Byju’s SPAC turns into India’s $48 bln IPO problem 20 Dec 2021 New Delhi is yet to allow companies to list directly overseas, so ed-tech star Byju’s is mulling a U.S. debut via a merger. Other startups will probably get creative too. It’s similar to the regulatory grey area that China’s tech giants exploited but are now paying the price for.
BNP Paribas left with an agreeable cash dilemma 20 Dec 2021 The French bank has sold its U.S. retail arm for 14 bln euros in cash. BNP could invest a 7 bln euro windfall in the business, or swallow a mid-sized traditional player in Italy, where it has a base. The risk is that it goes big in a funkier sector like payments, and overpays.
Rio Tinto’s new chair is an odd change agent 20 Dec 2021 The $105 bln miner has appointed Dominic Barton to run its board. China experience fits well with managing Rio’s key relationship, but scandal tainted McKinsey while he ran the consultancy. For a group trying to move on from its own controversies, it’s a strange choice.
Data hunters will be Big Pharma’s next prey 20 Dec 2021 Drugmakers such as AstraZeneca spend $160 bln annually trying to unearth new treatments for diseases like cancer. The winners will be those who can source and analyse data quickly. That makes artificial intelligence experts like Relay Therapeutics and Exscientia targets.
Big Meat will channel VW-Tesla in alt-protein war 20 Dec 2021 Elon Musk stole a march on automakers, forcing them to play catchup on electric cars. A similar dynamic could play out in real and plant-based meat. The likes of Impossible Foods have a Tesla-like lead, but old hands like Tyson and JBS can use M&A to play tortoise to their hare.
Capital Calls: Bundesbank, Biogen 20 Dec 2021 Concise views on global finance: The new head of Germany's central bank is a reassuringly boring choice; cutting the price of its Alzheimer's drug could help Biogen squeeze something out of what looks like a flop.
Alibaba climate tide can lift valuation boat 20 Dec 2021 The e-commerce titan, whose market worth has halved this year, has unveiled bold 2030 carbon neutrality goals. Notably, it wants to widen the scope of consumer and merchant emissions it includes. Details will be key but longer term, the efforts could bolster shareholder returns.
Xi’s 2022 GDP target will be moment of truth 20 Dec 2021 One of the Chinese president’s signature policy initiatives was to curb property-related risks. That implies slower but higher quality growth: 4% or so in 2022. Outside advisers are pushing for more. The final economic decision will signal the extent of Xi Jinping’s power.
Aussie climate ambition will restart at ballot box 20 Dec 2021 The $1.4 trln economy has all it needs to be an energy-transition leader, except a proactive government. The 2022 election will change that, making independent, global warming-savvy candidates the kingmakers. Stronger policy also will be lucrative for domestic and export markets.
Rare Oracle deal would be anything but spontaneous 17 Dec 2021 The software group might spend $30 bln on healthcare IT specialist Cerner. That would mark a shift from buying back $100 bln of stock in four years. But Cerner has been in Oracle’s sights for nearly 20 years. It’s the last company still available on a longstanding shopping list.
Scarce U.S. workers can be found on Etsy 17 Dec 2021 Millions of Americans ditched their jobs and became self-employed in the pandemic, with about 20% in retail. Outlets like crafts-seller site Etsy benefited. But businesses are strained and competing to pay for workers. Resolutions – like increasing immigration – only help so much.
Capital Calls: Wall Street texts 17 Dec 2021 Concise views on global finance: JPMorgan's $200 mln penalty for failing to keep records of bankers' private messages is hard to ignore.
KKR sends strong buy signal on European telecom 17 Dec 2021 The private equity firm is paying 1 bln euros for half of a Spanish fibre-optic network at a multiple of 22 times EBITDA. It already owns Madrid-based Masmovil, tilted at Dutch operator KPN in May and is stalking Telecom Italia. Eventually, public investors will get the message.
Europe tightens energy noose round its own neck 17 Dec 2021 Germany will not certify Nord Stream 2 until the second half of next year. The Baltic pipeline is a hugely flawed solution to Europe’s energy security shortcomings. But the main losers from delaying its launch are likely to be its own consumers, rather than Russia or Gazprom.
TSMC can fix Taiwan’s stalled green transition 17 Dec 2021 Referendums on a nuclear power plant and a fossil-gas terminal spotlight the island’s 20% renewables target. Bureaucracy and red tape, though, have held up wind and solar projects. The local chipmaking champion’s voracious appetite for cleaner power offers a much-needed spark.
