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UK likely to be SA’s biggest foreign direct investor — even after Brexit

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Created after the Brexit decision, the UK’s department for international trade sees SA as a key business partner.

Last month marked a year to go until the UK leaves the EU. While we’ve been clear that we will remain close friends and partners of the EU in future, we also have a unique opportunity to re-invigorate our relationships with other trading partners around the world.

The UK’s new department for international trade, created after the referendum, is leading the way. As we look to establish our own independent trade policy for the first time in more than 40 years, our business relationships with countries such as SA will be key to our mutual prosperity.

After all, as the International Monetary Fund (IMF) predicts, 90% of global growth will be outside the EU in the coming decades, and the UK’s new trade policy should be about helping businesses from both our countries work together even more extensively.

UK businesses are already recognising SA as a great place to do business. SA’s bilateral trade with the UK was worth £8.8bn in 2016 — a 9.2% increase on the previous year. The UK remains SA’s biggest long-term foreign investor, with 45% of SA’s FDI stock originating from the UK. And there are many South African companies active and present in the UK, growing their businesses and sustaining jobs in SA.

We are clear that this strong relationship will continue as the UK leaves the EU. I’m pleased to report that we’re making excellent progress in our discussions to ensure continuity of the regional Economic Partnership Agreement with SA, the other members of the Southern African Customs Union, and Mozambique.

The UK and partners in the region share a common goal of replicating this trade agreement to provide certainty of our trading relationship for businesses, and so that we have a framework that will allow us to build an even closer economic partnership in future.

I’m looking forward to discussing this with Trade and Industry Minister Rob Davies when we meet in Johannesburg this week.

But we can do even better. To improve our already impressive record of working together in business, we need to make it even easier for UK and South African companies to operate in each other’s markets, to overcome any regulatory barriers that make trade more expensive.

There is huge potential, given the complementary nature and shared entrepreneurial spirit of the UK and South African economies. Our companies stand to benefit if we are better able to bring together the home-grown technology and innovation we see being created in SA and the UK. Our shared strong commitment to open trade, democracy and the rule of law gives us the solid foundation from which to build an exciting and prosperous future.

Supporting this ambition is where our post-Brexit relationship can flourish further. Our expertise can be SA’s expertise, and UK companies stand ready to help advance economic transformation for SA’s future. The UK’s export credit agency, UK Export Finance (UKEF) has nearly £3bn available to support UK companies doing business in SA, as well as South African companies looking to buy British goods and services.

And as the UK welcomes a diverse community of 52 Commonwealth nations at next week’s Commonwealth Heads of Government Meeting, including many of SA’s regional partners, I look forward to embracing a future of fair and free trade that we can build together for shared success.

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Allen & Overy enters merger talks with US law firm O’Melveny

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Allen & Overy (A&O) has entered merger talks with US firm O’Melveny & Myers which could create a £2bn global law firm, Advisory Excellence understands.

The magic circle firm has long desired a US merger and talks are thought to have been progressing for a number of months with senior partner Wim Dejonghe and managing partner Andrew Ballheimer thought to be running the talks.

A&O has made several overtures towards the US in recent years, breaking its lockstep for the first time to bring in several US partners nearly two years ago.

Since then, rumours of need to expand in the US had circulated with O’Melveny frequently mentioned as a merger candidate for the magic circle firm.

A spokesperson for A&O said: “While we have said for several years that we are open to considering a merger with the right partner in the US, we talk to many law firms in many countries all of the time and we do not comment on market speculation and rumours regarding any particular firm.”

A&O has hired from O’Melveny in the past, bringing in Barbara Stettner, Chris Salter and Charles Borden as partners in July 2011 to open the firm’s Washington DC office. Five years earlier, A&O turned to O’Melveny when hiring banking partner Elizabeth Leckie to bolster its New York office.

One West Coast-based partner at a rival firm told Advisory Excellence: “Everyone knows it’s been A&O’s strategy for a while to expand their global footprint. They need to do something, A&O hasn’t got the US presence that it would ideally like.”

“Does it surprise me?” added the partner. “No.”

While rumour has circulated for several years over A&O’s US expansion plans, the firm was thought to have been cool on the idea of merger.

Market sources indicated that Shearman & Sterling was being touted for a potential major US tie-up, though Ropes & Gray and Fried Frank had also been mentioned in the same vein.

Of its existing US relationships, A&O is thought to work frequently with Fenwick & West, primarily on intellectual property matters.

A spokesperson for O’Melveny said: “We have no plans to merge and never have.”

Data showed A&O generated £1.5bn in turnover for the 2016/17 year, making £666m in net profit with average per equity partner of £1.5m.

O’Melveny generated $738m (£524m) last year while bringing in $335.4m (£238.1m) with PEP of $2m (£1.4m).

