Staples-Office Depot spread beckons the brave 10 Sep 2015 Shares of Office Depot are trading 27 pct below the implied value of rival Staples’ $5.6 bln offer. The retail office trade is a challenged business, but with Staples down just 18 percent since January, Office Depot looks like a cheap option on the deal passing antitrust muster.
Tough talk on jailing bosses is ultra-cheap 10 Sep 2015 U.S. lawmen are touting new rules to nail people not just their employers. It’s a bit late and also glosses over that the failure to prosecute individuals really comes down to the difficulty of making a case. The C-suite won’t be intimidated until regulators walk the walk.
Jeb Bush tax plan features impractical good sense 9 Sep 2015 The White House wannabe vying for attention with Donald Trump wants a simpler tax code with lower rates and fewer giveaways. Ideas like ending corporate interest deductions are on the right lines. But even if he could quell special interests, Bush would need huge spending cuts.
National Geographic takes refuge in Fox house 9 Sep 2015 The 127-year-old non-profit society is handing control of its yellow-bordered magazine and other operations to Rupert Murdoch’s TV company for $725 mln. Like Sesame Street’s deal with HBO, it’s a sign of the media times. The digital upheaval is making for strange new bedfellows.
KKR and Marshall Wace marry need with ambition 9 Sep 2015 The buyout shop’s purchase of 25 pct of Marshall Wace creates an odd beast: KKR doesn’t get control, and the precedents are mixed. Still, asset managers want scale and diversity, and the buyout business is challenged. If the tensions can be managed, it looks a logical trade.
Jefferies may be canary in shuttered Wall St mine 9 Sep 2015 Unlike the rest of the U.S. securities industry, the firm controlled by $7.7 bln Leucadia isn’t barred from proprietary trading. So its quarterly results could offer some insight into just how much the Volcker Rule helps or hinders the likes of Goldman Sachs in volatile markets.
Moving millennials may unpack $600 bln punch 9 Sep 2015 Despite better job prospects, many young Americans are living longer with their parents. That curbs spending on housing, as well as on internet service, refrigerators and such. A Breakingviews analysis suggests millennials exiting attics could add 4 pct to GDP within a few years.
Heineken crafts telling move away from global beer 9 Sep 2015 The Dutch beer giant has bought into a Californian brewer of pale ale. The undisclosed financials will be small in the context of this 40 bln euro company. But strategically it is a big deal. Heineken is accepting it needs more than fizzy beer in green bottles.
Yahoo headaches stretch beyond Alibaba 9 Sep 2015 The U.S. taxman won’t bless the Internet company’s plans to spin off its $23 bln Alibaba stake in a tax-free transaction. Yahoo may still push its case but the roughly 60 pct discount attached to this stake implies the plan is troubled - as is the company’s core business.
United CEO shakeup is chance to fly right on pay 9 Sep 2015 Jeff Smisek departed abruptly amid internal and federal probes over airport dealings. He takes off with a $5 mln “separation payment” and other perks like parking spaces for life. New boss Oscar Munoz’s deal isn’t final, which means United has time to nix such absurdities.
Apple’s iPhone upgrade should sustain investors 8 Sep 2015 Boss Tim Cook is expected to unveil a new version of the company’s smartphone. If the product cycle pattern follows, it will elicit oohs and aahs but not drool. The event could, however, remind shareholders of one more thing: for a blue-chip stock, Apple trades at a big discount.
BofA’s hapless board deserves investor rebellion 8 Sep 2015 Directors last year overrode a 2009 shareholder vote to separate the chairman and CEO roles, giving Brian Moynihan both. Though governance has improved, the blunder implies the board remains too aloof. If BofA loses the coming vote, it’s a mark against directors, not Moynihan.
Blackstone hotel deal may include early checkout 8 Sep 2015 The buyout firm is paying $6 bln for Strategic Hotels, owner of Four Seasons and Ritz-Carlton properties. The 13 pct premium seems measly given the appetite of foreign buyers for luxury lodging. Maybe Blackstone’s rewarding commercial real estate breakup of 2007 would work again.
Mylan $28 bln offer not good enough for Perrigo 8 Sep 2015 The generic drugmaker’s hostile bid comes with a skimpy premium, and is mostly in its own paper. Perrigo investors shouldn’t want stock in a shareholder-unfriendly company with bad governance and financial risk. An auction could generate a better outcome than selling to Mylan.
Media General’s TV roll-up suffers print noise 8 Sep 2015 The owner of some 71 local U.S. stations is buying Meredith for $3.1 bln. Media General will get 17 more TV properties. But it will also be stuck with a raft of magazines. The modest 12 pct premium and decent synergies provide some buffer against the challenge of selling them.
Russia’s internet grip is softer than China’s 7 Sep 2015 A law forcing websites to store Russian users’ information domestically is the latest example of a clampdown on internet freedoms. But Russia’s size, combined with an unwillingness to enforce such rules fully, makes fight better than flight for the likes of Google and Facebook.
U.S. workers make Fed’s job easier 4 Sep 2015 The unemployment rate fell to 5.1 pct in August, putting half the central bank’s dashboard right on target. When joblessness last dropped so low in 2005, interest rates were raised to 3.25 pct. With the inflation outlook also stable, moving past zero shouldn’t be heavy lifting.
American Express may face its Microsoft moment 4 Sep 2015 The $75 bln credit-card firm led by Ken Chenault is ValueAct’s latest target. It’s not clear how breaking up or returning capital will remedy Amex’s subpar growth and lagging stock. Going after the long-serving boss, ValueAct’s successful strategy at the software giant, might.
Rob Cox: Wall Street’s rave party feels the drop 3 Sep 2015 Robert Sillerman’s attempt to roll up the electronic dance music business is collapsing not long after UBS, Barclays and Jefferies helped his SFX Entertainment go public. Live Nation may once again turn out to be the buyer of a Sillerman creation, but this time will be different.
Troubled U.S. firms get the Argentina treatment 3 Sep 2015 A court says they can’t force holdout creditors to accept less security against loans. A similar ruling led to a standoff between Buenos Aires and hedge fund Elliott. Unlike countries, companies can declare bankruptcy as a fallback. But restructuring is getting tougher for both.