Qualcomm’s director election offers double rebuke 30 Mar 2018 Support for incumbents averaged under half the U.S. chipmaker’s outstanding shares. That’s a warning after the board resisted Broadcom’s $117 bln hostile bid, nixed by Donald Trump. Meanwhile, the convoluted process and an error voting Vanguard’s shares shame an archaic system.
Walmart may have hit on healthy kind of disruption 30 Mar 2018 Merging with insurer Humana could put clinics in the U.S. retailer’s stores, keeping patients out of hospitals and insurance costs down. Walmart isn’t given to big acquisitions and $37 bln Humana wouldn’t come cheap. But a broader partnership could bring many of the benefits.
Review: China fraud will always have a sequel 30 Mar 2018 It’s hard to know whether China or the U.S. financial-services industry comes off worse in a new movie about scam companies in the People’s Republic. Both emerge looking greedy and amoral. But “The China Hustle” forgets to lay blame on another group: overly credulous investors.
Viewsroom: Facebook’s multiplying problems 29 Mar 2018 The social network founded by Mark Zuckerberg is reeling from a data harvest on some 50 million users. It will take time for the $440 billion firm to feel the impact but people are starting to slowly unplug. Plus, the world’s largest consumer-drone maker may go public.
Holding: #MeToo is putting corporate law on trial 29 Mar 2018 Claims of sexual misconduct at the likes of Fox and Wynn Resorts have led to suits over board duties and disclosure. They’re long shots, largely because business governance is an awkward tool for social change. Yet investors and victims are giving it a new and useful purpose.
Melrose wins battle for GKN, UK M&A may be loser 29 Mar 2018 The takeover specialist's 8 billion pound bid for engineering group GKN has won the day. It now needs a turnaround plan that squares with pledges that were made to placate politicians. And potential bidders for other UK companies know they face a more interventionist government.
Index inclusion promises Saudi a pre-Aramco bump 29 Mar 2018 FTSE Russell will add the kingdom to global and emerging-markets indexes. MSCI is likely to follow suit, which could steer billions in index funds to the Riyadh exchange. That will make the Saudi market more international even if Aramco’s privatization stays local – or on hold.
Barclays settlement fixes one of several headaches 29 Mar 2018 The UK lender is paying $2 billion to settle U.S. regulators’ claims of mortgage securities mis-selling. That’s less than peers paid and removes some uncertainty. But the outcome of a UK investigation is still pending and CEO Jes Staley has yet to turn the investment bank around.
Facebook’s size is its other looming problem 28 Mar 2018 The social network – like Google – collects massive amounts of intel on users to sell advertising. The more Google knows, the better its search results get. But adding ever more data risks making Facebook less entertaining – and its users more wary of compromising their privacy.
CME stretches to kill NEX bidding war 29 Mar 2018 The Chicago Mercantile Exchange owner is buying Michael Spencer’s broker for 3.9 billion pounds. Meshing U.S. Treasury futures trading with NEX’s currency and bonds business is a good idea. The hefty premium may deter rival bidders but requires the deal to be perfectly executed.
Tricky Renault-Nissan deal would be rewarding 29 Mar 2018 The French and Japanese groups chaired by Carlos Ghosn may merge to create a carmaker that trades as a single stock. The Gallic state, which owns 15 pct of Renault, would put up roadblocks. But after 19 years of cooperation, margins are low enough to make the union worth a try.
Legal woes could impair SocGen’s 2020 vision 29 Mar 2018 The French lender says it is close to settling with U.S. regulators over investigations relating to Libya and Libor. A sanctions-busting probe could pose a sterner test, though. Any fine above 1.8 bln euros could threaten SocGen’s capital target – and put pressure on dividends.
China’s business culture sabotages its art culture 29 Mar 2018 Art Basel’s Hong Kong fair kicked off on Thursday. Mainland sales rose 14 pct to $13.2 bln in 2017; exhibitors hope enthusiasm will prove contagious. But Chinese art prices and volumes are unreliable. An excess of auction houses draws speculators and deters real collectors.
Shareholders could upset Hyundai overhaul 29 Mar 2018 South Korea’s second-largest conglomerate is finally moving to simplify its elaborate corporate structure. But the first stage of the rejig short-changes minority investors in a key unit. The controlling Chung family might have to improve the terms to get this done.
Chinese food-to-flights app offers half-baked IPO 29 Mar 2018 Meituan-Dianping may float in Hong Kong this year. That looks premature, as fights loom over takeaways and taxis. Stock investors could punish the $30 billion startup for burning cash to win market share. It would be better to stay private until it has a clearer edge over rivals.
