"MAPLE" Syrup used to glue all the partners...
Four pension funds have joined with banks in the deal, which offers TMX shareholders C$48 a share for the group, 70 per cent of that in cash and the rest in shares, a person familiar with the situation said. For every TMX share held, TMX shareholders would be offered C$33.52 in cash, up to a maximum of C$2.5bn, and 0.3016 of one share in the new TMX entity. TMX shares closed at C$41.75 on Friday.This would give the bank and funds consortium, codenamed “Maple”, 60 per cent of the group, with existing shareholders holding the rest.The funds are Caisse de dépôt et placement du Québec, Ontario Teachers' Pension Plan, Canada Pension Plan Investment Board – which manages Canada’s public pension plan, the biggest in the country – and the Alberta Investment Management Corporation.Banks leading the offer are Toronto-Dominion, Bank of Nova Scotia, Canadian Imperial Bank of Commerce and Quebec-based National Bank of Canada.It was not clear whether the two banks advising the LSE on the TMX deal, Royal Bank of Canada and BMO, will join the counter-offer
News, Research and Opinion articles on World Current Affairs, Money & Finance, Natural Resources, Latin America, the Middle East, as well as other Miscellanea from the web.
Sunday, May 15, 2011
Canadians launch counterbid for TMX
Thursday, March 17, 2011
Batista’s $80 Billion Wealth Target Turns to Colombia IPOs - Businessweek
Monday, March 14, 2011
Nuclear industry in turmoil after Japan quake | Reuters
Nuclear industry in turmoil after Japan quake
3:26pm EDT
* Uranium stocks hardest hit, Cameco down over 14 pct
* Germany put nuclear plants on hold, Italy pushes forward
* Utility shares fall, nuclear reactor builders down
TORONTO/NEW YORK, March 14 (Reuters) - Investors hammered companies that build nuclear reactors and supply them with fuel on Monday as Japan struggled to avert a meltdown at a stricken reactor, on fear that the whole sector could be in for a downturn, in the short and medium term at least.
But analysts said the industry could recover from the stock market setback as negative perceptions fade, and the current price slump might be a buying opportunity.
"Meltdown is a very big word in people's minds, so I think that the public sentiment is probably going to swing against nuclear power," said BMO Capital Markets analyst Edward Sterck. "But I don't think this is the end of the nuclear industry."
"With the hype that some commentators are making that this is the end of the nuclear energy, I think we're going to possibly see an overreaction in the stock prices. At some point there will be value there."
Japan's crisis, already the worst nuclear accident since the 1986 Chernobyl disaster, hit shares of industry giants like General Electric (GE.N: Quote, Profile, Research, Stock Buzz) and Hitachi (6501.T: Quote, Profile, Research, Stock Buzz), along with uranium producers Cameco (CCO.TO: Quote, Profile, Research, Stock Buzz) and Areva (CEPFi.PA: Quote, Profile, Research, Stock Buzz), and power utilities like Entergy (ETR.N: Quote, Profile, Research, Stock Buzz) and Exelon Corp (EXC.N: Quote, Profile, Research, Stock Buzz).
The Japanese reactors were designed to withstand earthquakes, but Friday's quake was a record for Japan, and a devastating tsunami knocked out backup power, causing and deepening the problems.
With the 24-hour news agenda focused on the possibility of a meltdown at one or more reactors in Japan, analysts said the market will need time to recover from losses.
"We need to see those reactors brought under control before people start to review the situation with a little more perspective," Sterck said.
Nuclear power accounted for about a third Japan's of energy generation before the quake, and the damage has raised concerns about future of the industry there.
Friday, November 26, 2010
Canada boycotts Durban III, cites anti-Israel focus - Israel News, Ynetnews
Taking a stance: Canada will not attend UN conference on racism because of negative focus on Israel, immigration minister says; Ottawa has lost faith in Durban process, whose agenda promotes racism, he says
Associated Press
Canada will not attend Durban III, a United Nations conference on racism next September in South Africa because the event has negatively targeted Israel, the country's immigration minister said Thursday.
