Commerzbank’s new plan is more sputter than bang 23 Sep 2019 CEO Martin Zielke plans a revamp whose 1.6 billion euro price tag will be funded by selling a Polish bank stake. Investors may welcome cost cuts. But a measly return on tangible equity target of over 4% cements his company’s status as one of Europe’s least profitable big lenders.
Thomas Cook crash is dry run for Brexit failures 23 Sep 2019 The UK government refused a 150 mln pound bailout of the travel firm, citing moral hazard, but will fund the repatriation of thousands of stranded Brits. A chaotic departure from the EU will leave more businesses ailing. That will test Prime Minister Boris Johnson’s tough stance.
BNP tests boundaries of Wall Street’s land grab 23 Sep 2019 The Parisian lender formally agreed to take on Deutsche Bank’s prime brokerage arm and up to 1,000 staff. The hope is that hedge funds already dependent on U.S. firms are wary about handing them even more business, giving European players a chance to win back some market share.
Sainsbury’s strategy rejig is last chance for CEO 23 Sep 2019 Britain’s second-largest grocer failed to buy local rival Asda. Now Mike Coupe faces shrinking market share, below-par operating margins and a valuation discount to market leader Tesco. More let-downs could cost Coupe his job - or leave the $6 bln group vulnerable to a takeover.
BHP’s pay plan forges dual path to sustainability 23 Sep 2019 The $122 bln miner wants to make more of its CEO's bonus dependent on emissions and other yet-to-be-provided climate goals. As importantly, it is trimming incentives and making bosses hold shares for longer. In an industry struggling to regain investor trust, both are important.
Beijing enables corporate debt dysfunction 20 Sep 2019 A provincial government funding vehicle has declined to redeem its perpetual bonds for the first time. State-backed companies embraced equity-like hybrid debt in part to hit their deleveraging targets. With $75 bln of it effectively coming due, the shortcut could prove costly.
Facebook gives Match’s parent a reason to split 20 Sep 2019 Barry Diller’s IAC may separate its holdings in the $22 bln dating site to uncork value. It would give some agility to a company already experimenting with new ideas like video and gaming. Mark Zuckerberg moving on Match’s turf provides another good excuse to make the move.
Climate strikes give governments cover to act 20 Sep 2019 Millions are downing textbooks and tools to demand more action against global warming. People power fueled a mass aversion to plastic. And many ideas and financing vehicles to enable the climate fight already exist. The worldwide protests allow politicians to take a tougher line.
Germany’s climate menu mixes small beer and fudge 20 Sep 2019 Angela Merkel’s coalition will begin pricing carbon at 26 euros a tonne to reduce emissions. That gives big polluters little incentive to clean up. It also limits Berlin’s need to disguise that its new 50 bln euro fund to smooth the transition will stay off-balance sheet.
Berlusconi puts Bolloré in a corner at Mediaset 20 Sep 2019 The Italian tycoon has found a clever way to thwart his French rival’s attempts to kill Mediaset’s merger plan. Small fund Peninsula has agreed to put up the almost 1 bln euros needed to buy out Vivendi. The surprise move gives Berlusconi the upper hand in the ongoing struggle.
Cox: Imagine Carlos Ghosn as a human rights martyr 20 Sep 2019 The wealthy former Nissan-Renault boss who held a birthday bash at Versailles isn’t the first person to come to mind. But that’s the argument his lawyers are making in a renewed pitch to acquit him of criminal charges in Japan. As unlikely as it sounds, the case has some merit.
Bold tax cut hands stimulus charge to India Inc 20 Sep 2019 New Delhi is making the most of a sharp slowdown, cutting corporate taxes from 30% to 22%. Companies can use savings to repay debt, invest, cut prices or pay bonuses. The faster benefits are shared with consumers, the sooner they will spread badly-needed economic cheer.
Hong Kong’s first UK exchange foray clouds second 20 Sep 2019 Its 2012 takeover of the London Metal Exchange promised to preserve the institution and expand in China. Hong Kong’s bourse honoured the first, but Beijing made its own way in commodities. Returns have been poor too. That history informs its $37 bln London Stock Exchange bid.
Beijing’s monetary easing path is a conflicted one 20 Sep 2019 China has trimmed its new one-year benchmark lending rate to 4.2%. Policymakers want to boost slowing growth, but without fueling a property or credit bubble. The result is another half-step towards loosening that will disappoint those hoping for a quick stimulus.
Jardine maps a road to younger Asia for its peers 20 Sep 2019 The $41-bln conglomerate turned to the southeast when it moved out of Hong Kong ahead of 1997. It thrived, betting on cars in Indonesia and milk in Vietnam. Those economies have cooled of late but long-term prospects, plus uncertainty up north, will encourage more to follow.
