Hadas: Technology is still working pretty well 9 May 2018 The global economy has lots of problems, but a slowing pace of innovation is not one of them. The numbers lie, as arbitrary adjustments to real GDP distort reality. Life-changing new developments keep coming as fast as ever, even though so much has already been accomplished.
SoftBank has tech gap to close with investors 9 May 2018 Analysts seem more convinced than shareholders by the $85 bln outfit’s transformation into a technology investment house. That could change if SoftBank can pull off a U.S. merger and a domestic listing in telecoms, and generate some clear successes among its futuristic bets.
Tokyo jobs giant makes pricey hire with Glassdoor 9 May 2018 Japan’s Recruit has bought the U.S. job-reviews site for $1.2 bln, or about seven times trailing sales. That is a big sum for a startup that is still unprofitable. Even so, Glassdoor’s insights and data could be useful as technology brings radical change to the HR department.
Indian hospital penta-scrum poses board quandary 9 May 2018 Five bidders want to invest in ailing Fortis, valuing it at up to $1.4 bln. Offers range from small stakes to a full takeover. Lenders and hedgies may want a quick exit, but in a critical care business, directors would do well to consider a treatment that works for the long term.
Hong Kong mall deal feeds economic-hub dreams 9 May 2018 New World Development will invest $2.5 bln to build a sprawling retail centre by the city's remote airport. The pricey project goes beyond wooing flyers, though. It's a bold bet that troubled infrastructure initiatives to link mainland China, Hong Kong and Macau will pay off.
A Fujifilm cash bid for Xerox would work on paper 8 May 2018 Carl Icahn is fighting the Japanese company's complex plan to take control of its U.S. partner, but he's open to a cleaner $11 bln deal. That just about stacks up for Fujifilm in terms of debt needed and an investment return. It'd be far harder to justify strategically, though.
Takeda swallows big dose of risk to buy Shire 8 May 2018 The Japanese drugmaker finally reached a deal to buy its Irish peer, for $62 bln. Takeda can just about make the deal math work with $1.4 bln of annual cost savings. It requires big cuts to R&D, however, and operating with excessive debt for a while. That's a dangerous mix.
JD’s Alibaba defence strains “jam tomorrow” model 8 May 2018 Quarterly sales at the Chinese web retailer jumped by a third to $16 bln. But investments in logistics and new tech squeezed operating margins. For investors, JD's fierce battle with Jack Ma's e-commerce giant means profitability could well continue to be the chief casualty.
Emerging markets split into haves and have-nots 8 May 2018 A stronger dollar and higher U.S. bond yields have hit Argentina, Indonesia and Turkey especially hard. But others like the Philippines are in sounder economic shape. Buoyant oil prices create winners as well as losers. For investors, discrimination is the better part of valour.
Sickly IPO may infect Hong Kong waiting room 8 May 2018 The group behind medical app Good Doctor fell below its float price on the second day of trading. The diagnosis is simple: this was overpriced, like other recent deals. With giants such as Xiaomi set to list, bankers may want to leave more on the table to keep the market healthy.
Higher rates are likely to calm Hong Kong property 8 May 2018 Interbank lending is getting pricier after a decade-long slump, as authorities defend the Hong Kong dollar. That implies costlier mortgages and slower growth in a frothy real estate market. This will be manageable for banks and developers, and welcome for renters and retailers.
China offers miracle cure for Aussie cancer unit 7 May 2018 Beijing-based buyout firm CDH Investments is offering $1.4 bln for Sirtex, the liver cancer specialist. The non-binding bid is a 20 pct uplift on an agreed deal with U.S. suitor Varian. The rich valuation upsets the logic that a strategic buyer can pay more than a financial one.
Chinese tech stars are MAXD out beyond FANG stocks 7 May 2018 Handset-maker Xiaomi is the first of four mainland titans to unveil IPO plans. Ant, Meituan and Didi round out the quartet, whose combined valuations may exceed $400 bln. That leaves far less upside than was available to public investors in Facebook, Amazon, Netflix and Google.
Japan’s carmakers brace for fanciful currency ride 7 May 2018 Honda reckons FX moves could lop nearly $2 bln off earnings this year. If the yen rises, automakers often suffer, as does much of Japan Inc. The $60 bln maker of the Accord typically errs on the side of caution, though. And a truly painful exchange rate is unlikely.
Alibaba’s e-commerce engine powers buying spree 4 May 2018 The Chinese web giant’s revenue jumped 61 pct to $9.87 bln in the fourth quarter, beating expectations. Investments overseas and in bricks-and-mortar retailers dragged down margins. Yet the results are a reminder that Jack Ma’s core online business is still a juggernaut.
Review: Saving central bankers from the mob 4 May 2018 How much influence should technocrats wield in a democracy? That’s the question former Bank of England Deputy Governor Paul Tucker attempts to answer in “Unelected Power”. His reply is thoughtful and robust but might end up drowned out by fractious politics or another downturn.
China and U.S. prepare for micro-managed trade war 4 May 2018 Treasury Secretary Steven Mnuchin has delivered a list of tough demands to the Chinese government, including a $200 bln trade deficit cut, the WSJ reported. Beijing rewarmed its offer of lower tariffs and increased imports. Neither side gave an inch, so things will get messy.
Asia shoulders too much of HSBC’s burden 4 May 2018 Healthy growth in the region wasn't enough to stop a 4 pct decline in total pre-tax profit in the first quarter and a lower return on tangible equity. New CEO John Flint wants to “grow safely”. A bigger challenge may be explaining how to do so at all in North America and Europe.
AIA sends mixed signals on growth 4 May 2018 New business at the $107 bln insurer rose 20 pct in the first quarter. That’s sluggish by AIA’s standards, hinting at the challenges of sustaining growth rates at ever-increasing scale. On the plus side, there are signs the group could reduce its heavy dependence on China.
Hong Kong reveals capital imbalance in LGBT spat 4 May 2018 The city is fighting to stop a lesbian from obtaining a spousal visa. Morgan Stanley, Freshfields and others have backed the woman's case, recognising the value of human capital. Hong Kong favours the financial kind, evidenced by the relaxation of rules to attract more IPOs.