Capital Calls: U.S. jobs, $7 bln tax settlement 3 Sep 2021 Concise views on global finance: Slow U.S. job growth signals caution for the Fed; meanwhile, a giant deal between hedge fund executives and the IRS gives legs to President Biden's tax plans.
Rio Tinto can afford to go halves in Mongolia 3 Sep 2021 The miner’s $14 bln Oyu Tolgoi scheme is over budget and debt-laden, depriving its government partner of a return. Restructuring so only 50% of the project’s free cash pays down debt could restore dividends and win Mongolia over. High copper prices give Rio scope to act.
Meggitt arm-wrestle is test for UK interventionism 3 Sep 2021 TransDigm’s 7 bln pound approach for the aerospace engineer is higher than rival Parker Hannifin’s but uses way more debt. PM Boris Johnson has been active in probing M&A that could affect jobs or national security. But intervening on leverage grounds would be a new departure.
China’s tech sector gets dragged off hamster wheel 3 Sep 2021 Companies like ByteDance and Meituan are cutting back work hours and improving benefits and labour protection, as Beijing pushes to reduce overwork and promote family life. Some companies may take short-term hits to profitability, but it could help improve focus and productivity.
Baxter’s $10.5 bln deal is preventative medicine 2 Sep 2021 Acquiring Hill-Rom and its “connected” hospital beds should boost the medical products maker’s growth. If it doesn’t, the return on investment could be a sickly 6%. A bigger benefit to Baxter may be building up defenses against powerful hospital chains and pressure to cut prices.
Capital Calls: New York City is on climate notice 2 Sep 2021 Concise views on global finance: Cities with a higher number of wealthier residents will be able to combat climate related events.
Juicy Nordic drug buyout needs safety label 2 Sep 2021 Advent and GIC are paying $8 bln for Swedish Orphan Biovitrum, which specialises in rare-disease treatments. The new owners will need to invest in fresh products and fend off rivals, all while keeping staff. The potential returns look appealing but come with a fair dose of risk.
Walmart lifts lid on good, ugly of India payments 2 Sep 2021 A report by the U.S. giant’s PhonePe app details a hot $560 bln market, of which it controls almost half. Small towns dominate and gold addicts are going digital. It underscores its edge as a financial super-app while raising key questions on the industry’s path to profit.
Railroad suitor’s graceful exit depends on rival 1 Sep 2021 America’s train regulator has derailed Canadian National’s roughly $30 bln agreed deal for Kansas City Southern. To avoid further uphill effort and hefty fees, the suitor needs peer Canadian Pacific to persuade their mutual target to let it off the hook by jumping tracks again.
South Korea’s app-store sandbox is worth watching 1 Sep 2021 A new bill stops Apple and Google from forcing local developers to use their payment systems, which carry hefty commissions. It’s good for the country’s tech champions, like the $60 bln Kakao. But it’s only worth copying elsewhere if users end up with cheaper or better services.
Capital Calls: Geely’s employee stock awards 1 Sep 2021 Concise views on global finance: The Chinese automaker shifts the idea of granting workers share options into gear.
Private credit gets bigger but not better 1 Sep 2021 Pension plans and insurers are pouring money into esoteric loans that aren’t widely traded. Set up by money managers like Blackstone or Apollo, such funds offer high yields and lower losses than public debt. Yet rapid growth may herald lower returns and bigger risks.
Bernard Arnault’s farewell to Carrefour is overdue 1 Sep 2021 The LVMH founder sold his remaining 5.7% stake in the $15 bln Gallic grocer, at one-third the likely price he paid in 2007. It’s a rare miss for the luxury guru. Yet given the sector’s shaky outlook and French government opposition to takeovers, even a painful exit makes sense.
Evergrande’s liquidity trap gets stickier 1 Sep 2021 The distressed Chinese real estate developer doubled first-half profit by dumping assets, but delayed paying suppliers so long it’s struggling to complete projects. As property restrictions tighten, finding buyers for what’s on the books will be harder. Contagion risk is rising.
BHP brawl tips why nickel will cost pretty penny 1 Sep 2021 The miner’s agreed deal for Noront must contend with billionaire Andrew Forrest. His Wyloo Metals’ new offer tops BHP’s by 27% and would keep the Canadian company listed. A hot market for electric-car batteries makes buying even rocky projects like ones in the Ring of Fire tough.
Capital Calls: SPACs’ defense, Zoom 31 Aug 2021 Concise views on global finance: Nearly 60 corporate law firms put their names to a rejection of recent suits against blank-check firms; the video-conferencing company reported slowing growth in the second quarter.
Ida’s effects will linger, but not in GDP figures 31 Aug 2021 Rebuilding from the hurricane should mean economic growth recovers quickly, based on past storms. But disasters hit personal wealth, and in this environment could pressure wages and materials prices. The opportunity cost of disaster spending, too, cannot be measured.
Robinhood is vulnerable to disruption 31 Aug 2021 The complex of brokers like Fidelity had every reason to be upended by Vlad Tenev’s platform. But U.S. regulatory scrutiny and government probes are a distraction for Robinhood management. If those troubles aren’t resolved quickly, a new Robinhood-like firm could swoop in.
Prosus pushes hard on Indian fintech door 31 Aug 2021 The tech investor is paying $4.7 bln for payment processor BillDesk. That transforms its PayU operation and provides a profitable base to extend credit. The multiple of 19 times revenue is punchy, but a fraction of Paytm. And it’s a strong foothold in a big emerging market.
Italian data land grab comes at a price 31 Aug 2021 Fintech group ION has upped its bid for risk intelligence provider Cerved to 2 bln euros. An overall premium of 45% reflects growing demand for financial information. Offloading Cerved’s debt collection unit, worth perhaps 400 mln euros, would help recoup some of the cost.