Here's my summary of the key news overnight in 90 seconds at 9 am, including news we will get the December housing sales data at about 9:30am this morning from the REINZ. We are expecting a fairly strong December although the listing shortage may have crimped some of the activity.
Internationally, company news dominates the wires, although President Obama has just finished a news conference on the US debt issues.
Firstly, those company items. Apple is reported to have sharply cut back its production on waning iPhone orders. And Microsoft has halved its expectations for sales of its new Surface tablet. In Europe, Volkswagen has reported a record high for sales, and in North America, the big three Detroit carmakers have bounced back on the strength of a surging US car market.
However, icon German industrial vehicle maker MAN is reported to be cutting back on weak demand for its products. Japan is not being left out; Toyota sales have rebounded sharply, and they have regained the global car sales crown. And probably most importantly, Li & Fung, a huge Hong Kong based buying house for many of the world's biggest retailers, has reported a shock profit warning.
It's a mixed picture, but one theme is that tech and retail seem under new pressure, whereas some of the bigger manufacturers are looking ahead with optimism.
In the euro-zone, industrial output declined the most in three years in November, pulled lower by countries in the region's south facing recession as they attempt to cut debt and deficits through austerity policies. The OECD says Britain is on track for a recovery however. And the IMF insists the euro-zone economy is improving.
In the US, President Obama is focusing on the fight over the debt ceiling, reminding Congress they authorised all the current spending. The arguments are likely to be played out on a public stage rather than behind closed doors as both sides appeal to voters and polls to win the pressure they need to prevail.
In China, all eyes are on the dreadful pollution that is gripping much of the country, and especially Beijing. Apparently, it is reminiscent of London in the 1950s. They are at a watershed moment and how they respond will set the scene for China's future. Anger at the dirty air has now spilled over into official circles, and finger pointing has started.
The NZ$ starts today at 84.0 USc, 79.6 AUc and the TWI is at 75.3.
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EnviroWaste sold.
IRONBRIDGE TO SELL ENVIROWASTE TO CKI
Ironbridge is pleased to announce that funds advised and managed by Ironbridge have entered into a binding sale and purchase agreement, subject to customary conditions including OIO approval, to sell EnviroWaste to CKI (Cheung Kong Infrastructure Holdings Limited http://www.cki.com.hk/english/about_CKI/cki_at_a_glance/index.htm), the largest diversified infrastructure company listed on the Hong Kong Stock Exchange.
The transaction value of NZ$501 million in cash and assumed finance lease obligations represents a multiple of 10x EBITDA for the financial year ending 30 June 2012
Ironbridge funds originally acquired EnviroWaste from Fulton Hogan in April 2007. Ironbridge assembled a strong new management team and also supported the company in growing its business footprint, making 17 bolt-on acquisitions as part of a successful strategy to build a truly national New Zealand waste company. EnviroWaste has delivered strong organic growth during this period, more than doubling its EBITDA.
EnviroWaste has also made a significant contribution to the local economy, with the generation of more than 300 new full-time roles over the past six years.
EnviroWaste’s outperformance since 2007 highlights both Ironbridge’s expertise in resourcing and executing buy and build transactions as well as its experience in the waste management segment of the Outsourced Services sector. Ironbridge funds also own Global Renewables in Australia.
Ironbridge Founding Partner Julian Knights said “EnviroWaste has an outstanding management team lead by Kim Ellis, Gary Saunders and Earl Gasparich, who will continue to lead the business under CKI’s ownership. It has an excellent track record of retaining key customers and winning new business.”
EnviroWaste Chairman Kim Ellis said “We are very grateful to the Ironbridge team of Julian Knights, Kerry McIntosh and Chris Aughton for their valued contribution to the growth and development of our business over the past six years. EnviroWaste is well placed to continue to provide superior service to customers and to expand its operations under the ownership of CKI.”
Transaction enterprise value comprises NZ$490 million in cash consideration payable by CKI and approximately NZ$11 million in EnviroWaste finance lease obligations to be assumed by CKI.
The NZD appears to be threatening to go up through some resistance levels. Primarily caused by foreign government capital flows. Hopefully our Reserve Bank will lean against any further rise; and the Treasury Debt management office won't make it worse with more foreign borrowing.
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