Buhlmann's Corner
The silk road is what you make of it
2018 is up and running and seems to be making a go of it. This is today’s upbeat, constructive message. True, Deutsche Börse missed a beat on Friday, March 16th a gremlin-spooked day, when, snowed under a mountain of derivates, and reeling from the effects of Brexit and bonuses, staff fumbled the button to signal the start of the day’s trading. Ironically the new (as it were) government in Berlin can now boast a Minister for Digital Infrastructure, a position filled by Andreas Scheuer.
So much the better, therefore that despite the hiccup, Healthineers turned into a resounding success and Siemens made it home and dry yet again. Low interest rates kept the effects of a 45 minute delay in a 4 billion-odd Euro IPO payment at reasonable levels, indeed far less than what Mickey Mouse had to fork out to bring home the bacon. At last year’s SAP AGM, the motion on emoluments squeaked by on a handful of votes. Walt Disney wasn’t so lucky. In Houston last March 8th a 52 percent majority voted the motion down, paving the way for something more concrete. Those on salaries which, in per annum terms, have three zeroes before the millions column are about to learn all about bearing direct responsibility towards shareholders. Thanks to Bob Iger.
Perhaps we have reached a moment of energy transition in managers’ salaries. These last eight years have been hard on RWE and e.on with a series of restructuring initiatives and no lack of costly litigation. The upshot was separation of distribution from production pending a ruling by the German monopolies commission. Red light, or red light and full speed ahead?
Daimler would have welcomed a traffic light or two along the silk road from China. At this juncture in automobile history when all eyes are on diesel, Dieter Zetsche made no bones about his envy of Volkswagen, PSA Peugeot and BMW having their anchor shareholder. He and Bodo Uebber got busy only to find themselves forestalled by Geely Automobile Holdings of Zhejiane. Perhaps, then, top company management ought to learn Mandarin as a means for extolling the experience of rock solidity, acquired through Volvo and powered by the Lotus legacy of speed and agility not to mention the dynamism of the Asian market seeing that Daimler headquarters are located in Stuttgart, a city itself off limits to cars. Could this be the first faltering step towards a revival of the old Deutsche Bank/Daimler entente, a new Germany PLC under the roof of one or more Chinese holding companies?
More important though are the steps that the recently appointed German Minister of Foreign Affairs, Heiko Maas will take regarding the Chinese. A country that invests abroad without the involvement of local partners must grant its prospective foreign investors the same right (Beijing and surrounding districts). So, Mr. Maas, how long before light is shed on the issue?
DWS, Deutsche Bank’s most recent IPO shows how to go about it under that particular roof. To begin with, its legal form will make it an extremely hard nut to crack in terms of issues of governance, and then before going on the trading floor, it has two anchors that provide a one-third guarantee. The first anchor is held by Tikehau Capital Partners in Paris and marking the spirit of harmony and good intentions towards the countervailing powers, the second anchor resides with Nippon Life. A year ago Antoine Flamarion, Tikehau’s managing partner in charge of foreign business wisely pointed out “La simplification de notre structure actionnariale et de notre gouvernance sera un atout dans le cadre de notre développement”. Considering that their starting portfolio of 4 million Euros has ripped through the 10 billion Euro ceiling, John Cryan and Marcus Schenck could take a leaf from this Parisian book in their quest to simplify their accounts or perhaps how to get Temasek on board as a shareholder.
<more> "DWS GmbH & Co. KGaA: A not so perfect start on the stock exchange" - Capital News