssenKrupp AG, reveals the company’s “Strategic Way Forward” and shows the importance of increasing visibility, guidance and the handling of expectation management regarding its investors. Find out, how ThyssenKrupp managed the restructuring process from a traditional steel producer with an effective elevator business to a performance-orientated group with individual market-leading businesses.View PDF
Defining the Role Mandate between Holding and Line: Balancing Responsibilities
Eight principles that facilitate the corporation between Holding and Line. Eight very simple and obvious principles that are often not followed. A difficult business environment pops up and all of a sudden, the role of the holding company is growing immensely, there is more centralization and line subsidiaries are confronted with rigorous regulatory requirements.
There is no perfect governance model, but Thomas Münkel, Chief Operating Officer of UNIQA Insurance Group AG, shares his insight on the design principles for defining the holing and line mandates.
Let the Data Speak: The Truth behind Minimum Wage Laws
In times of economic regression, the introduction or increscent of minimum wage is highly controversial. Prof, Steve H. Hanke, economist at the Johns Hopkins University, shows why minimum wage leads to higher levels of unemployment and how the welfare system is influencing tendencies of finding work. He gives an interesting dose of reality, and underlines that the people who are hurt most by high minimums are the most poverty stricken.View PDF
Regaining Stability – Toward a More Balanced World Economy
The recovery from the global financial and economic crisis is gaining more traction. While China, Japan and the US are rebalancing, the European Union is building a large external surplus, which is again threatening the global stability. Chief economist of Allianz SE, Prof. Michael Heise, is explaining the importance of higher household spending and a balanced and sustainable growth. He expresses the need for more investment in transport, telecoms, energy and education, but by attracting private capital into these areas.View PDF
Risking the Role as Global Locomotives? The Anglophone Urge to Hoard Corporate Cash
Will the US and the UK turn into locomotives for the anemic economies of the eurozone? What is the difference between the Anglophone’s strategy and business models from all around the world? How can they accommodate the surplus driven by the corporate sector without making others suffer? How long can they keep one making debts without deleveraging? Are they back to a cycle of borrowers, loans and unrealistic valuations that once before caused an economic crisis?
Find out the answers to all of these questions in the article written by John Plender, Columnist of the Financial Times.
Fit for Growth – How Innovations in the Business Model Secure Financing
ZF Friedrichshafen AG is a company, which is very much determined in their finance strategy by their shareholders. Their challenge: How to generate sufficient free cash flow from the operating business? Dr. Konstantin Sauer, Member of the Board Management, explains how the ZF Group is dealing with this challenge. To him, adjustment and flexibility in developing and adopting business models are the key elements, which will not only reduce risks, but will lead to more leeway in creativity and entrepreneurial spirit.View PDF
The Lifecycle of Family Ownership: International Evidence
Family firms in the UK: The older the firm, the less likely it is to be family-controlled. They have a lower chance of remaining family-controlled and become widely-held corporations than firms in Germany, France or Italy. Family businesses in the UK are more often being taken over than in Continental Europe. The analysis of Prof. Julian Franks, Professor of Finance at the London Business School, is clarifying this phenomenon. What is the connection between investor protection, the degree of development of financial markets, the activity of markets for corporate control and family ownership? How influential are family businesses in different economies?View PDF
Navigating the Changing Landscape of Finance
The financial system of the U.S. has been restored to stability. According to James Gorman, Chairman of the Board and Chief executive Officer of Morgan Stanley, the size and complexity of the U.S. banks had nothing to do with the financial crisis in 2008. Contrary, there were a lot of contributing factors as high leverage on thin capital, bad management and huge liquidity problems.
What do we learn from the mistakes we have made? How do we deal with future crises? James Gorman gives an interesting insight in how Morgan Stanley and other U.S. banks have established a financial system, safe and sound.
Low Interest Rates and the Insurance Industry: From Balance Sheet Impacts to Structural Industry Changes
Fact is, the current oversupply of money has to stop. The industry has to return to a more normal behavior. Economic actors usually have a good understanding concerning valuation of goods and services, but when it comes to low interest rates - managed by central banks to stimulate the economy, maintain inflationary stability or to manage growth and employment – they start becoming irrational. The underestimation of the so called “capital illusion”, the consequences and the impact on the insurance sector, are discussed by Gerhard Lohmann’s, CFO Reinsurance of Swiss RE, in his article.View PDF
How to Deal with High Prices for Acquisition Targets as a Corporate Buyer: “Where’s The Beef?”
Software companies are transforming today’s industry at a very high pace. Valuations in this sector are increasing immensely and companies are willing to pay very high acquisition prices. A lot of them are probably overprized, but who knows, whether there is the next Google or Amazon amongst them?
The importance of an in-depth analysis before an acquisition and the ensuring of assets, that is what Dr. Werner Brandt, Chief Financial Officer of SAP AG, is emphasizing in his article. Expensive deals can be great deals, just as cheap deals can be unmitigated disasters.
On Measuring Greenness: A New Enabling Metric, Please
Green is not only the new color of McDonalds, but it is a worldwide movement towards ecofriendly – so called “green” – investments. Since greenness enhances the attractiveness of a firm to investors, the most important question is: How does an investment or a company qualify for greenness? How do you ensure that an assessment approach is replicable? There are two methods, but according to Prof. Steve H. Hank, economist at the Johns Hopkins University and Dr. Heinz Schimmelbusch, Chairman and CEO of Advanced Metallurgical Group, there should be a more transparent and replicable formulation. Find out more about their way to assess the attractiveness of green companies for investors: Enabling Greenness Ratio.View PDF
Investing in Africa – Private Equity: Where Next?
Private Equity in Africa: the demand for growth capital significantly exceeds the supply. There are more investment opportunities for capital than capital raised, leaving the market underfunded. It will surprise you, why organic growth is so effective or from where the private equity funds operate. Fact is, Africa is proving to be more attractive than other emerging markets with promising industries and companies. Anthony Siwawa, Managing Director of Venture Partners Botswana, illuminates the development and sectors of Private Equity and shows its immense potentials.View PDF