BHP’s dual-listing dilemma gets ESG nudge 3 Feb 2021 The spread between the $160 bln miner’s Aussie and UK shares is at its highest since 2011. Tax perks mean the equity Down Under should trade at a premium, but distaste for fossil fuels among British funds is helping widen the gap. It’s time to reconsider collapsing the structure.
Publicis turnaround remains a work in progress 3 Feb 2021 The 11 bln euro ad agency’s fourth-quarter revenue rose more than expected thanks to its U.S. arm. Cost cuts protected operating margins, too. But a lack of detail on data group Epsilon, acquired in 2019, makes it premature to salute Publicis’ desired digital pivot.
Nomura sluggishness shifts from bank to investors 3 Feb 2021 The Japanese bank posted its best quarterly pre-tax profit in 13 years. The trading tailwind that boosted U.S. rivals helped, but all divisions chipped in and costs are falling. Shareholders are not yet convinced. Addressing that is the next challenge for boss Kentaro Okuda.
Digital coins could dull Macau’s bling 3 Feb 2020 Mobile payments quintupled in the gambling hub in 2020, and digital currency might be introduced soon, helping watchdogs monitor money flows. Players might not like that idea, especially wealthy clients and tax dodgers. VIP haunts like Galaxy and Wynn are particularly exposed.
New Panasonic engineers leaner, meaner machine 3 Feb 2021 Cutting costs and dud assets boosted the $32 bln Japanese giant’s operating profit 30% in the first months of its overhaul despite pandemic-subdued sales. An electric-car boom will help the Tesla supplier’s top line, too. That gives incoming boss Yuki Kusumi room to manoeuvre.
Bezos steps aside after living high on the hog 2 Feb 2021 Amazon’s founder will shed his CEO title to the head of its cloud division just as fourth-quarter sales jumped 44%. But 2021 begins an era where the $1.7 trln giant will be benchmarked against a new normal. That includes regulatory scrutiny the next chief will have to address.
Alphabet risks losing sight of ABCs of search 2 Feb 2021 Google’s parent posted a 23% bump in quarterly revenue and growth recovered in its search-ads cash cow. But it’s losing share to Amazon, and competitors like Facebook are a growing threat. Rivals are also under political pressure but Google’s problems make it harder to ignore.
Tilman Fertitta takes liberty with SPAC menu 2 Feb 2021 The Texas billionaire is selling his casino and steak combo to a blank-check company. That’s after he used one of his own SPACs to buy his online-gaming unit, and another to acquire a food-delivery service that was later sued. If a SPAC serves it up, Fertitta is ordering.
UK throws sand in buy now pay credit boom’s wheels 2 Feb 2021 Britain’s financial watchdog wants to regulate companies that allow customers to buy goods and defer payment like ordinary lenders. That should mean more transparency, credit checks, and slower growth. The tough stance will make it harder for other countries to ignore the risks.
Vimeo earns its prime-time video slot 2 Feb 2021 The IAC-owned platform doubled its private market value to $6 bln in three months. That may rise further when Barry Diller’s group spins it off, given the boom in subscriptions sold to Starbucks and such. Vimeo could follow Slack as a target for business-focused tech giants.
Speed-loving billionaires to keep Ferrari running 2 Feb 2021 The luxury carmaker reported an 8% revenue drop during the pandemic and was cautious on future profit. Much of the hit stemmed from F1 woes rather than dwindling appetite for supercars. At least the next CEO can take some comfort from a rising cohort of the global super wealthy.
The Exchange: The long life of bad economic ideas 2 Feb 2021 From self-funding tax cuts to runaway executive pay, economists have provided intellectual support for seriously flawed policies. Reuters journalist Tom Bergin, author of “Free Lunch Thinking” tells Peter Thal Larsen how dodgy theories helped mislead politicians and the public.
Subdued Alibaba offers shoppers discount on self 2 Feb 2021 Quarterly sales at its commerce unit jumped 38% to $30 bln, showing the Chinese giant is still a formidable force despite regulatory woes. Most importantly, the cloud business turned an adjusted profit for the first time. Even if growth slows later, the business looks cheap now.
