Inmarsat buyout is $3.4 bln punt on airplane Wi-Fi 25 Mar 2019 The UK satellite operator is a logical target for private equity firms Apax and Warburg Pincus: the hard-to-value group could throw off loads of cash in a few years. Yet that depends on widespread take-up of in-flight broadband. Rivals may prevail, or flyers might not cough up.
Pinterest’s future relies on pegging global sales 25 Mar 2019 The scrapbooking app has a healthier balance sheet than other startups going public. Ad growth has outpaced expenses, shrinking its net loss by 65 pct over two years to $63 mln. But most new users are overseas, and still far less lucrative than U.S. crafting counterparts.
Chinese champions need a harder dividend squeeze 25 Mar 2019 Beijing wants to help balance its books by making stingy state companies hand over more of the $500 bln they earned last year to shareholders. It’s a good idea, but the economic effect will be modest until deeper reforms are put back on the table.
Trump takes politics to heart of Fed with nominee 22 Mar 2019 The president wants to put conservative commentator Stephen Moore on the central bank board. The former campaign aide helped draft the administration’s tax cuts and has called for Fed Chairman Jerome Powell to resign. It’s a troubling shift from more expert, independent choices.
Honeymoon ends early for Brazil’s Bolsonaro 22 Mar 2019 The far-right president is finding governing harder than firing off incendiary tweets. A Washington meetup with fellow populist Donald Trump was low on substance, key pension reform is struggling and his popularity has plummeted. Even his predecessor’s graft arrest may not help.
UK water-scarcity fix may pour billions down drain 22 Mar 2019 Climate change and population growth could cause chronic shortages by 2050. Whitehall’s preference is to target individual consumption and talk up costly infrastructure. It would be smarter and cheaper to push the biggest users – business and the power industry – to cut back.
BlackRock sees tech as an antidote to fee pressure 22 Mar 2019 The world’s largest investment shop is paying $1.3 bln for an alternative-asset management software firm. Boss Larry Fink gains heft in a booming private-equity market and bolsters a growing technology business. It’s a smart attempt to counteract price wars in stocks and bonds.
Brexit extension sharpens Britain’s choices 22 Mar 2019 European Union leaders gave Theresa May two more weeks to agree a plan for leaving the bloc. But they also dangled the possibility of a longer delay. For all the shuffling of dates, Britain’s options remain basically the same as before, including the risk of a chaotic departure.
Deutsche Bank bonus pay is excessive and ill-timed 22 Mar 2019 The German lender has nearly doubled management pay to 56 million euros due to higher variable pay. The group bonus pool shrank but is more than six times 2018 profit. If unions were irked by job cuts that a proposed merger with Commerzbank would bring, this will incense them.
John Paulson gives Newmont late but valid advice 22 Mar 2019 The gold miner’s $10 billion Goldcorp offer terms aren’t good enough for the hedge fund manager, who owns a 2.7 percent stake. He has a point – recent gold deals haven’t featured premiums. But his campaign might have gained more traction had he started earlier.
Cleaning up Hong Kong’s small caps is dirty work 22 Mar 2019 Scandals and high fees doom over 1,000 companies listed in the city to low valuations and feeble trade. The exchange may cut transaction costs to boost turnover, but that won’t solve deeper issues. Delisting would be a better solution for many, even if the process will be grimy.
Australia can defy economic gravity for longer 22 Mar 2019 After nearly three decades of growth Down Under, there are fresh signs of sputtering. Fourth-quarter GDP grew just 0.2 pct, house prices are falling and wages only inching up. There are reasons for optimism, though. Canberra’s spending power, for one, can keep momentum going.
China’s majors fill up on gas at the right time 22 Mar 2019 PetroChina’s losses on gas imports swelled to nearly $4 bln in 2018, thanks to low domestic rates. Yet China’s oil giants are preparing to buy more LNG from U.S. firms. That aids the trade cause. More importantly, it may help lock in supply before a forecast shortfall.
Viewsroom: German bank M&A’s questionable logic 21 Mar 2019 Putting Deutsche and Commerz together might create a national banking champion. A more likely outcome, though, would be a poorly performing behemoth. Meanwhile, Volkswagen boss Herbert Diess commits the mother of all CEO gaffes. Plus: sizing up a Chinese housing unicorn.
Levi Strauss IPO looks a few sizes too big 21 Mar 2019 The 166-year-old jeans-to-jumpsuits maker is worth $8.7 bln after shares popped 33 pct on its return to the public market. That’s perhaps justified, but it’s a stretch, suggesting denim will remain in vogue. Recent bankruptcies of two rivals are a reminder such fashion fads fade.