Minister Jason Kenney said Canada has lost faith in the Durban process, a conference that began in 2001 to develop strategies to defeat racism.
"Canada is clearly committed to the fight against racism, but the Durban process commemorates an agenda that actually promotes racism rather than combats it."
Anti-Israel protest at previous Durban conference (Photo: Reuters)
Next year's event commemorates the 10th anniversary of the initial Durban conference that saw the United States walk out in protest over texts branding Israel as a racist and apartheid state.
The initial conference, which ended days before the Sept. 11 terrorist attacks against the US, produced the Durban Declaration and Program of Action.
Speeches laced with anti-Israel rhetoric
The 62-page document raises 122 "general issues," among them "concern about the plight of the Palestinian people under foreign occupation." It "recognizes the inalienable right of the Palestinian people to self-determination and the right to an independent state."But most offensive to Canada and several other countries were speeches laced with anti-Israeli rhetoric. Canada led a boycott of Durban II in Geneva last year, where Iranian President Mahmoud Ahmadinejad railed against the Jewish state.
"We voted against this because we believe that the proposed meeting will only perpetuate the kind of ... divisive rhetoric that led Canada to boycott this process in the past," said Kenney.
Canada boycotts Durban III, cites anti-Israel focus - Israel News, Ynetnews
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Wednesday, September 1, 2010
DRC: Independent Audit Of First Quantum Mining Firm To Be Launched
The Democratic Republic of Congo plans to audit the operations of First Quantum Minerals Ltd. in the country to examine “suspected wide-scale misconduct,” Bloomberg reported Aug. 31, citing Mines Minister Martin Kabwelulu. A body engaged in financial auditing will carry out the investigation, which will look into allegations that First Quantum illegally exported copper ore without fully declaring it.
The MasterLiving Blog: 5 surprising facts about strippers - The Week
Some say they make as much as lawyers...
... and are quite happy with their jobs
Sweden is being shortchanged by strippers
Canada has a stripper shortage
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Tuesday, April 20, 2010
Mineweb - Colombia to attract $4.5 billion for gold mining over 10 years - POLITICAL ECONOMY
Colombia to attract $4.5 billion for gold mining over 10 years
Posted: Monday , 19 Apr 2010
Thursday, April 15, 2010
Hallucinogens Have Doctors Tuning In Again - NYTimes.com
Hallucinogens Have Doctors Tuning In Again
The MasterBlog
Monday, August 3, 2009
From Choppers with Buds
Few hurdles for Canada smugglers to get choppers
MALAKWA, British Columbia – Colin Martin was on bail, appealing his sentence for leading a U.S.-Canadadrug conspiracy involving aircraft. But he was still able to obtain three helicopters, two of which ended up being flown by drug smugglers.
His case illustrates the remarkable ease with which smugglers have obtained flight training and helicopters as they grab a share of Canada's sprawling, multibillion-dollar trade in marijuana, cocaine and MDMA, or Ecstasy.
Of about 10 pilots arrested in roundups of British Columbia-based helicopter smuggling operations this decade, at least half had recently trained at flight schools, sometimes dropping out once they knew just enough to handle the machine, an Associated Press review found.
Flight school operators say they don't check a student's background or monitor what students do on their own time, though they generally do ask why a student wants to become a pilot. Several said they don't want to train smugglers, but they also don't want to turn away business simply because a prospective student might be heavily tattooed or pay in cash.
"I don't think there's anything we can do," said Chinook Helicopters owner Cathy Press, who has seen several former students arrested for smuggling. "If you went and thought everyone was drug-running, you could tell the police, but maybe you're wrong — and that's not great for business."
Even if her suspicions were correct, she added, "They might put someone in jail, but someone else will step forward, so why get in the middle of it?"
