WebMD gets second opinion on rollup strategy 24 Jul 2017 Back in 1999, the online health-information publisher united with another fledgling rival in a deal backed by Microsoft and Intel. KKR is now buying WebMD for $2.8 bln, far less than the earlier stock-swap valuation. This fresh merger with other websites may work out better.
Dearth of policy action dulls U.S. economic hopes 24 Jul 2017 Six months in, Donald Trump’s growth promises are getting downgraded. The IMF just cut its forecast for U.S. expansion, though the global outlook is holding up. Stocks stateside have underperformed other markets in 2017 and the dollar has fallen. For now, greatness is elsewhere.
Saudi oil cut would be a hit-and-hope strategy 24 Jul 2017 The kingdom’s pact with OPEC to damp output is crumbling and has failed to drain inventories, or boost prices, fast enough. One suggestion is to reduce its own exports by as much as a seventh to shock markets into submission. If that fails, though, Saudi would look impotent.
White House creates its very own jobs crisis 21 Jul 2017 Press Secretary Sean Spicer quit after the hiring of financier Anthony Scaramucci. Donald Trump also fired his FBI director, undercut his Treasury secretary and regrets his attorney general pick. Just as U.S. employers wrestle with labor participation, so too does the president.
GE’s new boss may find inspiration from Honeywell 21 Jul 2017 Jeff Immelt’s weak earnings swan song underscores the challenge for John Flannery atop the $222 bln industrial giant. Making quick progress on early goals is key, as Darius Adamczyk is doing several months in at Honeywell. With activists in both stocks, it should be a no-brainer.
Puppy love keeps IPO investors on the leash 21 Jul 2017 Snap's stumble, Blue Apron's disastrous debut and YogaWorks' yanked listing spelled doom for trendy, fast-growing businesses. Then shares of PetIQ jumped some 30 pct. More sensible pricing helped the maker of dog treats and medicine, but it also remains vulnerable to competition.
IPO baggage weighs heavier on ZTO 21 Jul 2017 A U.S. pension fund is suing the Chinese courier and its underwriters for inflating profit margins in its $1.4 bln New York debut last year. Shares have traded poorly since, and the company faces rising costs and fierce competition. Winning over sceptics will be even harder now.
Buyout firms bet $3.7 bln on fintech’s dicier side 21 Jul 2017 Blackstone and CVC’s bid for Paysafe fits with an M&A rush for financial technology. The UK-based payment processor has a penchant for the racy world of online gambling. Those risks may be better handled in private ownership. In exchange, the buyers stand to make a decent return.
Blackstone’s Asia move shows Eastern promise 21 Jul 2017 Blackstone plans to raise its first Asia private equity fund, Reuters reported, catching up with rivals like KKR. The timing looks smart, as toppy U.S. values make Asia look more attractive. Still, a correction in the region could give the global fund's investors a nasty shock.
Microsoft now benefits from fear it once instilled 20 Jul 2017 The software titan's transition into cloud computing has caused some pain, but strong growth in the latest quarter suggests the bold move is paying off. Burgeoning worries about Amazon's and Alphabet's dominance probably help. It's an ironic twist for once-almighty Microsoft.
Uber could one day end up like Yahoo 20 Jul 2017 The internet pioneer now called Altaba was worth more than $100 bln back in 1999. Holdings in Alibaba and Yahoo Japan eventually dwarfed its own business. After converting China and Russia operations into stakes in rivals, Uber and its $68 bln valuation may be on a similar path.
Viewsroom: Why U.S. tax reform is doomed, too 20 Jul 2017 Republicans’ failure to replace Obamacare throws into doubt Washington’s ability to keep other high-profile election promises, not least cutting corporate levies. Meanwhile, President Trump’s fuzzy agenda for reforming NAFTA could give Canada and Mexico more bargaining power.
GOP may get inside help to defang bank watchdog 20 Jul 2017 U.S. Republicans want to nix a key CFPB rule. Champions like Democratic Senator Elizabeth Warren will defend the consumer regulator created by the Dodd-Frank Act. But if Director Richard Cordray runs for Ohio governor, as seems plausible, the agency may soon wither away.
Unilever is half way there on Kraft challenge 20 Jul 2017 The Marmite maker has cut costs faster than expected, reducing ad spend and paying less to its suppliers. Its 20 pct operating margin goal looks reachable. Yet with U.S. rival Kraft Heinz free to reprise its hostile bid next month, volume growth is too low for comfort.
Publicis pleasant surprise flags ad world’s plight 20 Jul 2017 The French ad group’s top line grew 0.8 percent. But even that looks good: in the previous two quarters Publicis’ organic revenue shrank, and analysts were expecting it to do so again. The challenges to media buying make the industry’s low valuation look justified.
Crypto-currency deals recall an earlier tech craze 19 Jul 2017 A rash of initial coin offerings has raised $1.3 bln in 2017, much of it in the past month. These crypto-currency versions of an IPO bear the speculative hallmarks of the ‘90s tech boom. With untested managements and few if any investor protections, this wave may end just as badly.
Let venture capitalists subsidize your life 19 Jul 2017 Frustrated by an inability to invest in unicorns? Try another strategy. VCs and other investors lose money funding vendors of meal kits, car rides, music, data storage, and even household necessities. Here’s how to live well off Silicon Valley’s obsession with the future.
McCormick may struggle to digest $4.2 bln deal 19 Jul 2017 The $12 bln spice vendor is paying a fat 20 times EBITDA for the mustard and hot-sauce business of Reckitt Benckiser. With modest synergies in prospect, McCormick will need strong growth to pay down debt. Investors have reason to question the acquisition’s aftertaste.
Hadas: No auction often beats a bad auction 19 Jul 2017 Governments and Google are fans of auction theory, which teaches how to extract the highest bids for assets like radio spectrum or online ads. But the branch of economics cannot say if the price is fair. Auctions too often confuse consumers and tarnish the image of capitalism.
Morgan Stanley gives Goldman a lesson in diversity 19 Jul 2017 Stabilizing fixed-income trading isn’t the only way CEO James Gorman showed Lloyd Blankfein his tail for the second quarter in a row. His growing wealth unit helped, too. With the diversified firm firing on all cylinders, it is justifiably overtaking Goldman even on valuation.