This week just keeps getting worse for Vale.
After warning shareholders on Wednesday of unexpected tax charges of $448m, the Brazilian mining giant stunned the market late on Thursday with news of a $4.2bn writedown on its nickel and aluminium assets. Read more
While foreign governments cheered loudly in favour of Felipe Calderón’s war against Mexico’s drug gangs, Jorge Castañeda always maintained it was unwinnable, a “bloody, reckless adventure”.
Castañeda, a former foreign minister, supported Calderón’s successful presidential campaign in 2006, but was first taken aback, then aghast as, almost without warning, the new president immediately donned military garb to confront Mexico’s powerful drug gangs. Read more
Christmas has come early – for Chile’s Enersis.
Shareholders in the energy company have approved Chile’s biggest capital increase — a whopping sum of nearly $6bn (if you think that´s a lot, remember they were originally planning to seek $8bn).
It was not an easy path — Enersis battled pension funds, which are key investors in Chile, over the amount and minority shareholders baulked at the valuation of some of the assets that Spanish energy company Endesa said it would use to subscribe its share of the fundraising. Endesa, by the way, is owned by Enel of Italy. Read more
Still in need of some Christmas gifts? What about some t-shirts sporting the face or the arrest warrant of Pablo Escobar, the violent leader of the Colombia’s Medellín drug cartel who terrorised the Andean country in the eighties and early nineties.
Almost 20 years after his death, Escobar’s son -born Juan Pablo Escobar Henao, now named Sebastián Marroquín-, has launched a clothing line, “Escobar-Henao”, which appears to be gaining adepts in the US, Mexico, Spain, and Austria. Read more
The recent successful sales of three of Turkey’s 21 regional power distribution companies was good news for Turkey’s privatisation programme and its long stalled plans to liberalise its energy markets.
However news on Friday that the sale of a state coal fired power plant had attracted no less than 16 bidders promises to ensure that 2013 should be the year when Turkey finalises the move from a heavily state-controlled power market to a fully liberalised one. Read more
Ludwik Sobolewski (left), head of the Warsaw Stock Exchange since 2006, was suspended late Friday “for compelling reasons” by a hurriedly convened management board meeting.
The exchange’s brief statement on the suspension did not give a reason for the decision, but the Polish press reports that Sobolewski had been linked to a controversy over the financing of a film about the stock exchange. Read more
Calling someone two-faced isn’t exactly flattering – but for a new Russian smartphone, it’s the key feature. Read more
Mozambique’s substantial offshore gas reserves moved a step closer to full development on Friday with the announcement of a heads of agreement between the Italian energy company Eni and the Texas-based Anadarko Petroleum to jointly construct an onshore liquefied natural gas (LNG) plant at an estimated cost of more than $10bn. Read more
Although South Africa boasts some of the more sophisticated financial systems in Africa, there is still some scepticism around foreign exchange trading.
So can events like the SA Forex Expo 2012, held in Cape Town, change investors’ minds? Although market experts see the potential, the expo’s organiser admit that it needs to work on wooing cautious local traders to participate. Read more
Given China’s increasing status as an economic power, it’s not surprising that more and more people are flying to the country. But it’s taken a while for new routes to open up, with much of the air traffic routed via the established centres of Beijing, Shanghai and Hong Kong. That seems to be changing.
British Airways announced on Wednesday that it will next year start flying from Heathrow to Chengdu – one of China’s growing inland centres, and Finnair announced on Thursday that it will be the first airline to connect Europe and Xi’an, another large interior city, flying three times per week from Helsinki. Read more
* Emerging stocks drop most in six weeks on U.S. budget
* BlackRock sees distortions in country ratings seeking S&P change
* Soaraway $500m China IPO cheers HK Read more
Shares in Gulf Oil, the lubricants business of the Mumbai-based Hinduja Group, rose 2.5 per cent on Friday as the company announced the completion of its $1.05bn acquisition of Houghton Oil, the US industrial fluids manufacturer.
It’s set to be the largest acquisition this year by a non-state Indian company, though it is dwarfed by the proposed $5bn deal made public last month, in which ONGC, the Indian state oil group, is buying a stake in Kazakhstan’s Kashagan oil field. Read more
Friday’s picks from the beyondbrics team: China’s property developers feel the squeeze; Is the new South Korean president Park Guen-hye giving too much deference to the chaebol? And there is a new opportunity to exert diplomatic pressure on Syria’s Assad regime; plus, why Hon Hai is considering setting up factories in Indonesia (it’s not the wages). Read more
A seasonal gift from Beijing for canny, or lucky, investors in Hong Kong. China Machinery Engineering Corporation (CMEC), the state-owned contractor, saw its shares leap by as much as 19 per cent as it made its HKSE debut on Friday.
With Asian markets generally weak on Washington’s failure to reach a fiscal cliff deal, CMEC’s soaraway $500m initial public offering was a surprise bonus on an otherwise dull day. Read more
By Christopher Garman and Alexander Kliment of Eurasia Group
With the US and Europe mired in economic uncertainty, investors have turned to the emerging markets as a source of higher growth and richer returns. But EMs face new economic and political challenges of their own that will cause them to diverge from one another in the coming years. Investors who fail to anticipate this divergence will underestimate risks in some countries and miss opportunities in others. Read more