Scottish Powers shareholders will be happy with the size of the bid and the fact that it is going through but it is not a good long term investment as debt levels will be high.
The bid came from the blue and sent the share price spiralling upwards. The bid from Ibedrola the spanish utility to buy Scottish Power for £11bn, looked like it could spark a bidding war for a good stable well run utility. But Scottish and Southern and the Germans were the first to say no and the bidders did not come. SP have been forced to accept this offer because it is good value.
The worry from a shareholder perspective is that Ibedrola are borrowing huge amounts of cash to pay for this buisness and they are buying it to protect themselves from takeover. Ironically the debt may devalue the combined company making them an easier and more attractive bid prospect.
The synergies exist but the cynical suggest that this will line Philip Bowmans pockets more than any long term investment decision in the new outfit.
17 February 2006
Commissioner shows teeth and the big players will be aware that they are in for a rough ride in the next couple of months. Overall this will put bearish pressure on prices. read more...
16 January 2006
Oil under pressure from Iran, as coal fired plant is on the up as the spark spread tightens relative to the dark spread. read more...
10 August 2005
Scottish Power look good but is their trouble round the corner read more...
31 May 2005
Americans think power price may fall whilst the Brits are happy to view a power price rise. read more...
Oil Disruption Fears create Volatile Markets
The European Union provided details this week of its proposed ban of Iranian oil imports as the Union steps up pressure over the country's nuclear programme. read more...
20 January 2012
The European Union provided details this week of its proposed ban of Iranian oil imports as the Union steps up pressure over the country's nuclear programme. read more...
European Credit Downgrades add to European Woes
Standard & Poors, the credit rating agency has downgraded 9 eurozone countries: France, Italy,Spain,Cyprus, Portugal, Austria, Slovakia, Slovenia and Malta. This comes at the end of a week that has seen strengthening oil prices but surpressed UK gas and power markets. read more...
13 January 2012
Standard & Poors, the credit rating agency has downgraded 9 eurozone countries: France, Italy,Spain,Cyprus, Portugal, Austria, Slovakia, Slovenia and Malta. This comes at the end of a week that has seen strengthening oil prices but surpressed UK gas and power markets. read more...
November 2011 Review
While debt repayment concerns combined with woeful economic indicators continued to be a feature throughout November, supply and demand fundamentals were an obvious driver too. Unseasonably warm weather combined with (and causing) plentiful gas storage meant that UK power and gas markets went into a nose dive. read more...
02 December 2011
While debt repayment concerns combined with woeful economic indicators continued to be a feature throughout November, supply and demand fundamentals were an obvious driver too. Unseasonably warm weather combined with (and causing) plentiful gas storage meant that UK power and gas markets went into a nose dive. read more...
Turmoil returns on Greek Announcement
Following last weeks announcement that the eurozone leaders had reached an agreement on a Greek bailout - one that would see banks take a 50% hit on their holdings of Greek debt, the Greek Prime Minister made his own shocking announcement that he plans to hold a referendum on the matter. The Markets tumble in response. read more...
01 November 2011
Following last weeks announcement that the eurozone leaders had reached an agreement on a Greek bailout - one that would see banks take a 50% hit on their holdings of Greek debt, the Greek Prime Minister made his own shocking announcement that he plans to hold a referendum on the matter. The Markets tumble in response. read more...
Eurozone Debt Deal Announced
After prolonged discussions and late night talks, European leaders have announced a agreement on a a Eurozone debt deal. But will the devil be in the detail? read more...
27 October 2011
After prolonged discussions and late night talks, European leaders have announced a agreement on a a Eurozone debt deal. But will the devil be in the detail? read more...
October -What to Expect
October is a month to identify some good value purchasing opportunities. History suggests we will see prices slip through the month before the real winter drivers kick in. read more...
03 October 2011
October is a month to identify some good value purchasing opportunities. History suggests we will see prices slip through the month before the real winter drivers kick in. read more...
Shale Gas - Latest UK estimates suggest enough for next 11 years
Cuadrilla Resources, the company at the forefront of Britain's Shale gas exploration released its first estimates of the amount of shale gas contained in the rocks of Lancashire. At 200 trillion cubic feet, the estimates are significant to say the least. read more...
22 September 2011
Cuadrilla Resources, the company at the forefront of Britain's Shale gas exploration released its first estimates of the amount of shale gas contained in the rocks of Lancashire. At 200 trillion cubic feet, the estimates are significant to say the least. read more...
Gas Imports Keep the System Balanced
Two GBAs in one week, use of Interruptible Supply Contracts and record temperatures but the system remains balanced and gas prices even drop during trading. read more...
08 January 2010
Two GBAs in one week, use of Interruptible Supply Contracts and record temperatures but the system remains balanced and gas prices even drop during trading. read more...