Hedge funds will evade short-squeeze enthusiasts 2 Feb 2021 Melvin Capital suffered huge losses after retail traders pushed up the share prices of companies against which it had bet. Such traps can be avoided by using derivatives. And small investors will struggle to boost the value of larger companies in the way they did with GameStop.
Corona Capital: Exxon, Uber 2 Feb 2021 Concise views on the pandemic’s corporate and financial fallout: Exxon dodges M&A questions, while Uber guzzles up a beverage delivery firm.
UK’s austerity guru shows better timing as banker 2 Feb 2021 Ex-finance minister George Osborne will join boutique Robey Warshaw. His frugal policy in office, now derided, and few banking skills make him an odd hire. Yet political savvy is ever more critical in M&A given state meddling, and Covid-19 pressures herald a surge in dealmaking.
BP walks green high wire without a safety net 2 Feb 2021 The $72 bln UK oil major missed analysts’ expectations and announced a $6 bln annual loss. CEO Bernard Looney’s bigger problem is that his firm’s shares have underperformed since he committed to wind and solar. Investors may be fretting that his pivot from crude is too violent.
Myanmar coup does China more harm than good 2 Feb 2021 Beijing has refrained from condemning the army’s ousting of Aung San Suu Kyi’s party. China may gain influence as Myanmar’s largest trading and FDI partner. But the junta is unfriendly, and instability will dampen demand for Chinese exports and undermine investment.
Hong Kong will ride China bulls beyond stampede 2 Feb 2021 A market frenzy has made the city’s stock exchange the world’s biggest at $82 bln and helped online broker Futu’s shares more than double this year. Valuations are frothy, but mainland rule changes should gird both the bourse and traders when momentum subsides and bubbles pop.
Guest view: Concrete and the carbon challenge 1 Feb 2021 Cement accounts for about 7% of global CO2 emissions. Yet the world will need more of it to make the concrete to build lower-carbon energy infrastructure. The industry can be part of a cleaner future, says Dinah McLeod, CEO of the Global Cement and Concrete Association.
Sports data a better bet than sports wagers 1 Feb 2021 Genius Sports, which collects live data for betting shops, is going public with a blank-check company for $1.5 bln. As U.S. legalized gambling grows and teams diversify revenue, data should become more valuable. Gaining an early advantage gives it an edge over future competitors.
Exxon-Chevron tie-up is right deal, tricky time 1 Feb 2021 A potential $350 bln mega-deal entices on paper with savings that could be valued as high as $20 bln. That would shore up both companies against oil’s darkening future. Exxon would need humility, though, and government a desire for a fossil fuel champion. Both are huge hurdles.
Biden’s relief package comes with political price 1 Feb 2021 Democrats want to go it alone on a $1.9 trln economic rescue. With a workaround they can probably pass some measures, like direct payments to households, even if Republicans protest. Minimum-wage hikes, though, may be out of reach. And the effect will be more ugly partisanship.
Retail silver punt brings real-world distortions 1 Feb 2021 The metal’s price leapt more than 11% to an eight-year high after online investors gave it the GameStop treatment. Unlike gold, consumption of the commodity is mainly driven by industrial usage. Volatility has potential for global consequences. It may also be harder to regulate.
LSE’s big deal makes its fortunes data-dependent 1 Feb 2021 The London Stock Exchange Group’s takeover of Refinitiv, which has closed after 18 months, lifts its value to $82 bln including debt. Most revenue now comes from charging for information, not handling trades. Investors aren’t giving CEO David Schwimmer full credit for the shift.
Corona Capital: Universal Music 1 Feb 2021 Concise views on the pandemic’s corporate and financial fallout: A Universal Music IPO could close Vivendi’s conglomerate discount.
Nintendo could reach next level in two-player mode 1 Feb 2021 Millions of homebound gamers helped drive quarterly operating profit up 36% to $2 bln. Despite hit franchises like Super Mario, the Japanese company depends on its Switch console, whose sales are peaking. Teaming up with partner Tencent in mobile would unlock steadier earnings.
Julius Baer can hit M&A trail after light penance 1 Feb 2021 The $13 bln Swiss private bank escaped serious penalties for money laundering sins and boosted net profit by 50%. That gives CEO Philipp Rickenbacher a strong foundation if regulators lift a ban on deals. Rivals EFG International or Edmond de Rothschild may be attractive targets.