Daily Archives: Nov 16, 2012

Kenya ShillingEverything seemed to be going well enough earlier this month when Cemex, the Mexican cement producer, raised $1.15bn from the partial sale of its Latin American subsidiary on the Colombian Stock Exchange. According to the BVC, as the exchange is called, the offering raised $153m in Colombia and $997m overseas, through two simultaneous operations.

Sadly for Cemex Latam Holdings, or CLH, its shares dropped 2.7 per cent, to 11,920 pesos, in its first trading day on Friday. The company had issued 170.4m shares at 12,250 pesos. 

Pacific-rim Chile has long looked to the Far East for trade. Now Banco Santander Chile, the country’s second-biggest lender by assets, is sampling some financial dim sum.

The Spanish-owned bank became the first Chilean bank to raise money in China’s bond market by issuing RMB500m ($80m) in two-year renminbi-denominated paper, dubbed “dim sum” bonds. 

Chileans love their soda so much they just call it “bebida”, or “drink”.

Indeed they glug with such gusto that the Andean country ranks third in the Americas behind Mexico and the US in consumption of fizzy drinks. So many Chilean consumers will be happy to hear that Coca-Cola and Coca-Cola Andina, its bottling partner in Chile, plan to pour $1.3bn into Chile by 2016. 

You would think that building hotels in Brazil should be a straightforward affair.

With the country set to host the World Cup in 2014 and the summer Olympics in 2016, Embratur, the government’s tourism arm, reckoned it would need to expand hotel capacity by at least 20 per cent to accommodate the expected influx of visitors.

So boom time for hoteliers right? Not exactly, according to Kirk Kinsell, who heads up the Americas division for InterContinental Hotels Group. 

Photo: Bloomberg

The Batista family, controlling shareholders of JBS, the world’s largest meat producer, has a lot to celebrate this week.

The family is expanding into paper and pulp through a new unit of its J&F holding company, Eldorado Celulose and Papel. The company’s new plant, which it claims will be the world’s largest “single-line” pulp mill, is due to start operation this week with a total investment of R$6.08bn. 

Sierra Leone pre elections

Photo: Tamika D. Payne

Investors typically take a wait-and-see approach to elections in Africa. And things are no different in Sierre Leone, which holds a presidential poll on Saturday, in its third election since its civil war.

There’s a lot at stake for the small West African nation looking to move beyond its bloody past – and for the energy and mining companies eyeing its natural resources. 

Russia on Friday implemented much-debated orders for state-controlled companies to boost dividends in a move that could perk up interest in the country’s undervalued stock market.

State companies’ dividends flow into state coffers, but minority shareholders will benefit – and non-state companies are likely to follow the Kremlin’s lead. 

Siblings have a special way of taking a poke at each other, even long after they have flown the family nest.

And so it is with Thaksin Shinawatra, Thailand’s exiled former premier. In a public appearance on Friday he insisted, as he often does, that he isn’t running the country through his younger sister, Yingluck, the current prime minister.

“I’m not running Thailand,” he said. “My sister is running Thailand, but she may ask my advice on some issue. But not every issue. She is very capable – much better than I expected.” Ouch. 

Sebastián Piñera, Chile’s president, was at the FT in London on Friday where he talked a bullish and persuasive story about his country’s progress. But with economic growth, job creation and a string of reforms moving confidently along, one big question raises its head: why is his government so unpopular? 

While much of the rest of the world is sneezing, Malaysia is successfully fending off a cold. The economy exceeded expectations on Friday – not for the first time in recent months – with year-on-year GDP growth of 5.2 per cent in the third quarter. 

Ignoring predictions of waning European gas demand, Russia’s Gazprom is pressing ahead with plans to build costly new pipelines to bypass Ukraine. Moscow wants to squeeze Kiev by funnelling EU-bound gas exports around what it sees as a troublesome neighbour.

But the policy is inadvertently driving Ukraine to do what it should have done long ago – reduce dependence on Russian-supplied gas by diversification and energy efficiency. Annual gas imports from Russia have already plunged from 50bn cubic metres a decade ago to under 30bcm this year – and are set to fall further. 

For years Zimbabwe politicians have been prone to extravagant forecasts of the country’s economic prospects, embellishing projections with references to vast unexploited mineral wealth, limitless agricultural potential and dazzling opportunities in tourism and manufacturing.

But on Thursday Finance Minister Tendai Biti injected a note of stark realism into his 2013 budget. He downgraded GDP growth estimates for 2012 from 9.4 per cent in his budget a year ago and 5.6 per cent in mid-year to just 4.4 per cent. 

* Qatari boost for Glencore and Xstrata deal

* Xi Jinping anointed China’s new leader

* Megafon relaunches London IPO 

In future, we will all have to work longer and retire later, right? Wrong, according to Jeremy Siegel, the Wharton professor. He says people in developed nations will still be able to stop work early and finance their retirement by selling their wealth to emerging market investors. “By the middle of this century, I expect all multinational companies to be owned by EM,” he says, pointing to a “new deal” between DMs and EMs.

Siegel is best known for the investment strategy laid out in his book, ‘Stocks for the Long Run‘. How did he arrive at his prediction? 

Friday’s picks from the BB team: the script of China’s leaders is little changed; taste the lifestyle of India’s growing elite; and marketing Megafon to institutional investors. Plus: corruption fights back in Guinea; the debate over Egypt’s antiquities; and Brazil’s mensalão trial.