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Sunrise Records, a Canadian chain of record stores, agreed to buy most of HMV Group Plc in an auction overseen by the embattled music retailer’s administrators, fending off a rival bid by retail magnate Mike Ashley, Bloomberg News reported. Douglas Putnam, who runs Sunrise and bought HMV’s Canadian unit in 2017, will gain control of 100 stores across the U.K., KPMG LLP said Tuesday. The remaining 27 shops will be shut down, putting 455 employees out of work.
Prayers for a sudden return to dovish monetary policies have been answered, and now investors are living with the aftermath: a world awash with $8.6 trillion in negative-yielding debt, Bloomberg News reported. That’s one reason money managers are wading once more into the fringes of fixed-income markets across the globe. Consider the action over the past week: Serial defaulter Ecuador managed to sell $1 billion in new bonds even as the government is in talks for International Monetary Fund financing.
Just a year ago, India’s third-largest mortgage lender was bragging about how it had shrunk its financing costs by replacing bank loans with market borrowings, a Bloomberg View reported. Now, Dewan Housing Finance Corp. is confronting the fallout of that seemingly clever strategy, one that many of its peers face as well: a dangerously high exposure to India’s struggling developers. At the end of March 2018, Dewan had brought its cost of funds down to 8.4 percent, a reduction of almost 2 percentage points in three years.
There’s been enough bad news about South Africa’s state-owned electricity company in recent months to rattle the hardiest bond investor. Or so you’d think. Even before President Cyril Ramaphosa said on Tuesday the nation won’t allow Eskom Holdings SOC Ltd. to fail, the company’s bonds were trading as if its troubles were over, Bloomberg News reported. The premium investors demand to hold the company’s 10-year dollar bonds rather than U.S. Treasuries dropped this week to the lowest since the securities were issued in August.
Brazilian fertilizer company Fertilizantes Heringer SA has said it is filing for bankruptcy protection, closing down nine plants in Brazil and laying off their workers, Reuters reported. Heringer, among the largest players in the Brazilian fertilizer market with annual output of around 6 million tonnes, explained in a securities filing late on Monday that its liquidity situation deteriorated recently, leading to the decision. Reuters last week reported that the company was closing down 10 installations including plants and regional offices, and laying off an unspecified number of workers.
Holiday airline Germania collapsed on Tuesday and canceled all flights immediately, the latest to succumb to turbulence in the European airline industry as it failed to secure financing to navigate a short-term cash squeeze, Reuters reported. The insolvency of the German company, which carried about 4 million passengers a year, followed the failure of Germany’s second-biggest carrier, Air Berlin, in 2017. Britain’s Monarch Airlines and Alitalia also filed for insolvency in 2017. German charter carrier Small Planet Airlines hit financial trouble last year after an expansion drive.
Dewan Housing Finance Corp Ltd shares rose on Monday following five consecutive sessions of decline, after the Indian home loan provider said it was keen to sell assets and some of its businesses to improve liquidity, Reuters reported. The stock rose as management tried to assuage liquidity concerns on a conference call with investors, media and analysts. The stock was trading 5.9 percent higher at 117.70 rupees at 0745 GMT on Monday.
Difficulties getting access to their collateral in the event of loan default means potential new entrants into the State’s mortgage market are likely to “think twice”, the interim chief executive of the Banking and Payments Federation of Ireland said. Joe Brennan reports that his comments come against a background of increasing political clamour to make it even more difficult to repossess homes, The Irish Times reported.
Italy’s Treasury is not planning to seek EU approval to extend a state guarantee scheme Rome devised to help banks offload bad loans in order to include so-called “unlikely-to-pay” (UTP) loans, a government source said, Reuters reported. Italy introduced the ‘GACS’ scheme to ease bad loan sales. Under the measure, which expires in early March after being renewed twice, banks can buy a guarantee from the state to wrap the least risky tranche in a bad loan securitisation sale.