Viewsroom: Not your mother’s oil shock 19 Sep 2019 Saudi Arabia is quickly repairing the damage drones inflicted on its oil industry. But the fallout has implications for everything from security to U.S. shale drillers to climate change-driven alternative energy. Plus: Why are AB InBev and ESR restarting Hong Kong listing plans?
U.S. antitrust effort cries out for a monopoly 19 Sep 2019 The U.S. Department of Justice and FTC admit to squabbling over turf as they target the likes of Amazon and Facebook. Both agencies also could use more money and people to take on deep-pocketed tech giants. Pooling resources and power through a merger is a natural solution.
JPMorgan shares too much space with WeWork 19 Sep 2019 Jamie Dimon’s outfit has helped line up $6 bln in credit for the office sublessor and lent millions to CEO Adam Neumann. Funds advised by the bank are also one of the firm’s largest investors. With WeWork’s IPO increasingly in doubt, the ties call into question JPM’s tech savvy.
Ryanair boss’s bonus gets an apt level of anger 19 Sep 2019 Almost half the budget airline’s shareholders voted against a package that could see CEO Michael O’Leary get 99 mln euros over five years. They stand to gain if he hits his targets. But given it looks relatively easy to do so they are right that it’s only barely acceptable.
DirecTV not the only thing AT&T ought to offload 19 Sep 2019 Boss Randall Stephenson’s $49 bln purchase of the satellite TV firm has been a flop. But hiving it off would address a symptom, not the cause. Stephenson defended DirecTV right through AT&T’s purchase of Time Warner. A thorough divestment plan would start with the CEO himself.
Airbnb may be everything WeWork isn’t 19 Sep 2019 Both space-sharing pioneers have been valued at more than $30 bln. Yet Airbnb’s asset-light business needs little capital while reaping obvious economies of scale and network benefits. That should help its public listing, planned for 2020, succeed where WeWork’s is failing.
Siemens’ smooth succession plan may stall breakup 19 Sep 2019 The $90 bln industrial behemoth has promoted COO Roland Busch to deputy chief executive, putting him in prime position to replace CEO Joe Kaeser in 2021. The perfectly-crafted plan offers clarity and continuity. An insider may however, be slower to simplify the sprawling company.
Third China Biologic buyout bid holds little charm 19 Sep 2019 CITIC is back with a new group trying again to take the plasma product maker private. The latest $4.6 bln offer is only 2% sweeter than a rival one from about a year ago, even though business has significantly improved. There are plenty of reasons for shareholders to be wary.
Weaker Aussie jobs clear fiscal spending path 19 Sep 2019 More people worked Down Under in August, mostly because of an increase in part-time positions. Overall unemployment ticked higher to 5.3%. It makes another interest rate cut more likely, but goosing government outlays would be a more effective option for the cooling economy.
Digital viewers add cash to Bollywood’s glitz 19 Sep 2019 After two decades abroad, India's Oscars swept into Mumbai this week. It's a timely homecoming for the world's busiest film industry. Box office receipts are booming and the sale of rights to Amazon, Netflix and others have helped earnings too. Everyone is winning, for now.
Li Ning’s sprint easily confused for a marathon 19 Sep 2019 The $7 bln Chinese sportswear maker’s shares have nearly tripled this year and now fetch a higher valuation multiple than Nike, Adidas and Anta. A new co-CEO from Uniqlo may help build on the turnaround. Fierce competition and an economic slowdown, however, will slow the pace.
Fed wrestles the unpredictable and the unintended 18 Sep 2019 Cutting interest rates again was the easy part. The whimsical trade policy of President Donald Trump and threats to oil supplies call for insurance. But stress in money markets is partly the U.S. central bank’s own handiwork. Chair Jay Powell is discovering the Fed’s new normal.
Vaping isn’t dead, just prematurely haggard 18 Sep 2019 Juul Labs started as a safer alternative to smoking, but now lawmakers are treating it as a menace. Its recent $38 bln valuation has likely gone up in flames. That doesn’t mean e-cigarettes won’t be profitable. Margins could even be higher as a niche health aid.
Hadas: The trillion-dollar lesson on fiscal policy 18 Sep 2019 Donald Trump’s tax cuts will lead Washington to borrow nearly $1 trln, or 4.5% of GDP, this year. The politics of deficits are controversial, but the monetary economics shouldn’t be. While large deficits can cause inflation or constrain growth, today’s shortfalls may do neither.
SoftBank’s funding tricks lack a magic tech wand 18 Sep 2019 Masayoshi Son’s firm lavishes startups with cash to help them dominate their field. But WeWork is struggling. Other Vision Fund-backed firms from dog-care service Wag to car-sharing app Getaround lag rivals. Deep pockets alone can’t conjure up strategy, leadership and execution.