Rocket-fueled stocks finally feel the burn 28 Mar 2018 Amazon lost as much as $50 bln in value, perhaps partly because Donald Trump isn’t a fan. Tesla’s stock fell another 8 pct-plus. Facebook has shed nearly $100 bln of market cap. Investors once whistled past concerns that haven’t changed much. Maybe they are opening their ears.
FDIC risks memory loss with old-guard exit 28 Mar 2018 Thomas Hoenig, the U.S. watchdog’s No. 2, used his swan song to criticize recent moves to ease bank-capital standards. It’s a cry in the wind given the deregulatory bent of Jelena McWilliams, likely the next FDIC chair. Yet forgetting history can sow the seeds of future crises.
Equifax CEO pick has lesson for Facebook 28 Mar 2018 The hacked $14 bln credit-scorer’s new boss is more technocrat than tech nerd. Then again, Facebook’s poor handling of its data woes suggests having a coding genius in charge is no certain solution. Hiring an outside manager willing to ask tough questions is a step forward.
Permian deal shows peril of wildcat discount 28 Mar 2018 West Texas-based Concho’s stock tumbled as it bought rival shale driller RSP for $8 bln. This is the first deal of its kind, and comes just as investors are becoming more risk-averse. But assuming scale does bring some benefits, it’s better to be early than late.
Hadas: Populist economics can be sensible 28 Mar 2018 U.S. President Donald Trump, Italy’s 5-Star Movement and other modern populists are floundering with outdated or bad economic plans. They would do more to help those left behind by globalisation if they used higher taxes to create better jobs and strengthen welfare security nets.
Takeda takes a turn at Shire’s risky M&A strategy 28 Mar 2018 The $42 bln Japanese drugs group may bid for $45 bln takeover machine Shire. There’s not much overlap, and uncertainties hang over key businesses. But Shire is cheap, and its shareholders exasperated. That may appeal to Takeda boss Christophe Weber, but it's also a warning.
Unilever-FTSE standoff is test of index power 28 Mar 2018 The benchmark compiler must decide whether to keep the Marmite maker in the FTSE 100 after it opted for a Dutch head office. Recent tax changes and activist pressure may prompt similar rejigs at heavyweights Shell and BHP. The index may have to bend its rules to retain its clout.
UK gender pay gap requires “just do it” approach 28 Mar 2018 Disclosures have revealed discrepancies, especially in finance, which will not close on their own. The state can help. Fining employers which fail to make progress over several years would align the interests of women and investors. CEOs would have to match words with actions.
Kim Jong Un’s change of heart might be for real 28 Mar 2018 The despot is acting suspiciously nice, mending fences with Seoul and Beijing and warming to U.S. President Trump. This could be another ruse to lift sanctions. Yet there are reasons to believe a more secure Kim is ready to start turning North Korea into a more normal country.
Apple stores up Yahoo-like trouble in China 28 Mar 2018 Keeping Chinese iCloud user data inside the People's Republic invites controversy amid Facebook's latest woes. After Yahoo shared emails with Beijing in 2004, Jerry Yang and other bosses were hauled up to Capitol Hill and called moral "pygmies." Apple should brace for blowback.
Coal clearout puts Rio on path to greener deals 28 Mar 2018 The Anglo-Australian miner has raised $4.2 bln this month getting out of coal. That implies more buybacks and fewer environmental concerns, helping lift Rio Tinto’s modest valuation. It can also focus on future growth, including investments in battery ingredients like lithium.
Chinese banks healthy enough for stronger medicine 28 Mar 2018 Stable real estate and solid corporate profits helped boost annual earnings at AgBank, CCB, ICBC and others. Manic asset growth slowed and risk buffers thickened. The way is clear for reformers to tolerate more defaults and address flaws in China’s debt-for-equity swap programme.
Wells Fargo is wrong objection to NY Fed candidate 27 Mar 2018 John Williams, who heads the U.S. central bank’s San Francisco operation, may be close to the top Liberty Street job. Wells sinned on his watch, as Senator Elizabeth Warren has noted, but other watchdogs deserve blame. For anyone looking, there are better arguments against him.
Cox: A beneficent billionaire should buy Remington 27 Mar 2018 The AR-15 maker filed bankruptcy papers a day after millions of Americans marched in favor of banning its products. Owners and creditors just want out in a hurry. But Bloomberg, Gates or Bezos could turn Remington into a force for sensible gun policies with mere pocket change.
Brookfield’s GGP offer shows writing on the mall 27 Mar 2018 The real-estate owner raised the headline value of its offer for the U.S. shopping-center operator to $15.3 bln. Yet the fall in Brookfield’s shares since it first made a bid makes the new offer look worse. Split the difference, and Brookfield is probably being rational.