KKR makes public bet on private credit 11 Dec 2017 Henry Kravis’s buyout shop is cutting in on Blackstone to create an $18 billion middle-market lender with FS Investments. It’ll be the largest concern of its ilk – but a small fish in the bigger leveraged-loans pond. Success rides on rivals not dipping too far below the surface.
Canadian Solar CEO deserves some shareholder shade 11 Dec 2017 Shawn Qu is offering a 7 pct premium to take the renewable-power firm private. It’s a cutthroat industry. But medium-term demand is strong. And Canadian Solar stock surged more than two-fifths this year. Investors should have no qualms forcing Qu to put more energy in his bid.
Xerox’s paper jam may be beyond even Icahn 11 Dec 2017 Activist Carl Icahn’s representative is leaving the board of the $7.5 bln copier company. He plans to nominate a new slate. Though his gripe is unclear, printers are having a tough time in a digital world. Short of a sale, small quibbles won’t do much.
Trump’s anti-WTO rhetoric hurts America first 11 Dec 2017 U.S. trade chief Robert Lighthizer has a tough message for the body’s biennial confab. The White House is also blocking new WTO appellate judges. Reforms are needed but America has won most of its complaints, including against China. Weakening it has consequences for U.S. firms.
Bitcoin futures set scene for more gambling 11 Dec 2017 The 20 pct surge on new CBOE cash-settled contracts is sedate by crypto-currency standards. There’s still cause for concern. Rather than being a useful hedge, futures make it easier to trade bitcoin without actually owning it. For now they have little utility beyond speculation.
U.S. hands HSBC CEO perfect going-away gift 11 Dec 2017 The end of a five-year agreement over money-laundering lapses removes the threat of authorities yanking the bank’s U.S. licence. HSBC devoted 8 pct of its operating expenses to compliance last year. Though those costs will stay, departing boss Stuart Gulliver can leave on a high.
Steinhoff is priced for unvarnished truth 11 Dec 2017 An accounting scandal and debt downgrade has cast doubt over the furniture maker’s future. Retail assets and investments should comfortably cover net debt of 6.5 billion euros. With shares down 80 percent in less than a week, however, investors are anticipating more bad news.
Uber’s taxi U-turn sets better Southeast Asia path 11 Dec 2017 Co-founder Travis Kalanick used derisive terms to describe the regulated industry he was trying to upend. Uber's new boss, however, just struck a deal with Singaporean taxi company ComfortDelGro. The JV should help it pare losses and compete in a tough market with rival Grab.
The Exchange: Marcus Ruiz Evans 8 Dec 2017 The president of Yes California leads a campaign arguing that the Golden State should become an independent country – an idea increasingly referred to as Calexit. He explains why secession would be good for the state’s economy and how he’ll get the rest of the nation to buy in.
Crude-backed crypto-coin is mostly snake oil 8 Dec 2017 An ex-CFTC commissioner is launching a digital currency backed by the commodity. His promise of stable value sits oddly against bitcoin’s wild ride. While it offers a tax edge over oil-backed ETFs, it’s hard to imagine this coin existing if not for the wider crypto craze.
Elliott tries curing $25 bln biotech’s independence 8 Dec 2017 Alexion prospered selling niche drugs at stratospheric prices, until hit by a botched deal, sales improprieties and a thin pipeline. Replacing its CEO hasn’t helped and the stock is nearly half its peak. The activist’s push to shape up or sell is just what the doctor ordered.
Shareholder ethos holds back U.S. wage growth 8 Dec 2017 The U.S. economy added more jobs than expected in November but wage growth remained tepid. President Trump claims the GOP tax bill will lead to big raises but most companies plan to spend profit on buybacks and dividends. When the market is king, workers tend to come last.
Fed forecasts just enough sunshine for stress tests 7 Dec 2017 The central bank wants to provide more information about its models for loan losses and other inputs in the annual exams. That would suit lenders who complain the process is too opaque. But the Fed would retain some mystery, striking a balance that boosts the test’s credibility.
Fossil-fuel slowdown spreads pain at GE and beyond 7 Dec 2017 The conglomerate is laying off 12,000 people in a power division that lights up 30 percent of the world. It blamed overcapacity amid a shift from coal and gas to renewables. Other divisions closely tied to fossil fuels are also ailing. GE’s woes suggest a wider shakeout ahead.
Viewsroom: Executive payouts in rude health 7 Dec 2017 Aetna CEO Mark Bertolini is bagging $500 million from selling the insurance company to drugstore chain CVS – despite only a middling performance as boss. Behind such healthcare mergers: a desire to cut out a surfeit of middlemen.
New bank rules are kind without being weak 7 Dec 2017 Big lenders will need a trifling 27.6 billion euros of fresh equity capital under new Basel regulation. Rules on the use of internal models are no worse than feared, and kick in slowly. This is hardly draconian – but that’s because banks have already done much of what was needed.
Bitcoin looks like speeded-up unicorn hype 7 Dec 2017 A sheen of futurism, fear of missing out, a lack of fundamental value, and an inability of big backers to sell without crashing the market are factors pumping up the digital currency’s price. It’s like accelerated startup funding rounds. The danger is a Theranos-like bloodbath.
Citi’s $20 bln writedown would be just the ticket 7 Dec 2017 That's how much planned U.S. tax cuts may cost the bank. In theory, investors should be up in arms. But being forced to dump tax credits of questionable real-world value should actually boost Citi's returns - eventually.
UK gender pay data needs rigorous audit 7 Dec 2017 Some British companies have suspiciously reported no gap between the pay of male and female employees, the Financial Times found. The government thought transparency would help close the divide. To be credible, though, the data must be audited – and offenders punished.
Walgreens gets in early on healthy growth in China 7 Dec 2017 The U.S. chain is paying $416 mln for 40 pct of peer GuoDa. A sensible shake-up of drug distribution and sales by Beijing is spurring consolidation and giving pharmacies a stronger hand. This deal gives Walgreens market insight and could be a springboard for more investment.