Companies & Funds

Sweden’s SEB chooses relevance over higher returns

13 December 2018

The country’s second-biggest bank by assets said costs will increase 1 bln crowns by 2021 to cover digital investment, hitting profit. Yet unlike many stodgy European lenders battling online rivals, SEB is in a better position to defend the bottom line.

Plunging GAM shares belie elusive value

13 December 2018READY SOON

With shares down 80 pct this year, the Swiss asset manager could be a takeover target. Cost savings alone are worth more than its market value. Yet uncertainty may lead clients to pull money, leaving a buyer with little. Fund group valuations are especially blurry in a panic.

Glasenberg successor will run a different Glencore

13 December 2018

The commodities giant’s combative boss says he will retire in 3 to 5 years. It’s unclear who will replace him, even after a recent reshuffle. With a U.S. subpoena and other woes weighing heavily on the stock, Ivan Glasenberg may yet be tempted to consider a much bolder overhaul.

Anta deal enters arena of extreme financial sports

13 December 2018

Instead of a straightforward acquisition, the Chinese company structured a $5.2 bln LBO of Finland’s Amer. Partners like Lululemon’s founder may help accelerate sales of workout apparel and Salomon skis, but hefty debt also implies a risky race for private equity-style returns.

Apax may have clicked on $1.8 bln Kiwi bargain

13 December 2018

The buyout group has won a rare New Zealand bid battle, buying Trade Me, a mix of Craigslist and eBay. That's fair, for a local champion with little debt and chunky margins. Apax has similar assets elsewhere, too. Only Amazon's looming spectre should unsettle.

China’s murky moves hand Trump more ammo

13 December 2018

Ottawa has lost contact with another citizen after Beijing detained an ex-diplomat. It will be considered retaliation for the arrest of Huawei’s CFO. Despite other concessions, such tactics stand to alienate China scholars, embolden U.S. hardliners and make trade peace harder.

Club Med embarks on overheated holiday escape

13 December 2018

The vacation resorts arm of Chinese conglomerate Fosun priced its IPO at the bottom end of the indicated range. A $2.4 bln market cap, however, imputes a multiple on par with its most richly valued peers. Sluggish tourism trends could leave optimistic investors scorched.

Tencent and Spotify are streaming’s dueling banjos

12 December 2018

Tencent Music’s IPO valued it at the same $23 bln as its Swedish rival, even though the Chinese service is profitable and Spotify is not. Their business models are worlds apart, but as one moves into video and the other builds up subscriptions they will sound increasingly alike.

Hadas: What oil price volatility is trying to say

12 December 2018

A barrel of oil costs 31 pct less than in early October. The message is not about investment needs or a big demand shift. The tumble is big because the geopolitical racket makes lesser moves inaudible. Stock markets may also be speaking up.

Vincent Bolloré will break up Vivendi

12 December 2018

The 66-year-old tycoon is smarting from a drubbing by Elliott in Italy, and his media group suffers from a huge conglomerate discount. A partial sale of Universal Music may help. But dismantling the whole group would release $10 bln in value, and keep potential activists at bay.

Pernod Ricard served a shot of Diageo by Elliott

12 December 2018

The French booze group lags its rival on some counts, such as operating margins, but has bested it on others, notably share-price performance. Narrowing the gap on profitability, and improving corporate governance, as the activist urges, are worthy and achievable objectives.

Activism anxiety will grip French establishment

12 December 2018

Between the state and raiders like Vincent Bolloré, France is no stranger to meddling investors. But this year some blue-chips will face cage rattling. Pernod is just the start. The likes of Saint-Gobain, Danone, Renault - and even Bolloré’s Vivendi - are no longer off-limits.

Thiam’s bid to be boring rests on ditching traders

12 December 2018

The Credit Suisse boss plans to buy back shares worth 1.5 bln Swiss francs a year in 2019 and 2020. That should help the bank hit its 12 pct return target. Robust wealth management will offset lower trading revenue. The prospect of a 10 pct dividend yield also appeals.

Hyundai heir is tightening his grip on the wheel

12 December 2018

A radical shake-up in the upper ranks of the Korean autos conglomerate should help de facto boss Euisun Chung repair multiple dents. Flagging sales and restructuring demands from activist Elliott are top of his to-do list. A firmer hand should drive progress on both.

India’s new central bank boss starts on back foot

12 December 2018

Ex-finance ministry official Shaktikanta Das was chosen to run the RBI, a day after Urjit Patel quit. Top marks for a fast pick. There’s little to suggest, however, that a bureaucrat who backed the prime minister’s fateful demonetisation plan will resist pressure from New Delhi.

China-U.S. trade war will get a lot more personal

12 December 2018

Washington and Beijing’s tariff truce is looking fragile. The arrest of tech giant Huawei's CFO on U.S. behest complicates matters. Detention is a common business negotiation tactic in China, as a Canadian ex-diplomat just found out. U.S. executives have good cause to worry.

Stitch Fix models tech’s terminal problem

11 December 2018

The outfit-delivery service’s shares fell 29 pct despite profit that beat expectations. That’s because tech valuations hang on terminal value – the cash flows that come once the business is mature. Slowing customer growth raises doubt about whether this one will reach middle age.

Goodbye tracking stocks – don’t hurry back

11 December 2018

Dell’s $23.9 bln plan to buy back paper that mirrored the performance of subsidiary VMware received shareholder approval. Like most tracking stocks, it consistently traded at a discount because holders had few rights. That sounds like a bug; for Dell it proved a handy feature.

Google finds Congress still searching for a clue

11 December 2018

U.S. lawmakers who grilled company chief Sundar Pichai failed to land a blow, and showed themselves ill informed about what the search engine actually does. The knowledge gap is risky for tech firms, because it increases the risk of regulation that misses the mark.

Big Tech has a mission in U.S. flyover country

11 December 2018

Facebook and its rivals need friends in Washington, yet they mostly aid the urban elites. That’s a missed opportunity, because it’s in America’s interior that they can do more good, by creating jobs. That would be a slow but lasting way to build goodwill.