Tuesday, February 2, 2010

JPMorgan (NYSE:JPM) Changing Strategy in RBS Sempra Commodities

JPMorgan (NYSE:JPM) RBS Sempra Commodities

JPMorgan Chase (NYSE:JPM) may have to change its strategy concerning the acquisition of RBS Sempra commodity investment company, as the announcement by Obama that he wants to restrict proprietary investing at banks in America would keep the deal from having value in some of the units of RBS Sempra, which do in fact involve proprietary trades.

A proprietary trade refers to a trade done with the money of the company rather than money of investors.

Even so, word is JPMorgan is still in negotiations concerning the global oil business of RBS Sempra, as well as all the other assets it holds outside of North America. Sempra Energy is now looking at acquiring the North American gas and power businesses of RBS Sempra.

Originally JPMorgan had wanted to acquire all of RBS Sempra for a reported $4 billion, but again, that has changed since the Obama initiative. Sempra at this time has a 49 percent stake in RBS Sempra. The Royal Bank of Scotland has the majority share of 51 percent in the company.

The power and gas business in North America isn't that valuable to JPMorgan, as it already has a strong presence there, so in a way it wouldn't hurt the company much - if at all - if it doesn't get it. That's because of the acquisition of Bear Stearns by JPMorgan, which came with it; including power plants and gas pipelines in America and Canada.'

The Royal Bank of Scotland is being forced to sell its majority share in RBS Sempra in order to qualify for bailout funds by the European Union.

JPMorgan (NYSE:JPM) RBS Sempra Commodities

1 comment:

Anonymous said...

The first sentence in this article is the longest run-on-sentence I have ever seen.