WannaCry exposes glitch in tech business model 15 May 2017 Britain’s health service was among users of Microsoft Windows hit by a virus because they hadn’t installed an update. This is, in theory, the user’s fault. But when customers are big, or the result of their negligence is grave, it’s the company that’s likely to end up bearing the cost.
Chinese yogurt bid warrants dollop of skepticism 14 May 2017 Mainland dairy giant Yili is prepping a gut-busting $850 mln bid for Danone's Stonyfield business. The price is tempting, but many Chinese U.S. purchases have soured. And Yili was recently thwarted by regulators at home. Danone has bigger interests to consider here than cash.
Ford shareholders in confused tizzy over strategy 12 May 2017 A 37 pct drop in the share price since Mark Fields became CEO should have owners asking questions, even if the carmaker’s valuation raced ahead of rivals who are now catching up. Railing against the family’s supervoting stock feels good but won't fix Ford's immediate issues.
Texas regulators once bitten, twice shy with TXU 12 May 2017 NextEra wants another shot at Oncor after local officials blocked its $18 bln deal to buy the transmission group caught in a 2007 LBO that went under. The Lone Star state reasonably wants Oncor protected, but creditors including Elliott are antsy, and a deal is better than limbo.
It isn’t easy being Barclays’ Jes Staley 12 May 2017 The UK bank chief is yet again in the spotlight after falling for an email spoof. After recent controversies involving whistleblowers and the blurring of work and outside interests, he is no doubt walking on eggshells. Breakingviews imagines a typical day.
Review: Piketty is more stimulating when he’s wild 12 May 2017 Too much of the economist's bestseller on inequality was standard-issue theory. As a new anthology of essays on the book makes clear, much is wrong or missing in his reasoning. A critic’s call for "wild Piketty" rings true. The topic needs a broad, multi-disciplinary approach.
China’s dealmakers edge out Trump in first round 12 May 2017 American cattlemen and financiers will get more access to mainland markets in exchange for chicken imports and a potential opening for Chinese banks. It's a good start but Beijing didn't give up much. U.S. negotiators will have to push harder if they want a better bargain.
EU could spoil Uber’s cross-country road trip 12 May 2017 Travis Kalanick’s ride-hailing service can be regulated like any other transport firm, according to an EU legal opinion. That actually changes little – many member states already do. The big difference is that it would puncture Uber’s fantasy of European single-market protections.
Relief offer hints at solution for Fannie, Freddie 11 May 2017 Regulator Mel Watt wants the housing-finance firms to rebuild their capital buffers to avoid fresh bailout risk. It’s a temporary band-aid while the administration ponders the firms’ legal status. Yet Trump’s Treasury should seize the idea as the basis for more-lasting reform.
Viewsroom: Comey ouster bad for business 11 May 2017 Donald Trump’s surprise firing of the FBI director could bog down policies from tax cuts to regulatory reform and even throw the rule of law into question. South Korea elects a new leader to put its own presidential scandal in the past. Plus: Coach goes shopping for Kate Spade.
Bombardier clears Canadian funds for takeoff 11 May 2017 In a rare revolt, pension funds ejected the train and plane maker's executive chairman. But it took a long downward spiral and outrage over pay to prompt action. A successful siege at a family-controlled national champion should inspire action elsewhere earlier and more often.
AIG goes back to the future for new CEO 11 May 2017 The $58 bln insurer may soon hire Brian Duperreault as its next boss. He has the experience, managerial clout, investor support and fintech nous that AIG needs. He’s also white, 70 and a former Hank Greenberg acolyte. Finding the next successor is Duperreault’s main task.
Cox: Nixon nostalgia missing from stock market 11 May 2017 Trump's sacking of FBI boss Comey has sparked worries about a crisis similar to the one that forced another Republican president out of the White House in 1974. A 40 pct decline in the Dow accompanied that ordeal. Investors don't seem to think history is repeating itself.
Australia hands U.S. timely infrastructure example 11 May 2017 An investor group is paying A$7.6 bln for 50.4 pct of Endeavour Energy, a New South Wales electricity distributor. It's an "asset recycling" model that raises private capital against established operations to fund new government investment. Trump's team should take note.
PPG might as well go hostile on Akzo 11 May 2017 It has little to lose by taking its $27 bln bid for the Dutch paint maker straight to shareholders. If Akzo invokes its poison pill, the deal falls away anyway. And if the U.S. suitor wins shareholder support, Akzo’s board will face enormous pressure to make the tie-up friendly.
Snap lays an egg worthy of Twitter nest 10 May 2017 The messaging app reported its first quarterly results showing a slowdown in user growth. That’s a worrisome trend since its lofty $27 bln value hinges on attracting more people. Meanwhile, rivals are co-opting features. The sheen of being the next new thing is fading fast.
Whole Foods board changes whet activists’ appetite 10 May 2017 The $12 bln organic-food purveyor is replacing more than half of its board, a step to appease Jana Partners. But the fund, with 8 percent of shares, wants a sale, and others are pounding the table. As long as Whole Foods same-store sales keep declining, they’ll stay hungry.
Time may join ranks of regretful M&A refuseniks 10 May 2017 Days after spurning takeover interest, the magazine publisher cut its dividend amid falling revenue. Some companies wisely go it alone, but many can't recoup deal-imputed value. With Time's shares trading 40 pct below one bid, it has a steep climb ahead to justify independence.
U.S. sheriff shoots own foot amid FBI skirmish 10 May 2017 The DOJ provided dubious cover for Director James Comey's dismissal, which risks undermining its moral authority overseas. U.S. prosecutors often step into cases, such as VW and FIFA, their counterparts won't. Foreign enforcers could now be more wary of providing necessary help.
Hadas: Solidarity is cure to Baumol’s cost disease 10 May 2017 William Baumol showed how differences in productivity put wage pressure on artists and other inefficient workers. The economist, who died last week, was right, but his analysis was too individualistic. The challenge is to find fair ways to share out the fruits of prosperity.