Unilever’s fairness agenda gets harder to manage 26 Jun 2020 The Anglo-Dutch giant is renaming skin-lightening products popular in India which generate $500 mln in sales. Dropping them, like J&J, would better fit with CEO Alan Jope’s values-driven ethos. Multinationals trying to be global and progressive will face more of these dilemmas.
Qantas charts choppy path for Bain’s Aussie flight 26 Jun 2020 The U.S. buyout shop beat out rival bids for bankrupt Virgin Australia. There’s haggling to do with creditors and others before the sums are known. At the same time, Qantas is raising $940 mln and plans to axe 20% of its workforce in a fresh sign of the brutal challenges ahead.
Remittance woes will transfer from poor to rich 26 Jun 2020 Money sent home by migrant engineers, domestic helpers and more will fall sharply with the global slump and job losses. It could cost $140 bln. The pain, borne mostly by developing countries, may be shared by wealthier peers in the form of slower recoveries and possible bailouts.
Paroled Chinese tycoon greases GOME rally 26 Jun 2020 Shares of the $4.5 bln electronics retailer rallied as much as 25% after founder Huang Guangyu was released after a decade in jail. GOME has lost money for years, but investors are betting his return, plus recent deals with JD.com, herald a comeback. That could be a long shot.
Bank stress tests give the Fed a pass grade too 25 Jun 2020 The biggest lenders would have a minimum capital ratio of 7.7% in a W-shaped virus recovery, the U.S. regulator reckons. The Fed is capping dividends as some banks approach the danger zone. Still, it reassures that after a decade of reforms, they can weather an unforeseen crisis.
Deal for Mark Wahlberg gym needs post-Covid energy 25 Jun 2020 A SPAC is buying the F45 gym group backed by the actor-musician for an enterprise value of $845 million. If projections pan out, that's a bargain next to Peloton and Planet Fitness. Heavy lifting is needed, though, to rebound from the coronavirus and keep new franchisees coming.
Real-time economic data show Covid-19 wariness 25 Jun 2020 The pandemic has placed a premium on figures that give rapid hints about how the economy is doing. TomTom’s traffic flows and OpenTable’s restaurant data reveal the positive impact of U.S. states easing restrictions – but also how worsening outbreaks send people back home.
Saudi $45 bln bank M&A is haunted by past failure 25 Jun 2020 The kingdom’s biggest lender NCB wants an all-share combo with Samba, having dropped its pursuit of Riyad Bank last year. Local retail investors may shrug at the prospect of creating a banking champion. That means the acquirer will have to pay towards the top of a mooted range.
Lemonade’s secret ingredients are tech and hope 25 Jun 2020 The digital insurer’s $1.3 bln valuation is leagues above what a regular insurer would command. Then again, Lemonade is less of an insurance company and more of a marketing machine with some charming quirks. Its biggest threat is that old-school insurers copy the recipe.
Vaccine victory would be half cure for economy 25 Jun 2020 Governments have ploughed over $5 bln into efforts to create a barrier against Covid-19. Promising trials raise hopes the virus can be made less lethal. But as even effective vaccines would still allow the disease to spread, they will only allow a partial return to normality.
Chancellor: Inflation as the post-pandemic cure 25 Jun 2020 The massive fiscal deficits engendered by the virus should see off deflation. The spectre of rising prices now beckons. While its potential horrors shouldn’t be downplayed, inflation can resolve great imbalances and festering social discontents besetting the global economy.
Viewsroom: Reparations math, the coming WFH battle 25 Jun 2020 As America continues to grapple with the legacy of slavery, Breakingviews columnists debate the financial question of whether the government, and some corporations, have a debt to repay. And Pete Sweeney dives deep into the post-pandemic future of working from home – or not.
Wirecard collapse is real-life fintech stress test 25 Jun 2020 The German group is filing for insolvency a week after saying $2 bln of cash was missing. Its collapse will test whether fast-growing and lightly regulated payments firms can fail without damaging customers or other lenders. The fallout has consequences for the entire sector.
SoftBank-Alibaba distancing has further to go 25 Jun 2020 Masayoshi Son is leaving the e-commerce group’s board after 15 years. The Japanese group just raised $11.5 bln using some of its Alibaba stake; its valuation discount gives it reason to keep selling. Being a major investor in both U.S. and Chinese firms will also only get harder.
Corona Capital: U.S.-China fight, Canada downgrade 25 Jun 2020 Concise views on the pandemic’s corporate and financial fallout: Washington deploys sanctions over Hong Kong, adding to trade and Covid-19 tensions; and a double whammy of the coronavirus and low oil prices costs Canada one of its AAA ratings.