U.S. floods add new twists to 2020 elections 21 Mar 2019 Several midwestern states have suffered some of their worst deluges on record, raising more climate-change fears. That could influence voters in Iowa, where presidential candidates face their first test. And the floods’ financial toll may prompt underwater farmers to dump Trump.
Goldman Sachs is down but not yet out in the Gulf 21 Mar 2019 Abu Dhabi fund Mubadala says it won’t hire the Wall Street bank due to the 1MDB scandal. With the UAE a key part of regional fees, further sovereign fund blackballs would hurt. Still, Goldman has other markets, and a similar spat between Citi and ADIA didn’t cause lasting damage.
SEC is last activist that fund investors need 21 Mar 2019 The U.S. watchdog worries that consolidation and fee pressure may be hurting small asset managers, thereby reducing choice. For sure, BlackRock and Vanguard loom ever larger over the industry. But the main problem for rival funds is justifying the fees they charge already.
Biogen loses same Alzheimer’s bet others have lost 21 Mar 2019 The failures of similar drugs in formal trials meant Biogen’s effort was always a long shot. Yet ditching it vaporized $18 bln, or over a quarter, of the biotech’s value. The giant market for a therapy and the fear of missing out lured in both the company and Wall Street.
Traders’ brave new world shrinks to same old story 21 Mar 2019 UBS boss Sergio Ermotti has warned first-quarter markets revenue fell a third compared to 2018. In December investment bankers hoped rising rates and volatility would boost group top lines. Instead, trading arms will be as much of a drag as they have generally been since 2009.
Tencent needs new obsession to replace video games 21 Mar 2019 The web giant’s fourth-quarter earnings slumped by nearly a third to $2 bln as Chinese curbs on mobile games took effect. Bets on payments and cloud computing have yet to pay off, and Tencent’s M&A record is patchy. Investors deserve a clearer idea of where it’s headed next.
Middle East payments IPO is spiciest in hot sector 21 Mar 2019 Network International is planning a London listing that values it at up to $3 bln. A focus on emerging markets, where cash dominates, leaves plenty of room for electronic payments to take off. The risk is tech firms offer Middle Eastern and African shoppers a slicker alternative.
China’s carriers dig deep for world-beating 5G 21 Mar 2019 The mobile giants have hinted at how much they will spend on the initial buildout of next-generation technology, outlining the first real plans for a potential $140 bln project. Costs look manageable for now, but expensive calls from Beijing remain a worry.
Hong Kong fumbles its China extradition fix 21 Mar 2019 The city may exclude white-collar crimes from a mooted deal to exchange suspects with the mainland, to assuage the business community’s concerns. Unfortunately, such an awkward compromise would only confirm the tension between the financial hub’s needs and Beijing’s ambitions.
Thailand’s vote may solve just one problem 21 Mar 2019 A poll on Sunday will end five years of military rule. The best outcome would be an uncontested one, even if the junta leader stays on. A democracy of sorts could well encourage some private investment, but none of the likely winners seem ready to tackle a sclerotic economy.
Kuala Lumpur can give up Malaysia Airlines 21 Mar 2019 The flag carrier has been losing cash for years. Now Premier Mahathir Mohamad is asking if it should fly at all. State-meddling has hampered a turnaround and there’s too much local capacity. Folding the airline would show that his government is ready to rein in the state.
Fed waves white flag on normalization 20 Mar 2019 The U.S. central bank held interest rates steady, cut its forecast for hikes and will stop shrinking its balance sheet in September. There are signs of slowing global and domestic growth, but the package looks more like a market wish list than the result of data-driven analysis.
Tech donors have reasons to keep 2020 powder dry 20 Mar 2019 Silicon Valley is a big source of White House campaign funds. But progressive Democrats who otherwise appeal to some tech types are bashing the sector. Others support Trump’s China crackdown and tax cuts but are afraid to back him publicly. It could mean a wait-and-see approach.
Google fines make case for tougher antitrust curbs 20 Mar 2019 Europe has hit the Alphabet unit with its third penalty in less than two years, taking the toll to over $9 bln. That sum pales against the $600 bln the firm has added to its market cap since the investigations began in 2010. Both sides are being pushed to a bigger showdown.
Chrysler Building can ape its Midtown rival 20 Mar 2019 New York City’s art deco tower is being sold for $150 mln, a fraction of what it fetched a decade ago. An onerous ground lease, renovation needs and drift away from Midtown explain much of the discount. But the Empire State Building shows how to restore luster to fading icons.