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Technology Stocks : PCW - Pacific Century CyberWorks Limited -- Ignore unavailable to you. Want to Upgrade?

To: ms.smartest.person who wrote (355)	2/19/2001 3:20:15 AM
From: ms.smartest.person	Read Replies (1) \| Respond to of 2248

Where's the Love? By Maureen Tkacik, AsiaWise 14 Feb 2001 16:00 (GMT +08:00) All happy mergers, a famous Russkie once pointed out, are alike; each unhappy merger is unhappy in its own way. Consider Mizuho, the merged Industrial Bank of Japan/Dai-Ichi Kangyo Bank/Fuji Bank. Biggest bank in the world, Mizuho. Baddest, too, maybe, if you're talking about its loans. Which is one of the things that qualifies Mizuho as unhappy, despite last Friday's Bank of Japan rate cut. But Mizuho's woes are a completely different breed from those of that other big Asian unhappy union, the merged (and debt-submerged) Pacific Century CyberWorks-Hong Kong Telecom. To be sure, both companies' problems are rooted in the D-word; PCCW owes too much, Mizuho -- like every other bank in Japan -- is owed too much, and both companies face higher premiums on any more debt they decide to issue to cover costs. Both companies propped up their profits last year with stock market gains, both are highly unlikely to see any more of those for a long, long time. Both are held by parties who, if the shares bounce at all, are likely to sell off -- Cable & Wireless on the PCCW side, an unwinding keiretsu of companies on Mizuho's side. More disheartening, you get the idea that both merged entities never really felt that "spark" of synergy in the first place. You get the idea that on both ends, merging was largely about becoming too big to fail. And you get the idea that these are two "stay away" stocks we have here. They're rather alike, really. And they've almost become Asia's "ailing merger" clichés. So I take it back. I'll cut the Russkie some slack; Tolstoy actually said all happy families are the same, that it's the unhappy families that are the interesting ones, and Anna Karenina was hardly 21 Picks for 2001. Besides, that was then, and now is 125 years later. Half of all marriages these days fail; odds are even worse for corporate marriages. Take Liz and Hugh, Bruce and Demi, Tom and Nicole. What went wrong? Crikey folks, what didn't? Take MCI and Worldcom, Daimler and Chrysler, London and Frankfurt. There's a mass-manufactured, candy-heart sameness to the reasons why. Hacks have tried to find literature in corporate lust's labors lost, but it all just clangs cliches like a paperback romance novel. Cultural conflicts. Deep-rooted corporate customs. Mutual suspicion. Inertia. Overly ambitious forecasts. Infighting. Labor disputes. So we hark back to the old days of hope; the talks, the takeout, the "Project X" pet names, the due diligence, the "unusual" share activity, the Wall Street Journal leak. What went wrong? we wonder. And we romanticize deals gone cold. On PCCW-HKT: Pulled in so many opposing directions and unsure exactly how to define herself, she saw him as a father figure. Someone with a core business, steady cash flows, gravitas... On Mizuho: It wasn't a spark, but there was a "if we reach sixty and we're still single" warmth to it. There was little to gain beyond shared interests, old-fashioned economies of scale, a somewhat increased sense of security, the "more than $1 trillion in assets" thing... still, the shareholders were thrilled... (this unhappy tale of two mergers continues in Other Fish in the Sea). asiawise.com