Teva lawyer conflict would make even bankers blush 10 Jun 2015 A judge urged that Kirkland & Ellis be barred from advising the drugmaker on its Mylan bid, citing an ethical breach. Goldman and others have been slapped for skewed loyalties but rarely with such force. It’s time attorneys stopped twisting formal rules to justify dodgy behavior.
MSCI lets fund managers ignore China a bit longer 10 Jun 2015 The index compiler says China’s $10 trln stock markets aren’t quite ready for global benchmarks. That’s a relief for investors worried about inflated mainland valuations. But inclusion is only a matter of time. Being underweight will soon be a matter of choice, not inertia.
HSBC’s exit exposes Brazilian banking conundrum 9 Jun 2015 The UK lender’s low returns, small market share and lack of global clients are driving it from Latin America’s biggest economy. Yet local banks are enjoying one of their best years ever. Large size and high interest rates are the main reasons. A recession could change all that.
Canadians add imagination to GE’s buyout work 9 Jun 2015 CPPIB is spending $12 bln to buy the U.S. conglomerate’s mid-market private equity lender. The manager of pensions for half Canada’s population gets both an investment and scope to expand. Assets of C$265 bln allow it to scale in-house rather than paying up for outside managers.
Student loans flunk lessons of Wall Street crisis 9 Jun 2015 Uncle Sam may forgive up to $3.5 bln of debt for students who attended a now-defunct college network accused of fraud. That’s good for grads. But the government’s shoddy approach to lending to its students smacks of banks in the mortgage boom. Time to pay more attention in class.
Rob Cox: Russia sanctions’ unintended consequences 9 Jun 2015 Russian cheese production is booming. So are Putin’s approval ratings. Relations with China have never been better. Free-market entrepreneurs are being financially squeezed while the Kremlin and its banks coddle state-owned enterprises. This can’t be what the West hoped for.
P&G may attract eye of another pushy investor 9 Jun 2015 Bill Ackman turned tail soon after he persuaded the $210 bln Tide-to-Charmin consumer giant to oust its CEO and bring back A.G. Lafley. The former boss has had limited success. With P&G’s growth weak and its shares underperforming, another activist could be tempted to have a go.
Still room for upside if Delhaize goes Dutch 9 Jun 2015 The Belgian grocer may sell to larger rival Ahold. The two are worth 26 bln euros combined, they’re neighbours in Europe, and both have sizeable U.S. arms. Even with modest potential cost savings and the 15 pct rise in Delhaize shares, the bidder might find another 15 pct.
Google gets taste of its own strong medicine 8 Jun 2015 MasterCard and Visa are stopping the tech titan’s Android Pay from taking a cut of transactions. That’ll please banks and could pressure Apple to ditch its own fee. Google won’t miss the revenue but has grown accustomed to being dominant. It may have met its match in finance.
U.S. oil chiefs march offbeat to carbon drum 8 Jun 2015 Even as the G7 tries to phase out fossil fuels and Europe’s corporate titans push to price emissions, bosses like Chevron’s John Watson snub the idea, saying “customers want affordable energy.” The steady beat for change means U.S. companies may cede the chance to shape policy.
Shareholder votes served with too much Apple sauce 8 Jun 2015 Companies keep tossing several proposals into one ballot initiative, despite a landmark 2013 ruling that ripped the iPhone maker for doing so. Such bundling also turns out to be more common than suspected, a new study shows. Investors deserve a dash of stronger voting protections.
Diageo bid genie may be out of the bottle 8 Jun 2015 Investors seem to think the $70 bln drinks giant is vulnerable to a takeover. Diageo shares jumped as much as 8 pct on sketchy reports of a possible approach from 3G Capital, of Heinz and Kraft fame. The UK-based company will need to respond, even if there’s no action this time.
U.S. jobs point to Fed’s sweet spot 5 Jun 2015 Some 280,000 positions were created in May, a healthy pickup to the 2015 pace. If this level of hiring keeps up and participation holds steady, unemployment would fall below 5 pct by year’s end. That’d beat the central bank’s projected range – and makes it harder to delay action.
Wal-Mart pits nepotism against experience 5 Jun 2015 The $240 bln retailer is replacing Chairman Rob Walton with his son-in-law. That’ll rile investors pushing for independent oversight. Greg Penner has a solid business background – and the family owns half the company. But Penner needs to prove he can get Wal-Mart back on track.
Mexico vote to damn ruling party with faint praise 5 Jun 2015 President Peña Nieto’s PRI will probably remain the strongest party after Sunday’s elections - despite a sluggish economy and voter disgust at corruption and violence. Opposition turmoil helped. But new voting rules may foster change, and economic reform is under way.
Vodafone talks raise more questions than answers 5 Jun 2015 The $100 bln telco is talking to cable group Liberty Global about an asset swap. Vodafone shares fell, suggesting disappointment among investors who’d thought a merger was on the cards. Smaller scale M&A is probably the right way forward, but any structure will be complex.
Thruppence: Should World Cup hosts foot FIFA woes? 5 Jun 2015 U.S. authorities are investigating how soccer’s governing body awarded the event to Russia and Qatar. As FIFA’s problems proliferate beyond graft indictments, Breakingviews columnists debate whether it is fair or practical to deprive host countries of the sport’s global fiesta.
Loans are no place for anti-takeover landmines 4 Jun 2015 The so-called “proxy put” gives lenders to a company the option of calling a default if enough board members are ousted. Investors say this impedes their right to vote for directors, and U.S. courts are tending to agree. Boards need to work with shareholders, not sabotage them.
Beware a bluff from poker-playing Dish boss 4 Jun 2015 Charlie Ergen would be making a bold bet by merging his $35 bln U.S. satellite operator with similarly-sized wireless provider T-Mobile US. Given the spectrum Dish has accumulated, a deal could make sense. Ergen has proven wily, though, and plays his cards very carefully.
U.S banks may loosen M&A reins after Kentucky deal 4 Jun 2015 Smaller lenders have lots of reasons to merge: slow growth, rising costs and low interest rates. They’ve held back, though, in part because deals got stuck in regulatory quagmires. The Fed’s relatively swift assent to BB&T’s Bank of Kentucky swoop might put things back on track.