EU offers vitamin pill to dying media patient 26 Aug 2016 Brussels wants to give media the right to seek compensation from search engines like Google that use online content. The intention is laudable - some publishers may be losing out. But the proposal has similarities with schemes in Germany and Spain - which haven’t worked.
Detractors give central bankers too much credit 26 Aug 2016 Federal Reserve Chair Janet Yellen and other rate-setters stand accused of pursuing policies that only help the rich. Yet the supposed beneficiaries complain that loose money depresses returns and distorts markets. Both sides overestimate central banks’ control over the economy.
India’s Welspun is in a tangle of its own making 26 Aug 2016 The Indian firm's shares have nearly halved since customer Target alleged Welspun passed off cheap sheets as Egyptian cotton. Markets tend to assume the worst. Fuzzy language and absence of the CEO amplify the problem. Welspun is failing at the basics of crisis communications.
All that glitters in corporate finance isn’t gold 25 Aug 2016 Shareholders went nuts when jeweler Signet paid $1.4 bln for Zales in 2014, sending its shares way above the value of future earnings from the deal. Now it's unraveling, sparking a surprise injection of costly private equity, providing a useful reminder that most mergers fail.
U.S. labor unions look increasingly white collar 25 Aug 2016 A ruling that lets Ivy League graduate students organize will add to the growing share of cubicle-dwellers in the union movement. Education is one of the few sectors in which membership is increasing, albeit from a low base. The blue-collar stereotype is slowly fading away.
Credit Suisse broking fail comes at unhelpful time 25 Aug 2016 Rio Tinto has dumped the Swiss bank from a two decade-long corporate broking role. The departure of two bankers close to the company, and an advisory mandate for rival Glencore may have been factors. Credit Suisse needs client stability after months of strategic uncertainty.
Trump and Farage have one big thing in common 25 Aug 2016 Brexit cheerleader Nigel Farage says Americans may defy the elite by voting for Donald Trump, as Brits did by opting to leave the EU. Farage, like Trump, was loose with facts but accurately gauged public anger. Betting markets, investors and pollsters ought to heed the lessons.
Colombian peace may have a price before a dividend 25 Aug 2016 A deal to end 50 years of conflict with FARC comes at a difficult time. Oil output is shrinking and inflation proving stubborn. Tax reform before year-end should help but thousands of rebels also will now need jobs. Any financial benefit from the war's end could take some time.
Time for Peppa Pig’s owner to earn its chops 25 Aug 2016 ITV has pulled a 1 billion pound proposal to buy production group Entertainment One, after Peppa Pig’s owner said it was worth more. With the share price now well below the 236 pence approach, managers need a plan B. Luckily, there are ways to stack up their undervaluation claim.
Apple tax fight is two wrongs in search of a right 25 Aug 2016 A spat between the U.S. and Europe over how firms like the iPhone maker, Amazon and Starbucks pay taxes shows the worst of both sides. America meddles, and Europe moralises. At heart is an issue both sides’ citizens should support: big companies too often avoid paying their dues.
Iconoclasts needed to topple central bank targets 25 Aug 2016 A reboot of global monetary policymaking is the best thing that could emerge from rate-setters’ annual Jackson Hole shindig. An overhaul is pressing as reality upends more and more economic orthodoxies. Ditching simplistic and discredited inflation targets would be a good start.
U.S. pension funding boost is temporary reprieve 24 Aug 2016 New figures show a $1.1 trln funding gap for 50 states narrowed in 2014 as high returns boosted assets. Investments have struggled since, though, and assumptions about long-term returns are still too rosy. Even the better-funded pension pots may fall short as bills come due.
EpiPen probe may give Mylan allergic reaction 24 Aug 2016 Three U.S. senators are slamming the $24 bln drug firm for jacking up the cost of its anaphylaxis treatment more than fivefold since 2008. An investigation could limit Mylan's pricing power on the product that has provided much of its growth and spread to the firm's other drugs.
Chile’s Bachelet faces her own Rousseffian crises 24 Aug 2016 The leftist leader's woes look like a breeze next to those of her impeached coreligionist in Brazil. Chile's corruption scandal, economic slowdown and rising pension crisis are small in comparison, but bad news for the copper producer's status as a bulwark of regional stability.
Intersil would be a high-octane deal for Renesas 23 Aug 2016 Buying the U.S. chipmaker would better position Renesas for the rise of the smart car. But a mooted $3 bln price tag for the power management specialist sounds high, even if Intersil is half-way through a turnaround. Renesas is steering itself towards a lacklustre return.
More marriages of convenience (stores) on the way 22 Aug 2016 Canada's Couche-Tard is paying $4.4 bln for U.S. gas-mart owner CST Brands. That's steep, but the cost savings cover the 42 pct premium. It's another savvy deal from a Quebecois giant that has racked up an 800 percent-plus return for shareholders over the last decade.
Britain’s haul: 27 gold medals and a wooden spoon 22 Aug 2016 China underwhelmed in the Olympic medals table, while the tiny UK excelled. That’s a poor guide to more important competitions. Though Britain still has soft power, its value as a role model is on the wane. China no longer needs gold medals to secure its place on the podium.
Gawker assets are bit-players in Univision future 19 Aug 2016 The Spanish-language broadcaster paid $135 mln for sites that draw Anglophone enthusiasts for gadgets, sports and so on, shunning the gossip blog whose privacy breach bankrupted the media group. But Univision's exit from a $14 bln buyout in 2007 still depends on its core market.
ITV could take lead role in takeover drama 17 Aug 2016 The largest British free-to-air TV group is chasing Peppa Pig-owner Entertainment One. But ITV could become a target itself. A more than 25 pct drop in its share price and the weak pound make it vulnerable to opportunistic bids from European rivals like RTL.
Nestle’s rich valuation needs recipe to match 18 Aug 2016 The Swiss kibble-to-Kit Kat maker, like its peers, trades on a high multiple of earnings because of its defensive qualities. Generating cash is a formula Nestle has down, but creating growth to justify consumer goods companies' lofty share prices calls for disruptive thinking.