HK migrants likely to give UK only a tiny boost 6 Oct 2020 The British government thinks 200,000 Hong Kongers will take up the former colonist’s offer of legal residence. That would add less than 1% to GDP, only a rounding error in comparison to the likely post-Brexit pain from lost EU migrants, and possible retaliation from Beijing.
LG Chem will get a charge from battery spinoff 6 Oct 2020 The $40 bln South Korean conglomerate’s separation plan failed to energise investors. Although it’ll take time for the structure to take shape, it’s fairly clear the Tesla-supplying division’s true value is lost inside a chemical maker. There’s an electric-car spark yet to come.
Aussie gold miners make deal wishes come true 6 Oct 2020 Northern Star is acquiring smaller rival Saracen for $4.1 bln. They’ll share a heap of promised synergies without a premium to pay for using a structure touted by an industry shareholder group. The buyer’s track record also should mitigate some typical merger concerns.
French sewage M&A battle takes messy twist 5 Oct 2020 Engie agreed to sell its 30% stake in Suez to waste rival Veolia for $4 bln, despite opposition from the French state, its largest shareholder. That may embolden CEO Bertrand Camus to resist a takeover. Wringing out a higher offer for the rest would allow him to exit honourably.
Wall Street can’t keep its finger off the trigger 5 Oct 2020 Credit Suisse and JPMorgan led the IPO of Academy Sports, a retailer of assault-style rifles that supplied the perpetrator of a 2017 mass shooting. Like Academy owner KKR, their part in America’s gun violence problem is relatively small. Still, it’s one they have taken willingly.
SPACs are one good scrub away from respectability 5 Oct 2020 Blank check companies have many qualities of an investment mania. There’s even an ETF that lets everyday investors take a punt on these complex, insider-friendly acquisition vehicles. With a cleanup, though, they could shed their shady image. The IPO world could use disruption.
Bristol Myers pays hearty price for cancer hedge 5 Oct 2020 The $132 bln drugmaker’s Celgene mega-deal last year left it dependent on cancer treatments and vulnerable to generic competition and the whims of governments. Paying $13 bln for revenue-free MyoKardia offers some political and patent protection – but it costs an arm and a leg.
Copper bulls may bust through China shop 5 Oct 2020 The metal’s price has jumped around 40% since March, hitting multiyear highs. Increased Chinese demand, tight supply and a weaker dollar played a part. Higher inventories could bring a reversal. But with a boom in renewable-energy infrastructure, optimists have the right idea.
Cox: U.S. cabinet picks have never been as crucial 5 Oct 2020 Donald Trump’s Covid-19 battle is a reminder the presidency isn’t a one-man job. It takes many competent managers, overseeing dossiers from Treasury to State and beyond. Trump’s choice of talent lags that of rival Joe Biden judging by responses to our Economic Dream Team Machine.
Guest view: CEOs learn value of long-term vision 5 Oct 2020 The disruption of the pandemic underscores the importance of planning ahead, write Mark Machin of Canada’s CPP and McKinsey’s Kevin Sneader. Long-term management not only creates more jobs and greater value. It’s also embedded in behaviors that CEOs and board members can learn.
Corona Capital: Donald Trump, Kenzo Takada 5 Oct 2020 Concise views on the pandemic’s corporate and financial fallout: U.S. President Donald Trump’s fight with the coronavirus could lead to a less fiercely contested election result; the death of Japanese designer Kenzo Takada comes at a bad time for the global fashion industry.
Italy payments deal trades value for state power 5 Oct 2020 Nexi is buying government-controlled Sia to create a 15 bln euro national champion ready to expand in the fast-consolidating sector. State investor CDP will own 25% but appoint nearly half of the board. It’s another market test for Rome’s push for influence over key industries.
Duty-free group bags the ultimate Chinese shopper 5 Oct 2020 Dufry struck a joint venture with Alibaba, while the e-commerce giant will pump up to $273 mln into the pandemic-struck Swiss travel retailer. CEO Julián González has secured a powerful local partner at a small price. It’s a good deal, assuming the duty-free business recovers.
Altice’s vexed minorities may have a trump card 5 Oct 2020 Minority investors are livid at Patrick Drahi’s lowball 4.9 bln euro take-private offer for the European telco. On the face of it, the Franco-Israeli billionaire can use his 78% voting rights to steamroller their views. But a new piece of Dutch law may give them the last laugh.
Warburg Pincus enjoys Japanese Suga rush 5 Oct 2020 IT conglomerate NEC will splash out $2.2 bln on private equity-backed Swiss fintech firm Avaloq. At 21 times adjusted EBITDA, it’s not cheap. But with new Prime Minister Yoshihide Suga vowing to digitise ministries and banks, the deal is well-timed for both sides.
