Latest news with #ElliottManagement
Japan Times
13-06-2025
- Business
- Japan Times
Sumitomo Realty seeks office sale after Elliott takes stake
Sumitomo Realty & Development, the Japanese developer facing pressure from Elliott Investment Management to boost its value, is seeking to sell a group of office properties in Tokyo for at least ¥100 billion ($700 million), according to people with knowledge of the matter. The developer has earmarked 19 midsize office buildings for the divestment. It has asked real estate investment firms and agencies to estimate the value of the offices, which it is considering selling separately, the people said, asking not to be identified because the matter is private. It is also weighing the sale of eight rental apartment buildings in the city, they said. Shares of Sumitomo Realty jumped as much as 6% and closed 2.4% higher at ¥5,838 in Tokyo on Thursday. Sumitomo Realty said in a statement that it is not true that it is considering selling the 19 office buildings. The company also said it plans to reduce nonprime assets to improve asset efficiency in line with its midterm business plan. After taking a stake in Sumitomo Realty, Elliott said this week that the Tokyo-based company should do more to improve shareholder returns and corporate governance. The sale plans mark a shift from its business model of developing properties in-house, holding them for the long term, and earning steady income from tenants, toward a strategy targeting capital gains. In a rare public letter, Elliott said it would vote against Sumitomo Realty's senior management at an annual shareholder meeting on June 27 if no meaningful progress is made on improving its value. Elliott said the company is one of the most undervalued real estate developers in Japan, assessing that its stock is worth at least ¥8,000, based on the valuation of its real estate holdings and peer companies. It called on the developer to unwind its cross-shareholdings, increase its shareholder payout ratio to 50% or more and target a return on equity of at least 10%. Elliott has built up more than a 3% holding in the company, according to the letter.
Japan Times
12-06-2025
- Business
- Japan Times
Sumitomo Realty seeks $700 million office sale amid Elliott push
Sumitomo Realty, the Japanese developer facing pressure from Elliott Investment Management to boost its value, is seeking to sell a group of office properties in Tokyo for at least ¥100 billion ($700 million), according to people with knowledge of the matter. The developer has earmarked 19 midsized office buildings for the divestment. It has asked real estate investment firms and agencies to estimate the value of the offices, which it is considering selling separately, the people said, asking not to be identified because the matter is private. It is also weighing the sale of eight rental apartment buildings in the city, they said. Representatives for Sumitomo Realty weren't immediately available for comment. After taking a stake in Sumitomo Realty, Elliott said this week that the Tokyo-based company should do more to improve shareholder returns and corporate governance. The sale plans mark a shift from its business model of developing properties in-house, holding them for the long term, and earning steady income from tenants, toward a strategy targeting capital gains. In a rare public letter, Elliott said it would vote against Sumitomo Realty's senior management at an annual shareholder meeting on June 27 if no meaningful progress is made on improving its value. It called on the developer to unwind its cross-shareholdings, increase its shareholder payout ratio to 50% or more and target a return on equity of at least 10%. Elliott has built up more than a 3% holding in the company, according to the letter.
