Freeport-McMoRan leaves Carl Icahn lots of targets 28 Aug 2015 Big cuts in spending and staff sent the struggling miner’s stock soaring – just before the activist revealed an 8.5 pct stake. The pre-emptive strike won’t be enough to satisfy the feisty billionaire. High debt and low commodity prices suggest he has asset sales in his crosshairs.
Review: Ben Bernanke and a global monetary plague 28 Aug 2015 Ever since the collapse of Lehman Brothers, the Federal Reserve has engaged in financial experimentation that has delivered the weakest rebound on record while spreading deleterious effects around the globe that author Brendan Brown, in a forthcoming book, likens to a plague.
Google EU antitrust spat riddled with holes 28 Aug 2015 The search giant’s robust response to a European challenge over price comparison tools ratchets up a complex theoretical battle over what makes a monopoly. Yet the dispute misses a broader point: it’s hard to see how any likely outcome will make a massive difference to consumers.
Rob Cox: Double-duty CEOs are a worrisome trend 27 Aug 2015 Fiat boss Sergio Marchionne may don another hat to run Ferrari. Like Jack Dorsey and Elon Musk, however, he’s only human. Investors in public companies, especially young or challenged ones, require full attention from a leader. That’s all but impossible when he’s running two.
Dole boss is bad apple for buyout barrel 27 Aug 2015 A judge says David Murdock duped shareholders, independent directors, lawyers and bankers when he took the produce vendor private two years ago for $1.6 bln. The deceit will cost him $150 mln. It’s also a sad reminder that even carefully vetted deals can be rotten at the core.
Coke’s sparkling H2O talk is a bit too fizzy 27 Aug 2015 The soft-drinks giant has done more than many corporations to nurture water resources. Now CEO Muhtar Kent reckons he can hit Coke’s goal of replenishing every liter it uses five years early. But the company’s claim that it will be water neutral doesn’t yet pass the taste test.
Solid U.S. growth trumps stock market sideshow 27 Aug 2015 GDP expanded at a 3.7 pct pace in the second quarter and 2.7 pct year-on-year. The jobs market looks steady. For central bankers like the Fed’s Bill Dudley, that ought to be more “compelling” than the now-arrested slide in shares. Zero interest rates are past their sell-by date.
Fake Goldman Sachs belies a real China strength 27 Aug 2015 The U.S. investment bank joins a long list of counterfeits that includes Apple stores, police stations and British villages. They’re easy to mock, but also veil a broader readiness to bend rules in search of profit. Properly channelled, that ingenuity and pluck could be powerful.
Schlumberger’s daring deal looks carefully hedged 26 Aug 2015 The oilfield services provider is moving outside its comfort zone to buy drilling gear maker Cameron for $15 bln even as the price of crude falls. The 56 pct premium is flattered by the market selloff and covered by cost savings. Schlumberger may have threaded the M&A needle.
Monsanto leaves Syngenta facing awkward questions 26 Aug 2015 The world’s largest seed maker has given up pursuit of its Swiss rival. The $46 bln deal required aggressive assumptions and carried risks. Syngenta’s management now needs to prove its reluctance to talk was worth it.
Monsanto $46 bln Syngenta offer deserves a hearing 26 Aug 2015 The U.S. seed giant’s last cash and shares approach to its Swiss rival was rebuffed. Monsanto has offered a little more, but can’t go much higher without destroying value or relying on rosy assumptions. The pressure is on Syngenta to talk, or show investors it has a better plan.
Yellen may relish opportunity not to communicate 25 Aug 2015 The Fed chair is skipping central bankers’ annual shindig in Jackson Hole this week. For all her institution’s professions of transparency, recent global market ructions mean nothing she might have said would have satisfied anyone. Better to wait until the FOMC meets next month.
Exelon mercifully spared winner’s curse 25 Aug 2015 Local D.C. authorities nixed the power company’s $6.8 bln takeover of rival Pepco. A bidding war against earlier failed Exelon target, PSEG, led to a price that was hard to justify. Such intervention may be a concern, but in this case one set of shareholders gets a helping hand.
Tech’s real China syndrome victims are yet to fall 24 Aug 2015 Facebook, Apple, Amazon and Microsoft lost nearly $200 bln of value in a week. China’s woes sparked the rout, but the problem was investors’ giddy faith in growth. Public tech stocks may recover. Fantasy valuations of private firms like Uber, though, will take the bigger hit.
Southern’s $12 bln deal could find true north 24 Aug 2015 The hefty 38 pct premium it’s paying for AGL looks rich for the utility sector. Though Southern isn’t giving a synergy figure, hacking out over 6 percent of costs would help justify the price. Previous mergers like Duke’s acquisition of Progress at least suggest it’s achievable.
Investors’ self-doubt worsens equity woes 24 Aug 2015 Global equities are extending declines. Valuations can’t quite explain the depth or breadth of losses. Investors’ low conviction in past asset allocation decisions could have more to do with it. So might waning faith in policymakers riding to the rescue.
Guest view: Urgent action needed on bank culture 21 Aug 2015 Converging pressures from regulators and shareholders have reached a level where bank CEOs know they must do more to restore traditional solid values to the industry, argues William Rhodes, a former Citi executive and co-chair of the G30’s steering committee on banking reform.
Internet spared FIFA-like governance risks, for now 21 Aug 2015 Uncle Sam is delaying the transfer of control over domain names to an international watchdog. Waiting makes sense. Soccer-style power-grabs and graft could infect cyberspace unless the as-yet-unidentified replacement for the non-profit ICANN is representative and accountable.
Effluent packs economic and environmental punch 21 Aug 2015 Fracker Pioneer National is about to start using treated sewage in its wells. United Airlines may use animal waste as fuel. Recycling feces is now efficient enough to produce both energy and drinking water. This new spin on natural gas offers benefits for the land and air, too.
Valeant pops risky $1 bln libido pill 20 Aug 2015 The acquisitive drug firm is buying Sprout, the maker of just-approved “female Viagra.” Valeant will have gotten a bargain if it can crank out billions in annual sales. Snag is, the drug isn’t very effective, it has bad side effects, and regulatory restrictions may crimp sales.