Bombardier may be the little Canadian that can 30 Apr 2015 The manufacturer is mulling selling a majority stake in its rail unit to a Chinese rival. Political objections are likely: even home-improvement chains are off limits to foreigners. Using the proceeds to keep its aviation business flying, though, may keep critics in the hangar.
Banks are designated drivers at China market party 30 Apr 2015 Bad debt levels are rising and earnings at the biggest lenders barely grew in the first quarter. Soon, they may be summoned to help clean up government debts, fund China’s global ambitions and sacrifice their margins to save the economy. Investors’ sober view is the right one.
Abu Dhabi’s $2.4bln hotel JV shows HK is still hot 30 Apr 2015 Tycoon Cheng Yu-tung’s offspring are shaking up property group New World Development. The sale of three top hotels to a joint venture with the Gulf sovereign fund shows that, despite falling visitor numbers and the slowdown in China, Hong Kong is still an attractive destination.
Insider case exposes U.S.-China conduct chasm 30 Apr 2015 Regulators froze the assets of two Beijing residents who made $2 mln trading ahead of a deal involving Nasdaq-listed 58.com. Such apparently basic scams are fairly rare in the United States. From insider trading to bribery, American rules and Chinese practice continue to clash.
Abe’s Capitol Hill speech needs ideas for backyard 29 Apr 2015 Shinzo Abe’s address to Congress will highlight Japan’s strategic and financial relationship with the United States. But the mooted trade deal offers limited economic benefits. Managing the rivalry with China and fostering cordiality with India can make Japan a more vital ally.
Focus Media’s Chinese homecoming is hard to repeat 29 Apr 2015 The advertising firm is preparing to list in Shanghai two years after it left the U.S. stock market. High valuations will tempt other Chinese companies with overseas listings to return home. For many, though, the costs and legal complexities make switching more hope than reality.
Huge Apple payouts play catch-up with China growth 28 Apr 2015 The $760 bln iPhone behemoth is adding $50 bln more to its buyback plans. Quarterly numbers, though, show the Middle Kingdom overtaking Europe as Apple’s second-biggest market after 71 pct growth. CEO Tim Cook is in danger of taking more fire for returning cash too slowly.
China SOE fusion could topple cult of competition 28 Apr 2015 A mooted $569 bln merger between Sinopec and PetroChina looks a step back for reform and efficiency. But competition between state-backed firms isn’t always helpful. A more demanding shareholder, pricing power and superior regulators could be better spurs to improve performance.
Tokyo Electron flop shows limits of M&A diplomacy 27 Apr 2015 Applied Materials’ $12.8 bln all-share takeover of the Japanese firm broke taboos in a country that is wary of foreign buyers. But after 19 months, U.S. regulators scuppered the tie-up. Investors will hope it doesn’t discourage other Japanese groups from considering bold deals.
China frothy markets churn up funding opportunity 27 Apr 2015 Companies are using rising prices to raise equity capital. Buoyant stocks have also made regulators more relaxed about new supply. For a country that has gorged on corporate debt, more equity sounds like a good thing. If investors were more discerning, it really would be.
India retirees’ stocks push lacks Japan’s zeal 27 Apr 2015 The $125 billion Employees’ Provident Fund is making its maiden foray into equity. The planned 5 percent allocation to stocks doesn’t pack the punch of Japanese pension funds’ recent portfolio shift. But a bolder switch will require overcoming unions’ mistrust of markets.
China’s cyber crackdown: A guide for the perplexed 24 Apr 2015 The People’s Republic is squeezing technology companies. New banking rules and counter-terrorism legislation could make it harder for foreign groups to operate in the expanding market. Is security just an excuse to protect domestic players? Breakingviews cracks the code.
Japan stocks can rise beyond symbolic Nikkei high 23 Apr 2015 The index closed above 20,000 for the first time since 2000. Though Japan’s bull market is more than two years old, a trade deal with the United States could make returns still sweeter for investors. Stronger corporate earnings and more money-printing could also boost equities.
SoftBank put on spot by Yahoo Japan exit 23 Apr 2015 The Japanese conglomerate is the natural buyer of the portal should the U.S. search group offload its 36 pct stake. But beefing up won’t impress investors struggling to see the value of its parts. A spin-off by Yahoo will up pressure for SoftBank to justify its business model.
India’s poor state banks will test investor limits 22 Apr 2015 State Bank of India is leading the rush to raise capital with a $2.4 bln share sale. A stronger economy makes bad debts look less bad. Investors will also have to believe a government pledge to meddle less in lending decisions. Even so, few banks look tempting.
India in depth: A race to write cheques 22 Apr 2015 Not all state governments will know what to do with an unanticipated $30 billion jump in their share of tax revenue this fiscal year. But that’s a short-term problem. Eventually, shifting spending from New Delhi to sub-national governments should boost India’s growth potential.
Circus deal risks becoming lunge at falling knife 21 Apr 2015 TPG and others are buying Montreal-based Cirque du Soleil at a $1.5 bln valuation. That’s over $1 bln less than the price secured by founder Guy Laliberté in an ill-fated 2008 sale to Dubai. Recent shows have struggled, though, and hoped-for Chinese growth could easily stumble.
China crafty beer deal brews value from simplicity 21 Apr 2015 China Resources is sucking everything out of its Hong Kong-listed subsidiary except for Snow beer, the world’s best-selling suds. In accounting terms, minority shareholders actually end up slightly worse off. Still, the increased transparency should create a considerable uplift.
Daiichi Sankyo scrubs out Indian M&A nightmare 21 Apr 2015 Last year the Japanese firm folded its stake in troubled Indian drugmaker Ranbaxy into local rival Sun Pharma for 40 pct less than it paid in 2008. A share rally means Daiichi has recovered its losses on the seven-year misadventure. It shows the power of appropriate ownership.
Sliding prices vindicate China’s growth worries 20 Apr 2015 New moves to get banks lending more show the authorities are worried that growth may miss the official target of 7 percent. Look closer at what’s happening to prices and there is good cause. China’s slowing growth is close to being too slow.