Pork feud stirs up another giant China risk factor 26 Aug 2021 WH Group is embroiled in a nasty clash with the octogenarian chairman’s son, who alleged financial misdeeds after being ousted. Denials didn’t prevent $2 bln of lost market value. Succession quandaries in graying corporate China add one more item to a growing investor checklist.
Gig-work startup is bad fit with today’s SPACs 25 Aug 2021 ShiftPixy, a temporary-employment app whose shares, floated in 2017, have lost 99% of their value since, has cut the funding target for four blank-check vehicles it is sponsoring. It looks like a last-ditch effort to score in an indiscriminate SPAC market that no longer exists.
Old-timers’ property brawl needs knockout blow 25 Aug 2021 Barry Sternlicht’s Starwood is trading bids with Chicago veteran Sam Zell for $2 bln U.S. industrial real-estate outfit Monmouth. The increments are too small to be decisive. The Monmouth board is sticking with Zell for now, but it's time for a best and final punch from each.
Dating outscores gaming in app store showdown 25 Aug 2021 A U.S. judge is considering an antitrust suit against Apple’s online shop as lawmakers pile pressure on the iPhone maker and rival Google. Despite games dominating their outlets’ $111 bln in annual sales, a cut in the tech giants’ 30% fee may boost daters like Match more.
Financially isolating Afghanistan is pointless 25 Aug 2021 Much of the budget has evaporated with the abrupt halt on aid, and an effective U.S. freeze on central bank reserves is compounding the chaos. An economic collapse will only fan extremism and refugee outflows. Targeted support is urgently needed to preserve development gains.
Capital Calls: Delta Air Lines’ vaccine stick 25 Aug 2021 Concise views on global finance: The U.S. carrier will charge unvaccinated stateside employees $200 per month towards healthcare. Adding some push to the pull of incentives makes sense.
KKR’s Aussie lenders are short of investor credit 25 Aug 2021 Pepper Money and Latitude have shown they can weather pandemic lockdowns and thrive thereafter. Even so, the two non-banks backed by the buyout shop are trading below their IPO prices earlier this year. Some caution is warranted, but the discount to bigger peers looks overdone.
Pinduoduo’s largesse masks bigger profit problem 25 Aug 2021 China's $124 bln e-commerce group swung into the black in the quarter as it reduced subsidies. But slowing growth, alongside a $1.5 bln philanthropic pledge in rural projects, suggest that is not sustainable. Beijing’s crackdown on the sector has also emboldened rivals like JD.
Riches await BlackRock in demystification of DeFi 24 Aug 2021 Trading crypto on non-traditional platforms, or decentralized finance, exploded 10-fold to $150 bln this year. But a recent $610 mln hack shows dangers. The growth threatens traditional financial firms. BlackRock and others can reshape speculative aspects if they join the fun.
Federer injects Swiss topspin into On sneaker IPO 24 Aug 2021 The trainer maker favored by The Rock and First Lady is bypassing Zurich for New York, with a mooted valuation of some $6 bln, a pack-leading 7 times sales. Athleisure wear is a crowded space, but On is growing fast. Like its marathoning clients, it’ll need endurance on its side.
The Exchange: Ron Johnson, Apple store retail guru 24 Aug 2021 He helped transform Target, opened the first Apple store, but failed to save J.C. Penney. Now Johnson is turning his attention to mobile stores. He tells Jennifer Saba about his new venture, Enjoy, and explains how e-commerce is changing everything.
Santander performs an acceptable U.S. U-turn 24 Aug 2021 The Spanish bank is paying $2.5 bln to buy out a 20% minority stake in its profitable U.S. consumer financing arm. It only listed the business in 2014, and has had to hike its offer price. But Santander is doing the same deals elsewhere, and it makes capital and earnings sense.
Capital Calls: Cook defeats Apple crumble risk 24 Aug 2021 Concise views on global finance: The CEO replaced the ailing Steve Jobs exactly 10 years ago. Despite fears at the time, Cook’s must be one of the most lucrative successions of all time for shareholders.
Beijing and ByteDance are killing a video-app star 24 Aug 2021 Kuaishou has shed $190 bln from a peak struck shortly after its February listing. Its adjusted net loss is forecast to hit $3 bln this year as it struggles with regulators and TikTok’s owner. Barring a turnaround, it may prove to be China tech's shortest-lived flash in the pan.
Branson’s second space SPAC draws awkward parallel 23 Aug 2021 Virgin Orbit, an offshoot of Galactic, inked a blank-cheque deal valuing it at $3.2 bln. With just three successful satellite launches, the projections are a leap of faith. But Orbit is using Galactic’s inflated multiples for validation. It underscores SPACs’ otherworldliness.
