SoftBank lives up to its name with Indian startup 19 May 2015 Housing.com CEO Rahul Yadav is a venture capital nightmare. The 26 year-old has slammed investors including the Japanese group as intellectually incapable and pledged to give away his shares. SoftBank may value a reputation for being founder-friendly, but being weak is worse.
Sharp’s $1.9 bln bailout won’t cut it for long 14 May 2015 The ailing Japanese electronics group’s creditors have rescued it for the second time in less than three years. But its restructuring plan looks too timid given its level of financial distress. Without an improbable revenue pickup, Sharp’s future will remain on a knife-edge.
U.S. trade setback more diplomatic than economic 13 May 2015 Senators denied President Obama authority to negotiate a new Pacific trade pact. The squabbling contrasts with China’s success in organising its infrastructure bank. But the benefits of both projects are uncertain. The world economy can shrug off the blow to America’s leadership.
SoftBank’s next boss more symbol than succession 12 May 2015 Chairman Masayoshi Son has no plans to retire but has named ex-Google executive Nikesh Arora as his likely successor. Appointing a foreigner to the role may be mainly a way for SoftBank to gild its international credentials, but the gesture is still a valuable one.
Toshiba adds accounting fog to strategic blur 11 May 2015 Accounting irregularities at the Japanese group are more serious than it first thought, yet disclosure remains vague. The shares have tumbled. Clarity is valuable for investors trying to decode a conglomerate that makes everything from flash memory chips to steam turbines.
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.
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.
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.
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.
U.S. throws monetary policy stone from glass house 10 Apr 2015 A new report from the Treasury criticizes excessive economic reliance on central banks in Japan and the euro zone and calls for more fiscal action. That’s rich, considering the Federal Reserve’s balance sheet has ballooned nearly fourfold since 2008 and Congress is paralyzed.
Japan index: BOJ plays a risky waiting game 8 Apr 2015 The Bank of Japan refused to heed growing calls to further ease its ultra-loose monetary policy. Inaction could be risky. Stock prices are the lone bright spot in a gloomy Breakingviews Abenomics Index reading for February. A return of deflation could hurt the BOJ’s credibility.
Unhappy anniversary for Japan’s inflation drive 2 Apr 2015 It’s two years since the Bank of Japan cranked up yen-printing in a bid to lift annual price rises to 2 pct in “about two years”. But with companies and consumers refusing to spend the stimulus – and oil cheaper – inflation is at zero. The BOJ needs to think beyond bond-buying.
Japan shows euro zone the limits of bond-buying 31 Mar 2015 The European Central Bank has barely begun buying government debt. The Japanese experience of massive purchases suggests low expectations are warranted. The Bank of Japan has yet to revive inflation. And it seems even to have lost the power to depress the yen and bond yields.
Nomura’s lonely mortgage stand could yet deliver 26 Mar 2015 JPMorgan and 15 other banks paid Fannie Mae and Freddie Mac $18 bln to settle home-loan fraud charges, yet the Japanese lender is fighting back at trial. It’s a risky move that may prove shrewd after U.S. court rulings this week. It isn’t a requirement to roll over for Uncle Sam.
DoCoMo woes challenge India reform rhetoric 26 Mar 2015 The authorities won’t allow Tata to pay the Japanese telco $1.1 bln to exit a joint venture. The deal will now go to arbitration. It is another example of India’s struggle to attract foreign investment. The government would prefer someone else make the difficult decisions.
Global trends through a Tiffany glass, darkly 20 Mar 2015 The luxury retailer’s tarnished outlook reflects a new economic normal. A slump in Japan reflects that nation’s fiscal constraints, while the rising dollar has hit sales elsewhere. On the bright side, growth in Europe is rebounding and Chinese consumers are playing their part.
Nintendo goes Super Mario with mobile push 18 Mar 2015 The struggling Japanese giant has bowed to investor demands to make games for smartphones. A library of well-known characters gives it a big advantage. If the likes of Pokemon are as popular as hits such as Candy Crush, investors’ hopes of a record score will be justified.
Japan index: Cheap yen brings some gains 17 Mar 2015 The Breakingviews Abenomics Index rose at its fastest pace in 16 months in January. A weak yen pushed stock and bond prices higher, and manufacturing output was strong. But wages are anaemic, and consumption is still struggling to recover from last April’s sales tax hike.
Japan retail deal gets M&A process back-to-front 11 Mar 2015 Convenience stores FamilyMart and UNY have set a date for their $5.4 bln tie-up, but haven’t agreed key terms. It’s another sign of the complexities of dealmaking in a country where big domestic mergers are rare. No wonder investors are worried the union will destroy value.