Research and Publication, IIPM Editorial

Boots also unveiled its second major deal in just a week. It is selling off its highly profitable non-pre­scription drugs business, Boots Healthcare International (BHI), to Britain’s Reckitt Benckiser, for a higher than expected $3.38 billion in cash. The BHI business recorded a 3.6% increase in revenues to $443.1 million and operating profits to the tune of $154.1 million for 2005. Boots has been trying to battle a 1.6% fall in second quarter sales. Amazingly, it would return $2.54 billion to its shareholders as special dividend after the deal.

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Source: IIPM Editorial, 2006

Research and Publication, IIPM Editorial

Boots also unveiled its second major deal in just a week. It is selling off its highly profitable non-pre­scription drugs business, Boots Healthcare International (BHI), to Britain’s Reckitt Benckiser, for a higher than expected $3.38 billion in cash. The BHI business recorded a 3.6% increase in revenues to $443.1 million and operating profits to the tune of $154.1 million for 2005. Boots has been trying to battle a 1.6% fall in second quarter sales. Amazingly, it would return $2.54 billion to its shareholders as special dividend after the deal.

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Source: IIPM Editorial, 2006

Research and Publication, IIPM

The Viacom split makes excellent strategic sense as the two parts will present more focused investment options and ensure steady cash flow. Especially when Viacom’s stock has not performed better than most top media stocks. While Time Warner’s stock price was down by only 8.3%, and Walt Disney’s by 12%, Viacom’s stock price is down 20%. Sir Martin Sorrell’s WPP group is perhaps the most pristine example of how media companies of the same group perform more efficiently when managed as independent businesses. Redstone’s decision could well now become fashionable.

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Source: IIPM Editorial, 2006

Mickey mania in Hong Kong

Walt Disney opened its fifth holiday resort (third outside the US, after Tokyo and Paris) in Hong Kong on September 12. Hong Kong Disneyland Park, which has been built over a 6 year period, at a cost of $3.5 billion is expected to attract 5.6 million visitors ev­ery year. Disney has entered into a joint venture with the Hong Kong government for a 43 percent stake in the park. Out of the other two parks outside the US, the one in Paris is heavily indebted, and it remains to be seen how well Mickey can create its magic in Hong Kong…

Source: IIPM Publication

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Copyright IIPM(2006)