Anta deal enters arena of extreme financial sports 13 Dec 2018 Instead of a straightforward acquisition, the Chinese company structured a $5.2 bln LBO of Finland’s Amer. Partners like Lululemon’s founder may help accelerate sales of workout apparel and Salomon skis, but hefty debt also implies a risky race for private equity-style returns.
Apax may have clicked on $1.8 bln Kiwi bargain 13 Dec 2018 The buyout group has won a rare New Zealand bid battle, buying Trade Me, a mix of Craigslist and eBay. That's fair, for a local champion with little debt and chunky margins. Apax has similar assets elsewhere, too. Only Amazon's looming spectre should unsettle.
China’s murky moves hand Trump more ammo 13 Dec 2018 Ottawa has lost contact with another citizen after Beijing detained an ex-diplomat. It will be considered retaliation for the arrest of Huawei’s CFO. Despite other concessions, such tactics stand to alienate China scholars, embolden U.S. hardliners and make trade peace harder.
Club Med embarks on overheated holiday escape 13 Dec 2018 The vacation resorts arm of Chinese conglomerate Fosun priced its IPO at the bottom end of the indicated range. A $2.4 bln market cap, however, imputes a multiple on par with its most richly valued peers. Sluggish tourism trends could leave optimistic investors scorched.
Hadas: What oil price volatility is trying to say 12 Dec 2018 A barrel of oil costs 31 pct less than in early October. The message is not about investment needs or a big demand shift. The tumble is big because the geopolitical racket makes lesser moves inaudible. Stock markets may also be speaking up.
Hyundai heir is tightening his grip on the wheel 12 Dec 2018 A radical shake-up in the upper ranks of the Korean autos conglomerate should help de facto boss Euisun Chung repair multiple dents. Flagging sales and restructuring demands from activist Elliott are top of his to-do list. A firmer hand should drive progress on both.
India’s new central bank boss starts on back foot 12 Dec 2018 Ex-finance ministry official Shaktikanta Das was chosen to run the RBI, a day after Urjit Patel quit. Top marks for a fast pick. There’s little to suggest, however, that a bureaucrat who backed the prime minister’s fateful demonetisation plan will resist pressure from New Delhi.
China-U.S. trade war will get a lot more personal 12 Dec 2018 Washington and Beijing’s tariff truce is looking fragile. The arrest of tech giant Huawei's CFO on U.S. behest complicates matters. Detention is a common business negotiation tactic in China, as a Canadian ex-diplomat just found out. U.S. executives have good cause to worry.
Global equities offer value trap in 2019 11 Dec 2018 After two sharp corrections in 2018, U.S. earnings multiples are near 10-year averages. Yet aside from the dot-com bubble, U.S. stock valuations have never been higher in cyclically adjusted terms. With leading economic indicators stretched, they may be built on sand.
Apple case underscores Chinese tech ties that bind 11 Dec 2018 A mainland court banned the sale of older iPhone models just days after Huawei’s CFO was detained in Canada. Meanwhile, U.S. regulators have revived old concerns about Chinese audits. Trade-war-related or not, the decisions allude to how many connection points there are to sever.
China’s export mystery may grant economy reprieve 11 Dec 2018 Shipments manage to keep rising despite U.S. tariffs. Many assume it’s due to “front-loading” orders to get ahead of duties, yet evidence is thin. If foreign demand has been a genuine driver up to now, Beijing will have a far easier time coping with the looming slowdown.
SoftBank IPO investors mute shrill market signals 11 Dec 2018 The Japanese group is set to raise a whopping $24 bln in its domestic mobile business float. That makes it one of the world’s most highly valued carriers even as upstart Rakuten becomes a potential threat. Fresh jitters involving Chinese kit also may demand a greater discount.
Governor’s exit kills myth of India’s central bank 10 Dec 2018 Urjit Patel's resignation after a spat with New Delhi makes him the second chief to leave in almost as many years. That removes the illusion of independence. Finding a successor will be tough too. Investors will now significantly reprice risk as India hurtles into elections.
Miners’ digging rush is a chance to show restraint 10 Dec 2018 Exploration, which stalled as prices crumbled after 2011, is back. Speculation over Rio Tinto’s drilling in Australia’s Great Sandy Desert, for example, has sent rivals on a copper-hunting frenzy. With deals scarce, such moves make sense, so long as the diggers stay disciplined.
Unsavoury disclosure spoils Chinese food delivery 10 Dec 2018 Meituan Dianping fired one employee and referred others to police after an internal corruption probe. Yet the $40 bln company only said so in Chinese, and didn’t flag it before its Hong Kong IPO. Once-reported metrics also have gone missing. Such opacity is unappetising.
OPEC condition upgraded from terminal to ailing 7 Dec 2018 The oil producers’ club agreed a 1.2 million bpd cut with allies like Russia, hiking prices. After Qatar’s exit, failure to do so would have destroyed the cartel’s credibility. But the details imply OPEC leader Saudi’s wishes are subordinate to those of Russia and the U.S.
Review: The uncertain new world of labour 7 Dec 2018 The number of worried and desperate workers seems to be increasing. Some cultural critics see a symptom of modern social decay. “Precarious Lives” looks at the numbers and finds mild damage. Its main finding: a strong welfare state is welcome, but this problem is hard to solve.
Ericsson debacle exposes costs of anti-Huawei push 7 Dec 2018 The Swedish group’s glitchy software crashed some telecom networks. Yet it may grab market share, with its rival’s CFO under arrest and governments backing away from the Chinese company’s kit. A more concentrated market would mean higher prices and a risk of further big outages.
Hong Kong tycoon tunneling out of public markets 7 Dec 2018 Gordon Wu, whose mega-bridge idea was just built, has offered to take his property company private 40 years after its IPO. A $2.7 bln bid puts a big premium on Hopewell’s share price, but still discounts underlying assets. Peers similarly frustrated by valuations may follow suit.
Trade truce gives China room to loosen up 7 Dec 2018 Wary of sending the wrong signal, Beijing has left its benchmark interest rate untouched since 2015. But central bankers eager to foster growth have other monetary policy levers they can pull, like interbank rates. A period of diplomatic calm gives them the space to do just that.