Deals continued to flow thick and fast with the Graeme Hart-controlled Pactiv Evergreen among those poised to change hands, while markets remained choppy as investors gauge the pace of interest rate cuts around the world.
Hart’s Packaging Finance entity approved the sale of packaging firm Pactiv Evergreen to Apollo Global Management-backed firm Novolex for US$18 a share, or roughly US$3.2 billion – a premium to the US$14.68 price the shares closed at yesterday and valuing the company at US$6.7 billion including debt. Hart's entity owns more than 75% of Pactiv Evergreen, having spun it out of his Reynolds Group Holdings packaging empire and listing it in 2020 at US$14 a share.
That was one of several deals to emerge overnight, with Nikkei reporting that Nippon Life Insurance will buy Resolution Life – which owns the old AMP life unit – and the Wall Street Journal reporting that US retailer Walgreens is in talks with private equity firm Sycamore Partners to discuss a deal.
Markets were generally mixed with luxury European stocks such as LVMH and Kering weighed on by slower Chinese exports, while the European Central Bank’s rate review later this week remained in focus for investors.
Wall Street was mixed ahead of inflation data with the Federal Reserve’s last policy meeting of the year on investors’ minds. Google-parent Alphabet advanced after revealing a new generation chip it said helped pave the way for quantum computing, while Oracle sank after missing analysts’ estimates for its November quarter earnings.
Yesterday’s Reserve Bank of Australia policy review surprised analysts by softening its inflation-targeting rhetoric, pushing the kiwi and Australian dollars lower. The kiwi fell to 57.95 US cents at 7am in Auckland from 58.32 cents at 5pm yesterday, and traded at 90.92 Australian cents from 91.20 cents yesterday.
“The market brought forward the path of easier policy, now seeing a better than even chance of a 25 basis points cut at the next meeting in February and two full cuts by May,” Bank of New Zealand senior markets strategist Jason Wong said in a note. “(RBA governor Michele) Bullock was asked whether she was surprised by this market reaction and she said, ‘No I am not’.”
Locally, Statistics New Zealand’s September quarter business activity will provide more clues to the upcoming gross domestic product release later this month, while kiwifruit growers approved to increase the international licensing for Zespri-branded fruit to be grown overseas.
Meanwhile, the government’s decision on KiwiRail’s Interislander ferry unit will be announced today, with some speculation that it could be a spun out as a mixed-ownership model company.
