DuPont’s fight against Nelson Peltz rages on 28 Jul 2015 The $50 bln chemical maker may have seen off the pushy billionaire in May, but its shares have since tumbled 20 pct. DuPont now expects lower profit, and dividends from spun off Chemours look shaky. Boss Ellen Kullman soon could find shareholders wondering what might have been.
New York commuter crisis may be good for America 28 Jul 2015 Major delays on some of the busiest rail lines into Manhattan from New Jersey have incited outrage. The overhead wires being blamed are emblematic of the decrepit infrastructure across the country. After so much partisan bickering, this episode could focus minds on funding.
Billionaire’s biotech IPO rides high on hope 28 Jul 2015 Patrick Soon-Shiong, whose NantKwest just fetched a $3.4 bln value, has made minority investors rich before but also treated them poorly. His new cancer treatment lacks supportive data for such a difficult task amid stiff competition. In this market, though, almost anything goes.
Ford shows why Marchionne’s M&A drive is stalling 28 Jul 2015 The U.S. carmaker revved up its best quarter since 2000, with a record showing in North America. Boss Mark Fields sounded optimistic, too. That makes it easy for Ford to ignore the Fiat Chrysler CEO’s pleas for industry consolidation – even if tie-ups make sense longer term.
The Economist’s elite owners seek elite print run 28 Jul 2015 The Agnellis, the Rothschilds, et al may buy more as Pearson sells. A 6 pct dividend yield has appeal. If the valuation – recently 730 mln stg – and payout are to keep rising, however, the weekly has to succeed where other publications have failed and turn its top line around.
Allergan turns itself into M&A lab experiment 27 Jul 2015 The pharma giant has since 2012 racked up over $100 bln in deals and changed its name twice and its tax HQ once. Selling its once core business to Teva for $41 bln leaves Allergan free to pursue even bigger targets. But too much reliance on M&A could leave the Petri dish exposed.
Wacky $2.2 bln SNL deal puts investors in a tizzy 27 Jul 2015 Shares in McGraw Hill lost $1.6 bln of value after it agreed to buy the financial data firm for 53 times last year’s EBITDA. That suggests investors value the growing SNL at little more than the $550 mln of tax breaks it brings. The multiple is crazy, but that doesn’t compute.
McDonald’s can sizzle flipping double-3G burgers 27 Jul 2015 CEO Steve Easterbrook’s fast-food chain trades at half the valuation of the Burger King-Tim Hortons feast the Brazilian investment firm cooked up. That’s because 3G outdoes its super-size rival at beefing up sales with new products. Bolder recipes would help McDonald’s catch up.
FT’s rich price is a sign for the Times 27 Jul 2015 Media tongues are wagging about the sale of the Financial Times to Nikkei for $1.3 bln. If 35 times operating profit is a guide to the going rate, it’s worth wondering what’s next. The still family-led New York Times springs to mind. The Sulzbergers may not get a better chance.
Starbucks serves up a tepid brew in Johannesburg 27 Jul 2015 The coffee giant has been blitzing China, but its move into South Africa is more cautious. Although the country offers a growing middle class, GDP growth is slowing. And too few Africans can afford the “Starbucks experience” for rapid expansion across the continent.
Fannie and Freddie cozy up in Uncle Sam’s basement 24 Jul 2015 Congress wants to fund highway repairs by raising mortgage insurance fees and cap pay for bosses of the two rescued GSEs. Both proposals are well intentioned but encourage the idea that Fannie and Freddie are permanent wards. It’d be better to find ways to help them leave home.
Breakdown: Watchdogs chew on health insurer deals 24 Jul 2015 Anthem and Cigna are the latest big U.S. providers to serve up a blockbuster merger. But they and their peers need to satisfy a slew of regulators before chowing down. Here’s a look at the agencies and the transactions officials may be asked to swallow in a concentrated industry.
Amazon rides cloud to value bigger than Wal-Mart 23 Jul 2015 Investors cheered as Jeff Bezos’ burgeoning web services business helped Q2 sales grow 20 pct. Flat capex meant free cash flow ballooned despite wafer-thin profit margins. Amazon, now the world’s most valuable retailer at $264 bln, just has to live up to its potential.
Mylan is Stichting it to its shareholders 23 Jul 2015 The uniquely Dutch poison pill makes it likely that the drugmaker has seen off Teva’s $40 bln hostile bid. Mylan may now be able to seal a deal to buy smaller Perrigo. If not, Teva’s offer might re-emerge. Either way, though, investors have been deprived of a clear choice.
White House circus is barely even reality TV – yet 23 Jul 2015 Donald Trump is just one of 21 wannabe candidates for U.S. president next fall. Talk of policy and qualifications, including folks with time at Lehman, is swamped by soundbites designed to grab notice. At least until early 2016 it’s a spectacle, not a preview of the real choices.
Garbage-hauling upstart could trash establishment 23 Jul 2015 Rubicon, whose techie model threatens to rattle the $48 bln U.S. rubbish industry, is close to a fresh $50 mln injection and just added Uber’s former CFO to its board. If dominant operators like Waste Management and Republic Services aren’t flexible, their new rival may clean up.
Financial logic in $1.3 bln FT buy is paper thin 23 Jul 2015 Japanese media group Nikkei is taking a bold step with its purchase of the Financial Times. The price equates to 35 times adjusted operating income. Sure, Nikkei gets a bucketload of kudos. But the tag is around three times higher than the multiple enjoyed by quoted media peers.
Ferrari IPO customized with Fiat governance part 23 Jul 2015 The supercar maker is offering an extra vote for shares held for three years – part of its parent’s spec, too. The loyalty shares help entrenched owners keep a grip. What might make investors skittish, though, is Ferrari trying to live up to a touted 10 bln euro valuation.
Lazard and Evercore do more with less in M&A boom 23 Jul 2015 Second-quarter results show the two independent advisers have not reaped as much benefit as bulge-bracket rivals from the recent dealmaking surge. But their simpler business models and higher margins leave more of the gains for shareholders – especially owners of Lazard.
General Motors gives investors a wake-up call 23 Jul 2015 Bumper second-quarter results in America and China show that CEO Mary Barra is getting the carmaker in the right gear. She can’t hit cruise control yet. But the stock is trading below the 2010 IPO price and at a big discount to rival Ford. GM deserves a bit more shareholder love.