The Independent
09-06-2025
- Business
- The Independent
Thames Water lenders offer £17 billion rescue deal in return for looser rules
A group of Thames Water's creditors have proposed a multibillion-pound rescue deal for the struggling supplier, offering new investment in exchange for regulatory leniency. The proposal, submitted to Ofwat, includes investment firms such as Aberdeen, Elliott Management, and BlackRock offering to overhaul £17 billion of Thames Water's debts. The firms would invest £3 billion in new equity and a further £2 billion of funding. The proposal would also involve writing off "several billion" pounds' worth of debt and a "complete loss for existing shareholders" in what they claim would be the "largest financial loss suffered by investors on an infrastructure asset in British history." The creditors are asking for leniency on performance targets and compliance, and warned that without a "regulatory reset" Thames Water's "pollutions, asset health deterioration, and customer service levels are likely to worsen." Under the proposals submitted to Ofwat, customer bills would not increase by more than the regulator has already approved over the next five years. They are holding intensive talks with Ofwat in the hope of securing approval for their deal in early July. The plans come after US private equity giant KKR last week pulled out of a rescue deal to inject much-needed cash into Britain's biggest water supplier, which has 16 million customers and is sinking under £19 billion of debt. It threw the future of Thames Water into doubt once more and raised the threat of temporary nationalisation by the Government if a deal cannot be agreed. A spokesperson for the creditors said their turnaround plan was 'designed to fix the root causes of Thames Water's problems, restore its balance sheet, rebuild customer trust, and provide the financial investment and operational capabilities to fix the fundamentals of the business once and for all'. They added: 'The plan seeks to break from the patterns of the past by delivering customers' priorities and improved outcomes for the environment in the shortest possible timeframe. 'The creditors include some of the largest investors in UK water companies, as well as UK and global infrastructure more broadly, with a proven track record of corporate turnarounds and long-term stewardship. 'These investors have the funding and experience required to deliver a transformation of the company's performance which is intended to mark a departure from past failings, creating a 'new' Thames Water that works effectively alongside Government, regulators, and customers to deliver for the environment and economic growth.' The creditors are the bondholders who effectively own Thames Water after the High Court earlier this year approved a financial restructuring through a loan of up to £3 billion to ensure it can keep running until the summer of 2026. Other investment and pension firms in the group include Apollo Global Management, M&G and Silver Point Capital. As part of their plans, the creditors would appoint a new board at Thames Water to run the utility. They would commit to spending £20.5 billion over the next five years, as agreed under the current five-year plan with Ofwat. But they are calling for a 'pragmatic approach' to regulation – including 're-basing incentives and performance targets – and 'realistic levels of compliance'. 'Without the regulatory support requested, the creditors believe that customers will remain exposed to the risk of a continued 'doom loop' of underperformance and non-compliance,' according to the creditors. 'A clean slate that would see Thames Water and investors held to account to deliver an ambitious trajectory for the company's return to compliance,' they added. A spokeswoman for Ofwat said the regulator had been 'engaging regularly' with Thames over the funding plans. 'We have commenced a thorough review of the submission from the group of senior creditors,' Ofwat said. 'The submission includes their turnaround plans, approach to financial resilience and proposals for governance. 'Our focus is on assessing whether the plans are realistic, deliverable and will bring substantial benefits for customers and the environment.' Liberal Democrat MP Charlie Maynard, who has previously appealed against a £3 billion rescue deal for the utility, said: 'What will it take for the Government and the regulator to put a stop to this horror show Thames Water customers are forced to suffer through and pay for? 'Having created a mountain of debt, all at customers' expense, this latest plan for Thames Water would let them continue to pollute with impunity.'
The Independent
09-06-2025
- Business
- The Independent
Creditors table £17bn plan for Thames Water but call for regulatory leniency
A group of Thames Water lenders have put forward plans for a multibillion-pound rescue deal of the troubled supplier that would see them pump in new cash but ask for leniency in how it is regulated. Creditors including US and UK investment firms – such as Aberdeen, Elliott Management and BlackRock – have submitted a plan to regulator Ofwat to overhaul £17 billion of Thames Water's debts, including investing another £3 billion in new equity and a further £2 billion of funding. It would also involve writing off 'several billion' pounds' worth of debt and a 'complete loss for existing shareholders' in what they claim would be the 'largest financial loss suffered by investors on an infrastructure asset in British history'. Under the proposals submitted to Ofwat, customer bills would not increase by more than the regulator has already approved over the next five years. But the creditors are asking for leniency on performance targets and compliance, and warned that without a 'regulatory reset' Thames Water's 'pollutions, asset health deterioration, and customer service levels are likely to worsen'. They are holding intensive talks with Ofwat in the hope of securing approval for their deal in early July. The plans come after US private equity giant KKR last week pulled out of a rescue deal to inject much-needed cash into Britain's biggest water supplier, which has 16 million customers and is sinking under £19 billion of debt. It threw the future of Thames Water into doubt once more and raised the threat of temporary nationalisation by the Government if a deal cannot be agreed. A spokesperson for the creditors said their turnaround plan was 'designed to fix the root causes of Thames Water's problems, restore its balance sheet, rebuild customer trust, and provide the financial investment and operational capabilities to fix the fundamentals of the business once and for all'. They added: 'The plan seeks to break from the patterns of the past by delivering customers' priorities and improved outcomes for the environment in the shortest possible timeframe. 