Capital Calls: Microsoft, U.S. bank footprint 25 Jun 2021 Concise views on global finance: The $2 trillion software giant’s avoidance of antitrust scrutiny may be coming to an end; a new study challenges the received wisdom that American banks do better in faster-growing states.
Toshiba chair ouster risks strategic hold-up 25 Jun 2021 Shareholders have voted out the $20 bln conglomerate’s respected board chair in one of Japan’s biggest-ever corporate upsets. Yet toppling Osamu Nagayama, whose tenure post-dated the latest scandal, causes confusion and could delay the reforms sought by aggrieved investors.
Getlink’s Brexit blues may have happier M&A ending 25 Jun 2021 The $9 bln Channel Tunnel operator has been hit by travel curbs and reduced UK-France trade. Shares a fifth below pre-Covid peaks don’t reflect recovering traffic flows or duty-free sales. A decades-long concession increases the appeal to yield-hungry infrastructure funds.
South Korean retailer shops eBay to battle Coupang 25 Jun 2021 A unit of Shinsegae Group, which opened the country's first department store 90 years ago, is paying $3 bln for 80% of the U.S. company’s local business. It’s a bold attempt to challenge its fast-growing, domestic online rival. E-Mart’s big brick-and-mortar presence will help.
Indian cricket bowls toward financial big leagues 25 Jun 2021 RedBird Capital, backer of baseball’s Red Sox, is buying into the Rajasthan Royals, valuing the team at up to $300 mln. That puts it within reach of the top 30 European soccer clubs. The deal spotlights the Indian Premier League’s lucrative American-style commercial potential.
Bank buybacks return, hopefully not with a bang 24 Jun 2021 U.S. lenders will be able to resume big share repurchases after passing Fed stress tests. The biggest six banks could have $150 bln of excess capital. But there are reasons for them to tread cautiously, like a possible central bank reshuffle that could make future exams tougher.
Viewsroom: Wall Street is open again and booming 24 Jun 2021 From Morgan Stanley to BlackRock, the world’s top investment banks and money managers are back in their offices and super busy with mergers, IPOs, LBOs and other activities thumping. Plus, Soho House and Wise go public and green hydrogen megalomania on the Congo river.
Five reasons BuzzFeed’s $1.5 bln SPAC deal is LOL 24 Jun 2021 The once-hot digital publisher is merging with a blank-check firm and simultaneously buying a streetwear brand. The deal comes with a listicle of risks, from aggressive growth forecasts to a fickle audience and an ambitious valuation. Worried emoji face goes here.
Ackman’s un-SPAC elicits a shrug from investors 24 Jun 2021 Owners of the billionaire’s blank-cheque company get 10% of Universal Music, a possible future deal, and the right to buy into a novel acquisition vehicle. Yet the SPAC’s valuation premium has dwindled. Investors either dislike complexity or doubt Bill Ackman’s dealmaking talent.
Brunswick stake sale is step towards future deals 24 Jun 2021 The financial PR firm founded by Alan Parker sold 11% to private equity group BDT at a $700 mln valuation. The rejig will help fund expansion into new countries and areas like lobbying. But Parker and his co-investors will eventually want an exit. That means more transactions.
Mukesh Ambani the chameleon will easily go green 24 Jun 2021 After building the world’s second biggest mobile-data carrier and India’s top retailer, Asia’s richest man is ready to turn his $200 bln Reliance into a renewable energy major. A track record of impressive pivots gives it a decent chance of success, and merits a higher valuation.
Amazon’s lax policy on waste belongs in the bin 24 Jun 2021 The $1.8 trln retailer has been destroying millions of unsold items in the UK alone, ITV says. For now Amazon is benefitting from a lack of net zero emissions-style global standards on waste, and a grey area over unsold stock liability. It should be prepared for that to change.
UAE takes relaxed view of Deripaska sanctions risk 24 Jun 2021 Mubadala has bought 2.6% of En+ from the Russian oligarch’s ex-wife. The $243 bln Abu Dhabi fund is banking on the green strategy of the aluminium and energy group, which has taken steps to curb Oleg Deripaska’s influence. Still, the UAE is taking a punt that these controls work.
China’s prolonged credit-scoring saga amasses risk 24 Jun 2021 Ant may be trying to wriggle out of a co-op with rivals by forming a venture with state-owned companies. That would be better for the fintech giant, but not necessarily for the public. As consumer debt grows, Beijing’s inability to devise a decent system wastes precious time.
Capital Calls: Infrastructure, Doximity, Deliveroo 24 Jun 2021 Concise views on global finance: President Biden’s $1 trln bipartisan plan for U.S. infrastructure is a feat of political engineering. Meanwhile, medical-themed social network Doximity finds riches in niches, and UK delivery outfit Deliveroo serves up a favorable court ruling.