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Bitcoin will see a major bull run in 2018, Experts claim

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The year 2018 has been off to a bad start for all cryptocurrencies. Whereas some people already despair, good things will come to Bitcoin and altcoins. Various experts are convinced all of the top currencies will mount a strong comeback during late 2018. It is always important to keep the bigger picture in mind.

Top Crytocurrencies Will Continue to Dominate

There is a lot more to cryptocurrency than just the Bitcoin price. Unfortunately, the value of BTC dictates how the rest of the ecosystem will evolve in the coming months and years. Getting rich quick with cryptocurrency may not happen in 2018 as of right now. Even so, industry experts are not too worried about the current bearish market. In fact, one could say the markets are going through their regular volatility as of right now. BRD CMO and Co-founder Aaron Lasher comments:

“The game isn’t over, Digital scarcity is a major innovation in money and value, and we’re in the initial stages of a multi-decade trend towards tokenization of assets.”

Over the past seven days, all top currencies lost a fair amount of value. Declines range from 11.6% to 15.9%, with Ethereum getting the worst of it. Additionally, over 80% of the top 100 currencies ranked by market cap have decreased in value over the past week. Bitcoin is dragging everything down, as it always has in the past. This trend will not relent until the Bitcoin price effectively recovers the lost ground.

This is where things will get interesting later this year. It is not the first time Bitcoin has gone through a lengthy bearish cycle. At one point, the value per BTC dropped by almost 99%. Surviving that proved to be rather easy, hence this current dip doesn’t seem too problematic. These are still the very early stages for Bitcoin and other cryptocurrencies.

The Impending Bitcoin Bull Run

Several things are going Bitcoin’s way as of right now. The launch of ETFs allows institutional investors to speculate on cryptocurrencies. Although the demand seems rather low right now, things are gradually improving. With a regulatory body to be formed for these products, things can only improve from here on out.

Speaking of regulation, Bitcoin is still a hot topic among government officials. Any regulatory measure will legitimize the cryptocurrency industry as a whole. Not everyone is in favor of this particular trend, though, but it is a “necessary evil” to take this form of money mainstream in the future.

Currencies other than Bitcoin are still evolving as well. Ethereum is set to undergo some big changes, including a switch to proof-of-stake. Additionally, there are rumors Vitalik Buterin may effectively introduce a hard cap supply for Ether. Ripple is still making inroads in the financial sector as well. Litecoin has seen a few setbacks due to Litepay falling apart, but the currency will bounce back eventually.

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Falkirk law firm opens permanent new office in Glasgow

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Falkirk-based criminal law firm MTM Defence Lawyers has opened a permanent new office in Glasgow (at 2 West Regent Street) to service its growing business in the West of Scotland.

MTM has also created a new working partnership with Falkirk’s Hutchison Law. Simon Hutchison of Hutchison Law will be working alongside the MTM legal team, bringing with him the firm’s portfolio of clients.

MTM Director, Martin Morrow, said: “The new office follows on from our office in Edinburgh, which opened in 2016. As in Edinburgh, establishing the Glasgow office has been driven by local referrals – both from other legal firms without their own in-house criminal law expertise, and by private individuals charged with criminal offences and in need of expert legal help.”

Speaking of Simon’s appointment, Mr Morrow said: “Simon’s appointment to the role of consultant with MTM, and the partnership with him, adds another string to MTM’s bow as the firm continues to expand. The new partnership means that the second largest criminal defence firm in Falkirk district is coming together with the largest firm – MTM.”

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London set to stay as global finance centre according to IPO market

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London is set to retain its dominance as the world’s premier financial centre despite Brexit uncertainty, according to analysis of company flotations data by EY.

The Big Four consultancy’s quarterly “IPO Eye” survey of initial public offerings revealed what it described as a “slow but steady” start to the year.

In the first quarter there were 16 flotations in London – nine on the main market raising a total of £1.15bn and seven on the alternative investment market (Aim), amassing £149m.

While a 38pc drop in the number of IPOs in the same period a year ago, the total raised by the deals was up by 6pc.

EY said that the amount raised was held back by the fact only one of the flotations was private-equity backed.

However, digging down into the numbers, 11 of the deals were IPOs of financial services businesses, which accounted for 51pc of the total proceeds.

This, according to EY, “confirms that London continues to hold its position as a global financial centre despite political uncertainty”.

The IPO market has been volatile for some time with deals being pulled because of concerns about pricing and Brexit.

However, Scott McCubbin, EY’s IPO leader, said that worries are now likely to abate – at least for a while. Cross-border flotations – which made up 26pc of listings and 58pc of the funds raised last year – are likely to continue as businesses act in the period of expected calm ahead of Brexit.

“Although the market may remain low-key overall, the IPO pipeline is currently still looking strong for small main market listings and Aim listings,” Mr McCubbin said.

“We expect to see some of the delayed listings from this quarter to come on stream in the second quarter and activity to peak in the third quarter for this group of companies.

