BREAKFAST DEALS: Bullish Macquarie

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Macquarie Group says it's optimistic on the US and is also rumoured to be sizing up UK broker Tullett Prebon.

Macquarie Group, Tullett Prebon, Bank of China

Macquarie Group is feeling bullish on the US, saying it has "eyes and ears open” for opportunities. The chief of Macquarie Capital's US division, Tim Bishop, has told Bloomberg: "There really is an opportunity for a traditional investment bank in the US that is focused largely on the mid-market, not trying to be everything to everybody, where we think in a relative sense there's more limited competition.” The silver donut – which has $4.5 billion of excess capital – made five acquisitions in North America last year, with wealth management, investment banking and energy advisory featuring, and has also been adding to its employee numbers. And while Macquarie is not yet ubiquitous in the US, it says it plans to capitalise on its Asian links to gain more cross-border transaction advisory work, although debt and equity financing deals remain more commonplace than M&A work at this stage. In any event, one business rumoured to have caught Macquarie's eye is British interdealer broker Tullett Prebon, according to a report in the UK's Daily Mail. Other groups reportedly interested in Tullett are Bank of China or the company's own chief, Terry Smith, perhaps with private equity backing.

Vale

Meanwhile, Brazilian mining giant Vale says it is on the look-out for M&A opportunities in Australia, and will branch out beyond coal. Vale – which is embroiled in legal issues with joint venture partner Aquila Resources and has been rocked by recent company departures – has told The Age it plans to spend $39 million on Australian exploration this year, with $17 million earmarked for copper and fertiliser. "We are actively looking for other minerals. We are looking for any [M&A] opportunity,” global coal managing director Decio Amaral is quoted as saying.

Aurox, Atlas Iron

Infrastructure access and a desire to bulk up played a key role in the proposed Atlas Iron and Aurox merger, announced yesterday. With spot prices high and rail and port access limited across Western Australia, the pair has decided to combine forces, with Atlas Iron paying a hefty 173 per cent premium to do so. And another deal could be on the cards, with Atlas telling AAP it knows of other opportunities although it's not "on a rampage”. The future of Aurox's Balla Balla project in the merged entity, meanwhile, has been questioned given Atlas has been looking to sell 70 per cent of its Ridley magnetite project nearby. Elsewhere in resources and mining, and Perth-based iron ore company Cashmere Iron says it expects talks with various parties, including Chinese steel mills, to speed up following a recent discovery. Cashmere chairman David Hendrie says a stake sale or joint ventures would be considered, Bloomberg reports, although he did not elaborate on how much the company expects to raise in an IPO later this year. Over to coal, and ANZ Banking Group has tipped Australia will receive more attention from India as the nation looks to secure its energy needs. The head of M&A in Asia, Glenn Porritt, has told Bloomberg that ANZ has seen a lot of flow in terms of merger and acquisition interest or off-take interest. Coal India is among those looking at Australia for a coal alliance.

Queensland Rail

The stoush between the Queensland government and the state's coal producers continues, with the state appointing Credit Suisse, Goldman Sachs JBWere, Merrill Lynch, UBS and Royal Bank of Scotland as joint lead managers for the QR float, while the producers lock in Citigroup for a rival offer. (Sources have told The Australian the float might garner $50 million in bank fees). A spokesman for the producers – which include BHP and Xstrata – has called on the government to adopt a "common sense” approach should its bid provide a better outcome for taxpayers than the planned IPO.

Wrapping up

Amid talk that recent job cuts at local oil refiner Caltex Australia signify Chevron is looking to exit Australia, Chevron chief executive John Watson has reportedly said the US oil giant expects the relationship between the companies to continue. Chevron holds a 50 per cent stake in Caltex, which has cut thousands from its local workforce amid tough conditions. Across to financials, and ANZ Banking Group says it is making progress on its Royal Bank of Scotland Asian asset acquisition, while Korea Exchange Bank might yet be sold by US private equity fund Lone Star, and a 20 per cent stake in China's Pudong Development Bank has been snapped up by the world's biggest mobile operator, China Mobile. And finally to the fertiliser wars – Terra Industries of the US has turned its back on an offer from Norway's Yara International in favour of a sweetened $US4.7 billion offer from CF Industries.