Evergrande’s liquidity trap gets stickier 1 Sep 2021 The distressed Chinese real estate developer doubled first-half profit by dumping assets, but delayed paying suppliers so long it’s struggling to complete projects. As property restrictions tighten, finding buyers for what’s on the books will be harder. Contagion risk is rising.
Ping An’s regulatory brush is terrible timing 1 Sep 2021 News of a probe into the Chinese insurance giant’s property holdings sent shares sliding. With the entire real estate sector under pressure, jitters are unsurprising, but it also comes amid a strategic shift in its core business. This makes reassuring investors harder.
BHP brawl tips why nickel will cost pretty penny 1 Sep 2021 The miner’s agreed deal for Noront must contend with billionaire Andrew Forrest. His Wyloo Metals’ new offer tops BHP’s by 27% and would keep the Canadian company listed. A hot market for electric-car batteries makes buying even rocky projects like ones in the Ring of Fire tough.
Capital Calls: SPACs’ defense, Zoom 31 Aug 2021 Concise views on global finance: Nearly 60 corporate law firms put their names to a rejection of recent suits against blank-check firms; the video-conferencing company reported slowing growth in the second quarter.
Ida’s effects will linger, but not in GDP figures 31 Aug 2021 Rebuilding from the hurricane should mean economic growth recovers quickly, based on past storms. But disasters hit personal wealth, and in this environment could pressure wages and materials prices. The opportunity cost of disaster spending, too, cannot be measured.
Robinhood is vulnerable to disruption 31 Aug 2021 The complex of brokers like Fidelity had every reason to be upended by Vlad Tenev’s platform. But U.S. regulatory scrutiny and government probes are a distraction for Robinhood management. If those troubles aren’t resolved quickly, a new Robinhood-like firm could swoop in.
Prosus pushes hard on Indian fintech door 31 Aug 2021 The tech investor is paying $4.7 bln for payment processor BillDesk. That transforms its PayU operation and provides a profitable base to extend credit. The multiple of 19 times revenue is punchy, but a fraction of Paytm. And it’s a strong foothold in a big emerging market.
Italian data land grab comes at a price 31 Aug 2021 Fintech group ION has upped its bid for risk intelligence provider Cerved to 2 bln euros. An overall premium of 45% reflects growing demand for financial information. Offloading Cerved’s debt collection unit, worth perhaps 400 mln euros, would help recoup some of the cost.
Xi’s anti-screen campaign will reshape family time 31 Aug 2021 Beijing has restricted kids to three hours of video games a week to combat addiction. The financial hit looks manageable for $575 bln Tencent and peers. But the president wants to drag children away from phones into healthier activities. Investors should brace for more measures.
Australia’s Chinese trade glass is only half full 31 Aug 2021 Punitive tariffs cost vintners Down Under access to one of their most lucrative markets. Treasury Wine’s results at least suggest there’s demand elsewhere for premium brands. Producers of cotton and other commodities will struggle to replace sales at similar margins.
Rivian $80 bln IPO valuation risks electric shock 30 Aug 2021 The 12-year-old electric-truck maker is well funded and has credible backers like Ford and BlackRock. Another, Amazon, will buy 100,000 of its vans. Still, a price tag that high allows no room for error for a nascent manufacturer driving into a competitive market.
Man Utd investors lose heads over Ronaldo signing 30 Aug 2021 The soccer club’s shareholders hailed the Portuguese striker’s return by adding $165 mln to its market value. The 36-year-old brings goals and commercial clout, but he also left former club Juventus with a higher wage bill. Investors are unlikely to share in his success.
Capital Calls: Bharti Airtel 30 Aug 2021 Concise views on global finance: The telecom operator’s $2.9 bln rights issue will widen the gap with its next rival.
Huarong’s shareholders brace for more beatings 30 Aug 2021 The Chinese asset manager lost $16 bln last year and its indebted offshore subsidiary is still bleeding. A planned state-led restructuring will give creditors relief but dilute equity investors. The stock, down 75% in three years before being halted, is due further correction.
Electric-car crash is double pain for Evergrande 30 Aug 2021 The Chinese property developer’s unit saw its equity value fall 90% in four months to just $8 bln. Founder Hui Ka Yan is adept at finding money when the going gets bumpy, but EV makers rely on high values to lure fresh funds. It represents a dead end for its indebted parent too.