A clean criminal record is not a prerequisite for a pilot's license, said Rod Nelson, a spokesman for Transport Canada, the government agency that oversees the aviation industry. Nor do Canadian officials ask students to disclose previous convictions. They do ask about any substance abuse in an applicant's past.
The U.S. Federal Aviation Administration takes a similar approach, asking flight students to disclose previous convictions and requiring background checks only of foreign students, spokesman Paul Turk said.
Sam Lindsay-Brown was a clean-cut, friendly 23-year-old when he showed up at Chinook Helicopters in Abbotsford to begin flight training in December 2007. He was also a drug smuggler. And for almost a year after Canadian police began investigating him, he remained enrolled, essentially working his way through flight school as a co-pilot on cross-border drug flights.
U.S. agents arrested Lindsay-Brown in February as he put his training to use by making a 426-pound marijuana drop in northeastern Washington state with one of Martin's leased helicopters. He committed suicide in jail four days later.
The Royal Canadian Mounted Police and Transport Canada note that they can't bar people from studying as a pilot or obtaining a license without proof of criminal activity.
"The guy's 20-some-odd years of age, and he's gaining qualifications that can be used for a lawful purpose," said RCMP Cpl. Dan Moskaluk. "It's a tragedy that he chose to get involved in this line of business, instead of pursuing the lawful side of the skills he was acquiring."
The RCMP declined to say whether agents were aware he had been enrolled at flight school. They had been investigating him since spring 2008, after a woman he hired to transport 200,000 tabs of Ecstasy was arrested in California and gave his name to police.
RCMP spokesman Norm Massie said the agency had no record of Lindsay-Brown making prior smuggling flights, but two coconspirators confirmed to the AP that Lindsay-Brown had made several as a co-pilot, meaning he would be paid at least $5,000 to help load and unload contraband and keep an eye out for trouble.
The coconspirators spoke on the condition of anonymity because of their own involvement in criminal activity and fear that they could face repercussions from otherdrug traffickers for speaking with a reporter.
Massie declined to discuss what steps the RCMP takes to monitor flight schools, but said the agency knows that some traffickers get training there.
"We would be remiss not to include that in our investigative techniques," Massie said.
Martin, 37, was sentenced in 2007 in Canada to 2 1/2 years in prison for leading a major drug-smuggling operation in the 1990s, one that started using an airplane after ground couriers were caught.
He said he became involved in drug trafficking about 16 years ago and remains well connected in the smuggling world, though he declined to discuss specifics; he was arrested but has not been charged in Lindsay-Brown's case. In interviews with the AP, he estimated that as many as 30 pilots across Canada make drug-smuggling flights at least occasionally.
Someone looking to hire a pilot can put the word out via Blackberry and hear from pilots as far away as Quebec or Australia by the end of the day, Martin said.
In dozens of interviews with smugglers, pilots, lawyers, Canadian and U.S. authorities, and operators of flight schools and helicopter companies, a snapshot of the highly specialized profession emerged.
Some drug-running pilots are highly experienced. Some do it full-time, and some do it on the side when legitimate business gets slow or unexpected expenses such as helicopter damage leave them struggling to pay the bills. Some enjoy the rush. Some have a thing for getting America high. They all like the money.
One, Shane Menzel, told a federal judge in Seattle that he turned to smuggling because it was so hard to find work as an inexperienced pilot. Many "low-time" pilots must work for years washing helicopters and cleaning out hangars before they get a real flying job.
People familiar with British Columbia's marijuana trade have estimated that anywhere from 30,000 to more than 80,000 pounds of pot per month is smuggled into the United States.
It's a huge business, infusing billions of dollars a year into the province's economy. The province's most prominent gangs — the Hells Angels, the United Nations, the Independent Soldiers — are believed to own most of the drugs moved across the border, but to avoid heat they leave the shipping to others.
Air transport is generally considered the best way to exploit the vast, unpopulated terrain along the border.
