Tankmaker KNDS Explores IPO, Stake Sale as Buyout Firms Circle
The family members behind Krauss-Maffei Wegmann, which merged with France's Nexter to create KNDS, have informed the German government that they're considering selling part of their 50% stake and looking at options including an IPO and partial divestment, said the people. As part of this, Berlin is in the early stages of studying the purchase of a blocking minority of 25.1%, according to some of the people.
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Yahoo
27 minutes ago
- Yahoo
What are the main issues facing new Renault CEO Provost?
PARIS (Reuters) -Incoming Renault CEO Francois Provost will take the helm of the French automaker at a time when it is beginning to show cracks in its recent success, revising down its full year profit forecast earlier this month due to weaker sales volumes. Below are some of the challenges ahead for Provost when he takes over on Thursday. TOUGHER COMPETITION While Renault has been largely protected from U.S. tariffs because it does not sell in the United States, it has been indirectly hit by increased commercial pressure as European competitors looking for new markets outside the U.S. step up efforts to sell in the French firm's home region. The company reported zero growth in second quarter sales volumes, and warned of weak sales performance in June. It is also facing rising competition from Chinese entrants, both in electric vehicles and hybrids. Analysts at Barclays say Renault may have seen slower price-mix momentum in the first half of the year. The company is scheduled to report full results for the first half on Thursday. DEPENDENCY ON EUROPE AND CARS With sluggish growth in Europe where Renault sells more than 70% of its cars, it needs to expand in emerging markets. It has already outlined plans to invest 3 billion euros ($3.4 billion) to launch eight new models under the Renault brand for non-European markets by 2027. It will also target developing less cyclical businesses beyond autos, such as EV charging and financial services, as part of a mid-term strategy which former CEO Luca de Meo had aimed to unveil later this year. TOO SMALL, LESS INDEPENDENT Conscious that its small size does not allow it to fund the development of electrified and autonomous vehicles, Renault has set up numerous partnerships, including with China's Geely in Korea and in combustion and hybrid engines around the world, and with Volvo Group in electric vans. However, this strategy has raised concerns among unions that the company could lose its in-house know-how and its independence. Renault, ranking only 15th in volumes globally, is frequently the subject of rumours of a tie-up with larger peer Stellantis. Partnerships with Geely also have some worried about potential leverage by China, though Renault's main shareholder, the French state, says the tie-ups do not compromise the company's ability to remain independent. A HIGH PACE OF LAUNCHES Under de Meo, Renault launched one of the biggest product renewals in its history, with a record 10 launches and two facelifts last year. It is planning another seven launches and two facelifts in 2025, including of the Renault 4 and the Dacia Bigster, and eight more in 2026, according to sources familiar with the matter. Key to increasing market share, new launches also require significant investment in marketing and industrial fine-tuning to deliver cars on time, at the right quality. VAN WOES A leader in Europe's high profit commercial vehicles market, Renault's van sales plunged by 29% in the first half due to a softer economy, and an overhaul of its models and product offering. GETTING BACK TO INVESTMENT GRADE One of Renault's top priorities is to get its credit rating back to investment grade to attract new investors, while also boosting its market cap, currently only at 10 billion euros versus Stellantis' 23 billion euros. Renault's debt is rated Ba1 by Moody's and BB+ by S&P Global, one notch below investment grade. NISSAN Since starting to rebalance its partnership with Nissan in early 2023, Renault has done three share sales, and reduced its stake in its Japanese partner to 35.7% (17.05% held directly and 18.66% via a trust). It will need to find the right time to sell more, made more challenging by Nissan's financial and operational difficulties. It will also play a role in Nissan's overhaul, particularly if the Japanese company decides to sign a strategic partnership with another manufacturer. Renault opposed recent plans for a tie-up with Honda because it considered the financial terms were not generous enough. ($1 = 0.8721 euros)
Yahoo
27 minutes ago
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Gestamp posts €5.84bn revenue for H1 2025
Gestamp, an automotive component manufacturer, has reported a significant reduction in net debt and an increase in profitability for the first half (H1) of 2025. Despite the challenges posed by currency fluctuations and market volatility, the company says it has managed to achieve its lowest net debt level in the first semester since the implementation of International Financial Reporting Standard 16 (IFRS 16), standing at €2.14bn. This has resulted in a leverage ratio of 1.7x net debt to EBITDA, marking a significant milestone for the company. Gestamp has closed the H1 2025 with revenues of €5.84bn, impacted by the downturn in light vehicle production in prime markets and adverse currency impacts. The first half of the year saw light vehicle production volumes rise by 3.7% year-on-year (YoY), largely driven by the Asian market. However, this growth was offset by a