German GDP down 0.1%; Bronfman drops Paramount bid
Good morning, and welcome to our live coverage of business, economics and financial markets.
Germany’s economic outlook has worsened as GDP was confirmed to have fallen in the second quarter and consumer sentiment slumped, according to figures published on Tuesday.
GDP fell by 0.1% in the second quarter, confirming the previous estimate, said Destatis, the federal statistics office. GDP in the first quarter of 2024 was up 0.2% on the previous quarter, unrevised from the last reading.
Meanwhile job concerns weighed on German consumer sentiment. GfK’s closely followed index fell to -22 points for September. That was down from a slightly revised -18.6 the month prior and below a forecast by economists polled by Reuters for -18.2.
Ruth Brand, Destatis’s president, said:
After the slight increase in the previous quarter, the German economy slowed down again in spring.
Germany’s economy has narrowly avoided a technical recession for a year and a half, alternating between a contracting economy followed by expansion. Two consecutive quarters of contraction is one commonly used definition of recession.
Edgar Bronfman drops bid for Paramount
Media industry veteran Edgar Bronfman has dropped his bid to take over Paramount Global, paving the way for a $28bn (£21bn) deal with Skydance to proceed.
Bronfman, a former Warner Music chief executive, had gathered a consortium of investors to try to gazump Skydance after it last month agreed a merger (described, of course, as a blockbuster) with Paramount. The deal will, if it goes through, sever links with the Redstone family, whose media empire has included Paramount since 1994.
That deal had a “go shop” period in the terms, allowing Paramount to evaluate other offers. Bronfman gathered a consortium to offer $4.3bn and then $6bn to Shari Redstone, who controls the company. However, he failed to come up with the equity to finance the deal, Reuters reported, citing unnamed sources.
Paramount is the company behind classic films such as The Godfather, Titanic and Breakfast at Tiffany’s. It also owns the television network CBS and channels including MTV, Nickelodeon and the UK’s Channel 5.
Skydance, a film production group, is led by the producer David Ellison, the son of Larry Ellison, the tech tycoon who co-founded Oracle.
The agenda
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11am BST: UK Confederation of British Industry distributive trades index (August; previous: -43; consensus: -11)
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2pm BST: US S&P/Case-Shiller home price index (June; prev.: 6.8% year-on-year; cons.: 6%)
Key events
On the Paramount bid battle, here is what the various parties had to say.
Edgar Bronfman officially dropped out of the running on Monday evening. Reuters reported that a source said that some of the equity partners had dropped out.
Bronfman said in a statement:
We continue to believe that Paramount Global is an extraordinary company, with an unrivaled collection of marquee brands, assets and people. While there may have been differences, we believe that everyone involved in the sale process is united in the belief that Paramount’s best days are ahead.
Paramount said the deal with Skydance will close in the first half of 2025.
Charles Phillips Jr, chair of Paramount’s special committee, said:
Having thoroughly explored actionable opportunities for Paramount over nearly eight months, our special committee continues to believe that the transaction we have agreed with Skydance delivers immediate value and the potential for continued participation in value creation in a rapidly evolving industry landscape.
The biggest gainer on the FTSE 100 this morning is Bunzl, which distributes packaging, cleaning products and personal protective equipment.
It may not be the most glamorous name on London’s benchmark index, but it has wowed investors this morning with a big upgrade to its profit forecast thanks to higher profitability.
It also said it will buy back shares worth £450m. Frank van Zanten, chief executive of Bunzl, said:
I am very pleased with the performance of the group during the first half of 2024, with strong growth in adjusted operating profit for the period.
London’s FTSE 100 is the pick of Europe’s stock markets this morning, as investors catch up from a bank holiday on Monday.
Most of the other main indices are fairly flat in the opening trades. Here are the opening snaps, via Reuters.
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EUROPE’S STOXX 600 UP 0.2%
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BRITAIN’S FTSE 100 UP 0.4%
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FRANCE’S CAC 40 UP 0.1%; SPAIN’S IBEX FLAT
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EURO STOXX INDEX FLAT; EURO ZONE BLUE CHIPS FLAT
German GDP down 0.1%; Bronfman drops Paramount bid
Good morning, and welcome to our live coverage of business, economics and financial markets.
Germany’s economic outlook has worsened as GDP was confirmed to have fallen in the second quarter and consumer sentiment slumped, according to figures published on Tuesday.
GDP fell by 0.1% in the second quarter, confirming the previous estimate, said Destatis, the federal statistics office. GDP in the first quarter of 2024 was up 0.2% on the previous quarter, unrevised from the last reading.
Meanwhile job concerns weighed on German consumer sentiment. GfK’s closely followed index fell to -22 points for September. That was down from a slightly revised -18.6 the month prior and below a forecast by economists polled by Reuters for -18.2.
Ruth Brand, Destatis’s president, said:
After the slight increase in the previous quarter, the German economy slowed down again in spring.
Germany’s economy has narrowly avoided a technical recession for a year and a half, alternating between a contracting economy followed by expansion. Two consecutive quarters of contraction is one commonly used definition of recession.
Edgar Bronfman drops bid for Paramount
Media industry veteran Edgar Bronfman has dropped his bid to take over Paramount Global, paving the way for a $28bn (£21bn) deal with Skydance to proceed.
Bronfman, a former Warner Music chief executive, had gathered a consortium of investors to try to gazump Skydance after it last month agreed a merger (described, of course, as a blockbuster) with Paramount. The deal will, if it goes through, sever links with the Redstone family, whose media empire has included Paramount since 1994.
That deal had a “go shop” period in the terms, allowing Paramount to evaluate other offers. Bronfman gathered a consortium to offer $4.3bn and then $6bn to Shari Redstone, who controls the company. However, he failed to come up with the equity to finance the deal, Reuters reported, citing unnamed sources.
Paramount is the company behind classic films such as The Godfather, Titanic and Breakfast at Tiffany’s. It also owns the television network CBS and channels including MTV, Nickelodeon and the UK’s Channel 5.
Skydance, a film production group, is led by the producer David Ellison, the son of Larry Ellison, the tech tycoon who co-founded Oracle.
The agenda
-
11am BST: UK Confederation of British Industry distributive trades index (August; previous: -43; consensus: -11)
-
2pm BST: US S&P/Case-Shiller home price index (June; prev.: 6.8% year-on-year; cons.: 6%)