Latest pharma roll-up leaves lots of room to grow 7 Jul 2015 Horizon’s $1.75 bln unsolicited offer for U.S. rival Depomed continues the sector’s M&A rave fueled by tax savings and cost cuts. The Irish bidder is a recent entrant on the scene, so its low debt load and small size means it can easily expand. That portends more deals ahead.
Oil is grounded in a sub-$60 bear market 7 Jul 2015 Brent crude fell over 6 percent on the back of worries about Greece and the prospect of an Iran nuclear deal. The latter has a much bigger, if delayed, impact. As U.S. shale drillers cut costs fast and Saudi Arabia goes for volume, ample supply is likely to keep a lid on prices.
Buyouts of U.S.-listed Chinese firms look doubtful 7 Jul 2015 Bosses of groups like Qihoo 360 and Momo have offered to buy back their firms, eyeing higher valuations back home. But with mainland shares slumping, most of these stocks now trade far below the potential bids. These deals were tricky to start with. The scepticism is merited.
Goldman case proves even shrimps can punch back 6 Jul 2015 Sergey Aleynikov beat more criminal charges of swiping the bank’s high-speed trading secrets. Bigger fish like AIG ex-CEO Hank Greenberg and sports mogul Mark Cuban have held Uncle Sam to the letter of the law. Aleynikov’s success may sway more small fry to stick it to the man.
Planet Fitness runs a race against itself in IPO 6 Jul 2015 A stock sale would make the $10-a-month gym chain the next test of investor appetite to back the seemingly eternal quest to slim down the American consumer. Though it has few public market analogues, and a lot of debt, Planet Fitness’ asset-light strategy may get pulses racing.
Bank investors put too much faith in rate hikes 6 Jul 2015 Shares in U.S. lenders have been on a roll, but not because business is booming. The market is hoping rising interest rates will be a cure-all. That ignores risks from deposit flight to investment and trading snafus that could be exacerbated by years of pent-up frustration.
Aetna’s bitter Humana pill is good long-term care 3 Jul 2015 The two U.S. healthcare insurers struck a $37 bln deal ahead of rivals in a race to consolidate an industry rapidly reshaping under Obamacare. Cost savings will fall short of the premium Aetna is offering. It may be a price worth paying to be first in line with trustbusters.
Uber’s French lesson: disruption has limits 3 Jul 2015 The upstart taxi app has suspended its service in France after a fortnight in which it was the target of violence. Two executives were also detained. Uber’s truculent approach has driven growth. But agents of renewal sometimes have to work with the status quo to change it.
Cuba’s coming boom: A cautionary Caribbean tale 2 Jul 2015 As the communist nation’s emergence takes another step with U.S. diplomatic ties restored, its neighbor Puerto Rico is descending into a debt crisis. Breakingviews imagines a future conversation between former Presidents Castro and Obama if Cuba fails to heed the warning.
BP may now get closure on Gulf spill 2 Jul 2015 The UK oil major has settled claims with the U.S. government and five states for $18.7 bln. It brings the total bill to $53.8 bln. But it could have been worse and it’s payable over as much as 18 years. It may also mean BP can finally put the Deepwater disaster behind it.
U.S. jobs gains yet to vanquish crisis hangover 2 Jul 2015 The economy added more positions in June and the jobless rate fell to 5.3 pct. It’s a steadily improving situation – yet there are clear signs of slackness, like a new low for workforce participation and stagnant wages. The damage from the 2008 crunch is proving persistent.
Iberdrola’s American dream gets harder to realise 2 Jul 2015 The Spanish utility’s $3 bln takeover of listed U.S. peer UIL has been dissed by the Connecticut regulator. Iberdrola can probably offer concessions to get the deal done. But the costs of doing so risk making its attempt to crack the fragmented American market less attractive.
Healthcare M&A pumped after Obamacare booster shot 2 Jul 2015 The U.S. top court decision upholding medical-coverage subsidies signals the official start of a race to consolidate. Centene and Health Net’s $6.3 bln deal gives the insurers an early lead. Big rivals like Cigna may catch up as the industry accepts that reform is here to stay.
GE could yet pull cooking appliance deal from fire 1 Jul 2015 U.S. trustbusters sued to block Electrolux’s $3.3 bln purchase of the conglomerate’s oven business. The firms may be able to pull an American Air-US Airways and sell assets to save the deal, but market definition issues loom. Either way, Uncle Sam knows how to turn up the heat.
Nike displays unsportsmanlike governance conduct 1 Jul 2015 Founder Phil Knight’s transfer of stock that allows him to elect a majority of the board to a foundation constitutes a foul of sorts. Though investors will give the sneaker giant a pass for its extraordinary performance, their successors may rue that failed call.
ACE aims to defy history with $28 bln Chubb deal 1 Jul 2015 The Swiss insurer is buying its upscale U.S. rival. Cost and tax savings don’t cover the premium, implying ACE believes in promised revenue gains, also touted in the Willis-Towers Watson merger this week. The failed 1999 marriage of Provident and Unum, though, provides a warning.
Fossil fuels deserve dispassionate analysis 1 Jul 2015 Coal, oil and natural gas are dirty and contribute to global warming. They also make the global economy hum. Substitutes remain more expensive. That matters most in poor countries where GDP growth does the most good. A wise climate policy would count up both sides of the ledger.
Apple marching to the drum of its own Beats 30 Jun 2015 The company’s new subscription music streaming and online radio services could upend markets dominated by Pandora, Spotify and SiriusXM. Their combined annual revenue of $6.4 bln would be equaled by just 6 pct growth in iPhone sales. The hardware angle sets Apple’s effort apart.
Breakups, activists presage more industrial M&A 30 Jun 2015 Emerson said it plans to hive off its struggling network power business, a possible prelude to more spinoffs at the $37 bln conglomerate. And Nelson Peltz took a stake in $12 bln rival Pentair, saying he wants management to do deals. It’s more fuel for the mergers fire.
Rob Cox: Uber gets a pass on its Wall Street habit 30 Jun 2015 Big banks break rules and pay fines. Traditionally it’s just a cost of doing business. Uber, meanwhile, pays fines when drivers violate regulations that stand in the way of its business model. Nowadays banks attract outrage, but Uber is often forgiven in the name of disruption.