EasyJet sees glimpse of blue sky above virus cloud 25 Jun 2020 The UK budget airline raised 419 mln pounds from investors. With European economies reopening and the few planes back in the sky full of passengers, CEO Johan Lundgren’s route out of the gloom is clearer. Shares up 50% from their virus low make this a good time to refuel.
Bayer pays dearly for blind faith in science 24 Jun 2020 The German group will spend up to $10.9 bln to settle U.S. claims its weedkiller causes cancer. Though Roundup remains legal, Bayer misread the danger of taking its chances with American juries. Shareholders will bear the toxic legacy of its ill-judged $66 bln Monsanto takeover.
Chaotic U.S. virus tactics augur sickly economy 24 Jun 2020 Covid-19 cases are rising across roughly half the country, but only 30% of states require wearing masks in public. The lack of White House leadership exacerbates local differences in handling the outbreak. A return to lockdowns is likely, putting commerce back in the sick bed.
Jeff Ubben gives Wall Street its Fukuyama moment 24 Jun 2020 ValueAct’s founder declared “finance is, like, done” as he left to start an ESG fund. True, it’s harder for traditional activists to make money. But like the academic who claimed that history had ended, Ubben’s off the mark – as his new climate and social gig is likely to prove.
Winnebago’s spring surge may run out of gas 24 Jun 2020 The recreational-vehicle maker’s stock price has more than tripled from March lows as social distancing pushes stir-crazy Americans outdoors. But the company’s valuation is stuffed with expectations of hitting Mount Rainier-type heights. Investors might want to put on the brakes.
VMware spin would repair Dell’s complexity damage 24 Jun 2020 The $36 bln IT group may off-load its $50 bln majority stake in separately listed VMware. Logic suggests first extracting cash to reduce debt and then spinning VMware off to Dell’s shareholders. That would clean up balance sheets and governance, probably boosting both valuations.
Central banks have a way to spur greener recovery 24 Jun 2020 Fed chief Jerome Powell and ECB boss Christine Lagarde are purchasing bonds without taking account of whether they are supporting the carbon-intensive status quo. There are good reasons for that. But they can at least demand more disclosure of climate risks before buying.
VW’s Europcar takeover would be a rough round trip 24 Jun 2020 The German carmaker is considering buying the $500 mln French car-rental firm, which it sold in 2006. Beleaguered boss Herbert Diess could use its airport and city locations to launch ride-sharing services. Plummeting rentals and high debt will make bumpy economic returns ahead.
Camera sale puts Olympus value into clearer view 24 Jun 2020 The $25 bln Japanese company is offloading its historic but unprofitable imaging division 18 months after pushy investor ValueAct prompted a shakeup. A new focus on medical equipment has helped send Olympus shares soaring. The question now is whether expectations are too rosy.
Corona Capital: A tax on martinis 24 Jun 2020 Concise views on the pandemic’s corporate and financial fallout: Uncle Sam has bad news for those enjoying the libation during lockdown as it’s putting up import duties on gin, vodka and olives.
Yandex picks good time to untangle from Sberbank 24 Jun 2020 The Russian search engine will pay $600 mln for the bank’s stake in their e-commerce tie-up and exit their payments unit. With shares up, funding this with $800 mln from investors like Roman Abramovich makes sense. Sadly, immunity from Kremlin meddling isn’t part of the deal.
The looming war over working from home 24 Jun 2020 After decades of false starts in telecommuting, the pandemic has ushered in a real revolution. It’s great for collaborative technology developers, less so for office landlords. The next big clash between labour and capital over the fruits of productivity is also set to kick off.
Bill Ackman bests Goldman Sachs in SPAC race 23 Jun 2020 Both are launching blank-check companies designed to buy private firms. Goldman’s is smaller, and rides on its contacts and cachet. Ackman’s could reach $6 bln, and adds some governance-friendly tweaks. Short-term investors will probably prefer Goldman’s; Ackman may hope they do.
Electoral dash for cash creates room for conflicts 23 Jun 2020 Two probes into U.S. lawmaker Kelly Loeffler, who sold stock after a Senate Covid-19 briefing, were dropped. Weeks earlier, her husband donated to Republican campaign groups. Amid several tight races, each dollar becomes more valuable. Yet potential controversy is easy to avoid.
Cerberus bags more waiting for Albertsons checkout 23 Jun 2020 Stephen Feinberg’s buyout firm has tried several times to exit the U.S. grocer it has owned for 14 years. But the pandemic has been a boon for both supermarkets and capital markets. That means Cerberus can get a better deal than was on offer when it last tried to leave the store.