Zoetis gives $2 bln vet deal luxury treatment 16 May 2018 The animal-health giant will on the face of it only get a 2 pct return on investment from buying diagnostics firm Abaxis. It’s betting more owners globally will shell out big bucks on their pets – and so fluff up earnings. If not, $40 bln Zoetis will be nursing a dog of a deal.
A Hollywood star may be born in Hong Kong 16 May 2018 STX, behind movies such as Jackie Chan's "The Foreigner", is ready for a stock-market premiere. Backers Tencent and John Malone co-star but the IPO features China, where the young studio has an edge. A somewhat original script also should support a valuation of at least $2.5 bln.
Viewsroom: 1MDB rears head in Malaysian election 16 May 2018 The $5 bln sovereign-wealth fund’s scandal played a role in voters replacing Prime Minister Najib Razak with nonagenarian Mahathir Mohamad. Its resurgence could mean bad news for Goldman Sachs and Najib himself. Plus: Walmart nabs Flipkart in a big bet on e-commerce in India.
Time for Elaine Wynn to take break from the table 15 May 2018 The director targeted by the casino’s co-founder is leaving, as is another. With a refreshed board and new CEO, Wynn Resorts is well placed to move on from recent scandals. Unless she has suddenly hit on a new grand plan, Elaine Wynn would do well to leave them to it.
Volvo’s $30 bln IPO bar is conundrum for bankers 15 May 2018 The carmaker’s Chinese owner Geely won’t sell for less, the FT reported. That means financiers have to either disappoint Chair Li Shufu and miss out on fees, or convince investors Volvo’s Autos 2.0 bets make it more a Tesla than a traditional manufacturer. Neither is palatable.
Holding: Lawyers can make even charity look sleazy 15 May 2018 The U.S. Supreme Court will decide whether Google can settle an $8.5 mln privacy lawsuit with nonprofit gifts. The tech giant says the public will benefit, but only attorneys win big while victims get zilch. As with M&A suits, legal eagles have soiled a potential good with greed.
Tax cuts hasten demise of U.S. corporate pensions 15 May 2018 With a $6 bln annuity purchase, FedEx has offloaded a chunk of its obligations. Lower U.S. tax rates are encouraging more companies to do the same. It’s good for older workers, but it’s another nail in the coffin of employer-provided retirement security for millennials.
Europe’s payments crown does not come cheap 15 May 2018 Worldline is paying 2.3 bln euros for the credit card processing arm of Switzerland’s SIX. That will strengthen its position as Europe’s largest electronic payments group. But the French company had to pay a hefty multiple - and accept a humdrum return - to secure its dominance.
Vodafone CEO leaves hard work to his successor 15 May 2018 Vittorio Colao will be replaced by CFO Nick Read. Discipline in M&A and investment has helped the $72 billion mobile group beat peers’ returns. Read’s job is to make a success of the giant Liberty Global deal at a company that’s more used to pruning than growing its portfolio.
CBS and the Redstones may want to book Judge Judy 14 May 2018 The company led by Les Moonves is suing its controlling shareholders. The idea is to stop Shari Redstone replacing directors, giving the board time to dilute the family’s voting rights and so escape a bad merger with Viacom. Right now, though, it’s a lot about egos.
U.S. drug-price plan needs more bully, less pulpit 14 May 2018 Donald Trump wants to cut the cost of pills. His approach targets flush middlemen, Medicare’s limited negotiating ability, murky pricing and the inevitable foreign boogeymen. Yet calls for self-regulation have led sector investors to sigh with relief. He’ll have to get tougher.
Wall Street vets give small banks M&A wake-up call 14 May 2018 Cadence, set up in 2010 by Bob Steel, Bill Harrison and others to snap up failed lenders, is buying State Bank Financial for $1.4 bln. It’s a small deal in isolation. But there’s an expanding group of acquisitive upstart banks that may force stodgier rivals to do deals.
Xerox has one more chance for positive innovation 14 May 2018 The creator of laser printing and the GUI has been mired in a badly inked $6.1 bln sale to Fujifilm and far from user-friendly board governance. Carl Icahn and Darwin Deason have put an end to both. Xerox is in decline, but there’s still room for a clean, intuitive exit.
Symantec leaves investors suffering from silence 11 May 2018 The maker of anti-virus software lost a third of its value after it revealed an audit investigation and then skipped its earnings Q&A entirely. Not talking about the inquiry is understandable. But ruling all topics off limits encourages shareholders to indulge their worst fears.
California helps Paris send solar message 11 May 2018 The most populous U.S. state is making panels mandatory on most homes built after 2020. It will cut emissions only a little. But the clean-energy focus will push other states along. Fossil-fuel producers will have fewer excuses to ignore the renewable writing on the wall, too.
Zoopla lures new twist on classic UK property punt 11 May 2018 Silver Lake has offered $3 bln for ZPG, owner of housing search firm Zoopla. The U.S. buyout group’s punt mirrors that of the property speculators that use the website. Leverage makes it look a better deal, but increases the risk if the market tanks.
Holding: A bribe is a bribe, abroad or at home 10 May 2018 AT&T and Novartis would risk criminal prosecution if they paid a foreign leader’s pal for political influence. Yet handing big bucks to Trump fixer Michael Cohen seems well within U.S. law. The double standard undermines America’s claim “to spread the gospel of anti-corruption.”
Viewsroom: What’s eating at Elon Musk? 10 May 2018 Tesla’s CEO berated analysts for asking “boring, bonehead questions” after the electric-car maker reported a record quarterly loss. He then taunted Warren Buffett, suggesting his idea of corporate “moats” is sugary nonsense. Breakingviews columnists discuss why Musk is so testy.
Murdoch will be the winner once Fox movie is made 10 May 2018 The media mogul may soon have Comcast competing for parts of his empire. Disney would probably have to hike its $52 bln offer for Fox assets. His partial exit suggests he sees a dimmer future for cable TV. Even as the target, he’s one step ahead in the M&A game.
Investors shove three potatoes up Ford’s exhaust 10 May 2018 A majority of independent shareholders rejected the automaker’s long-term pay plan, want to scrap supervoting stock and reduced support for at least one director below 80 pct. It’s a significant rebuke, but the Ford family’s outsized votes insulate management from dissent.