HP’s Autonomess should devour Marc Andreessen, too 20 Nov 2012 The Silicon Valley visionary behind Netscape goaded Leo Apotheker, the CEO he recruited to HP, to bet big on Autonomy as part of his “software eating the world” thesis. Andreessen was also integral to the value-destructive Palm deal. HP’s board would be better off without him.
Enforcers keep on casting for biggest SAC fish 20 Nov 2012 The feds hit Mathew Martoma, an ex-trader at Steve Cohen’s hedge fund firm, with criminal and civil insider trading complaints. They say he directly urged his boss to trade, helping make $276 mln. But if they hope Martoma can assist them in landing Cohen, they’ll need to deal.
JPMorgan CFO rejig leaves only Dimon unpunished 20 Nov 2012 Promoting Marianne Lake ticks several boxes. It sidelines another top dog, Doug Braunstein, who failed to spot the London CIO mess; adds another woman to the c-suite; and restores the CFO’s place in the hierarchy. Clawing back some of Dimon’s pay would at last harpoon the whale.
Baseball is due to face a financial curveball 20 Nov 2012 Rupert Murdoch is buying into the New York Yankees cable network at a Ruthian EBITDA multiple. Player salaries and ticket prices have surged at triple the rate of inflation over 20 years while franchise values are at 42 times operating income. These diamonds aren’t forever.
Deloitte tests whether TBTF applies to accounting 20 Nov 2012 If what HP says is true, Autonomy’s auditor will be in a tight spot. Deloitte keeps popping up in scandals despite a public shaming by its regulator. It’s becoming increasingly clear that the Big Four structure is leaving companies too vulnerable. It may be time to break them up.
HP’s $8.8 bln Autonomy trouble sown by dysfunction 20 Nov 2012 Sure, the granddaddy of Silicon Valley blames accounting improprieties at the UK software company it bought for nearly $12 bln last year. But HP, facing declining businesses and boardroom disarray, was too eager. CEO Meg Whitman’s already tough job just got even harder.
HP-Autonomy row suggests bankers did not compute 20 Nov 2012 There’s plenty of blame to go around in the explosive bust-up between the U.S. tech giant and the British data-sifter. But it raises tough questions for the M&A advisers who shepherded the $12 bln deal, chiefly Frank Quattrone’s Qatalyst, Barclays and Perella Weinberg.
Fiat Industrial unearths more value in CNH tie-up 20 Nov 2012 The Italian tractor maker’s no-premium merger bid for 88 pct-owned unit CNH was rightly rebuffed by a committee of the U.S. company’s board. FI is back with a 26 pct cash bump. The bidder’s not above some arm-twisting too. But this looks more like a fair squeeze-out premium.
Short-seller raises stakes with Singaporean attack 20 Nov 2012 Shares in Olam have been suspended after Muddy Waters founder Carson Block questioned its accounts. His record of exposing Chinese frauds will make investors take notice. But the commodity trader, and largest shareholder Temasek, are bigger game. Both sides have much to lose.
Amazon of China defies down-round blues after all 20 Nov 2012 The valuation of online shopping site 360buy swelled by 15 pct to $7.6 bln in a year, despite widening losses. VCs continue to pour money into China’s crowded e-commerce space. But as players increasingly compete for market share by discounting, profits look ever more elusive.
If Apple becomes Microsoft, investors should cheer 19 Nov 2012 At least, that is, for their wallets. Middle age for tech stocks can hurt as growth shareholders lose interest and value-oriented owners await stability. But Apple has already made the transition. Even if its next decade echoes Microsoft’s last, the company is worth over $1 trln.
Intel’s next chief can’t be chip off old block 19 Nov 2012 The semiconductor giant’s shine has dulled with the rise of mobile. Being surpassed in market value by Qualcomm illustrates the shift. Retiring CEO Paul Otellini’s replacement will have to tackle smartphones, but time is wasting. Intel also needs to play tougher defense.
Soft power is priceless – and scarce 19 Nov 2012 When the term was coined in 1990, the U.S. way of life still had broad appeal. But America is now equally distrusted and emulated. No nation has filled the soft power gap. Japan and the UK are powerless despite a new study that says otherwise, and China offers only soft weakness.
Colombia brokerage fail more MF Global than Lehman 19 Nov 2012 Interbolsa’s collapse evokes elements of both Wall Street firms. But the demise of Colombia’s largest brokerage is merely painful like MF Global’s, not systemic like Lehman’s. At least Colombia’s regulators have an excuse: they’re toothless until a firm fails. That has to change.
Blackstone begins pricey auf Wiedersehen 16 Nov 2012 Its 2.7 bln euro Deutsche Telekom misadventure is unwinding after six years. Blackstone will keep a seat on the German telco’s board, but it dumped a third of its underwater investment. The loss shows why private equity and minority stakes in big public companies don’t connect.
Whatever happened to the fiscal "Cialis plan?" 16 Nov 2012 That was the name given to a piece of U.S. legislation spearheaded by Erskine Bowles that would have given the lame duck Congress a way to avoid the fiscal cliff and set the framework for a grand bargain. Its absence from the debate suggests a mere temporary patch in 2012.
Chesapeake mini-me CEO’s days should be numbered 16 Nov 2012 SandRidge’s top shareholders make a solid case to oust boss Tom Ward, a co-founder of wobbly energy peer Chesapeake. Unless stopped, Ward plans to sell the firm’s best oil assets. And his outrageous pay - $25 mln, or half 2011 earnings - shows directors have neglected investors.
Hostess Brands is dead, long live the Twinkie 16 Nov 2012 The fluorescent yellow cream-filled cakes are a cultural touchstone for generations of Americans. As Hostess limps through a second bankruptcy in three years, the nuclear option of liquidation is being pursued. But the Twinkie brand’s half-life should be longer than its maker’s.
Review: Why Polaroid faded away 16 Nov 2012 The instant photo pioneer had three fantastic decades, and an equally long descent. Digital technology and predatory financiers were too much for weak managers. A pacey new book is weak on finance, but shows how Edwin Land, Polaroid’s dazzling founder, was a lot like Steve Jobs.
Reckitt enters vitamin wars with a Bang 16 Nov 2012 The consumer powerhouse behind Cillit Bang has gatecrashed Bayer’s bid for U.S. vitamin maker Schiff. At a 23.5 pct premium and 16.5 times EBITDA, the $1.4 bln counterbid is potent stuff. But trust Reckitt to extract big synergies, as it did in previous punchy deals.