Comcast wireless ambitions could get a lot pricier 6 Apr 2017 The $180 bln U.S. cable firm is pushing into cellular service, nipping at the heels of Verizon and AT&T, which in turn are edging into TV. Paying Verizon for bandwidth is a prudent way to start. Yet success could lead boss Brian Roberts to go shopping, maybe even for T-Mobile US.
Bezos’ rocketing wealth fuels space ambitions 6 Apr 2017 The Amazon founder is selling $1 bln of stock a year to finance his dream of colonizing space. Both he and his company can afford it. The firm’s dominance in cloud computing has added $25 bln to his worth in the past year. With a trajectory like that, the sky is not the limit.
BP’s bonus rethink is still kind to Bob Dudley 6 Apr 2017 The British oil major has caved to shareholder pressure and cut 2016 pay for its chief executive by 40 pct. Dudley has cleaned up BP since the Gulf of Mexico spill. But his latest long-term incentive plan still positions him comfortably ahead of his domestic peer group.
Staples buyout belongs only on back of an envelope 6 Apr 2017 The $6.4 bln office-supplies chain is in talks with private-equity shops about a possible deal. Even if a new owner could stop profit from falling, use ample debt and extract dividends, the return math looks shaky. And it would be crazy to count on reviving an Office Depot merger.
7-Eleven owner steps on the gas in Texas 6 Apr 2017 Japan's Seven & i will pay $3.3 bln for most of Sunoco's gas stations, building on its lead as America's top convenience-store chain. Financial details are scant, but there is a good geographic fit. The buyer has also clearly moved on from last year's sensational boardroom coup.
Unilever finds clever twist in takeover defence 6 Apr 2017 The Magnum ice cream maker unveiled measures to increase shareholder value, and implicitly prevent a re-run of Kraft Heinz’s hostile approach. It’s mostly obvious stuff. But plans to review Unilever’s dual Anglo-Dutch structure offer a cunning way to build a political shield.
South Africa’s slow burn cuts chances of quick fix 6 Apr 2017 President Jacob Zuma seems to be doing his best to get foreign investors to dump domestic assets. That may not lead to a sudden stop: only a small minority face being forced sellers. The bad news is that this could slow the process to replace him with a more responsible leader.
Hadas: Hard Brexit could have sting in the tail 6 Apr 2017 Conventional wisdom is that even a "clean break" with the European Union just means a slower UK growth rate. But if modern revolutionaries gain control, Britain might end up with less foreign money and fewer trading partners. That would bring a huge drop in living standards.
Yum China slowly cooking up value for investors 6 Apr 2017 Separating KFC owner Yum Brands from its Chinese unit has yet to bring super-sized returns for shareholders. At least same-store sales in the People’s Republic are improving, especially at Pizza Hut. Drawing up recipes for corporate value creation is easy. Delivery takes time.
Fantasy gaming IPO has real-life charms 6 Apr 2017 Netmarble wants a valuation of up to 65 times last year's earnings in a $2 bln-plus IPO. The South Korean maker of online role-playing games is growing fast, and profitability is improving vastly. So that figure is not as fantastical as it looks - provided the hits keep coming.
China’s reformers could use tough line from Trump 5 Apr 2017 The U.S. president has threatened his Chinese counterpart with punitive trade policies. A more creative approach would target barriers to foreign investment in the People’s Republic. That would find support from U.S. corporations – and China’s frustrated pro-market faction.
Amazon does a clever bit of shopping itself 5 Apr 2017 Jeff Bezos, who upended retail as a dominant seller, will power his warehouse forklifts with a novel deal. In exchange for buying hydrogen fuel cells, Amazon gets discounted warrants in supplier Plug Power. The customer imprimatur could make a good investment even better.
Republicans lose their way on Main Street 5 Apr 2017 The chairman of a House panel told CFPB Director Richard Cordray he should be fired. This escalating fight saps resources from guarding consumers against predatory lenders and debt collectors. Political dogma is obscuring the agency's mission and a populist message from voters.
Panera buyout overeggs fast-food feeding frenzy 5 Apr 2017 At $7.5 bln, JAB is paying 41 times earnings for the sandwich maker. That may prevent interlopers from mounting a counteroffer. And the owner of Krispy Kreme and Peet’s Coffee has brand expertise and good management. But such a rich valuation will have few rivals in the M&A oven.
White House cross-border M&A rethink risks blowback 5 Apr 2017 President Trump may make it harder for foreigners to buy U.S. firms. The process for divining national-security threats in takeovers needs an overhaul. But many of the ideas smack of pure protectionism against China ahead of President Xi’s state visit. It could spur retaliation.