Planes can fly faster and farther than helicopters, but need airstrips. Helicopters can skim treetops — flying as close as three feet — to avoid radar detection. They can dart through low mountain passes or river valleys and land at a remote clearing or even a wide spot in a logging road, where they're met by GPS-equipped drivers. They're back across the Canadian border in minutes.
Often, no cash crosses the border, because it might be seized or difficult to exchange, Martin said.
Instead, whoever moves the marijuana or Ecstasy south gives the profit to a U.S.-based cocaine trafficker. That trafficker instructs a contact north of the border to pay the Canada-based owner of the marijuana or Ecstasy.
The cocaine trafficker then takes the proceeds from the marijuana to buy cocaine to be shipped north into Canada, where the transaction happens again in reverse.
A helicopter smuggling operation charges about $350-$550 per pound to fly marijuana south of the border, and $1,500-$1,800 per kilogram to bring cocaine back.
Such an operation, of course, needs helicopters. In Canada, it is difficult to lease a helicopter without an operating certificate, a Transport Canada document that allows someone to use a helicopter for commercial purposes. Such a document is a sign of legitimacy to leasing companies, who typically want to know what their machines are being used for.
But there are ways around that hurdle.
Many smugglers instead simply buy helicopters, registering them to "numbered" companies — 123456789 Ltd., for example. There are 90 helicopters registered for private use to such companies across Canada, Transport Canada records show.
In other cases, smugglers have paid third parties to register the machines for them, or they're not registered at all. One unregistered helicopter with the tail mark C-FTCH has been used in smuggling runs and recently was parked deep in the woods near Cranbrook, in the mountains of southeastern British Columbia, three people with knowledge of the machine told the AP.
Martin bought the first helicopter he acquired in 2007, sight-unseen, for $925,000 from an owner in Texas. No conditions of his bail prohibited him from possessing aircraft. Massie declined to discuss Martin's case, but said generally: "Should those conditions be in place? Absolutely."
The helicopter was eventually repossessed when he couldn't afford more than $1 million in repairs. Meanwhile, Martin tried to lease another helicopter through Gorge Timber, a company registered in his wife's name. The helicopter was a Eurocopter EC-120 put up for lease by a British Columbia company called Vertical Solutions, run by Kevin McCart. Martin said he didn't think he'd be able to get the lease without an operating certificate, but a Calgary city police aircraft engineer, Greg Solar, who had helped him repair his first chopper, had a connection.
"I thought, 'We're a little company, we don't have the best books,'" Martin said. "And all of a sudden Greg's saying, 'I know Kevin McCart. I'll put in a good word for you guys.'"
Solar and McCart declined to speak with the AP, but Martin said he leased the EC-120 for $30,000 U.S. a month, including insurance and maintenance. He had it for about nine months, until last fall, when the owner took it back because uninsured pilots had been flying it. The helicopter was used in cross-border drug flights, Lindsay-Brown's coconspirators told the AP.
Early this year, Martin used Gorge to lease another machine — the Bell 206 Jet Ranger that Lindsay-Brown was arrested in — from Eagle Copters of Calgary, one ofCanada's most prominent helicopter companies.
Mike O'Reilly, Eagle's president, did not return repeated calls from the AP.
"Sure, I have a past, but those charges were a decade ago," Martin said. "If you have the money and you want to get into a helicopter business, you can — doesn't matter who that individual is."
On Feb. 23, the day of his arrest, Lindsay-Brown climbed into the Jet Ranger at Martin's shop and flew it to a snowy clearing outside Ione, Wash. He was to drop off 426 pounds of marijuana and pick up 83 kilos of cocaine, authorities said.
But the driver he was meeting, Len Ferris, had been arrested in Utah with the cocaine. For more than a day, Ferris did not return Blackberry messages from Sean Doak, a recently paroled drug trafficker who was his contact on the Canadian side of the border, Martin said he later learned from Adam Serrano, another man arrested in the case.
