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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: elmatador who wrote (37372)	8/21/2003 11:08:30 PM
From: maceng2	Read Replies (1) of 74559

ABB plugged on FT be careful i.e wait until the stock is trashed first (imho) news.ft.com US blackouts may prove lifeline for ABB By Dan Roberts in Zurich Published: August 21 2003 20:04 \| Last Updated: August 21 2003 20:04 Increased infrastructure spending following last week's US electricity blackouts should provide a $2bn lifeline for ABB, the Swiss-Swedish engineering group brought to the brink of bankruptcy last year. The company's managers say they expect orders for ABB's transmission equipment will lead to a significant upward revision of profit forecasts and allow Jürgen Dormann (pictured), the German chief executive brought in to rescue the group, to stand down within 12 to 18 months. A recovery in the group's share price, up 80 per cent in the last month, has also increased the chances of a rights issue to re-capitalise ABB's over-stretched balance sheet. ABB claims more than 60 per cent market share for the high-voltage equipment now thought to be urgently needed in the US and expects a doubling in investment will translate to a similar increase in its $2bn of US sales. "The probability that we will reach the numbers we communicated [to the market] is now extremely high, and probably we will be able to go faster," said Mr Dormann in an interview. "We do not like what's happened in the US; but it's [the sort of] good luck you get from time to time." ABB briefing For more news and analysis on the Swiss-Swedish engineering group Click here In spite of some outstanding asbestos liability, ABB is also thought to be within days of completing the $1bn sale of part of its oil, gas and petrochemical division to a consortium led by JP Morgan and Candover. Proceeds from this and buyers for other parts of the group could lead to further capital restructuring. ABB said other options still remained open but it was determined to improve its debt to equity ratio by 2005.

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