DataRoom AM: Macquarie baulks

Macquarie Group falls out of favour with JPMorgan Chase, while Credit Suisse is bullish on M&A in Asia.

JPMorgan Chase has selected the favoured bidder for its physical commodities business and Macquarie Group has missed out – but it’s not a done deal just yet.

Elsewhere, Credit Suisse is bullish on Australian gas M&A, final bids for Macquarie Generation come in, Hochtief claims a larger slice of Leighton Holdings, Genworth Financial outlines tentative Australian IPO plans in 2014 and a new suitor could be on the scene for Queensland Motorways.

JPMorgan Chase has chosen the preferred suitor for its $US2 billion-plus physical commodities division and Australia’s Macquarie Group appears to be on the outer. According to Reuters, Swiss trading house Mercuria has entered exclusive talks with JPMorgan, but a final deal could still be months away.

That leaves the door slightly ajar for fellow suitor Macquarie, though it appears to have baulked at an asking price that may have topped $US3.3 billion.

Credit Suisse’s global strategy team is bullish on M&A in Asia, with Australia’s Cooper Basin singled out as an area to watch in 2014. Among the possible targets listed were Beach Energy, New Standard Energy, Senex Energy and Drillsearch Limited, with Santos Limited and Chevron singled out as potential buyers. The targets, save for New Standard, could also turn suitors amid the consolidation.

The analysts also suggested ANZ Banking Group may again make a play for a small Hong Kong bank, with the $2 billion Dah Sing Bank seen as the most likely (and perhaps only) target.

AGL Energy has again been forced to wait on regulatory clearance for its proposed buyout of Macquarie Generation after the ACCC delayed its ruling by one day. Meanwhile, the NSW government has confirmed it has received three bids for MacGen, likely worth around $1.5 billion. ERM Power and Japan’s Marubeni Corp are the two other suitors, with a decision expected before the end of February.

Leighton Holdings’ largest shareholder has once again upped its stake in the troubled construction firm. Germany’s Hochtief, which in turn is controlled by Spain’s Grupo ACS, spent $55 million in raising its shareholdings from 57.75 per cent to 58.77 per cent. An imminent takeover bid still looks unlikely despite Leighton’s share price hovering near decade-long lows.

Genworth Financial has confirmed plans to complete an $800 million IPO in Australia before the end of the year. However, Genworth boss Thomas McInerney admitted a “lot of things have to go right” for a float of 40 per cent of its Australian mortgage insurer to go-ahead in 2014.

Hastings Fund Management is looking to rope the Kuwait Investment Authority into a $5 billion-plus bid for toll road operator Queensland Motorways, according to the Australian Financial Review. Macquarie Capital and UBS AG are advising on the sale, with indicative bids due tomorrow.

Shares in Virgin Australia Holdings plumbed fresh two-year lows yesterday, leaving it vulnerable should major shareholders Air New Zealand, Etihad Airways and Singapore Airlines harbour any ambitions to take over the group. It remains a big long shot, but it wouldn’t be a shock if the three largest shareholders were taking a closer look.

Finally, the WA government is planning to auction off the rights to upgrade the busy Dampier port in the state’s north. Interest will be gauged in both the leasing of existing facilities and the building of new infrastructure.