Self-driving truck race suffers from major traffic 23 Jun 2021 Embark, which automates big rigs, is worth $5.2 bln in a SPAC deal with smart-money PIPE investors and Trump’s former transport boss on the board. Its strategy might please shippers and truck-makers. The valuation isn’t bad. But competitive and regulatory roadblocks lie ahead.
Amusement parks inch to top of the market cyclone 23 Jun 2021 Companies like SeaWorld have seen a resurgence in customers paying full price to enter their parks. They’re spending more, too. With costs cut during the pandemic, it’s a sweet spot. But discounting and competition will return. Flush days will end. Valuations reflect neither.
Fate of U.S. mortgage giants only half clear 23 Jun 2021 The Supreme Court’s blow to Fannie Mae and Freddie Mac investors leaves a fuzzy future. Bill Ackman’s fund and others had insisted the government illegally confiscated earnings. What Joe Biden wants to do with the firms backing half America’s homes may have bigger consequences.
Soho House depends on IPO to keep the party going 23 Jun 2021 The private club founded in London in 1995 now has 28 outlets and 119,000 members. It’s also highly leveraged and loss-making. A $3 bln New York listing will fund post-virus expansion, but delay addressing the key issue of whether scale, profit and exclusivity are compatible.
Morgan Stanley vaccine edict is leverage at work 23 Jun 2021 CEO James Gorman’s decree that only the inoculated can enter his firm’s New York offices reflects reality – most employees are already vaccinated – but also clout. Wall Street is pretty well placed to dictate terms to staff. The return to work may be a rude awakening for some.
GSK rejig may still leave investors feeling queasy 23 Jun 2021 The $100 bln pharma group set a 5% sales growth target for its new medicines business. Offloading 80% of the consumer unit and loading it up with debt creates an $11 bln war chest, too. But both GSK’s drug pipeline and its under-fire CEO need to deliver for the new plan to work.
Volkswagen’s Tesla race hits wrong gear in China 23 Jun 2021 Boss Herbert Diess wants the country to account for much of the $156 bln German automaker’s electric-car sales by 2025. But VW is falling way short of this year’s target, despite an overall market-leading position. That bodes ill for hopes of challenging Elon Musk’s dominance.
Syngenta plants listing seed in rich Chinese soil 23 Jun 2021 The Swiss agrochemical giant’s Beijing-backed owners are cultivating a Shanghai IPO with a possible $60 bln valuation. That’s punchy. But with local investors desperate for global exposure and farm-produce prices soaring, an ambitious price tag may be achievable.
Profitability makes Wise a true fintech unicorn 23 Jun 2021 Like financial-technology rivals, the UK money-changing group has a snazzy app and disruptive business model. What sets it apart is healthy earnings. Big banks can’t match its service without parting with fees worth $250 bln a year. Smaller ones may end up using Wise’s service.
Capital Calls: Schwarzman’s double tax speak 23 Jun 2021 Concise views on global finance: The founder of Blackstone has a love-hate relationship with capital gains changes.
JD’s governance upgrade starts in Hong Kong 23 Jun 2021 The $112 bln e-tailer is adopting investor-friendly measures like holding annual meetings and allowing the board to convene without boss Richard Liu. JD now has a female director, too. The city’s listing rules are driving some changes, and more can be done. But it’s a start.
Tea chain IPO steeped with exuberance 23 Jun 2021 Nayuki's market debut should reflect the popularity of the beverage’s modern boba twist. The Chinese company could be valued at $4.4 bln, on a higher multiple of sales than Starbucks. Keeping the kettle hot without getting burned by expansion costs, however, will be a tough brew.
Money-market fund problems are bad pennies 22 Jun 2021 The usually safe investment vehicles have long confounded U.S. watchdogs. Mistargeted reforms years after the 2008 financial crisis helped amplify damaging redemptions in March 2020. Ensuring the SEC's latest revamp is a better one will take more courage than last time.
Biden becomes dealmakers’ no fun police 22 Jun 2021 The new U.S. president was meant to bring certainty to the antitrust environment after a tumultuous four years. But Amazon, Aon, Willis, and Live Nation have been caught in antitrust crosshairs. A bigger stick was expected, but the implementation of crackdowns is still a guess.
The Exchange: Roger Ferguson talks monetary policy 22 Jun 2021 The former Fed vice chair and ex-TIAA CEO joins Swaha Pattanaik to discuss how the central bank is navigating economic recovery and price pressures. He also talks about whether corporate America is living up to its diversity pledges and suggests strategies to speed progress.