BREAKINGVIEWS-The Week in Breakingviews: Hostile retreat

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Peter Thal Larsen

LONDON, Nov 30 (Reuters Breakingviews) - Welcome back! I’m off to New York for the Reuters NEXT conference on December 3rd and 4th, where we will offer a sneak peek of Breakingviews’ predictions for 2026 and look back at what we got right (and wrong) this year. See all the speakers and tune in to the live stream here. If you’re there in person, come and say hello. As always, email me with your thoughts.

OPENING LINE

“‘We beat the forecasts this year and will beat them again,’ British finance minister Rachel Reeves said triumphantly on Wednesday, crowing like a CEO on earnings day.”

Read more: UK budget beat lacks long-term lift.

FIVE THINGS I LEARNED FROM BREAKINGVIEWS THIS WEEK

1. The estimated cost of rebuilding Ukraine after the war with Russia has risen to almost $600 billion.

2. Microsoft MSFT.O has not issued any bonds this year.

3. Companies have raised just $10 billion from share sales in Shanghai this year, compared with $48 billion in Hong Kong.

4. Apollo Global Management’s APO.N shares are the most-shorted among its peers.

5. Britain’s new “mansion tax” will apply to less than 1% of homes.

WARS OF WORDS

Have CEOs forgotten how to execute hostile takeovers? The question occurred after I read about mining giant BHP’s BHP.AX latest botched attempt to buy rival Anglo American AAL.L. It is the most recent in a string of unfriendly deals which were aborted or failed to snag their target. Though capitalism is better for it, it is a surprising development.

First, a quick recap. In April last year, BHP boss Mike Henry went public with a plan to buy Anglo American for $39 billion. But there was a wrinkle: any offer was conditional on the London-listed target first spinning off its platinum and iron ore units. Anglo folded its arms and refused, leaving BHP with no option but to fold its tents and retreat.

A week ago, Henry tried again, in a last-ditch attempt to gatecrash Anglo’s merger with Canadian miner Teck Resources TECKb.TO. His target again refused. In a previous era, mining bosses might have responded to such a rebuff by launching a full-blown hostile bid. But Henry quickly withdrew.

He is not the only CEO licking his wounds. Carlos Torres, who leads the Spanish bank BBVA BBVA.MC, spent almost 18 months touting a hostile $13 billion offer for smaller rival Sabadell SABE.MC, only for shareholders to turn him down. UniCredit CRDI.MI CEO Andrea Orcel pursued simultaneous takeovers of German lender Commerzbank and Italy’s Banco BPM but has so far come away empty-handed.These thwarted unions show that hostile takeovers have become harder. Corporate bosses must win over shareholders who are more willing to reject bids they think are too low. Regulators and governments are increasingly happy to interfere with unfriendly offers, especially from overseas.

That is probably why CEOs are less likely to even contemplate an aggressive approach. Unfriendly deals have reached two peaks in recent decades. The first was in 1999, at the height of the tech frenzy, when telecom giant Vodafone snapped up German rival Mannesmann, among others. The second came in 2007, just before the credit crunch, when a consortium led by Royal Bank of Scotland famously and foolishly dismembered the Dutch lender ABN Amro. In each of those years the value of hostile M&A – including deals which failed – exceeded $730 billion, according to Dealogic. Between 2020 and 2024, however, the average was just $135 billion a year, while the total so far in 2025 is a positively pacifist $65 billion.

On balance, this is a good thing. Most mergers already fail to add value. Hostile deals pile on further risks. Gung-ho bosses can end up overpaying in their desperation to bag the target or fail to spot problems friendlier discussions might have uncovered. Companies and their investors are better served by the lack of hostility. The only drawback is that when CEOs try to turn belligerent, they discover they are no longer fighting fit.

CHART OF THE WEEK

Revolut is one of the biggest recent successes in European finance. The fintech has only been around for a decade but has overhauled rivals that have existed for centuries. A recent sale of shares by staff valued Revolut at $75 billion, making it more valuable than Deutsche Bank DBKGn.DE. Yet while much of the recent focus is on the company’s struggles to obtain a UK banking licence, a glance at its numbers suggests it is not really a bank. Only a quarter of revenue comes from interest income. The rest is from activities like processing card payments, trading cryptocurrencies and foreign exchange, and subscriptions.

THE WEEK IN PODCASTS

“Buy land, they’re not making any more of it.” The hoary old investment cliché sums up our complex relationship with property. On The Big View I talked to Mike Bird, Wall Street editor at the Economist and author of “The Land Trap”, about why real estate is such an enduring issue – and why it is so hard to reform.

Over on the Viewsroom, Aimee Donnellan and Jonathan Guilford discussed with Associate Editor Neil Unmack how the financing of the artificial intelligence boom is spilling from Big Tech companies’ cash flow into credit markets.

PARTING SHOT

The Chinese Communist Party loves a slogan. A lot of the People’s Republic’s signature initiatives in recent years can be summed up in a pithy phrase. So too with Made in China 2025. The domestic manufacturing push launched a decade ago helped inspire a drive into green technology and electric vehicles, while prompting a trade backlash. That may explain why China is a bit more circumspect about the next leg of its industrial strategy. Nevertheless, looking at five-year plans and other documents reveals an ambitious blueprint which is set to cause shockwaves both at home and abroad.

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(Editing by George Hay; Production by Oliver Taslic)

((For previous columns by the author, Reuters customers can click on LARSEN/peter.thal.larsen@thomsonreuters.com))