'The creditors include some of the largest investors in UK water companies, as well as UK and global infrastructure more broadly, with a proven track record of corporate turnarounds and long-term stewardship. 'These investors have the funding and experience required to deliver a transformation of the company's performance which is intended to mark a departure from past failings, creating a 'new' Thames Water that works effectively alongside Government, regulators, and customers to deliver for the environment and economic growth.' The creditors are the bondholders who effectively own Thames Water after the High Court earlier this year approved a financial restructuring through a loan of up to £3 billion to ensure it can keep running until the summer of 2026. Other investment and pension firms in the group include Apollo Global Management, M&G and Silver Point Capital. As part of their plans, the creditors would appoint a new board at Thames Water to run the utility. They would commit to spending £20.5 billion over the next five years, as agreed under the current five-year plan with Ofwat. But they are calling for a 'pragmatic approach' to regulation – including 're-basing incentives and performance targets – and 'realistic levels of compliance'. 'Without the regulatory support requested, the creditors believe that customers will remain exposed to the risk of a continued 'doom loop' of underperformance and non-compliance,' according to the creditors. 'A clean slate that would see Thames Water and investors held to account to deliver an ambitious trajectory for the company's return to compliance,' they added. A spokeswoman for Ofwat said the regulator had been 'engaging regularly' with Thames over the funding plans. 'We have commenced a thorough review of the submission from the group of senior creditors,' Ofwat said. 'The submission includes their turnaround plans, approach to financial resilience and proposals for governance. 'Our focus is on assessing whether the plans are realistic, deliverable and will bring substantial benefits for customers and the environment.' Liberal Democrat MP Charlie Maynard, who has previously appealed against a £3 billion rescue deal for the utility, said: 'What will it take for the Government and the regulator to put a stop to this horror show Thames Water customers are forced to suffer through and pay for? 'Having created a mountain of debt, all at customers' expense, this latest plan for Thames Water would let them continue to pollute with impunity.' He said his party's plan would be to put Thames Water into special administration and then have it become mutually owned by its customers.
Daily Mail
09-06-2025
- Business
- Daily Mail
BP scrambles to retain independence as takeover talk intensifies
BP is determined to preserve its status as an independent UK-listed oil company amid speculation that a sinking share price and uncertainty over leadership could push it into an unwanted merger. The firm's shares have plunged 22 per cent over the past year (see chart). With a market value of just £56 billion, it is seen as a tempting bid target for one of the US oil giants or a British bid from Anglo-Dutch rival Shell. Predators see the temporary power vacuum caused by the impending departure of chairman Helge Lund as a vulnerability. An urgent hunt for a strong replacement is being led by Amanda Blanc, BP's senior non-executive director, who is also boss of the insurer Aviva. BP is seeking to convince investors that it can dial down the radical green transition led by former boss Bernard Looney by embracing an aggressive drilling and cost cutting agenda. Chief executive Murray Auchincloss (pictured), former finance director, is seeking to restore the company's stock market rating by focusing on capital spend and cost cutting. He has so far failed to convince activist investor Elliott Management, which has built a 5 per cent stake in BP, that the company can drill its way out of difficulty and that his cost cuts are sufficient. However, BP has long history of successful exploration and production, and has recently secured valuable drilling rights in India and Azerbaijan, where it has become the leading oil company. Since taking over as chief executive last year, Auchincloss has consulted 70 per cent of the company's shareholding base. It is thought that long-standing British shareholders would be deeply unhappy if BP were to be taken over. It is also thought that the UK Government is supportive of BP as a national champion which is developing the country's biggest electric vehicle network of charging stations with Marks & Spencer. A bid by Shell for BP, favoured by some investment bankers, is seen as much harder to accomplish than generally thought. Both companies, as international explorers, have large trading operations and a deal would almost certainly cause competition problems. Some 35 per cent of the two London-listed firms' operations are understood to overlap. US rivals Chevron and Exxon Mobil, mentioned as possible bidders for BP, have in recent times virtually withdrawn from exploration beyond the Americas, unlike the two big London-listed players. They have instead focused on the riches of the Permian Basin in Texas and Guyana in South America. Chevron is seeking to complete its $53 billion merger with US group Hess. Oil mergers are seen as notoriously tricky to navigate. A quarter of a century after BP, then led by John Browne, took over Amoco, the group is still wrestling with integration of complex accounting systems. BP believes that if it can lift its annual cashflow from $8 billion in 2024 to $14 billion by 2027, it can raise the value of the group, securing its status.
