Company news in brief
13 March 2019 | Business
Ethiopia has long prevented foreign ownership in economic sectors including banking, but Abiy has embarked on rapid political, diplomatic and economic reforms since coming to power in April.
An entrance into the Ethiopian market of 100 million people, while not imminent, would be part of a strategy Absa laid out after its split from Britain's Barclays in 2017.
Jason Quinn, the bank's chief financial officer, told Reuters that Absa was investigating how and where to enter a number of other growth markets, including Nigeria and Angola.
The bank had already highlighted Nigeria as key to future growth, where Quinn said there was a "nice opportunity" for Absa in corporate and investment banking. It had also already flagged Angola as attractive, alongside Egypt. – Nampa/Reuters
Boeing shares crash 737 MAX tragedy
Shares of Boeing Co slid 10% on Monday after China, Indonesia and Ethiopia ordered airlines to ground their Boeing 737 MAX 8 planes following the second deadly crash involving the jet in just five months.
The losses put the stock on course for its biggest daily fall in nearly two decades, halting a surge that has seen Boeing's market value triple in just over three years to a record high of US$$446 per share.
Wall Street has been overwhelmingly bullish on Boeing – 19 of the 24 brokerages covering the stock rate it "buy" or higher, while five have a "hold" rating.
It is the best performer in the Dow Jones Industrial Average so far this year, up 31% compared with a 9.1% gain in the index. The decline on Monday was a major factor in pulling the index lower.
Boeing's shares lost 12% in the weeks following the Lion Air crash last year, but have more than recouped those declines. They were down 9.6% at US$381.72 soon after the opening bell, erasing about US$32 billion from the company's market value. – Nampa/Reuters
Barrick Gold ends hostile Newmont bid
Barrick Gold Corp on Monday pulled its US$18 billion offer for Newmont Mining Corp and agreed to form a joint venture in Nevada with its rival, ending a hostile takeover bid that sought to unite the world's two largest gold producers.
By combining their operations in the southwestern US state, which is home to one of the world's largest gold-producing areas, Barrick and Newmont hope to save more than US$5 billion over the next 20 years.
Toronto-based Barrick will control 61.5% of the venture, giving it slightly less oversight than it initially wanted even as it gains full operational control over mines that produce more than 4 million ounces of gold annually.
The agreement comes amid a pickup in deals across the gold industry, which has struggled with a loss of investor confidence and financing constraints in recent years.
"This is one of those rare transactions that really does create demonstrable value for everyone involved," Barrick CEO Mark Bristow told Reuters on Monday. "It shows that people, if you put your mind to it, can deliver transactions in a very short while."
Levi Strauss looks to deepen pockets with IPO
Levi Strauss & Co hopes to sell US$587 million worth of shares in an upcoming return to the stock market after three decades, which would value the inventor of blue jeans at US$6.17 billion and give it a potful of cash to invest in broadening its product range.
The company, which has 385.5 million shares outstanding, said it expects to offer 36.7 million shares priced between US$14 and US$16 per share in an initial public offering.
Demand for denim is surging, driven by new styles such as high-waist and pinstriped jeans. Smaller rivals American Eagle Outfitters and Abercrombie & Fitch last week posted strong results, boosted by robust denim sales.
The 165-year-old company, however, aims to evolve into a full-fledged global lifestyle leader for both men and women.
Levi Strauss, which also sells footwear, belts and wallets, reported annual net revenue of US$5.6 billion in 2018. – Nampa/Reuters
Malaysia Airlines’ future in balance
The Malaysian government is considering whether to shut, sell or refinance national carrier Malaysia Airlines (MAB), prime minister Mahathir Mohamad said yesterday.
The government was studying options for the national carrier, and a decision should be made “soon”, Mahathir said, when asked about analysts’ suggestions the airline be shut down or spun off. "It is a very serious matter to shut down the airline," Mahathir said.
The airline has been trying to transform its operations and return to profitability by 2019 as it recovers from two disasters in 2014, when flight MH370 disappeared in what remains a mystery and flight MH17 was shot down over eastern Ukraine.
Sovereign wealth fund Khazanah Nasional Bhd, which took MAB private in 2014, said the government needed to decide on its investment in, and level of support for, the struggling airline.
The fund also said that it was waiting for MAB to present a review of its business strategy. – Nampa/Reuters