That was a clear sign of trouble, but Doak never told Lindsay-Brown about it, and Lindsay-Brown had no clue he was flying into a setup, Martin said.
U.S. agents greeted him with guns drawn.
Martin reported the helicopter stolen. The DEA said it didn't believe him and returned the machine to Eagle Copters.
The following week, another pilot flew down to meet Ferris — with predictable results. This time, it was Jeremy Snow, who recently had done flight training at Okanagan Mountain Helicopters in Kelowna. He was arrested as he landed in Idaho, pleaded guilty in U.S. District Court in Seattle and is expected to face four years in prison.
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Friday, July 3, 2009
The Bolivarian Brain Drain
For just a moment, in the early days of his presidency, Venezuela's Hugo Chávez looked almost like a healer. "Let's ask for God's help to accept our differences and come together in dialogue," he famously implored his conflicted compatriots in 2002. Instead what Venezuelans got was an avenger. The government is seizing privately owned companies and farms. Labor unions have been crushed. Political opponents are routinely harassed or else prosecuted by chavista controlled courts. And now after a decade of the so-called Bolivarian revolution, tens of thousands of disillusioned Venezuelan professionals have had enough. Artists, lawyers, physicians, managers and engineers are leaving the country by droves, while those already abroad are scrapping plans to return. The wealthiest among them are buying condos in Miami and Panama City. Cashiered oil engineers are working rigs in the North Sea and sifting the tar sands of western Canada. Those of European descent have applied for passports from their native lands. Academic scholarships are lifeboats. An estimated million Venezuelans have moved abroad in the decade since Chávez took power.
This exodus is splitting families and interrupting careers, but also sabotaging the country's future. Just as nations across the developing world are managing to lure their scattered expatriates back home to fuel recovering economies and join vibrant democracies, the outrush of Venezuelan brainpower is gutting universities and thinktanks, crippling industries and hastening the economic disarray that threatens to destroy one of the richest countries in the hemisphere. Forget minerals, oil and natural gas; the biggest export of the Bolivarian revolution is talent.
The Bolivarian diaspora is a reversal of fortune on a massive scale. Through most of the last century, Venezuela was a haven for immigrants fleeing Old World repression and intolerance. Refugees from totalitarianism and religious intolerance in Spain, Italy and Germany and Eastern Europe flocked to this country nestled between the Caribbean and the Andean cordillera and helped forge one of the most vibrant societies in the New World. Like most developing nations, the country was split between the burgeoning poor and an encastled elite. But in the 1970s and 1980s, Venezuelans were the envy of Latin America. Oil rich, educated, with a solid democratic tradition, they lived a tier above the chronically unstable societies in the region. "We had a relatively rich country that offered opportunities, with no insecurity. No one thought about leaving," says Diego Arria, a former Venezuelan ambassador to the United Nations, who lives in New York. "Now we have rampant crime, a repressive political system that borders on apartheid, and reverse migration. Venezuela is now a country of emigrants."
It's much the same all over the axis of Hugo, the constellation of 10 states in the Andes, Central America and the Caribbean that have followed Chávez in lockstep in the march towards so called 21st century socialism. In the name of power, justice and plenty for the downtrodden the leaders of the "Bolivarian alternative" in Bolivia, Ecuador, Nicaragua are rewriting their constitutions, intimidating the media and stoking class and ethnic conflicts that occasionally explode in hate and violence. (The military coup on June 28 that ousted Honduran president Manuela Zelaya, a key Chávez ally, is the latest example of the blowback from the Bolivarian revolution.) The middle classes and the young are taking the brunt. A study just released by the Latin America Economic System, an intergovernmental economic research institute, reports that the outflow of highly skilled labor, aged 25 or older, from Venezeula to OECD countries rose 216 percent between 1990 and 2007. A recent study by Vanderbilt University in Nashville showed more than one in three Bolivians under 30 had plans to emigrate, up from 12 percent a decade ago, while 47 percent of 18-year-olds said they planned to leave. Many established professionals have already made up their minds. "I ask myself if I'm not patriotic enough," says Giovanna Rivero, an acclaimed Bolivian novelist who is leaving for a teaching job at the University of Florida and has no plans to come back. "But Bolivia is coming apart. There are people who´ve known each other all their lives who don't talk to one another anymore."
