James Gorman rubs Goldman Sachs’ nose in it 19 Apr 2017 Morgan Stanley’s CEO didn’t just hit his return target with a $1.8 bln first-quarter showing. A near-doubling of fixed-income trading revenue, the best of the batch of Wall Street bulge-bracket results, confirmed his chief rival made a mess of the first three months of the year.
Akzo’s go-it-alone plan has a rose-tinted hue 19 Apr 2017 The besieged maker of Dulux paint is wooing investors by breaking itself up and becoming more profitable. On paper, the strategy is superior to merging with U.S. rival PPG. In reality, lifting margins by a quarter until 2020, while cutting fewer jobs, looks a stretch.
Australia’s Tatts could wring more out of KKR team 19 Apr 2017 A buyout consortium has made a fresh attempt to gatecrash the betting group's takeover by rival Tabcorp. At $4.7 bln, this broadly matches Tabcorp in value. Hard cash is nice, but investors will forgo some potential upside. Tatts could open its books and push for a little extra.
IBM’s cloud provides little silver lining 18 Apr 2017 Big Blue fell short of investor expectations and reported its 20th consecutive quarter of falling revenue. Boss Ginni Rometty keeps talking up artificial intelligence and remote servers. Competition from the likes of Google and Amazon, however, is proving too formidable.
Holding: Cross-shareholding theories are overdone 18 Apr 2017 The latest antitrust fad says even the smallish stakes BlackRock and others own in multiple rivals can reduce competition. Studies arguing such holdings led to higher airfares sparked a U.S. investigation, but the evidence is weak. It looks like an answer in search of a question.
Cardinal sings out two more drug warnings 18 Apr 2017 The U.S. pill distributor said for the third time since October that falling prices would hurt profit. Cardinal Health underscored the hard times ahead by paying $6 bln for Medtronic's medical-supplies unit to diversify. Other links in the pharmaceuticals chain will suffer, too.
Buy American crackdown may hurt Build America push 18 Apr 2017 The White House wants to curb the use of foreign goods in U.S. construction projects and procurement. Disregarding global supply chains and relying on arcane definitions of what qualifies as domestic add risk of rising prices. The same is true of Trump's infrastructure plans.
Feds keep hunting big game in bank M&A 18 Apr 2017 U.S. regulators are permitting consolidation among smaller financial institutions. Capital One's revised deal – with a new partner and a lower price – for the credit-card assets of guns-to-tents retailer Cabela's, however, suggests that larger mergers are still in the crosshairs.
Goldman fintech revolution can’t come fast enough 18 Apr 2017 Only a tax break spared the $90 bln Wall Street firm a dreary first quarter. Its young online banking unit is growing fast, though. Eventually it could deliver far higher returns than the investment bank. Goldman's take on Main Street may be CEO Blankfein's best long-term hope.
BofA return to health limited by D.C. drip-feed 18 Apr 2017 A tight grip on costs and better fixed-income trading gains than Goldman helped the bank crank out an estimates-beating $4.4 bln of earnings. Rising rates helped, too, but CEO Brian Moynihan needs more help from the Fed and Donald Trump to boost its lowly return on equity.
Weetabix goes better with U.S. cereal than congee 18 Apr 2017 Bright Food is selling the UK breakfast staple for $1.8 bln. This trailblazing cross-border deal has gone soggy, with EBITDA flat over five years. Grape Nuts maker Post Holdings is a more natural owner than a state enterprise. For once, China's outbound M&A machine is in reverse.
Deal flop will force Anbang to fly low in the U.S. 18 Apr 2017 The $1.6 bln takeover of Fidelity & Guaranty Life is off, after the Chinese insurer apparently baulked at revealing ownership details. This, the latest in a string of failed deals from China, shows opacity can be as much of a deal-killer as inexperience or security risks.
Online retailers betray limits of the internet 18 Apr 2017 Websites like Amazon and furniture seller Made.com are opening physical showrooms so punters can look before they buy online. Being footloose remains better than having old retail’s cost bases. But the new entrants wouldn’t be hiking their own expenses if they didn’t have to.
Netflix content crown begins to fit comfortably 17 Apr 2017 The video service missed subscriber estimates yet still nearly hit 100 mln customers. The plan to spend billions on films and TV series like “Stranger Things” is helping to lift its base. But it's still far from able to justify a stock price trading at 130 times earnings.
Brazil’s Temer steers white-knuckle reform route 17 Apr 2017 The "Car Wash" corruption probe is increasingly denting the president's government as he tries to drive crucial changes to an unsustainable pension system through Congress. The nation's economic recovery may hinge on his ability to ease off the gas just enough to ensure passage.
Arconic CEO’s foolishness saves its board, for now 17 Apr 2017 Klaus Kleinfeld's unauthorized contact with Elliott Management in the midst of a proxy battle gave directors an easy excuse to let the poor-performing boss go. The affair, though, underscores the hedge fund's argument that the board bears much of the burden for the firm's woes.
Fed’s new bank overseer could rattle rates process 17 Apr 2017 Randal Quarles looks headed to lead regulatory oversight at the central bank. He worked at Treasury but left before the crisis. He's expected to have a pragmatic view, despite Trump’s Dodd-Frank dissing. He may make more waves on monetary policy with a rules-based approach.
Jack Ma gives rival a new way to win M&A fight 17 Apr 2017 Ant Financial's sweetened $1.2 bln bid for MoneyGram is 20 pct higher than rival Euronet's. Cost cuts alone can't justify a new counteroffer. Given Anbang's struggles to close its deal with Fidelity & Guaranty, Euronet is better off waiting to see if regulators clear the way.
Murder video puts lie to Facebook cleanup pledge 17 Apr 2017 Mark Zuckerberg's firm bungled its response to the grisly posting of a man being shot. The incident jars with the social network's promise to police fake news and other objectionable posts. Experienced editors, not algorithms, are the answer to Silicon Valley's content problems.
Alere discount diagnoses limits of deal desertion 17 Apr 2017 The U.S. medical-test company is selling for 9 pct less than first agreed. Buyer Abbott had threatened to walk away after Alere's billing practices and accounting came under fire. To settle such a good MAC test case suggests the M&A escape clauses are merely negotiating tools.