DJI is a more elusive U.S. target than Huawei 16 Dec 2021 Washington is putting a bigger squeeze on the Chinese drone maker by blocking American investment in the company. But unlike Huawei’s telecom gear, DJI products are widely used in the United States, including by police. Western rivals are tiny, making an outright ban tricky.
TPG flexes market-timing muscles with IPO 16 Dec 2021 The private equity firm has finally filed to list shares, nearly 15 years after Blackstone became the first LBO shop to IPO. Competitors like Apollo have grown more dramatically with a public currency as TPG missed the boat. But TPG, like Blackstone, has timed its listing with aplomb.
Trailblazing UK rate rise may pay off in the end 16 Dec 2021 The Bank of England is the first major central bank to hike its policy rate. The ECB faces less acute price pressures and the Fed must consider the job market alongside inflation. It’s a gamble, but acting now means British rate-setters will have less hiking to do in the future.
Reddit float feeds on meme stock craze 16 Dec 2021 The social network, long dwarfed by Facebook, has filed for an IPO. Retail traders have inflated user numbers and advertising revenue. Reddit might seek a $15 bln valuation, five times its worth three years ago. It needs to prove that a midlife resurgence won't become a crisis.
Byju’s SPAC deal is straight out of the textbook 16 Dec 2021 India’s edtech startup has an offer to go public at a $48 bln valuation. SPAC sponsor Michael Klein would invest in a private placement too, adding credibility to sales forecasts. Byju’s copies Grab’s deal outline, but growing U.S. revenue could help it fare better.
EDF picks doubly bad time for a nuclear wobble 16 Dec 2021 The 33 bln euro French energy giant shuttered four reactors, sending its shares down 14%. With European power prices soaring, it’s an unfortunate moment to be buying replacement power. And with nuclear’s role in the energy transition up for grabs, outages may turn more heads.
Viewsroom: China goes global, Harleys go electric 16 Dec 2021 Gina Chon assesses how China’s 20 years of membership of the World Trade Organization have played out compared to expectations in 2001. And Jonathan Guilford test-drives Harley-Davidson’s deal to merge its electric-motorcycle unit with a blank-check company.
Springsteen deal shows Boss has a financial touch 16 Dec 2021 The “Born in the U.S.A.” singer is selling his music rights to Sony for $500 mln. It’s well-timed: valuation multiples for songs are high, buttressed by cheap money, and growth in online streaming may slow. Buyers’ hungry hearts will lead artists to a monetary promised land.
Embracer rolls the dice in $3 bln board-game play 16 Dec 2021 The $9 bln Swedish video-game firm is buying France’s Asmodee, maker of tabletop titles “Catan” and “Pandemic”. The price looks fair against rival Hasbro, and tie-ups between old-school and newfangled gaming have worked. But a lack of synergies makes a winning return tricky.
KKR can still find gems in Telecom Italia’s wreck 16 Dec 2021 Chopped into bits, the struggling Italian telecom operator may be worth 38 bln euros including debt. Its network alone, in which its U.S. stalker has a stake, is probably worth almost half that. A breakup may add a quarter to the fund’s 10.8 bln euro prospective offer.
Shanghai’s tech board gets welcome IPO flop 16 Dec 2021 The biggest listing on the overheated STAR market this year bombed as shares of biotech giant BeiGene fell 16% on their debut. That finally adds risk to a once-safe bet on triple-digit first-day pops. Regulators fretting about the speculative stock mania can relax a bit.
Capital Calls: McDonald’s makes ex-CEO pay 16 Dec 2021 Concise views on global finance: The fast-food chain settled its lawsuit with ousted boss Steve Easterbrook, recovering compensation now worth $105 million.
China’s metaverse will be a tiny place 16 Dec 2021 Stocks in local companies associated with digital worlds blew up in 2021. The country’s video-games industry, tech expertise and masses of disaffected youth make it an ideal place to push the bleeding edge of virtual reality. That’s precisely why Beijing is squashing it.
Big Wall Street bonus pools may be hard to drain 15 Dec 2021 As revenue has rocketed amid friendly markets, so has banker pay this year at Goldman Sachs, JPMorgan and peers. Big payouts will help them compete not just with each other but with fintech and crypto firms. The catch is that the talent may start to expect it every year.
New Fed dot plot joins unreliable post-Covid data 15 Dec 2021 The U.S. central bank’s signature chart of interest-rate expectations now foretells three hikes in 2022. But the forecasters will change as three seats on the Fed’s board open up. Other economic reports and the recovery are also hard to interpret. The dots are far from settled.