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Wednesday, 04 March 2015

BREAKINGVIEWS

Actavis CEO Brenton Saunders speaks during an interview with CNBC on the floor of the New York Stock Exchange November 17, 2014.

Actavis sale dresses up barely investment grade

03 March 2015

The acquisitive drugmaker attracted huge demand for $21 bln of bonds one notch above junk. They yield 1.75 percentage points over U.S. Treasuries, less than Verizon’s bigger, better-rated issue did in 2013. Buyers of top-tier debt can’t help but keep looking further downward.

A sign reading "Bank" is seen on the door of a bank in Westminster, Colorado November 3, 2009.

Surviving small banks look battle-hardened at last

03 March 2015

The crisis wiped out nearly 2,000 U.S. community lenders. Those left struggled with patchy loan demand, ultra-low interest rates and new rules. An improving economy and a hike from the Fed will help, if none succumb to rate shock. Any that do will only have themselves to blame.

The flag of Bank BPI hangs in front of the facade of Bank Millennium BCP in Lisbon's downtown

Caixabank faces bigger price tag to secure BPI

03 March 2015

The Spanish bank has already bid 1.1 bln euros for its Portuguese peer, but fellow BPI investor Isabel dos Santos wants a merger with local rival BCP. That would create competition issues. But dos Santos’ blocking stake suggests Caixa may have to pay up – if it can afford it.

A 20mg dose of Zocor, the Merck & Co. Inc cholesterol fighting drug, is shown in a pharmacy in Westfield, New Jersey.

M&A optimism over Merck KGaA is about to be tested

03 March 2015

The chemical and drugmaker has become one of Germany’s hottest stocks, gaining 55 pct in a year. Solid revenue growth and a dividend hike for 2014 underscore the renewal. To keep investors onside, Merck must now smoothly integrate a $17 bln takeover, the biggest in its history.

HK property shows limits of new central bank tools

03 March 2015

Regulators in the former colony have spent five years tightening mortgage controls, but real estate prices are still rising. It’s a reminder not to expect too much from “macro-prudential” policies. Authorities can stop banks from lending too much. Deflating a bubble is trickier.

Men fish next to cracked ground as the Atibainha dam lake dries up due to a prolonged drought in Nazare Paulista, Sao Paulo state, October 17, 2014.

Brazil water crisis heats up climate tail risks

02 March 2015

Sao Paulo’s drought stems from statistical hubris similar to the Wall Street models that failed to predict the 2008 financial crash. Decisions to prop up banks and markets had near immediate effect, though. Climate-related black swans are likely to prove more pernicious.

A man works on a tent for NXP Semiconductors in preparation for the 2015 International Consumer Electronics Show (CES) at Las Vegas Convention Center in Las Vegas, Nevada January 4, 2015.

$15 bln tech M&A spree poor fix to limp sales

02 March 2015

Chipmaker NXP and networking gear firm HP need strong demand to compensate for falling prices. Trouble is, that has not happened. Buying Freescale and Aruba will help cut costs, build scale and fill in niches. But neither deal turns tech hardware into a growth market.

Trust Citi to win from losing most profitable unit

03 March 2015

The U.S. mega-bank has at last offloaded OneMain to rival Springleaf for $4.25 bln. The subprime unit’s 6.7 pct return on assets far exceeds anything else at Citi. And yet the deal provides a one-off income boost, frees up capital, accesses tax breaks and removes a distraction.

Barclays' trading woes offset pay restraint

03 March 2015

The UK bank has cut investment bank bonuses by a quarter, atoning for a PR gaffe last year when pay rose despite a drop in profit. But 2014 results show returns in the unit are also lower. To maintain its turnaround, Barclays may have to shrink the misfiring division further.

Alibaba Group Holding Ltd founder Jack Ma listens to a speaker during the plenary session titled "Valuing What Matter" at the Clinton Global Initiative 2014 (CGI) in New York.

Alibaba's split nationalities invite trouble

03 March 2015

Taiwan wants to boot the e-commerce group out for not declaring itself Chinese. Yet Alibaba’s home changes depending on who asks. China’s taxman sees Hong Kong, licensing bodies see China, and investors see the Cayman Islands. The confusion may encourage regulatory meddling.

A man speaks on his mobile phone, which has an image of Hindu nationalist Narendra Modi, the prime ministerial candidate for India's main opposition Bharatiya Janata Party (BJP), outside the party headquarters in New Delhi May 12, 2014.

India's $13bln spectrum auction has room for upset

03 March 2015

The top mobile operators are limbering up to renew licences that support as much as 70 pct of their revenues. The worry is that rivals or new entrants such as Reliance Jio may bid aggressively for additional bandwidth. An expensive auction will weigh on balance sheets.

John Browne listens to a question during a television interview in central London.

John Browne's Russian truce points to oil M&A boom

02 March 2015

The former BP boss will head L1, a $10 bln energy fund owned by oligarch Mikhail Fridman. The duo once sparred over BP’s assets east of the Urals. Their alliance today highlights the deal opportunities created by oil’s rout - even if L1’s Russian roots are a problem.

A man makes a phone call using his mobile phone

French telco buyout shows dealmaker in a hurry

02 March 2015

Vivendi is selling its residual 20 pct in Numericable-SFR to the mobile operator itself and parent Altice for 3.9 bln euros. This helps Altice’s billionaire boss Patrick Drahi prepare for a follow-on deal with Bouygues. It’s harder to see why Vivendi would accept a big markdown.

Videos

Columns

Rob Cox

Rob Cox: Silicon Valley's boom-boom room moment

03 March 2015

These days the talk of the geek enclave isn’t the latest Mary Meeker report or mega-IPO but complex legal complaints alleging naughty behavior by leading venture capitalists. The lawsuits are the latest reminder that the tech industry’s moral exceptionalism is undeserved.

Edward Hadas

Edward Hadas: UK voters deserve some dreamers

02 March 2015

The runup to May’s poll should be open season for attacking conventional wisdom and promoting radical agendas. But the pamphlets emerging from the fringe are strangely tame. Outsiders are wasting their licence to operate beyond the rules of pragmatism.

Features

A Google self-driving vehicle is parked at the Computer History Museum after a presentation in Mountain View, California May 13, 2014.

Tech drive strips old-school carmakers of clout

02 March 2015

Apple is the latest to take an interest. From Tesla to Google, the shift to connected, self-driving vehicles may take a while, but it could shake up everything from systems to materials to car usage. The winners may be able to rev up returns far higher than current performance.

Peter Thal Larsen

Review: Building HSBC's sprawling, flawed empire

27 February 2015

The Hong Kong bank grew into one of the world’s biggest financial institutions. But poor results and a furore over Swiss tax make for an unhappy 150th anniversary. A new history shows how hands-off management and breakneck M&A under former chairman John Bond are partly to blame.