Dewey case puts legal eagles on precarious perch 29 May 2015 An accounting fraud trial kicked off this week against three of the defunct law firm’s leaders. Dewey & LeBoeuf’s methods may have been extreme, but big shops tend to play fast and loose with already fuzzy rules. What attorneys consider creative could turn out to be illegal.
Review: The slow, painful grind to safer banks 29 May 2015 It’s now received wisdom that America can’t afford to forget financial crises. Veteran FDIC bank examiner John Bovenzi manages to corral the evidence in a surprisingly readable book, joining the dots from the 1980s S&L rout to the start of too-big-to-fail and subprime stupidity.
Banks could get stuck in FIFA penalty area 29 May 2015 Over 20 lenders are mentioned in the U.S. Department of Justice’s 164-page soccer rap sheet. Even if FIFA officials are found guilty, banks may be blameless. But UBS’s recent experience suggests any sniff of wrongdoing could change how U.S. regulators view past misdemeanours.
Dick Fuld spits right into perfect storm 28 May 2015 Lehman’s former CEO turned up for a rare public appearance since his bank went bust seven years ago. Most of Wall Street has moved past his distorted version of the crisis. Voices like Fuld’s could risk lessons learned being forgotten faster – if anyone takes them seriously.
Venezuela adds hazy Rosneft $14 bln to leaky pail 28 May 2015 President Nicolas Maduro is touting the misleading investment sum from Russia’s oil giant. Though U.S. sanctions have boosted his popularity, he can’t escape high inflation, low reserves and power shortages. A further run-up in crude prices may be one of the country’s last hopes.
The FIFA big boss guide to executive survival 28 May 2015 Soccer’s supremo Sepp Blatter may win a fifth four-year presidency at the scandal-wracked governing body. Even if he fails, his tenacity is remarkable. It owes much to FIFA’s financial success, but also cumbersome governance and tin ears. Those help all boardroom Machiavellis.
M&A virtuosi deliver more warning than blueprint 28 May 2015 A new study suggests corporate wheeler-dealers generating strong returns use riskier options like cross-border and hostile transactions. Plenty of research, though, shows most acquirers struggle to add value. CEOs would do well to recognize their limits before building empires.
Avago offers textbook case for chip consolidation 28 May 2015 The serial acquirer is buying semiconductor rival Broadcom for more than $36 bln. Cost cuts should just about cover the 30 pct premium. Avago’s track record, the cash-and-stock mix and the logic of industry mergers all add up, too. Only an interloper could spoil the party.
To fix FIFA, start with the sponsors 28 May 2015 U.S. prosecutors allege that shadowy marketing agencies diverted cash from the likes of Toyota, Santander and probably Nike to corrupt soccer officials. Big bucks are at stake. FIFA’s revenue from 2011 to 2014 was $5.7 bln. In future, contractual transparency will be paramount.
FIFA cover-up almost a dare for U.S. enforcers 27 May 2015 In November, the Zurich-based World Cup organizer whitewashed an internal investigation, according to the former U.S. attorney who conducted it. Swiss authorities were alerted, but FIFA largely dismissed corruption allegations. No wonder American prosecutors have gone in hard.
Chicago bonds catch mild version of Moody’s blues 27 May 2015 Two weeks after the firm cut the city’s credit rating to junk, underwriters priced about $670 mln of bonds with yields approaching 6 pct. That’s nearly double what triple-A cities pay, but well shy of broke Puerto Rico. It’s a fair reflection of Chicago’s simmering fiscal mess.
Fiat boss fights for car M&A with hand behind back 27 May 2015 Sergio Marchionne argues mergers would cut duplicative spending and boost shareholder returns. GM has already rebuffed him, probably because such deals are complex and hard to complete. But he also hurts his case by downplaying the benefits of lower costs and fewer employees.
Edward Hadas: Why Lehman Brothers lives on 27 May 2015 Almost seven years after the U.S. investment bank failed, the reputations of financial markets, central banks and economic theorists remain deeply tarnished. Worse, the shock permanently damaged already-weak governments, ever-fragile labour markets and the frayed social fabric.
U.S. well placed to blow whistle on soccer excess 27 May 2015 Americans already act as the globe’s legal enforcer and financial regulator. Now a federal prosecutor is filling soccer’s refereeing void with a direct tackle on its long-running corruption allegations. FIFA, the sport’s governing body, faces a long overdue reformation.
Congress makes Wall St look like paragon of virtue 26 May 2015 U.S. lawmaker Paul Ryan and colleagues claim a recent court ruling exempts them from a self-imposed ban on insider trading. That’s lame in any event, but also hypocritical: They’re mulling bills to expand constituents’ liability. They should get their own houses in order.
Rob Cox: Bolivarian bank dream faces Andean climb 26 May 2015 Brazilian lender Itaú has pursued a strategy to create the first truly pan-Latin America financial institution. Its biggest effort to date is at an impasse. The merger it thought it cleverly struck with Chile’s CorpBanca is backfiring in ways that may cost it treasure and face.
Time Warner Cable finds money covers Charter flaws 26 May 2015 CEO Rob Marcus rejected a bid from his smaller rival last year, balking at the leverage, cash and stock on offer. Those terms haven’t changed much but the price has gone up appreciably, to $56 bln. Time Warner Cable provides a reminder about what really matters in deal talks.
Buyers hold cards in $6.4 bln Latam oil deal 26 May 2015 Investors opposed to the takeover of Pacific Rubiales have enough votes to knock the sale off course. But the dissenters would be crazy to push the button. The 34 pct premium looks fair. Without a deal, or a surge in oil prices, Pacific Rubiales’ future looks bleak.
M&A dealmakers fight different battle of bulge 22 May 2015 With his energy-focused startup, ex-Barclays bigwig Skip McGee can exploit a trend of smaller advisers winning business from banking supermarkets. There’s new competition by size in the indie world, too, though. Bigger players like Lazard and Rothschild are reclaiming dominance.
Review: Modernizing Mexico, one feud at a time 22 May 2015 Two Mexicos coexist, one an insular land of hard-to-kill monopolies in politics and business, the other more outward-looking, embracing modernity and even the United States. In “Amarres perros” pundit-politician Jorge Castañeda recalls a life of trying to change the balance.