Saudi will find luring May was the easy part 5 Apr 2017 The British prime minister’s charm offensive in Riyadh may help sell more planes and halal lamb. It also sends a message to EU negotiators. What Saudi really needs is investment, people and skills – which hinge on the so-called soft issues Theresa May seems happy to overlook.
Markets snooze their way to Le Pen showdown 5 Apr 2017 French government bond prices suggest a lower probability of far-right Marine Le Pen winning the presidential election than bookies do. Markets may be too calm about the disruptive potential of voter apathy, or a left-wing alliance. That limits their ability to reassure.
Bovis Homes is a challenging fixer-upper 5 Apr 2017 The UK builder rejected a proposed merger with Galliford Try and instead hired the bidder’s former CEO to fix the business. Bovis has visibly lower returns and profitability than rivals. It’s not, though, a good time for the kind of cost cuts and land selloff that may be needed.
Britain is appropriate spearhead for bonus rethink 5 Apr 2017 UK ministers want to cut so-called long term incentive plans from executive pay. Such schemes can work, but all too often don’t. Turning them into less opaque deferred bonuses could preserve domestic competitiveness, while aligning Britain with peers that value greater clarity.
Facebook will be lost in India’s payments crowd 5 Apr 2017 A mooted move to enable payments through WhatsApp, the messaging service, might help the social media giant retain users in its biggest market. But Alibaba-backed Paytm and a state-backed rival would be fierce competitors. It is hard to see how WhatsApp could stand out.
China’s auxiliary capital looks like Brasilia 5 Apr 2017 Beijing wants to relocate some government functions to a new city 100 km away. State media compare the plan to the Shenzhen free trade zone, which drove economic reform in the 1980s. This bureaucratic backwater won't do anything of the sort, but it's clever urban planning.
Hong Kong’s margin loan rules are due an overhaul 5 Apr 2017 The market collapse of a Hong Kong-listed dairy farming group highlights the perils of share pledging. Disclosure rules in the city don't go far enough. Investors need to know early on, and in full, if large blocks of shares are tied to loans.
Jamie Dimon hands out bank-reform cheat sheet 4 Apr 2017 In his latest shareholder missive, JPMorgan's CEO reprises many old beefs with financial regulation. He has a more receptive audience now that Republicans run Washington. Dimon's rosy take on rewriting the rules should play well even to a president unconcerned by details.
Latin America needs leaders who can say “adios” 4 Apr 2017 A reluctance to cede power is a common failing in a region known for strongmen and weak institutions. Protesters who torched Paraguay’s Congress over the issue last week had the right idea, if wrong method. Rulers’ refusal to let go clouds prospects in Ecuador and Venezuela too.
Fed fails self-audit with tardy Lacker ouster 4 Apr 2017 The Richmond Fed president quit after saying he had a hand in leaking policy details in 2012. It's a shock at an institution that hates surprises. The central bank’s slowness to examine itself may fuel demands for closer scrutiny – and sets a poor example for banks it regulates.
Empty Fed seat an obstacle to banks’ reform hopes 4 Apr 2017 Regulatory chief Daniel Tarullo defended the central bank’s post-crisis rules in a farewell speech. Trump wants a rollback but first he’ll need to replace the governor, which could take months. While bank bosses are clamoring for reform, the Fed may be on autopilot for a while.
Brexit forces issues that are best left murky 4 Apr 2017 A phony battle over how Spain and Britain might treat tiny Gibraltar is a distraction, and a warning. If Britain’s exit from Europe becomes a mechanism for settling old scores, it could kill the constructive ambiguity on which the UK, the euro and the single market all depend.
Fox scandals weaken Murdochs’ TV future 4 Apr 2017 Mercedes-Benz pulled its advertising after news that on-air host Bill O'Reilly has faced sexual harassment claims. The cost to Fox is low, for now. Yet as with, say, Uber, a toxic culture can damage long-run efforts to broaden consumer appeal – especially with younger cohorts.
Airline cycle goes roundtrip with Frontier’s debut 4 Apr 2017 The no-frills U.S. carrier filed for an IPO eight years after going bust. Like most airlines, Frontier has gained from efficiencies, low fuel prices and passenger growth. Its liftoff has risks, but low-cost carriers are well positioned relative to legacy operators for a downturn.
ITV takeover is a hard story to pitch 4 Apr 2017 The UK free-to-air broadcaster’s shares have risen more than 15 pct in the last six months, partly on bid speculation. But ITV’s high margins and exposure to fickle TV advertising make a potential 12 bln pound price tag hard to justify – even for top shareholder Liberty Global.