Markets prove regulator’s point on Sprint/T-Mobile 30 Oct 2017 Antitrust authorities are skeptical a merger of the third and fourth U.S. wireless carriers will benefit the public. Verizon and AT&T shares fell on news the deal hit a snag. Investors are betting consolidation will produce higher industry profits at the expense of competition.
Russia mess sucks up U.S. economic bandwidth 30 Oct 2017 The first charges in the 2016 election-meddling investigation snagged President Donald Trump’s former campaign manager. That diverts White House resources better used elsewhere: namely reforming taxes, picking a new Fed chair and preparing for a high-stakes Asia trip.
Constellation Brands takes the party up a notch 30 Oct 2017 The Svedka vodka and Corona beer maker's mission is to "elevate life with every glass raised." By purchasing 9.9 percent of Canada's Canopy Growth for C$245 mln it can add tokes of marijuana to that vision. It's telling to see big booze beat big tobacco to the fiesta.
For-profit college deal textbook merger of equals 30 Oct 2017 Strayer and Capella are forming a company worth $1.9 bln as regulatory pressures force them to improve the quality of their degrees. Pooling resources, and slicing out $50 mln in costs, gives them a better chance to disrupt America's overpriced higher-education racket.
Utility merger rightly up against Texas brigade 30 Oct 2017 Vistra is buying Dynegy in an all-stock deal to create a power dynamo stretching from Texas to Maine. It makes sense for shareholders, but regulators in the Lone Star State are prickly. The firms will have to allay concerns that synergies will come out of consumers’ pockets.
Homebuilder $18 bln merger hits just enough nails 30 Oct 2017 Lennar has agreed to buy smaller rival CalAtlantic at a 27 pct premium, creating the largest housebuilder in the U.S. The logic seems solid, and the expected $250 mln in cost savings mean that Lennar can afford the markup, though with little left over to feather its own nest.
Axalta deal complicates Akzo’s juggling act 30 Oct 2017 Fresh from deflecting a takeover, the Dutch group is considering a merger of its paints unit with its U.S. rival. A combination makes sense. But new CEO Thierry Vanlancker is already grappling with weak results and a chemicals spinoff. That raises the risk of dropped balls.
Big Oil’s well-plugged holes do their job, for now 27 Oct 2017 Exxon, Chevron and Conoco all posted decent earnings for the third quarter. And they’re ramping up production - even Conoco, despite cutting capex. That’s proof their endeavors to adapt to $50-a-barrel oil are paying off. Improving from here, though, could prove tricky.
U.S. economy doing just fine without tax cuts 27 Oct 2017 Initial estimates show GDP expanded at 3 pct in the third quarter, despite the hurricanes. Increasing inventories helped, but global growth and healthy corporate earnings are other positive signs. Trump will take credit, but protectionist policies could put the trend at risk.
Treasury crowns asset managers, insurers victors 27 Oct 2017 Investment and insurance firms should be regulated for systemic risk based on their activities, not by specific entities, the U.S. department said. It also rebuked the global FSB for overreach with its stricter approach. The industries got nearly everything on their wish list.
Clariant-Huntsman gives way to post-activism chill 27 Oct 2017 The scrapped $14 bln merger between two chemicals makers is not worth mourning; Clariant has other ways to create value. The near-term risk lies in activist duo White Tale, whose 20 pct stake killed the deal. Investors can’t tell whether they will be a catalyst or an inhibitor.
China’s Belt and Road plan builds bridge to Canada 27 Oct 2017 Aecon is being sold to a Beijing construction titan for C$1.5 bln. The 42 pct premium should satisfy the target's investors and Canadian officials have little to squawk about. It's also a deal that can bypass China's M&A crackdown as it befits an infrastructure drive.
Aetna bid is a defensive prescription for CVS 26 Oct 2017 The drugstore and pharmacy-benefit company’s $66 bln offer for the health insurer should generate some savings. More important, it could help the firm resist Amazon’s entry into drug distribution, and the unpleasant side effects of transparency and low margins that may follow.
Generational shift augurs holiday blues for Mattel 26 Oct 2017 The toymaker’s shares tumbled after it posted a 13 pct quarterly sales drop and suspended the dividend. Toys R Us’ bankruptcy hurt Barbie and Hot Wheels, but American Girl, which sells direct to consumers, suffered even more. Digital kids are the nightmare of Christmas present.
It’s time for Alphabet to feature YouTube 26 Oct 2017 The platform is the leading U.S. video-streaming service, by one estimate, yet the Google parent provides few details. Its stock has underperformed rivals Netflix as well as Amazon and Apple, which are ramping up TV efforts. CEO Larry Page may want to shed more light on the unit.
Microsoft cashes in on corporate comfort 26 Oct 2017 Quarterly figures show a booming cloud business. The work world’s familiarity with Office, LinkedIn and other products makes it a natural supplier for many enterprises. This ease and economies of scale should enable the company to keep winning more of its customers’ computing.
Viewsroom: China’s leader cements his power 26 Oct 2017 President Xi Jinping emerged stronger at the end of China’s Communist Party Congress. His desire to consolidate control however may not help his plans to keep the Middle Kingdom’s economic engine humming. Plus: U.S. telecom firms try again to dial up a merger.
Heavy Amazon investment aims at rivals – and costs 26 Oct 2017 The $470 bln online giant’s third quarter again showed prodigious growth and a desire for more. CEO Jeff Bezos is pouring money into warehouses, gear and employees to beat Wal-Mart on the ground and Alphabet in the cloud. The bigger challenge may be outrunning rising expenses.
The Exchange: Mark Meadows 26 Oct 2017 The congressman and chair of the Freedom Caucus thinks neither Republicans nor Democrats have had success in being the governing party. The Exchange went to his office to discuss what that means for tax reform and other issues, and why members of Congress could lose their jobs.
Hadas: Greed is best indicator of financial crisis 26 Oct 2017 New research casts small-time property investors as the secret villains in the 2007 U.S. house price collapse. As usual, the love of leverage was the root of financial distress. Balance sheets are stronger today, but investors still haven’t learned the virtue of moderation.