Grindr stokes bad blood in U.S.-China relationship 27 Mar 2019 The dating app’s Chinese ownership has been flagged as a U.S. security risk, Reuters reports. That ought not be a surprise given the potential to use hook-up data for Kompromat. But amid a trade war, this jilting move is likely to make U.S.-China relations even rockier.
Staley puts neck on the line in Barclays reshuffle 27 Mar 2019 A shake-up of the investment bank will see its three main chiefs report directly to CEO Jes Staley. The ploy could thwart pressure by investor Edward Bramson to scale back the unit. But the big boss is putting his own job on the line with a pledge to improve its mediocre returns.
Turkey’s attack tactics are worst form of defence 27 Mar 2019 Ankara is making it harder to bet against the lira, but overnight swap rates of 700 pct also make hedging prohibitive. Probes by the bank watchdog mean a research drought. Investors will dump Turkish assets rather than stay exposed, especially when experts are opting to keep mum.
Hadas: Boeing undermined by too-positive thinking 27 Mar 2019 The aircraft maker’s hasty introduction of new software may have led to two fatal crashes. If so, the problem was probably not greed or lack of concern for safety, but something just as dangerous: overconfidence. As global banks learned in 2008, the worst sometimes does happen.
Fiat Chrysler might gain from M&A waiting game 27 Mar 2019 The carmaker is in demand. Already the subject of interest from Peugeot, it could also face a bid from a merged Renault-Nissan, the FT says. Such a deal would be tricky and take time. But patience could give the Agnelli clan better options to solve FCA’s tech and Asian headaches.
Jumia to test faith in the rare African unicorn 27 Mar 2019 The e-commerce startup from Rocket Internet is hoping for a $1.4 bln price tag when it goes public in New York. Sales are galloping but so are losses. That’s a punchy valuation given the poorest continent’s social and political problems – unless Alibaba or Amazon are the buyers.
Ashley’s retail foray more desperate than inspired 27 Mar 2019 Sports Direct, controlled by Mike Ashley, may pay 61 mln pounds for struggling high street chain Debenhams. But taking on its heavy debt and leases, or restructuring them later, would be tricky. Ashley’s best bet may be to agitate for a higher payoff for his 30 percent stake.
China property giants face call of tech sirens 27 Mar 2019 The $45 bln Evergrande and peers reported bumper earnings for last year despite slowing overall sales. Home prices are rising, debt is stabilising and policy seems friendlier. Shareholders could relax, were developers not also plowing into electric cars and robots.
Huawei’s charm offensive scores only half-points 27 Mar 2019 The Chinese telecom champion is engaging in an unprecedented public relations push, battling U.S. allegations of spying, IP theft and opacity. Its arguments about security have some merit, but the campaign might convince more sceptics if Beijing wasn't trying so hard to help.
China’s art market paints a clearer picture 27 Mar 2019 Sales in the mainland and beyond dipped in 2018, to $13 bln. There was still exuberance: a monumental abstract triptych sold for a record $65 mln. But the mood ahead of Hong Kong’s Art Basel is subdued. For buyers, that may be good news, auguring less volatility and lower prices.
Apple Card puts customer first, Goldman second 26 Mar 2019 The remarkable thing about the iPhone maker’s new status symbol isn’t its titanium sheen, the cash back or promises to protect user data. It’s that partner Goldman Sachs has eschewed many features that make the credit card business so lucrative for issuers. That’s no bad thing.
WeWork shows benefit, and cost, of SoftBank vision 26 Mar 2019 The shared-office giant’s loss in 2018 more than doubled to $1.9 bln, outpacing the growth – and amount – of revenue. Backer SoftBank believes in investing heavily in expansion. Potential IPO investors must square that breakneck spending with a $47 bln private valuation.
Ditching Obamacare would be self-defeating 26 Mar 2019 The Trump administration wants a court to throw out all of the Affordable Care Act. That’s dubious politically as past attempts helped flip the House to Democrats. And success would actually undermine the White House’s main healthcare goals, including reducing costs.
Activists target messy retailer for spring clean 26 Mar 2019 A trio of pushy investors wants to strip Bed Bath & Beyond of its CEO and board, and replace them with a fresh sheet of directors. The $2.4 bln chain is beset by poor governance, lackluster results and a plunging stock price. It’s long past due a thorough shake-out.
Wirecard’s relief surge has gone too far 26 Mar 2019 The 15 billion euro payment group’s shares rose more than a quarter after a review found no evidence of any misconduct that would have a material financial impact. Its valuation is now uncomfortably close to sector stalwarts Visa and Mastercard. A bigger discount is merited.
