BREAKINGVIEWS

China puts Washington into awkward M&A role

24 January 2020

The government faces the temptation to broker new tie-ups to mitigate the blacklisting of telco Huawei, and unwinding of China-related mergers. True, Beijing-bashing could inspire other deals: think Cisco buying Nokia. But Washington is better as an onlooker than a matchmaker.

Bayer settlement only slightly eases Monsanto pain

24 January 2020

The German chemicals group may spend $10 billion compensating alleged cancer victims of its acquisition’s Roundup weed killer. That would be better than CEO Werner Baumann’s worst fears. But it barely makes his ill-starred $66 billion deal look any better.

Progress can’t dispel viral risk to world GDP

24 January 2020

It has been decades since a pathogen as frightening as new coronavirus has spread. Biotech advances and China’s modernization helps catch diseases earlier, but easier travel speeds dispersal. Vaccine development is slow. Economic damage, from mild to $3 trln, is up to chance.

UK belatedly bares antitrust teeth over tech M&A

24 January 2020

Competition authorities may probe Takeaway.com’s Just Eat deal, even though the buyer doesn’t operate in Britain. As with its Amazon-Deliveroo inquiry, the regulator’s logic borders on paranoia. That’s better than the naivety it showed with Facebook’s 2012 Instagram purchase.

Ericsson gives glimpse of pain from 5G squeeze

24 January 2020

An earnings hit from a U.S. mega-merger is only one headache for the $28 bln Swedish telecoms firm. Britain appears to be throwing a lifeline to Chinese rival Huawei. And mobile operators are pushing hard to break the pair’s grip over the $500 bln market for next-generation kit.

Remy Cointreau’s woes are weighty but temporary

24 January 2020

The spirits maker is relatively more exposed to Hong Kong and China, so protests hit sales harder. The coronavirus and U.S. trade war fallout add extra pressure. But with demand for pricey cognac on the up, Remy still deserves a premium to Diageo and Pernod Ricard.

Atlantia charts tentative path to road truce

24 January 2020

The $19 bln infrastructure group’s new boss wants outsiders to invest into its units. These include embattled motorway operator ASPI, which risks losing a rich road concession after a bridge collapse. Opening ASPI’s capital to state investors offers a way out of the crisis.

Wuhan virus will shape China’s smart city vision

24 January 2020

The metropolis of 11 mln is under quarantine. Big investments in healthcare, AI and even surveillance led by the $50 bln Hikvision and other giants could help curb future contagion risk. That might compensate for less tractable problems: human error and institutional weakness.

Hong Kong homecoming bets are only half a whim

24 January 2020

Trip and Baidu are mulling secondary listings in the Asian hub, following in the footsteps of Alibaba. Early evidence suggests that could boost valuations. For now, it’s more convincingly a hedge against any politically-driven crackdown on Chinese companies listed in New York.

SoftBank’s next problem: Sprint M&A interference

23 January 2020

CEO Masayoshi Son values his group’s stake in the U.S. carrier at $29 billion, a reflection of its original deal with T-Mobile US. Investors rightly take a dimmer view. Courts may block the deal. But even if they don’t, T-Mobile has a strong case to lower its price.

Wells Fargo fine is one half of a double deterrent

23 January 2020

Former boss John Stumpf will pay $17.5 mln for overseeing pervasive misbehavior at the U.S. bank. It may dissuade other executives from wrongdoing, but pales next to the $75 bln or so foregone by investors. That seems just, too: In some ways they were also asleep at the wheel.

Podcast deals put new spin on sorry old tale

23 January 2020

Spotify is collecting podcast content in addition to distributing it. The New York Times may be after hit series “Serial.” Splashy deals validate both talented productions and wannabe radio show hosts. But like blogs, low barriers to entry threaten valuations across the board.

Nelson Peltz plays important second fiddle at P&G

23 January 2020

Shares in the $315 bln consumer-goods company have jumped 36% since the activist snagged a seat on the board. But P&G’s success stems from plans CEO David Taylor had already put in motion. Encouraging execution, rather than offering new ideas, is working out fine so far.