In Venezuela, Chavez has pushed hard against anyone who refuses to accept his party line. Daniel Benaim was one of Venezuela's top independent television producers, turning out prime time entertainment and game shows for national channels with Canal Uno, a leading production house. "We had 160 employees and a 24/7 operation," he says. But after the failed coup against Chávez in 2002, the government cracked down on independent media and programming budgets dried up. In a month, Canal Uno was down to four employees and heading for bankruptcy. Benaim redirected his business to serve the international advertising market and raked in prestigious international awards, including multiple Latin Emmys. But opportunities for non-chavistas in Venezuela had dried up. One by one, he watched the people he trained over the years leave the country. "I used to give angry speeches about the brain drain. Now I have to bite my tongue," says Benaim, who is also moving to the U.S. "We had the best minds in the business, and now there's nothing for them here."
One of Benaim´s associates was Gonzalo Bernal Ibarra. He, too, had soared up the career ladder in broadcast television and until recently ran a campus network that reached 100,000 students. Everything changed in late 2007 when Chávez lost a refrendum to rewrite the constitution and began to crack down on his media critics, including Bernal. Strangers in jackets with weighted pockets--dress code for Chávez´s military intelligence police--began to follow him day and night. Then congress was set to pass a bill obliging schools to teach 21st century socialism. "I didn't want my kid learning that crap," he says. Even shopping became a trial as spiking inflation and government price controls emptied the supermarkets of basic goods like milk, eggs and meat. One day in late 2008, he opened a bottle of whiskey and held a yard sale. "I got drunk and watched my life get carted away," he says. He now lives in the Washington, D.C. area, with his wife and six year old daughter, and is trying to adapt. "I was living in the most beautiful, wonderful, funny country in the world. Now a third of my friends are gone. In another ten years, Venezuela is going to be a crippled country."
No industry has been harder hit by the flight of talent than Venezuela's oil sector. A decade ago, Petroleos de Venezuela (PDVSA) ranked as one of the top five energy companies in the world. Everything changed under Chávez, who named a Marxist university professor with no experience in the industry to head the company. PDVSA's top staff immediately went on strike and paralyzed the country. Chávez responded by firing 22,000 people practically overnight, including the country's leading oil experts. As many as 4,000 of PDVSA's elite staff are now working overseas. "The company is a shambles," says Gustavo Coronel, a former member of the PDVSA board, who now works in the Washington D.C. as an oil consultant. Up until 2003, researchers at the company's Center for Technological research and Development generated 20 to 30 patents a year. Last year it produced none, even though its staff has doubled. PDVSA produced 3.2 million barrels of crude oil a day when Chávez took control. Now it pumps 2.4 milion, according to independent estimates.
The decline has spread across Venezuelan society, heightened by cronyism, corruption and censorship. In May, on the pretext that scientists were pursuing "obscure" research projects such as "whether there is life on Venus," Chávez began to slash budgets at the university science centers, where the country's cutting edge public health research was carried out. Instead he poured petrodollars into official "misiones cientificas" (scientific missions), where the purse strings are controlled by Chávez allies. Now the country's most respected research institutes are falling behind. Earlier this year, Jaime Requena. a Cambridge University trained biologist at the Institute of Advanced Studies, was forced into retirement and stripped of his pension after publishing a paper charging that scientific research in Venezuela was "at a 30-year low." The number of papers published by Venezuelans in international scientific journals fell from 958 to 831, a 15 percent drop in just the last three years. At aged 62, with an aging mother, Requena has few options. "It's not easy to get another job at my age. I would leave Venezuela if I could. My friends and colleagues all have."
