Americas

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.

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.

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.

Review: Trapped inside Big Tech’s “Uncanny Valley”

24 January 2020

Anna Wiener slams the industry’s godlike power in her new memoir about Silicon Valley’s recent gold rush. But the book mirrors what it mocks, largely reducing people to their social media posts or buying habits. It shows how impossible it is to escape the Bay Area’s long shadow.

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.

U.S.-France digital tax truce could easily unravel

23 January 2020

Treasury Secretary Steven Mnuchin is no longer demanding that any global Big Tech levy be optional, while Paris will delay collecting payments from groups like Google. That was the easy part. Even basics, such as how much to charge such companies, will be harder to hammer out.

PG&E is squandering its bankruptcy

23 January 2020

The California utility’s latest restructuring plan helps wildfire victims and insurers. But PG&E would be left more indebted than when it started, and the Golden State has punted tough decisions. Being reliable, green, cheap and profitable at the same time remains a challenge.

Boeing needs MAX insurance more than a dividend

22 January 2020

The $175 bln aircraft giant’s new CEO, David Calhoun, says he won’t cut its $4.6 bln a year dividend. Yet Boeing will burn cash as long as the 737 MAX remains grounded. Borrowing more can paper over problems, but cutting the payout would be prudent in case of further delays.

GM’s investors school Tesla’s on self-driving hype

22 January 2020

Shares in Mary Barra’s $50 bln carmaker barely budged after it unveiled its autonomous vehicle, yet the potential of similar technology helped Elon Musk’s outfit to top $100 bln in market value. Considering true self-driving remains a long way off, GM’s owners are more realistic.

Billionaires’ cash wins over critics in U.S. race

22 January 2020

Mike Bloomberg and Tom Steyer boosted their presidential poll ratings after doling out a total of $380 mln for political ads. That’s more than twice the outlay of all other contenders combined. But Bernie Sanders’ small-donor approach may well prove more potent in the end.

Xerox’s HP bid walks, quacks like Carl Icahn

22 January 2020

The printer maker may try to oust most of HP’s directors to win support for its $33 bln merger proposal. HP’s intransigence isn’t constructive, but its board is stronger. A proxy fight could leave Xerox activist Icahn in control, with only a small share of the company.

Banks feel the heat of global warming in Davos

22 January 2020

Climate change is the hot topic at this year’s Swiss mountain gathering and financial institutions are in the spotlight. Large investors like BlackRock can force some changes. But regulatory pressure on lenders to manage the risks of a warmer planet may prove more effective.

Alstom-Bombardier rail M&A would face faulty track

22 January 2020

The $11 bln French train maker and its Canadian rival are discussing a deal, Bloomberg reported. The former’s failed deal with Siemens posed more obvious EU antitrust issues, but Brussels may still balk. And synergies that rely on big job cuts in France will be politically toxic.

How Jamie Dimon can grab Larry Fink’s green halo

21 January 2020

Now that the BlackRock boss has got serious about climate change, the focus is on his JPMorgan peer. As CEO of the biggest U.S. bank, Dimon’s sway over corporate debt gives him more power than any equity activist. Deploying it would turn his bank from laggard to leader.

Netflix investors risk ruing streaming-stock binge

21 January 2020

Reed Hastings’ firm has little if any need for TV ratings, box-office sales or ads, unlike rivals. Shareholders focus on subscriber and revenue growth, fueling its stock-market success. But a slowdown in new users and an excessive, if declining, cash burn put that under threat.

Vale dam cleanup hints at miners’ rising ESG bill

21 January 2020

The world’s top iron ore producer faces criminal charges for a deadly 2019 dam collapse. It has spent billions on reparations and safety upgrades, and seen its share price stumble. The total financial hit is yet to become clear, but other resources firms will face reckonings too.

Democratizing U.S. data access has drawbacks

21 January 2020

Plans to change how journalists handle some releases, including the crucial jobs report, aim to ensure traders and the public get them at the same time. But markets may become jumpier. And those with big bucks will still contrive to get the data a few microseconds sooner.