Sports Authority loses game with unforced errors 2 Mar 2016 The U.S. retailer declared bankruptcy a decade after a $1.3 bln buyout. Debt and internet competition contributed to its demise, but rivals like Dick’s survived similar challenges and turned in a stellar performance. Bad management was largely to blame for the costly strikeout.
Rolls-Royce’s board activist is double-edged sword 2 Mar 2016 U.S. activist fund ValueAct has a seat on the board of Rolls-Royce. If the engine maker’s No. 1 shareholder musters enough patience, it can underpin the turnaround engineered by CEO Warren East. But should it push for quick fixes like a breakup, Rolls’ predicament could worsen.
Wall St girds for role as White House battleground 2 Mar 2016 Hillary Clinton and Donald Trump emerge from Super Tuesday as their parties’ likely presidential nominees. Both have vulnerable ties to high finance. That’ll be fodder for heated attacks and even wayward campaign promises. Bankers are resigned to it. But it’s just what markets hate.
Spotify’s cash hoard signals it’s ready to dance 1 Mar 2016 The digital music service may be about to raise $1 bln of convertible debt, much of it from TPG. That’d hand the private-equity firm an IPO discount without affecting the $8.5 bln valuation from last year’s funding round. It’d also give Spotify firepower to hunt for partners.
U.S. bank watchdog may at last be back in business 1 Mar 2016 The Senate committee that oversees Wall Street essentially has been on hiatus for months as Chairman Richard Shelby tends to his re-election. Ex-Im Bank, the Fed and the SEC are all waiting. An end to this pathetic case of congressional inaction hinges on Tuesday’s polls.
Jamie Dimon to Wells Fargo: Go ahead, make my day 1 Mar 2016 The JPMorgan boss suggests that if his big, boring rival wants to compete internationally, it’ll have to buy an investment bank. Bulking up on Wall Street would recklessly push the lender led by John Stumpf into businesses it doesn’t know well. Dimon wouldn’t want that. Right?
Exxon supertanker cruises on stormy financial seas 1 Mar 2016 Yields on the energy titan’s $12 bln bond issue were higher than previous debt sales, reflecting jitters about cheap crude and worries about Exxon’s triple-A rating. Paying 4.1 percent for 30-year money, though, is a problem cash-strapped oil rivals would love to have.
NYC judge unlocks door to Apple privacy win 1 Mar 2016 A jurist in Brooklyn says the FBI can’t force the tech giant to bypass security on an iPhone. The ruling confirms that a 225-year-old law doesn’t apply and that the hack would unduly burden Apple. It’s a roadmap for the better-known case unfolding in California and Congress.
Chancellor: Buffett’s US optimism long-term valid 29 Feb 2016 In his annual shareholder missive, the Oracle of Omaha rejects arguments, by Larry Summers and others, that America has entered a period of “secular stagnation.” However, the Berkshire Hathaway chairman’s optimism looks misplaced for now thanks to distortive monetary policies.
Honeywell and UTC give tour of M&A sausage factory 29 Feb 2016 The potential $160 bln merger is worth $108 a share to United Technologies owners, maybe as much as $134. No, wait, it’s $101. Synergies add $40 bln of value. Or is it $23 bln? Maybe zero. Antitrust aside, the back-and-forth offers a glimpse into the messy process of dealmaking.
Amazon pantry raid should worry UK grocers 29 Feb 2016 The Seattle giant’s move into British fridges, via a deal with Wm Morrison, is starting modestly. Just 5 pct of UK grocery sales happen online, and profit is scarce. But Amazon has three things in its favour: size, a tolerance for low margins, and no pesky real-world stores.
Guest view: Financial storm conditions will worsen 29 Feb 2016 The disruption in international capital flows will only accelerate, says former Citibank exec Bill Rhodes, thanks to China’s slowdown, the continuing collapse of oil prices and diverging monetary policy. It’s going to be a rough ride for global markets and economies.
EU states could easily balk at data privacy deal 29 Feb 2016 Brussels’ agreement with the U.S. will tighten how Google, Facebook and others handle information. But the EU’s members need to approve it. American efforts to hack iPhones and otherwise relax restrictions on intelligence officials should make the bloc’s residents wary.
Valeant CEO back with less power and no glory 29 Feb 2016 Mike Pearson has returned from illness, stripped of his chairmanship. The $25 bln drugmaker also withdrew guidance and will further delay reporting 2015 results. Marginally better-looking governance isn’t enough to give investors like Bill Ackman hope of reversing losses.
Schwarzman’s riches mostly there for the taking 29 Feb 2016 The Blackstone boss pocketed a breathtaking $800 mln or so last year. Four-fifths of that came from dividends paid by the buyout shop to all owners. Gawking at Steve Schwarzman’s Croesus-like wealth may be good fun, but potential double-digit yields are openly for sale.
Buffett fancies himself exception to every rule 29 Feb 2016 The latest missive from Omaha hews to a familiar Oracle tradition. Asset-liability mismatches and unofficial accounting metrics get both mocked and embraced, just like investment bankers, derivatives and tech stocks before them. Homespun wisdom is for lesser investing mortals.
Oscars spotlight red carpet for Chinese investors 26 Feb 2016 Tinseltown’s glitziest night is on Sunday, where stars like Leonardo DiCaprio vie for the movie biz’s most prestigious awards. Healthy box-office sales of $11 bln last year belie looming challenges for some studios. Chinese investors are likely to get the runway treatment.
Elizabeth Warren to GOP: Do as I say, not as I do 26 Feb 2016 The Democratic senator has championed the president’s right to pick a new Supreme Court justice this year and the Senate’s duty to consider the nomination. Yet Warren has resisted confirming candidates for office with Wall Street ties. Next time she should take her own advice.
Scalia’s empty seat reverberates beyond Washington 26 Feb 2016 Dow Chemical is paying $835 mln in a decade-old lawsuit that was heading to the Supreme Court. The company decided the conservative judge’s death changed the balance of the outcome and settled. It’s a reminder that politics surrounding the top U.S. bench has real-world effects.
Paris accord weakens Exxon’s proxy defenses 26 Feb 2016 Last December’s UN greenhouse gas deal has led to an increase in shareholder resolutions on global warming, including at the $350 bln oil titan. Investors are striking while the iron is hot. It leaves energy companies with less power to resist demands for more information.