Holding: Time to put M&A cash cow out to pasture 26 Mar 2019 So-called appraisal cases have rewarded shareholders and deterred dodgy deals. But judges’ reluctance to set share prices, an expert-witness scandal and other trends have made them less lucrative. The HP-Aruba merger gives Delaware’s top court a chance to end the tactic.
Fizzy Fevertree valuation depends on global surge 26 Mar 2019 The maker of fancy tonic boosted sales by 40 pct last year. Discerning spirits drinkers have helped lift its valuation to 3 bln pounds, a frothy 33 times forward EBITDA. To justify that premium, Fevertree has to replicate its UK success elsewhere - or find an optimistic buyer.
Uber gets an IPO boost from Middle East deal 26 Mar 2019 The ride-hailing giant will pay $3 bln to acquire Dubai-based rival Careem. It shows the group, which is burning through $1 bln a year, can still spend to grow as it prepares to go public. Amid intense overseas competition, the move gives Uber one less thing to worry about.
Rare-earth bid reverts Aussie conglomerate to type 26 Mar 2019 After spinning off supermarkets and selling coal, $27 bln Wesfarmers is back adding to its sprawl with a $1.1 bln offer to buy Lynas. The attraction of owning the only major producer of speciality ingredients outside China is clear, but the financial and strategic cases less so.
Second-hand $4 bln colostomy bag LBO may get messy 26 Mar 2019 Medical-kit maker ConvaTec’s value rose 9 pct after a report that buyout group EQT might be interested. Its shares are down a third since it was floated by private equity in 2016. A new owner could slash costs to rip out cash, but risks sacrificing more market share to rivals.
Chaotic Thai result is near investors’ worst case 26 Mar 2019 A vote to end direct military rule has slid into confusion, with accusations of cheating and both sides claiming they can form a government. A clear outcome may be weeks away. With foreign funds already ditching shares, that's a poor prospect for a cooling $460 bln economy.
Hostile Indian IT bid does not compute 26 Mar 2019 Larsen & Toubro’s $2 bln tilt offers a measly premium for outsourcer Mindtree. The buyer’s vow to keep the outfit separate to its existing IT businesses seems odd, and deprives the target of a higher-performing parent. A sweeter price and a clearer plan could seal a better deal.
The Exchange: Fomenting rugby fever in Hong Kong 26 Mar 2019 As the city braces for the annual Sevens showdown, organiser Robbie McRobbie tells Breakingviews what the event reveals about its host. From fancy dress and fancier corporate suites, to a real estate dilemma, the sports extravaganza tracks the financial hub’s health and wealth.
Apple stretches to take on Netflix, Amex, Disney 25 Mar 2019 It unveiled a dizzying array of new services aimed at disrupting sectors like media and finance. They range from the confusing to the mildly innovative. The $880 bln tech giant’s launches used to strike fear, but this time boss Tim Cook is paving a trail of mediocrity, not havoc.
Economy will displace Mueller in U.S. headlines 25 Mar 2019 The special counsel’s verdict that President Trump didn’t collude with Russia removes a layer of political risk. But markets have other anxieties like flagging earnings and investment. Ending trade wars would help, and Trump’s renewed political capital gives him room to maneuver.
Extra! Newspaper bidder flubs credit test 25 Mar 2019 MNG, owner of the Denver Post, is waving a “highly confident” financing letter from Oaktree to advance its hostile bid for publisher Gannett. Yet MNG isn’t clear if the debt specialist will even bother to lend it $1.7 bln. The tactic is as unconvincing as it is unconventional.
“Japanisation” of ECB will blight Europe’s banks 25 Mar 2019 Weak economic activity is raising the chances of the European Central Bank copying its Japanese counterpart, which has kept rates ultra-low for two decades and adopted ever more radical measures to boost inflation. Lenders in Japan show European peers the heavy toll that takes.
ING offers savvy alternative to cross-border M&A 25 Mar 2019 The Dutch bank wants to add 1 million profitable customers per year through 2022. Using a single technology platform and fewer branches helps boss Ralph Hamers grow efficiently, without resorting to risky acquisitions. Investors aren’t giving ING’s model enough credit.
Peugeot needs FCA more than the other way around 25 Mar 2019 Carlo Tavares is reading from Sergio Marchionne’s script. A $45 bln merger would, in theory, deliver massive cost savings which could be invested in new technology. But politics makes that hard. And while PSA would gain a U.S. foothold the Agnellis would be pulled back to Europe.
Naspers relocates its Tencent discount to Europe 25 Mar 2019 The Johannesburg group is shifting internet investments, including a $134 bln stake in the Chinese web giant, to an Amsterdam-listed unit. That might tempt investors wary of South African risks. But it does little to address fears that Naspers will squander its Tencent windfall.