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Daily Dispatches – Men move over – women are better at M&A

A new study by the University of British Columbia Sauder School of Business reveals that the more women on a corporate board the less a company pays for its acquisitions.

The business school, which has published study in the Journal of Corporate Finance, said the cost of a successful acquisition is reduced by 15.4% with each female director added to a board. It also reveals that each additional female director reduces the number of a company’s attempted takeover bids by 7.6%.

“Female board members play a significant role in mitigating the empire-building tendency of CEOs through the acquisition of other companies,” says Sauder finance professor Kai Li, one of the study’s two authors. “On average, merger and acquisition transactions don’t create shareholder value, so women are having a real impact in protecting shareholder investment and overall firm performance.”

The researchers say their results suggest women are less interested in pursuing risky transactions and are more focused on a higher return on investment.

Reserve Bank of Australia issues words of warning

The Financial Times reports that Reserve Bank of Australia deputy governor Philip Lowe has warned of significant challenges facing the economy, with benefits from ever-rising Asian demand likely to wane.

Lowe says that in terms of Australia’s demographics, the ‘sweet spot’ had passed, and at some stage, the share of the working-age population in employment is likely to decline, given the ageing population. 

But he says investment in infrastructure can boost productivity, and the public sector can be an enabler by using its own balance sheet or in risk-sharing arrangements with the private sector.

The central bank may yet cut interest rates further to stimulate the economy. It left its overnight benchmark rate unchanged at 2.5% after its November meeting.

Singapore listing short-cut for Chinese companies

With the IPO freeze continuing in China, stock-market regulators in China and Singapore have set up a framework for Chinese companies to list in the Lion City, says Business Times.

Under the framework announced on Monday, Chinese-owned and incorporated companies will be able to list on Singapore Exchange (SGX) after getting approval from the China Securities Regulatory Commission as well as SGX.

SGX CEO Magnus Bocker said investors here would have more choices and access to the growing Chinese economy.

China to launch new carbon trading exchanges

Two new pilot carbon trading schemes will be launched this week in Beijing and Shanghai, reports the South China  Morning Post.

The new platforms, which will force industrial firms to buy credits to cover any CO2 they emit above allocated quotas, also underscore Beijing’s commitment to “market mechanisms” to slow emissions growth, in line with an ambitious raft of reforms outlined earlier this month.

Private equity group PAG scores major coup with appointment of former Ping An Bank chairman

Xiao Suining is the latest top banker to move into private equity, a growing trend in the financial industry, says the South China Post. He was the former chairman of Shenzhen Development Bank – which was renamed Ping An Bank following its takeover by Ping An Insurance.

China eases restrictions on insurers investing in private equity 

China will raise the ceiling on insurers’ investments in private equity to boost direct financing in the country and give financial institutions greater flexibility in managing their financial risks, according to a senior insurance regulatory official, according to the Asia Insurance Review.

Insurers will likely be allowed to invest 20% or 30% of their total assets in private equity, up from 10%.

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