Peloton investors rediscover gravity 27 Aug 2021 Gym-goers confined to their homes latched onto the cyber-exercise app last year, accelerating sales and use of the roughly $30 bln company's exercise machines. The cruising is over. It's no wipeout, but real-world bikers know they pay for every downhill with a climb.
Capital Calls: Forbes catches SPAC wave 27 Aug 2021 Concise views on global finance: The business brand and magazine has agreed to merge with a blank-check firm in a $630 million deal, upping its value since last time it changed hands.
Afghanistan’s financial lifeline may lie in Qatar 27 Aug 2021 The state needs help to prevent an economic collapse. If gas-rich Doha provided funds, as it has to other stricken regimes, it could embolden critics who claim it is too close to militants. But Qatar has a chance to avoid past mistakes and shore up its status as a power broker.
Business travel fixes risk grounding recovery 27 Aug 2021 The $1.4 trln industry of selling expensive plane tickets and hotel rooms to itinerant executives faces a bleak future as firms like HSBC slash travel budgets. Making ordinary customers pay more would bolster margins. But raising prices may also dampen an already slow revival.
Chinese tech tycoon gives de-SPAC new meaning 27 Aug 2021 Joyy’s founder wants to take the video-streaming outfit private in a mooted $7.8 bln deal. Having sold many of its businesses already, what's left is mostly a huge cash pile. A buyout of what’s effectively a blank-cheque firm at a 100% premium puts a wild twist on the M&A craze.
Guest view: Climate’s lessons for the water crisis 27 Aug 2021 Tackling carbon emissions is at last mainstream thanks to data, science, a clear message and plenty of capital. Martijn Wilder, co-founder of climate advisory and investment firm Pollination, argues that drawing on those can help alleviate worsening floods and water scarcity.
Axel Springer redefines trophy news asset 26 Aug 2021 The German publisher partly owned by KKR is adding Politico to its growing portfolio of U.S. properties. The newish political news organization punches above its weight in D.C. But the mooted $1 bln deal is pricy compared with Bezos' splurge for the august Washington Post.
Warby Parker proposes float sans Groucho glasses 26 Aug 2021 In an equity market full of disruptors claiming to change the world, the eyewear seller has a simple pitch: It provides specs more conveniently, for less. Growth is average, executive comp unoriginal, and listing direct to investors. At a $4 bln valuation, it’s easy on the eye.
Coty’s makeover is stuck at foundation stage 26 Aug 2021 New CEO Sue Nabi, who spent 20 years at L’Oreal, has cut the $7 bln U.S. beauty firm’s costs and revamped management. Pivoting CoverGirl to middle America also looks smart. Yet shrinking sales and $5 bln of net debt suggest Coty’s chunky discount to its French rival will persist.
Soothing Zoom filter will suit Powell speech 26 Aug 2021 The annual Fed confab, again forced online, is usually a place to make news. Last year, the chair outlined new thinking on the central bank's 2% inflation goal. Now reducing $120 bln in monthly bond purchases is top of mind. With Covid resurgent, reassurance is the safest course.
Capital Calls: Pennies matter to dollar stores 26 Aug 2021 Concise views on global finance: Low-margin U.S. retailers are suffering from supply-chain cost inflation, a direct hit to their business model.
Maersk’s green ships have first-mover disadvantage 26 Aug 2021 The $53 bln container giant is buying eight vessels powered by carbon-neutral methanol. Maersk gets a green halo, and customers could shoulder its increase in costs. The catch is that clean fuel alternatives currently in development are likely to be cheaper, and greener.
DWS greenwash probe could be ESG tipping point 26 Aug 2021 The German asset manager’s shares slumped 12% amid a U.S. investigation into alleged overstatement of its green credentials. A lack of consistent ESG metrics and terminology is a long-running, sector-wide problem. The desire to avoid similar attention could fast-track a cleanup.
Xiaomi is primed to scale Mount Microchip 26 Aug 2021 The $82 bln Chinese company shipped 53 mln handsets in the second quarter, overtaking Apple to become the world’s No. 2 producer behind Samsung. With greater heft, boss Lei Jun’s ambitions in semiconductors should be within reach soon. Favourable policies from Beijing will help.
Viewsroom: China’s push for common prosperity 26 Aug 2021 Markets have been hit by a series of crackdowns in private tutoring, data security and more. Underlying this is Beijing’s effort to limit rich excesses and boost middle-class wealth, which could curb the performance of the country’s biggest and best-known private companies.