Instacart aims to deliver ads as well as groceries 23 Aug 2021 The online shopping service is valued at nearly $40 bln. Going public is on the firm's list, and tech unicorns like their price tags to ratchet upward. New ex-Facebooker boss Fidji Simo hopes to justify that with lots of advertising dollars. She'll need to grab market share fast.
Capital Calls: Pfizer M&A, Uber driver status 23 Aug 2021 The drugmaker has agreed to acquire Trillium Therapeutics for $2.3 billion, looking to its broader post-coronavirus strategy; a California judge has struck down a law exempting tech companies from treating drivers as full employees, complicating their push to keep costs down.
China’s middle-class push has luxury silver lining 23 Aug 2021 President Xi Jinping’s plans to rein in the super-rich may mean more, not less, conspicuous consumption. With China accounting for 40% of designer demand, LVMH and others are nervous. But wealth reallocation may swell the ranks of bourgeoisie. The luxury selloff looks excessive.
Sainsbury’s surfs wave of UK retail FOMO 23 Aug 2021 The British supermarket’s shares jumped 12% on Monday on rumours of a private equity bid of over 7 bln pounds. The feeding frenzy around rival grocer Morrisons guarantees thwarted bidders on the rebound. As with that saga, buyers should fear overpaying as much as missing out.
China market woes put hedgers in the driver’s seat 23 Aug 2021 More policy and regulatory pressure erased $560 bln of market value in a week. Some investors may flee as former darlings are hit. But many state-owned stocks are hurting less, and Monday cheer for a new offshore futures contract suggests more rethinking than a general retreat.
Hollywood’s China romance withers faster 23 Aug 2021 Films like Disney's "Black Widow" are conspicuously absent as cinemas in the People's Republic reopen. The delay coincides with Beijing's heightened ideological censorship and rising nationalism. Tinseltown's already-shaky courtship looks headed for the rocks.
Ackman’s SPAC inconveniences everyone 20 Aug 2021 The hedge fund manager aimed to have the biggest and most shareholder-friendly blank-check firm. After a deal setback and a lawsuit, he’s hoping to return $4 bln to investors early. His novel ideas have become a burden for them, for him, for regulators and even for other SPACs.
Companies offering child care get grown-up payback 20 Aug 2021 The pandemic has deterred women from working. U.S. employers are short of workers and long on office space. Patagonia, for one, says providing for employees' kids is worth it over time, and government aid can extend the perk to lower-income staff. It’s a teachable moment.
Capital Calls: Salmon, M&S, Sydney airport, BHP 20 Aug 2021 Concise views on global finance: SalMar places $1.3 bln order for Norway Royal Salmon; the UK retailer’s improving fortunes may ward off predators; the Australian firm provides scant evidence for rejection of a $16 bln takeover bid; Santiago dings the Aussie miner over water use.
Morrisons’ epic saga could use a short circuit 20 Aug 2021 CD&R’s 9.7 bln pound swoop gazumps Fortress and extends the already-lengthy bidding war for the UK grocer. A UK Takeover Panel auction, as proposed at inhaler maker Vectura, might help. Given the increasingly paltry returns if things drag on, bidders might even welcome it.
Sex toy unicorn gets into the wellness fetish 20 Aug 2021 UK online vibrator seller Lovehoney is buying Germany’s Wow Tech to form a $1.2 bln “sexual wellbeing” group. Their punters love e-commerce and aren’t too price sensitive, boosting margins. Asian markets are also losing their scruples. An IPO would be the ultimate taboo breaker.
Evergrande’s restructuring clock starts now 20 Aug 2021 The central bank has issued a rare warning to the troubled developer to reduce debt risks, a hint to speed up non-core asset sales. That should calm investors as founder Hui Ka Yan sheds stakes in electric cars, a bank, and more. What will be left, though, looks disappointing.
Telecom floor price threatens toppy Indian tech 20 Aug 2021 Mobile operators want regulators to impose minimum rates to help ease financial stress. Without higher charges, Vodafone’s local unit might struggle to repay debt. Rational tariffs, however, would hurt the voracious data consumption underpinning soaring tech valuations.
Bill Ackman’s SPAC is a treat that is going moldy 19 Aug 2021 A shareholder is suing the hedge fund manager, claiming his blank-check company acted like an investment company and should be governed as such. U.S. regulatory ambiguity creates scope for such disputes. Clearer guidelines would help, but for now, some managers will be deterred.
Capital Calls: Amazon, Robinhood, GlobalFoundries 19 Aug 2021 Concise views on global finance: The e-commerce giant may open its own version of department stores; contrary to the stereoptype, Robinhood IPO buyers may be holding rather than flipping; a successful IPO by chipmaker GlobalFoundries would bolster the case for an Arm listing.