value and opportunity

Magyar Telecom

In a pending SEC bribery case, Magyar Telekom has now received the final “sentence”, which amounts to 90 mn USD for bribery in Macedonia and Montenegro.

The DOJ filed a three-count information (see here) against Magyar Telekom charging it with one count of violating the FCPA’s anti-bribery provision and two counts of violating the FCPA’s books and records provisions. The DOJ release notes that at the time of the charged conduct, Magyar Telekom’s American Depository Receipts (ADRs) traded on the New York Stock Exchange

One might argue now a lot if this was justified or not (can you do business in certain countries without some sort of bribery ? Should you invest in such companies ?), however it shows one additional risk factor which I haven’t considered yet: An US ADR listing. This exposes companies to all sort of crazy US regulation. Something to watch in the future.

Do-it-yourself stores & Interent

Lowe’s, the big US DIY chain announced yesterday that they bought an online retail company:

NEW YORK (MarketWatch) — Lowe’s Cos., in its first purchase in at least 12 years, said Thursday it bought online home-improvement retailer ATG Stores for an undisclosed amount to expand its product offerings and better its Internet business, a key growth area.

Out of curiosity, I just checked what kind of DIY store merchandise is available on Amazon in Germany. I was surprised thath this is already a seperate category, comprising items from light switches to a 3.400 EUR lawn mower.

Hornbach started relatively early with its online store, however one has to watch this developement closely. A quick look tho electronic retailers should be enough to understand how disruptive online business can be to “traditional” retail concepts.