Elliott double dips with pandemic fallen angel 31 Jan 2022 The activist is buying Citrix for $16.5 bln after shaking it up starting in 2015. Management turmoil, an ugly transformation, and missed pandemic opportunities left the software firm vulnerable. Plans to merge it with a similar enterprise company give Elliott a solid second chance.
Rogan deal blunts Spotify’s edgy podcast appeal 31 Jan 2022 The streaming service is slapping advisories on its shows after a Joe Rogan Covid-19 misinformation spat. The compromise stops CEO Daniel Ek looking like a censor, and cuts the risk of music subscribers tuning out. But the promise of balance in podcasts may reduce their allure.
Capital Calls: Antitrust game of chicken 31 Jan 2022 Concise views on global finance: President Joe Biden’s administration is hypersensitive to mergers that reduce competition. Sectors that have also experienced inflation may be top of the hit list – like poultry production.
Vodafone intruder adds hope to activist toolbox 31 Jan 2022 Shareholder Cevian Capital lacks obvious levers to boost the 36 bln pound telco’s performance. Consolidation in markets like Spain, Italy and the UK would lower costs and improve pricing. But success depends on competition watchdogs dropping their opposition to fewer operators.
Irish housing bind opens door to radical options 31 Jan 2022 The cost of renting in Ireland has soared, but so has the cost of buying a home. Regulatory reluctance to relax bank lending standards means demand won’t rise to help stimulate new supply. The impasse makes it more likely that leftist Sinn Féin may win the next election.
Elliott flub hurts Hong Kong investor activism too 31 Jan 2022 The pushy shareholder has thrown in the towel on its seven-year battle with Bank of East Asia. It looks like a costly defeat for Paul Singer’s firm. That an industry titan failed to break through family ties so prevalent in the city shows the hazards for similar campaigns.
Sony and Nintendo play FOMO video-game challenge 31 Jan 2022 The financially robust makers of PlayStation and Switch generally prefer only smaller deals. Upheaval is coming, however, with Microsoft’s $69 bln plan to buy Activision. As console sales peak, pressure will mount for Japan’s timid buyers to develop bolder M&A strategies.
Italy presidential race delivers least bad option 31 Jan 2022 Lawmakers backed incumbent Sergio Mattarella for a second term. This averts an implosion of the reformist executive of premier Mario Draghi, who had vied for the presidency. The status quo offers investors cover from Italy’s dysfunctional politics while an energy crisis rages.
Activists misdiagnose retailer disease 28 Jan 2022 Macellum wants Kohl's to break up, after activists similarly pushed Macy’s and Dillard’s. Carving up the $8 bln department store may help a takeover. But Macy’s activists have hit snags. And as Eddie Lampert’s plunge into Sears shows, financial engineering can worsen retailer woes.
Oil dims hope central bankers will walk fine line 28 Jan 2022 Brent crude topped $91 a barrel for the first time since 2014. Rate-setters can usually ignore temporary jumps, but not when inflation is already high. Fed boss Jay Powell and global peers will struggle to hike rates enough to curb price pressures without stifling growth.
Breakdown: Real profit and loss in the metaverse 28 Jan 2022 Mark Zuckerberg is on the case, and nascent virtual spaces like Decentraland could be the next social-networking hit. Breakingviews unpacks the metaverse, what it offers users and investors, and the risks.
Europe’s gas crunch can avoid worst-case outcome 28 Jan 2022 For a continent struggling with high energy costs, a Russian invasion of Ukraine would be a nightmare. But cutting off gas exports would also damage President Vladimir Putin. Barring a total boycott, liquefied gas imports and action by corporate buyers could limit the disruption.
Siemens Energy wind fix would be worth the money 28 Jan 2022 The German group may buy out minority investors at struggling wind-turbine subsidiary Gamesa. The 5 bln euro bill sounds steep, especially as the problems may be temporary. Yet Siemens Energy can afford it, and it would get to keep the upside for itself when wind power scales up.
Capital Calls: Netflix, Google-India 28 Jan 2022 Concise views on global finance: Netflix hints at deals by flagging the risks associated with potential acquisitions; Google’s $700 million investment in Bharti Airtel also reflects on Reliance.
SoftBank No.2 exit shows bad timing all round 28 Jan 2022 Marcelo Claure overhauled both Sprint and WeWork for the $70 bln conglomerate. His departure was at least partly about money, per media reports. Expecting a bumper payout as shares halved looks a poor move. But SoftBank is losing a key player just when steady hands are needed.
