Energy Dept choice pits Trump against bureaucracy 16 Dec 2016 Rick Perry ran for the White House promising to dismantle the federal energy agency. Now the president-elect wants him to run it. The DOE is already resisting a Trump request to list staffers working on climate change. Animosity from the "deep state" could slow-roll his agenda.
Breakdown: Dodd-Frank, Trumped 15 Dec 2016 The U.S. president-elect wants to unwind some post-crisis financial rules. Given their slim Senate margin and regulators' support for key reforms, Republicans may have to pick their battles. Tougher capital requirements would be tough to roll back, but the Volcker Rule may go.
A teachable moment in for-profit education 15 Dec 2016 DeVry is paying $100 mln to settle fraud accusations under a crackdown by the Obama administration. For-profit colleges can expect looser oversight when the founder of Trump U. takes office. DeVry's post-election stock surge suggests investors are discounting regulatory risk.
Fed rate hike foretells end of credit-market boom 15 Dec 2016 U.S. corporations have gone on a borrowing binge in recent years to fund stock buybacks and juice reported earnings. The central bank's long-awaited move, and the prospect of more to come, alters the calculus. Real growth rather than financial engineering will be the new game.
3G will take another bite of Corporate America 15 Dec 2016 The Brazilian investors behind AB InBev and Kraft Heinz look poised for another mega-deal in 2017. After a failed bid for Hershey, Mondelez makes for a hefty, attractive $66 bln target. Kellogg and General Mills could also be tempting if the Oreo maker proves too big to digest.
KKR gets shot in arm from bumper Capsugel exit 15 Dec 2016 Selling the drug capsule group for $5.5 bln means the U.S. buyout group has tripled its money since buying from Pfizer in 2011. It has also done so without savaging Capsugel’s R&D budget. Acquirer Lonza gets vertical integration but will struggle to get the same kind of return.
Sky shareholders are close to maximum altitude 15 Dec 2016 Some of the pay-TV operator’s investors grumble that independent directors were too eager to accept an 11 bln pound bid from Rupert Murdoch’s Fox. But Sky’s share price wasn’t obviously beaten up, and the premium is generous. A small bump is the best they can hope for.
Verizon-Yahoo union faces death by a billion hacks 14 Dec 2016 The telecom giant's $4.8 bln deal to buy the internet outfit's core business was already in question after it revealed 500 mln user accounts may have been breached. Now Yahoo has flagged another intrusion, twice as large. It's increasingly easy – and smart – for Verizon to walk.
New president may force hawkishness on 2017 Fed 14 Dec 2016 The central bank nudged interest rates up again after a year's pause. Janet Yellen and colleagues previously sounded cautious but that was before the Trump bump. If bond yields, inflation and stock prices continue to rise, the Fed will be under pressure to make quicker increases.
New Hertz CEO faces tough drive out of ditch 14 Dec 2016 Kathryn Marinello has a great résumé. The problem is that she's the $2 bln rental-car outfit's third boss in two years, and activist investor Carl Icahn looms in the back seat. Earnings just took a hit, leverage is high, and the sharing economy is undermining Hertz's model.
Actelion looks like a lose-lose for Sanofi 14 Dec 2016 The French firm is mooted as a buyer for the Swiss biotech group after J&J walked away. The financial logic looks equally strained, and overpaying would smack of desperation about Sanofi's own business. With drug prices under pressure, pharma M&A will not get any more rational.
Small step for some is giant leap for Uzbekistan 14 Dec 2016 The landlocked central Asian country has poor human rights and low foreign investment. But new President Shavkat Mirziyoyev has made encouraging changes, like restoring air links with Tajikistan and scrapping visas for some foreigners. There is far to go, but it’s a start.
Goldman adds a splash of color to executive ranks 14 Dec 2016 Two bald white male vets will replace Gary Cohn, the bald white president who won't replace Lloyd Blankfein, the bald white chairman and CEO of the bank. So the appointment of Martin Chavez as CFO stands out in many ways – jokes aside, mainly for his entrepreneurial background.
Wells is wrong bank to lead anti-regulatory charge 14 Dec 2016 New CEO Tim Sloan has been the most vocal bank boss in calling for a rollback of oversight since the U.S. election. He may have a point. But the $274 bln lender's fake-accounts scandal seems to be spreading. And the business Sloan ran flunked the Fed's latest living-wills test.
Match.com owner’s pushy profile a real turnoff 13 Dec 2016 IAC Chair Barry Diller steamrollered Michael Eisner and other directors in his bid for eternal control with a new class of stock. The governance is abysmal even by Silicon Valley standards. CalPERS is suing. But the media mogul's power grab will encourage more shareholder abuse.
Tech needs to speak the president-elect’s code 13 Dec 2016 Most major Silicon Valley CEOs have heeded the call to Trump Tower. They may be expecting a browbeating, a deal for tax cuts – or both. Their real task, though, is to convince a hostile audience that they – and open societies – create wealth, jobs, security and power.
Even if Yellen remains, Trump can reshape Fed 13 Dec 2016 The governors of the U.S. central bank are gathering for the last markets meeting of this year. The chair plans to stay until 2018. But with two vacancies out of seven and the potential for more to quit, the next president has a chance to tip the political balance of the group.
Aetna savings undercut wider synergy credibility 13 Dec 2016 The U.S. medical insurer's CEO now says cost cuts following its Humana acquisition are forecast at $3 bln a year, not the original $1.25 bln. Extra efficiencies conveniently help Aetna with its antitrust defense. The big revision should feed skepticism about all such estimates.
Basel set to fill bank capital holes – with fudge 13 Dec 2016 Global standard setters could allow lenders to hold less capital against assets than previously flagged. It's a predictable compromise to help the worst affected European banks, while heeding U.S. calls for more uniformity. Banks will be pleased; hairshirt supervisors less so.
Exxon’s new boss will confront the end of empire 13 Dec 2016 Rex Tillerson's selection as U.S. secretary of state clears the way for Darren Woods to take charge of the $380 bln oil giant amid falling reserves. With Saudi Aramco prepping an IPO and rival Shell coming up fast, Exxon's days as Big Oil's unparalleled heavyweight are numbered.