CurrentAccount: Pity the poor shareholders in Indian newspaper group Jagran Prakashan this week. The newspaper company, which publishes the best-selling Hindi newspaper Dainik Jagran, is one of the brighter stars in the Indian media firmament.
Its success has even attracted the interest of Tony O'Reilly's Independent News & Media, which has taken a 26 per cent chunk in the company. Despite all this it may not look back on its flotation on the Bombay Stock Exchange with too much satisfaction.
The company's shares opened at 376 rupees, but within an astonishingly short time dropped to 273 rupees as the market delivered the verdict on its true value.
Many analysts had expected this, as they felt the issue price had been too high and were surprised when the issue was oversubscribed.
Still, one has to have sympathy for the guests who arrived for the listing ceremony in Mumbai (formerly Bombay), only to see the company's price plummet even before they had tucked into the tea and snacks.
Time Warner clash may inspire O'Brien
Denis O'Brien's intentions regarding Independent News & Media - where he has a 3 per cent stake - remain a closely guarded secret.
But a clue comes from the tussle under way at Time Warner, where legendary US investor Carl Icahn is trying to muster support for breaking up the company, which he says will unlock value.
Icahn, who coincidentally owns about 3 per cent of Time Warner, commissioned a report from Lazards to back up his view, but failed to garner much investor support. He has not given up, however, and "settlement" talks stumble on.
Has O'Brien got someone crunching the numbers on the pros and cons of selling off Indo's attractive but disparate operations in Australia, South Africa and Britain?
More importantly, how would institutional investors react to the proposal, which could expect short shrift from Tony O'Reilly, the controlling shareholder?
Developing billionaires
Current account a few weeks ago had a chat with a man who'd had a chat with a man who said he personally knew of 10 property developers who were worth a billion.
The point was raised with a senior member of the accountancy profession this week. He said there was a number of individuals in Ireland who had made so much money in the past 15 years that their affairs tended to crop up on the books of all the main accountancy firms.
It was his view that there were in the region of 30 billionaires in Ireland, and almost all of them were property developers.
In his opinion there were two very different worlds in Irish business: one where business people worked hard and could, if successful, make tens of millions of euro over a lifetime; and another where property developers did deals and could, if successful, make hundreds of millions of euro over a lifetime.
If not a billion.
Merrion Capital shivers
Is a chill wind about to blow from the north from Merrion Capital? Ratings agency Fitch this week cut the outlook on Iceland's triple-A rating to negative, citing an "unsustainable current account deficit and soaring net external indebtedness".
Part and parcel of the Icelandic economic boom has been the explosive growth of Iceland's three main banks Kaupthing, Landsbanki and Islandibanki, which have roughly doubled in size every year for the last couple of years.
The small size of the domestic deposit market has meant that all three have been regular visitors to the debt markets. As a result, there is a burgeoning business in Icelandic credit default swaps, which allow lenders to insure against the bank's defaulting.
This week's news sent the price of swaps upwards and they are now trading at a sizeable premium to comparable European banks. It is a bit early to start worrying - given that all three banks hold A credit ratings from Fitch, and A1 or A2 ratings from Moody's - but it is unwelcome news all the same for the shareholders in Merrion, who hope to pocket €20 million over the next few years from the earn out agreed when Landsbanki bought Merrion last year.
