It’s almost certain that the Catalan crisis will prevent the Spanish budget from being approved, which will be a blow to political stability and the duration of the current legislature.
Telefonica is starting the process of preparing a stock market listing for a stake in its currently fully-owned Argentine subsidiary. In the upcoming AGM on April 16, it’s expected that authorisation will be sought from shareholders to go ahead with the share placement.
Although most of Spain’s public debt belongs to the central Administration, the debt held by the 17 autonomous regions is by no means insignificant: it accounts for 25% of Spain’s GDP, way above the 16% it represented just five years ago. Many regions are now returning to the debt markets.
Spain is far from complying on deficit and State debt targets. It’s still surprising that out of a total amount of debt issued equivalent to 137% of GDP, there can be an official debt of 98%, thanks to a cut which, under the EU’s conditions themselves, is fully approved. This growing divergence has been there for years, particularly since the PP entered government in November 2011.
In three months, Barclays has cut its price target for Telefónica on four occasions, from 9,8 euros/share in December to 9 euros/share last time round, on March 19. That’s almost 10% lower. How can a company’s value change so much in such a short space of time?
If I haven’t got the wrong end of the stick, Italy plans is to create a parallel currency to the euro, guaranteed by the Italian government, but which I don’t know who will control. A Bank of Italy? The government would issue these BOT, endorse them with the BI, which would give it the money to be shared out amongst the unpaid creditors. It seems a lot like Helicopter Money.
Repsol’s sale of a 20% stake Gas Natural to CVC is near to being closed. The current value at market prices of 20% of Gas Natural is 3.708 billion euros. Furthermore, the stock has fallen nearly 6% in the year due to last markets turmoil. After its recent downward correction, Repsol’s stock price is back at an advantageous entry level.
The UK Court of Appeal has dismissed a demand from Three which blocked the new frequencies auction (planned for Autumn 2017), in turn blocking Telefonica’s share sale of O2. This is positive news for Telefónica as it means that it eliminates a practical hurdle for the company to be able to carry out the O2 share sale in the UK, raising funds to cut its debt.
“I am “the king of debt”. That was very grandiose for me as a businessman, but it’s bad for the US. I made a fortune with debt, I will sort out the US”. This is the kind of tweet which would ruin anyone’s political career, with the exception of one person: Donald Trump.
Athanasios Dimadis and Hung Q. Tran | US is not alone in its worry about debt and deficit. According to the International Institute of Finance statistics, China poses the biggest threat to global economic stability, its total debt having risen astronomically over the last decade. The eurozone is still trying to heal the scars of an enduring economic crisis, with Greece’s unmanageable debt remaining a significant problem.