An estimated 9,000 Venezuelan scientists are currently living in the U.S. - compared to 6,000 employed in Venezuela. One of the victims is an internationally acclaimed life sciences expert, who quit his job as chief of a major research laboratory in Caracas to try his luck in the U.S. in 2002, but always nursed hopes of returning. "I sent the government a number of proposals and they never got back to me," he says asking not to be named for fear of reprisals against his relatives in Venezuela. "Now it's all about politics. If you are not with Chávez you will never get grants. You will be persecuted. This is a war on merit." Venezuelan medical science, he said, is groping in the dark. "The last epidemiological report Venezuela published was in 2005," he says. "We don't even know what diseases we have and whether they are increasing or decreasing. This is the Cuban model, of keeping people in the dark."
The Bolivarian diaspora seems to be getting worse. Though census data is patchy, Latin American analysts say that outmigration from Venezuela, Bolivia and Ecuador has created sizeable enclaves in the U.S., Spain, Colombia and Central America. Panama City glistens with new buildings built by moneyed Venezuelan expatriates, who number some 15,000, up from a few thousand at the beginning of the decade. So many Venezuelans have flocked to Weston, a suburb of Fort Lauderdale, locals call it Westonzuela. There is hardly a middle class family in Venezuela without a son or daughter abroad," says Fernando Rodríguez, a columnist for the anti Chávez newspaper Tal Cual. In fact, far more people from the Bolivarian countries might be emigrating if it weren't for the global recession and rising hostility to outsiders, Venezuelan emigrants do not qualify as political refugees and enjoy no special advantage in the fierce competition for the 400,000 H1B work visas issued yearly by the U.S. for highly skilled migrants, three quarters of which go to Indians, who have an edge because they can speak English. "One reason we are not seeing more dislocation from these countries is that many people have no place to go," says Alejandro Portes, a sociologist who studies global migration at Princeton University.
Latin America has seen this before. Virtually the entire Cuban middle class fled to the U.S. after Fidel Castro's revolution, turning Miami into a business hub for Latin America while Havana moldered. The Cold War, stagflation, serial debt crises and massive unemployment drove the brain drain through the 1980s, Latin America's lost decade, especially in Chile, Colombia, Argentina, Peru and throughout Central America. By the early 2000s, some of the countries convulsed by dictatorship or guerrilla insurgency, such as Chile and Peru, had managed to reverse course, making their societies prosperous and safe. But other countries have struggled to bring their expatriates home. In the 1980s and 1990s, Colombia had become synonymous with cocaine, violent crime and guerrilla warfare, all of which drove some four million Colombians from their homes. Targeted by kidnappers and political thugs, tens of thousands of middle class professionals left the country. In 2002 Pres. Álvaro Uribe declared war on drugs and crime, and now onetime bandit cities like Cali, Medellin and Bogota are safer than ever and have even become models for the rest of crime-ridden Latin America. Yet the brain drain has not reversed. "Either the [emigrants] have found the American dream or they are not yet convinced that it's safe to return," says Jorge Rojas, of Codhes, a Colombian thinktank that tracks refugees. "It shows how difficult it can be to recover lost talent."
For the nations of the Bolivarian Revolution, this means some dark days are likely to be ahead. Even the wealthiest nations could ill afford to lose their best and brightest, and Venezuela, Bolivia, Ecuador and Nicaragua have all fallen in the World Economic Forum's competitiveness index. Fitch ratings recently demoted all three countries' debt to junk status, while the World Bank placed the Bolivarian trio of Bolivia, Ecuador and Venezuela in the bottom quarter of its ease of doing business, along with most of the African continent.