notable decrease in production in Europe and the North American Free Trade Agreement (NAFTA) regions. The EBITDA for the Q2 stood at €343m, excluding the Phoenix Plan impact, with an EBITDA margin of 12%, representing the company's 'second-best' H1 result since its IPO. Gestamp's strategic initiatives have enabled it to generate a positive cash flow of €182m in the second quarter (Q2), culminating in a €99m positive free cash flow for the H1 of the year, excluding the impact of the Phoenix Plan. The company has maintained and enhanced profitability through short-term measures, such as flexibility and cost control plans, for ensuring efficiency. A key focus for Gestamp is the execution of the Phoenix Plan in the NAFTA region. Despite reduced light vehicle production volumes, the plan is progressing as anticipated, achieving an EBITDA margin of 7.1% by the end of the H1 of the year, once again excluding the Phoenix Plan impact, according to the company. Gestamp's strategic goal is to reach an EBITDA margin of around 8% by the end of this year, aiming to match profitability levels across all regions where it operates. The company has reiterated its guidance for the year, expressing confidence in maintaining automotive business profitability and generating free cash flow consistent with the figures from last year, despite a climate of high uncertainty and limited market growth. Gestamp executive chairman Francisco J Riberas said: 'In a particularly challenging environment for the sector, our focus remains on preserving our leading position within an industry undergoing a fast and in-depth transformation, while reinforcing the strength of our balance sheet and improving profitability. 'The efficiency and cost control measures are reflected in the results achieved, and with a strong free cash flow generation in the semester, we consolidate a strong financial profile'. In a move to further bolster its balance sheet, Gestamp has entered into an agreement with Santander Bank. Through Andromeda Principal Investments, S.L.U, the bank will invest €245.5m for a minority stake in the share capital of four Gestamp Group firms that hold the Spanish real estate assets. This transaction, set for September, is said to be executed via the subscription of a capital increase in each firm and the preferred shares' issuance. Gestamp will retain full control of the assets for its industrial operations in Spain. Gestamp noted that this strategic agreement is expected to decrease the net debt further, potentially leading to a leverage of 1.5x net debt to EBITDA Pro Forma for June 2025, aligning with commitments made during the Capital Market Days in 2023. In Q1 2023, Gestamp said it achieved a revenue of €3,144m, up 39.4% YoY, including a €163m contribution from Gescrap. "Gestamp posts €5.84bn revenue for H1 2025" was originally created and published by Just Auto, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Fast Company
28 minutes ago
- Fast Company
Europe's economy grows just 0.1% in second quarter amid tariffs
Europe's economy barely grew in the April-June quarter as frantic earlier efforts to ship goods ahead of new U.S. tariffs went into reverse and output fell for the continent's biggest economy, Germany. Gross domestic product grew an anemic 0.1% compared to the previous quarter in the 20 countries that use the euro currency, the EU statistics agency Eurostat reported Wednesday. Growth was 1.4% over the same quarter a year ago. And prospects are mediocre for the coming months, given the 15% tariff, or import tax, imposed on European goods in the U.S. under the EU-U.S. trade deal announced Sunday. The higher tariff will burden European exports with higher costs to either be passed on to U.S. consumers or swallowed in the form of lower profits. The economy sagged after stronger than expected 0.6% growth in the first quarter, a figure inflated by companies trying to move product ahead of U.S. President Donald Trump's additional tariff onslaught that was announced April 2, two days after the first quarter ended. Output fell 0.1% in Germany and Italy, while growth of 0.3% in France was boosted by a rise in auto and aircraft inventories while domestic demand was otherwise stagnant. That left Spain as the only strong performer among the four largest eurozone economies at 0.7% 'With the 15% U.S. universal tariff likely to subtract around 0.2% from the region's GDP, growth is likely to remain weak in the rest of this year,' said Franziska Palmas, senior Europe economist at Capital Economics. Germany's economy remains roughly the same size as it was before the pandemic six years ago, as its export-dominated business sector struggles with multiple issues including stronger competition from China, a lack of skilled workers, higher energy prices, lagging infrastructure investment, and burdensome regulation and bureaucracy. Economist Palmas said that Germany 'is likely to be hit harder than other major economies by tariffs and continue to struggle this year' before increased government spending from the new government under Chancellor Friedrich Merz, aimed at making up the infrastructure gap, starts to boost the economy in 2026. On Wednesday, Germany's Cabinet approved a draft 2026 budget that foresees a second consecutive year of record government investment in priorities such as modernizing transport infrastructure, building homes, security and digitization. Spending is set to rise to 126.7 billion euros ($146.2 billion) next year from 115.7 billion euros in 2025. 'Our top priority is to secure jobs and ensure new economic strength,' Finance Minister Lars Klingbeil said.