China’s Year of the Ox ends in equity abattoir 28 Jan 2022 Markets are lurching toward a bleak finish to the lunar year as indexes slump alongside global peers. Those who hoped mainland stocks would outperform as Beijing eases rates are cranky, but the decline accurately reflects reality for listed companies. That’s an improvement.
Beijing has shortcut to prop up real estate 28 Jan 2022 Regulators are trying to stabilise the market, but buyers are reluctant and economic stress is increasing. Sharp cuts to interest rates or easing up on property developers would sabotage deleveraging efforts. Relaxing heavy mortgage restrictions is an easier compromise.
Ambani brings big guns to India’s streaming wars 28 Jan 2022 The Reliance boss is close to a tie-up with James Murdoch and Uday Shankar that will turn his TV network into a formidable rival to Disney, Sony-Zee and Amazon. It’s likely to add more ammunition to the battle for content. That will please viewers but also lead to overspending.
Investors need to get used to working harder 27 Jan 2022 America’s economy expanded at a 6.9% annual pace in the last quarter of 2021. A healthy rebound supports the Fed raising interest rates soon. But the U.S. central bank faces a balancing act, and everyone else following markets will have to be more alert than before, too.
Congress is out of excuses on insider trading 27 Jan 2022 U.S. lawmakers have long avoided constraints on their investments despite obvious conflicts of interest. It undermines their criticisms of trades by Fed officials and corporate leaders. There's momentum finally to impose rules. The latest proposals might even have real teeth.
AT&T and Discovery’s tie-up has a Netflix quandary 27 Jan 2022 The telecom firm added 4.3 mln subscribers for its HBO service, soon to be part of a media joint venture with Discovery. But Netflix’s stock crash suggests streaming valuations have slumped. That takes some of the shine off “Succession” parent WarnerMedia’s upcoming union.
Facebook’s crypto demise is a missed opportunity 27 Jan 2022 The social network’s digital asset group is winding down under regulatory pressure. Though Diem Association’s links with Facebook proved toxic, ex-member firms like Visa could have made cryptocurrencies respectable. Meanwhile, watchdogs have done little to rein in riskier coins.
Apple supply shortages are a good problem to have 27 Jan 2022 Tech investors fear the pandemic pulled forward demand, especially for cloud-based companies. The $2.6 trln Apple has the opposite issue. Covid-fueled supply-chain woes have prevented it from satiating iPhone demand. Customer loyalty probably means these sales will come later.
Capital Calls: Blackstone, German chips, Guy Hands 27 Jan 2022 Concise views on global finance: The $140 bln group braces for falling asset values and rising interest rates; Berlin sends the wrong signal by ignoring a 4.4 bln euro offer for wafer maker Siltronic; Britain seeks to reverse the financier’s lucrative 1996 housing deal.
The Exchange: Hydrogen wave 27 Jan 2022 Can green hydrogen decarbonise big chunks of our economies? Air Products CEO Seifi Ghasemi, who’s backing the carbon-free gas in a major Saudi Arabia project, thinks so. He tells Lisa Jucca how his $61 bln group plans to be the world’s top green hydrogen producer in five years.
Deutsche CEO’s cost-cut ordeal is far from over 27 Jan 2022 Christian Sewing has hacked 2 bln euros of expenses since 2019, and the lender is finally paying a dividend again. Yet even if Sewing manages to hit his profit goals, his ambitions look subpar. The domestic retail and private banking units are prime candidates for further axing.
ESG fervour is weathering its first big storm 27 Jan 2022 Despite a U.S. greenwashing probe, Germany’s 7 bln euro asset manager DWS is seeing further green inflows. Investors’ zeal for funds that tick ethical boxes is outdoing concerns about their fine print and performance relative to dirty funds. Yet the worries aren’t going away.
MSC gives Lufthansa cover for Italian raid 27 Jan 2022 The shipping giant and German carrier want to buy Alitalia successor ITA, a boon for Italian taxpayers. A reported 1.2 bln euro price tag will surprise Berlin, which retains a 14% stake from a 2020 airline bailout. If MSC does the heavy lifting, the swoop is easier to justify.
Pushy 7-Eleven investors are welcome inconvenience 27 Jan 2022 The Japanese owner of the Slurpee-selling chain is under growing pressure to spin off struggling units and overhaul the board. There’s a risk of a frustrating battle like the one dragging out at Toshiba. A more receptive approach, however, could deliver Olympus-like results.
Korean retail investors prefer their value trap 27 Jan 2022 LG Chem and SK are spinning off prize units, hoping to shrink their conglomerate discounts. They have met heavy resistance from individual shareholders panicked about dilution. Buybacks and dividends would be more persuasive than jargon about unlocking value.