Startups bump up against myth of Southeast Asia 25 May 2018 Indonesia’s Go-Jek is moving into four nearby markets. For this, the $5 bln ride-hailing firm will spend heavily on separate brands and apps. The problem for it, Alibaba and others is that this region of 660 mln remains more of a political concept than an economic reality.
U.S.-China spat poses serious hazard for WTO 25 May 2018 The two countries are sparring at the Geneva-based organisation about how the WTO should handle Beijing’s brand of state capitalism. A U.S. threat to veto the appointment of judges could paralyse the trading body’s dispute resolution mechanism – and hold the outfit to ransom.
Viewsroom: America sees red on China trade deal 24 May 2018 Getting Beijing to force companies to buy more U.S. soybeans and oil may help the Trump administration claim a numbers victory. But it reinforces China’s statist instincts while ignoring most U.S. business beefs with Sino-American trade. Plus: has Tencent hit a peak?
Autos investors too quick to call Trump’s bluff 24 May 2018 German carmakers export a ton of vehicles, yet their stocks fell just 3 pct after the U.S. president threatened import tariffs. It implies they think Washington is just posturing, or that BMW and the like can mitigate the impact. That may prove to be overly optimistic.
Samsonite short case piles up Hong Kong’s baggage 24 May 2018 An experienced stock sceptic has laid into the $6 bln luggage-maker’s governance and accounting. It’s a bigger and better-known company than the Chinese minnows typically targeted. For a market relaxing standards to broaden its appeal, Samsonite gives investors more to unpack.
EMI deal calls out to 1MDB bounty hunters 24 May 2018 Sony is taking control of EMI Music Publishing. The sale could mean a $420 mln payout to financier Jho Low. U.S. prosecutors allege he used funds stolen from Malaysian fund 1MDB to make the purchase. That’s a temptingly huge sum for authorities in both countries to pursue.
Canada adds to global muddle with Chinese M&A veto 24 May 2018 Ottawa blocked the $1.2 bln sale of construction company Aecon to a Beijing-backed rival on national security grounds. The controversial decision could confound trade talks between the two countries. Increasingly, mergers are getting mixed up in the wider geopolitical realm.
Indian hospital deal merits a second opinion 24 May 2018 A Fortis Healthcare director was ousted by shareholders after three others facing a similar fate resigned a day earlier. It’s a rebuke of the decision to sell a minority stake to local tycoons. A fresh review of four other offers by a new board should lead to a better prognosis.
U.S. threatens autos with scorched-earth gambit 24 May 2018 Raising the prospect of tariffs on all vehicle and parts imports may just be President Trump's fuel-injected bargaining ploy for NAFTA negotiations. If the levies actually happen, it could bring a few more jobs stateside. But it'd leave domestic and foreign automakers reeling.
U.S.-China trade gap is best filled with software 23 May 2018 Beijing plans to shrink the $375 bln surplus by buying commodities like oil and soybeans. Better to import intellectual property, and pay for the millions of unlicensed copies of Microsoft and Adobe products running in China. Local firms could use the productivity upgrade.
StanChart dream reveals Barclays’ limited options 23 May 2018 The UK bank has considered merging with rivals including Standard Chartered, according to the Financial Times. Combining the two makes little financial sense. But it shows Barclays boss Jes Staley has few obvious ways to boost returns and appease activist Edward Bramson.
Rio Tinto can ease out of Indonesian mine mess 23 May 2018 The Anglo-Australian group may be ready to accept $3.5 bln for its interest in Freeport-McMoRan's Grasberg copper operation. The offer is hardly full, but a deal would save on costs and frustration. It also should make it easier for both companies to extract from a tough spot.
Santos gambles on crude with $11 bln bid rebuff 23 May 2018 The Australian gas group rejected the last in a string of approaches from private equity-backed Harbour Energy. New Chairman Keith Spence is optimistically betting energy prices will stay high. Given the industry’s volatility, this could come to look like a missed opportunity.
Oil index deal reinvents an old buyout trick 23 May 2018 Chinese-backed ZZ Capital International has struggled to close a roughly $800 mln purchase of U.S. data provider Alerian. Now two of its top dealmakers are leaving, and resurrecting the takeover at their new shop. That puts a fresh spin on pass-the-parcel deals by private equity.
Trump indulges China’s statist instincts on trade 22 May 2018 To spare Chinese telecoms giant ZTE from extinction, its execs will be scapegoated for violating sanctions, averting an export ban. Beijing will also order firms to import more U.S. goods. Washington is effectively encouraging command, rather than market, economics in China.
Sony loudly demonstrates love of content with EMI 22 May 2018 The Japanese group is buying 60 pct more of EMI Music Publishing from a consortium led by Mubadala. A valuation of $4.8 bln, or 19 times EBITDA, is deafeningly expensive. It leaves no room to doubt new boss Kenichiro Yoshida’s belief in a streaming-led recovery for the industry.
Hyundai U-turn puts Asia investors in higher gear 21 May 2018 The South Korean conglomerate slammed the brakes on a $9 bln restructuring after investors revolted. It's a big step in a region where shareholders are often given short shrift. Alongside other recent upsets, Hyundai's is welcome evidence the balance of power is shifting.
ArcelorMittal paying an odd bid “premium” in India 21 May 2018 The world's largest steelmaker is ready to cover $1 bln of debt in a tiny rival it no longer backs so it can buy bankrupt Essar. A quirky rule bans owners of defaulting companies from acquiring distressed assets. It's a sign of how India’s bankruptcy law is a work in progress.
Baidu gets $9 bln warning to stay the course 21 May 2018 The surprise exit of COO Lu Qi sparked a big drop in the Chinese search engine's shares. He helped Baidu focus on search and AI, lifting the company's market value since his arrival from Microsoft in 2017. Boss Robin Li has been sent a strong message about what investors want.
U.S.-China trade deal kicks nearly every can 21 May 2018 Beijing agreed vaguely to reduce imbalances and improve IP rights, both of which it has signaled before. A U.S. demand that China shrink its surplus by $200 bln went missing. Such details may yet get hammered out, but Xi Jinping's industrial policy looks safe amid the detente.