Face mask boom has unhealthy side effects 5 Oct 2020 Companies from Chinese carmaker BYD to retailer Gap have cashed in on demand for masks. Entrepreneurs and crooks have also piled in, leading to quality problems and fraud. As panic-buying winds down, dealing with excess capacity and used-mask trash could be a headache.
India’s gold jeweller IPO peddles platinum quality 5 Oct 2020 Demand for bling has some resilience against shocks in a wedding-obsessed nation that sees the yellow metal as an investment. That will help the Warburg Pincus-backed Kalyan’s market debut. Next to hotly-valued rival, Tata’s $14 bln Titan, though, it looks a touch less shiny.
Peltz puts the squeeze on middle-weight money men 2 Oct 2020 The activist’s fund Trian has taken big stakes in investment firms Invesco and Janus and wants to roll them up. Taking on powerhouses like BlackRock requires industry consolidation as low rates and fee pressure bite. Peltz may also benefit from good old-fashioned market timing.
Trump and China: this time it’s personal 2 Oct 2020 A Covid-19 diagnosis for the U.S. president turns the People’s Republic from a public enemy to a private one. Trump has already compared the pandemic to Pearl Harbor. A scorched earth policy on issues from trade and TikTok to Taiwan and the national debt has become more likely.
Review: London is global corruption’s top offender 2 Oct 2020 “Kleptopia” catalogues the corporate crooks who sanitise their ill-gotten gains. Though the problem is global, the British capital plays a central role. Tom Burgis shows how banks, stock markets and real estate are all complicit. But the flow of cash also erodes London’s appeal.
Suez white knight is a flawed M&A saviour 2 Oct 2020 The Paris-based sewage group has backed a last-gasp takeover offer by Ardian. The French fund could best rival Veolia’s bid by offering 13 bln euros for Suez’s equity. But there are no details, and CEO Bertrand Camus may not be OK with his company being broken up.
Europe’s least-bad banks have useful M&A currency 2 Oct 2020 Shares in the region’s big lenders on average dropped 61% in the past decade. Some, like Nordea, ING, UBS and Credit Agricole fared better. The combination of size and relatively strong valuations makes them the natural aggressors in a possible wave of dealmaking in the sector.
Christine Lagarde has a real rates problem 2 Oct 2020 Euro zone prices fell 0.3% in September from a year ago, a bigger drop than in August. This boosts the inflation-adjusted, or real, policy rate. That phenomenon is most marked on the ECB boss’s turf and may lift the euro. A rising currency would hasten further monetary easing.
David Beckham’s e-sports IPO is speculative effort 2 Oct 2020 Guild Esports, backed by the former soccer star, raised $26 mln in a London listing. Its plan is to recruit pro gamers and tap into a $1 bln market flush with fervent fans and eager advertisers. Making money out of real-world sports teams is hard enough. This looks even tougher.
Corona Capital: U.S. jobs, Real estate 2 Oct 2020 Concise views on the pandemic’s corporate and financial fallout: Americans slowly get back to work; New York City real estate sales fly to Florida.
Markets lose virus immunity with Trump diagnosis 2 Oct 2020 The U.S. president said he tested positive for Covid-19. How this will affect the outcome of the election is unknown. Ditto whether it spreads further through Trump’s cabinet. The Fed has helped prop up markets so far. Investors are on their own in this uncharted territory.
Playboy slips into something less comfortable 1 Oct 2020 No longer a purveyor of adult magazines, the late Hugh Hefner’s empire is using a SPAC to return to the stock market – ahead of a possible reinvention as an M&A-driven conglomerate. The idea is attractive enough, but the public gaze won’t be any more forgiving this time around.
Cash is king again in race to the White House 1 Oct 2020 Donald Trump beat Hillary Clinton in 2016 even though her war chest was bigger. But the impact of live rallies and the free airtime he gets as president have been tainted by Covid-19. Campaign finance matters more now, and Trump is lagging – even more so after Tuesday’s debate.
Airline employees are pawns in U.S. bailout debate 1 Oct 2020 American is going forward with 19,000 job cuts, at least temporarily, as Congress tries to agree on a bailout. Even if the carrier shrinks permanently, many of those jobs should return. That means Washington can justify helping rather than keeping workers in stressful limbo.
Daniel Kretinsky’s grocer grab has sliver of sense 1 Oct 2020 The Czech billionaire has bought $1.5 bln worth of shares in European supermarkets like J Sainsbury and Casino. Anaemic growth and low margins suggest that’s unwise. But if his targets can slash costs and take advantage of an online boom, his bet may begin to look shrewd.