Gas Balancing Alert Issued
National Grid issues a rarely used Gas Balancing Alert following both supply and demand pressures. With severe weather warnings in place and freezing temperatures set to continue, will this be the last of the GBAs? read more...
05 January 2010
National Grid issues a rarely used Gas Balancing Alert following both supply and demand pressures. With severe weather warnings in place and freezing temperatures set to continue, will this be the last of the GBAs? read more...
EdF enters the world of competition..
EdF has capitalised on competitive energy markets across Europe, not least in the UK, while at the same time enjoying a dominant, competition free, environment at home in France. It looks as though the EC has finally caught up with them... read more...
05 November 2009
EdF has capitalised on competitive energy markets across Europe, not least in the UK, while at the same time enjoying a dominant, competition free, environment at home in France. It looks as though the EC has finally caught up with them... read more...
What's in the Mix?
While gains may have been seen in both the power and gas markets this week – the gains were not equal causing a big shift in the generation mix read more...
24 September 2010
While gains may have been seen in both the power and gas markets this week – the gains were not equal causing a big shift in the generation mix read more...
Out with the Old, In with the New
During the last day of trading in 2009, the UK Power curve closes down but what will the New Year hold in store? read more...
31 December 2009
During the last day of trading in 2009, the UK Power curve closes down but what will the New Year hold in store? read more...
Unseasonal Temperatures help to melt prices
Middle of November but no sign of wintery temperatures. The effect was to soften the prompt power market, which also felt the pressure from weak commodity curves. The downward trend fed through the power curve. read more...
16 November 2009
Middle of November but no sign of wintery temperatures. The effect was to soften the prompt power market, which also felt the pressure from weak commodity curves. The downward trend fed through the power curve. read more...
Market forgets basic principles and panics!
It could be said that the market over reacted today in the prompt market with a price rally on the back of a £142 half hourly cash out price. read more...
02 October 2009
It could be said that the market over reacted today in the prompt market with a price rally on the back of a £142 half hourly cash out price. read more...
What's Happening in the Back-End?
The back end of the curve is extremely difficult to trade. Those dipping their toe in tend to be Producers (with excessive length adjusting their risk positions) and Banks looking for some exposure. At the same time Retailers tend to be short-termist. read more...
19 June 2009
The back end of the curve is extremely difficult to trade. Those dipping their toe in tend to be Producers (with excessive length adjusting their risk positions) and Banks looking for some exposure. At the same time Retailers tend to be short-termist. read more...
November 2011 Review
While debt repayment concerns combined with woeful economic indicators continued to be a feature throughout November, supply and demand fundamentals were an obvious driver too. Unseasonably warm weather combined with (and causing) plentiful gas storage meant that UK power and gas markets went into a nose dive. read more...
02 December 2011
While debt repayment concerns combined with woeful economic indicators continued to be a feature throughout November, supply and demand fundamentals were an obvious driver too. Unseasonably warm weather combined with (and causing) plentiful gas storage meant that UK power and gas markets went into a nose dive. read more...
Prepare for the clash of OPEC & IEA
With less than a month to go until OPEC meets, the statements are beginning to fly: OPEC believe the oil market looks balanced while the IEA again are saying that high oil prices could harm fragile global economic growth. Let the battle begin! read more...
23 November 2011
With less than a month to go until OPEC meets, the statements are beginning to fly: OPEC believe the oil market looks balanced while the IEA again are saying that high oil prices could harm fragile global economic growth. Let the battle begin! read more...
Markets Still Jittery
Most markets reported further losses today on the back of underlying nerves about the ability of both Europe and the US to repay their debts. Oil, commodities and equities all reported losses. read more...
21 November 2011
Most markets reported further losses today on the back of underlying nerves about the ability of both Europe and the US to repay their debts. Oil, commodities and equities all reported losses. read more...
Turmoil returns on Greek Announcement
Following last weeks announcement that the eurozone leaders had reached an agreement on a Greek bailout - one that would see banks take a 50% hit on their holdings of Greek debt, the Greek Prime Minister made his own shocking announcement that he plans to hold a referendum on the matter. The Markets tumble in response. read more...
01 November 2011
Following last weeks announcement that the eurozone leaders had reached an agreement on a Greek bailout - one that would see banks take a 50% hit on their holdings of Greek debt, the Greek Prime Minister made his own shocking announcement that he plans to hold a referendum on the matter. The Markets tumble in response. read more...
Eurozone Debt Deal Announced
After prolonged discussions and late night talks, European leaders have announced a agreement on a a Eurozone debt deal. But will the devil be in the detail? read more...
27 October 2011
After prolonged discussions and late night talks, European leaders have announced a agreement on a a Eurozone debt deal. But will the devil be in the detail? read more...
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