“There are some signs of more listings from larger companies anticipating more significant deal sizes, but this part of the market is very much waiting for a first-mover to lead the way.”

On a global basis, the number of flotations in the first quarter fell by 27pc on an annual basis to 287, while the total raised swung the other way, rising 28pc to $42.8bn.

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Insights: The biggest mergers and acquisitions of all time

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With the recent news regarding Rupert Murdoch’s 21st Century Fox offering to sell Sky News to Disney, we look back at the biggest mergers and acquisitions of all time.

On Dec. 14, 2017, American multimedia and entertainment conglomerate the Walt Disney Company announced its acquisition of the Rupert Murdoch-owned 21st Century Fox, which would include their film and television studios as well as its 39 percent stake in Sky. The deal is valued at $52.4 billion.

All deal values are approximate.

CVS Health — Aetna (December 2017)

Acquirer: CVS Health
Target: Aetna
Current name: NA
Deal value: $77 billion

Dow Chemical — DuPont (September 2017)

Acquirer: Dow Chemical
Target: DuPont
Current name: DowDuPont
Deal value: $130 billion

AB InBev — SABMiller (October 2015)

Acquirer: AB InBev
Target: SABMiller
Current name: Anheuser-Busch InBev
Deal value: $107 billion

Dell — EMC (October 2015)

Acquirer: Dell
Target: EMC
Current name: Dell Inc.
Deal value: $67 billion

Heinz — Kraft Foods (March 2015)

Acquirer: H.J. Heinz
Target: Kraft Foods Group Inc.
Current name: Kraft Heinz Company
Deal value: $45 billion

Charter Communications — Time Warner Cable (May 2015)

Acquirer: Charter Communications
Target: Time Warner Cable
Current name: Time Warner Cable
Deal value: $78.7 billion

AT&T — DirecTV (May 2014)

Acquirer: AT&T
Target: DirecTV
Current name: AT&T Inc.
Deal value: $48.5 billion

Verizon Communications — Verizon Wireless Inc (September 2013)

Acquirer: Verizon Communications
Target: Verizon Wireless Inc
Current name: Verizon Communications
Deal value: $130 billion

Pfizer — Wyeth (January 2009)

Acquirer: Pfizer
Target: Wyeth
Current name: Pfizer Inc.
Deal value: $68 billion

InBev — Anheuser-Busch (July 2008)

Acquirer: InBev
Target: Anheuser-Busch
Current name: Anheuser-Busch InBev
Deal value: $52 billion

RFS Holdings BV — ABN AMRO (April 2007)

Acquirer: Fortis, Royal Bank of Scotland, Santander Group
Target: ABN AMRO Holding
Current name: ABN AMRO
Deal value: $98 billion

AT&T — BellSouth Corporation (March 2006)

Acquirer: AT&T
Target: BellSouth Corporation
Current name: AT&T Inc.
Deal value: $86 billion

Sanofi-Synthelabo — Aventis (January 2004)

Acquirer: Sanofi-Synthelabo
Target: Aventis
Current name: Sanofi S.A.
Deal value: $65 billion

Pfizer — Pharmacia (July 2002)

Acquirer: Pfizer
Target: Pharmacia Corp.
Current name: Pfizer Inc.
Deal value: $60 billion

Comcast — AT&T Broadband (July 2001)

Acquirer: Comcast
Target: AT&T Broadband
Current name: Comcast Corporation
Deal value: $72 billion

Glaxo Wellcome — SmithKline Beecham (January 2000)

Acquirer: Glaxo Wellcome
Target: SmithKline Beecham
Current name: GlaxoSmithKline PLC
Deal value: $76 billion

America Online — Time Warner (January 2000)

Acquirer: America Online (AOL)
Target: Time Warner
Current name: AOL Inc.
Deal value: $165 billion

Vodafone AirTouch — Mannesmann (February 2000)

Acquirer: Vodafone AirTouch
Target: Mannesmann
Current name: Vodafone Group PLC
Deal value: $198 billion

Pfizer — Warner Lambert (November 1999)

Acquirer: Pfizer
Target: Warner-Lambert
Current name: Pfizer Inc.
Deal value: $90 billion

Exxon — Mobil (December 1998)

Acquirer: Exxon
Target: Mobil
Current name: Exxon Mobil Corp.
Deal value: $81 billion

Bell Atlantic — GTE (July 1998)

Acquirer: Bell Atlantic
Target: GTE Corp.
Current name: Verizon Communications, Inc.
Deal value: $65 billion

SBC Communications — Ameritech (May 1998)

Acquirer: SBC Communications
Target: AT&T Teleholdings, Inc.
Current name: AT&T Inc.
Deal value: $62 billion

Citicorp — Travelers Group (April 1998)

Acquirer: Citicorp
Target: Travelers Group
Current name: Citigroup Inc.
Deal value: $70 billion