Though much has been made of how developing world migrants can mitigate underdevelopment by sending precious savings back home, remittances will not close the widening talent gap that is sapping societies of their ablest hands. "If a 20-something engineer or computer specialist leaves the country, who cares? But in ten years we'll be feeling the loss," says Rául Maestres, a human resources expert in Caracas, whose son and daughter recently left Venezuela -he to work at U.S. architecture firm, she to study advertising in Buenos Aires. "When you think about the opportunities we have lost, you could sit down and cry."
Sunday, June 21, 2009
Xstrata Seeks Merger with Anglo American
Xstrata Seeks Merger with Anglo American
LONDON -- Anglo-Swiss miner Xstrata PLC has made a bold merger approach to rival Anglo American PLC, an effort that underscores the competitive pressure facing miners but also faces steep odds of success.
Xstrata said in a statement Sunday that it had sent a proposal to Anglo's board seeking consideration of a merger of equals – a combination that would have a market value of more than $68 billion, displacing Rio Tinto as the world's third-largest miner after BHP Billiton and Brazil's Companhia Vale do Rio Doce.
U.K.-based Anglo, in a separate statement, said "this situation is at a very preliminary stage" and didn't provide other details.
Xstrata is expected to propose a deal that would put its management, led by Chief Executive Mick Davis, more in control of the combined company, which would be equally owned by both companies' shareholders, people familiar with the matter said.
Any deal, though, faces high hurdles. For one, Xstrata is not offering a premium for Anglo shares, and would be hard pressed to raise the money to do so. Also, any desire on Xstrata's part to take the lead in managing the new company will likely reduce Anglo's enthusiasm. Beyond that, a deal could face political headwinds in South Africa, where Anglo has significant operations.
Regardless of the outcome, Xstrata's move highlights the pressures facing miners, which are seeking to cut costs to keep pace with the dramatic downdraft in prices as a result of the economic downturn. Prices for many metals and minerals are 30% to 50% lower now than they were 12-18 months ago.
The merger approach also shows how smaller operators such as Xstrata are scrambling to get bigger to keep pace with larger rivals including Vale, BHP and Rio. Rio and BHP are seeking to merge their vast iron ore operations in Australia.
A merged Xstrata-Anglo would be the world's largest provider of diamonds, platinum, chrome and zinc, and the second largest copper producer, just behind Chile's Codelco. The two companies already have some joint operations in Latin America as well as platinum and palladium assets that are near one another in southern Africa.
Estimates of the cost-saving opportunities from putting the companies together vary, with some in the Xstrata camp putting them at more than $1 billion per year. "The combination would create a premier portfolio of operations diversified across multiple commodities and geographies, with enhanced scale and financial flexibility to fund future growth," Xstrata said in its statement.
From Anglo's perspective, the benefits are less clear. People close to Anglo say the cost savings would be smaller, particularly in the companies' coal and copper operations. A merger would be more beneficial for Xstrata than for Anglo, one of the people said.
The strong performance of Xstrata shares in recent months has brought the companies' market values in line with each other, at about £20 billion ($33 billion) each – a fact that will likely lead Anglo's board to question whether this is an opportunistic approach from Xstrata's Mr. Davis. In late 2007, Anglo considered buying Xstrata, but decided against it.
Though Anglo's lagging share price has led to grumbling by some of its shareholders over the company's management, led by CEO Cynthia Carroll, its board may decide that the company's prospects as a standalone company are better, one of the people said.
Many of Anglo's shareholders and operations are also in South Africa, which would likely need to approve of any deal for it to succeed. A further complicating factor is Glencore International AG, the trading company that owns a big stake in Xstrata. Glencore would likely want the right to market key commodities from a combined Xstrata-Anglo, a demand that helped derail a recent takeover bid for Xstrata from Vale.
—Robert Guy Matthews contributed to this article.Write to Dana Cimilluca at dana.cimilluca@wsj.com and Jeffrey Sparshott atjeffrey.sparshott@dowjones.com