Ahold-Delhaize is a 25 bln euro deal full of hope 11 May 2015 The shares of both Dutch-listed grocer and its potential Belgian-listed target were up strongly on reports of renewed merger negotiations. A combination of the two U.S.-centric companies makes sense. But financing could be an issue, and the American market will still be tough.
Boring is beautiful for U.S. employment 8 May 2015 April’s 223,000 new positions represent a welcome rebound from a pitiful March, even if the pace is modest. The jobless rate also dipped to 5.4 pct, while participation barely moved. It all adds up to a durable recovery that should lead soon to higher wages and interest rates.
Thruppence: Can Snapchat unmask dodgy borrowers? 8 May 2015 Alternative lender Affirm has raised $275 mln for a model that rates creditworthiness using social media data alongside other old-school indicators. Breakingviews columnists debate whether info gleaned from Facebook and its ilk could supplant traditional credit-scoring methods.
Monsanto heaps pressure on Syngenta 8 May 2015 The U.S. seeds giant has made a $45 bln approach to the Swiss pesticide firm. The target rejected this as too cheap and too risky. Syngenta has a point: there will be major political and antitrust hurdles. But it needs to lay out just how it will create more value on its own.
Alibaba generation shift treats investors as kids 8 May 2015 The e-commerce group is swapping its chief executive for a younger insider. The plan was drawn up before the company’s IPO. Yet Alibaba has offered no explanation. Founder Jack Ma wants to promote young leaders, but investors deserve adult answers on who makes decisions and why.
Fitbit IPO flaunts refreshing financial health 8 May 2015 The maker of wearable fitness trackers marks a rare Silicon Valley stock sale with strong profit alongside fast sales growth. Fitbit’s founders also exhibit an uncommon focus. A dual-class share structure runs with the crowd, however, and Apple is just now sprinting in this race.
U.S. trucker offers Facebook owners ride to future 7 May 2015 Swift Transportation and the social networking giant face votes to dump feudalistic dual-share structures. Upset about their founder-CEO, the decades-old shipper’s second-class holders backed the idea last year. Facebook owners one day may find themselves similarly frustrated.
Rob Cox: Wall Street suits revel in Bonnaroo vibe 7 May 2015 Live Nation’s purchase last week of control in the iconic jam-band gathering forced financial analysts to turn their spreadsheets on an unusual target: 80,000 sweaty hippies in the Tennessee woods. Though peak festival seems nigh, investors are enjoying the scene for now.
Yelp’s cry for help heard around the internet 7 May 2015 When the $3.4 bln review site rebuffed Google six years ago, its future looked almost limitless. Now Yelp is exploring a sale. That will resonate through boardrooms and venture capitalists’ tree-houses as they ponder slowing growth and the limits of online business models.
U.S. interloper likely to win IT server tussle 7 May 2015 Things are hot in the air-conditioned data-centre business. Equinix is eyeing a $3.5 bln bid for Telecity that would kill the UK outfit’s all-stock purchase of Interxion. It’s hard to see Interxion biting back. Telecity owners are being offered 28 times 2015 earnings.
Whole Foods risks bitter millennial harvest Ready Soon |7 May 2015 The $17 bln grocery chain has added stores so fast it’s hurting established outlets and growth. Now it’s planning shops with cheaper food pitched at younger shoppers. That will increase competition, hurt margins and force Whole Foods’ bloated-looking stock onto a diet.
Latest bank regulation attack looks wide of mark 6 May 2015 A new analysis estimates Dodd-Frank will lop $900 bln off GDP over a decade. The study takes some big leaps to get there. Even if the headline number isn’t outlandish, though, the broader implication is: the work completely ignores the far higher cost of Wall Street excess.
Mexico oil sale gets $6 bln show of support 6 May 2015 A local conglomerate and private investors are offering a 35 pct premium for Pacific Rubiales. That sounds high for a company hit hard by oil’s plunge and a deal unlikely to have many synergies. But it’s a sign of confidence in Mexico’s pending, long-awaited oil liberalization.
Edward Hadas: The great British deficit confusion 6 May 2015 David Cameron and Ed Miliband both want to balance the UK government’s budget. But the prime minister and the opposition leader seem to misunderstand how government debt works. They are not alone. The obsession is shared by some deficit-loving and deficit-hating economists.
Alexion puts high stock to good use in biotech bid 6 May 2015 The drugmaker’s $8.4 bln offer for rival Synageva includes a whopping 136 pct premium. The stonking price is based on the rare disease specialist’s view that the market underestimates its target’s value. Exchanging a chunk of pricey paper for the assets may be a savvy move.
Would Microsoft really want to own Salesforce? 5 May 2015 Buying the cloud-based customer-service software could make businesses less likely to ditch Office. It might, however, cost Microsoft some $60 bln, more than all past deals combined. A bold bet for boss Satya Nadella would create earnings dilution that annoys his shareholders.
Trickle-down economics look all dried up 5 May 2015 Lawmakers aiming for more employment would be better off slashing taxes for low-earners, according to research from a University of Chicago economist. Another new paper suggests a dividend tax cut helps neither investment nor wages. Will Rogers may have had it right all along.
Guest View: Fixing a U.S. immigration bottleneck 5 May 2015 Outdated immigration policies are again preventing the supply of coveted visas from matching the demand from American companies, says former U.S. Treasurer Rosario Marin. Reforming the H-1B visa program would dramatically lift economic growth and deserves bipartisan support.
Hedge fund pay hauls a political-financial shame 5 May 2015 The top 25 managers took in $11.6 bln last year, Alpha magazine calculates. If these rewards were for building a stronger economy, the 0.001 percent’s political clout might still be troubling. But such gains for largely mediocre performance in secondary markets are shocking.
PartnerRe manages to cede high ground to Agnellis 5 May 2015 The Italian dynasty’s vehicle, Exor, has offered $6.4 bln for the Bermudan reinsurer. PartnerRe’s rigid board is sticking with a sweetened but lower-value merger with Axis. Exor’s hostile stance may put PartnerRe in play – as it probably should have been from the start.