The Exchange: Sustainable finance 30 Mar 2021 European bank ING is a leader when it comes to holding borrowers to climate-change commitments. In an interview hosted by the European-American Chamber of Commerce New York, ING Americas CEO Gerald Walker talks to Breakingviews’ Richard Beales about the future of green finance.
Deliveroo’s IPO cash hunger leaves sour aftertaste 30 Mar 2021 The UK food delivery firm’s offering values it at 7.6 bln pounds, the bottom of the target price range. Despite its rapid growth and big ambitions, investors face post-pandemic uncertainty. Boss Will Shu’s order for 1 bln pounds of fresh cash suggests profitability is a way off.
Aussie power giant spins into climate quandary 30 Mar 2021 AGL Energy hopes running its generation and retail units as separate businesses will lift its slumping stock. But CEO Brett Redman’s pitch is short on financial detail, envisions himself as boss of both parts, and leaves the $5 bln company heavily reliant on fossil fuels.
Capital Calls: BlackRock’s Archegos angle, SPACs 30 Mar 2021 Concise views on global finance in the Covid-19 era: The fallout from the collapse of Bill Hwang’s family office gives regulators reasons to focus on funds, not fund managers; and bosses of blank-check companies don’t take investor questions.
Hong Kong softens the G in ESG 30 Mar 2021 A new proposal would limit access to information about company bosses. Labyrinthine structures and easily confused names make such data invaluable for bank and investor due diligence. Going against the tide of governance and disclosure will taint the city’s business standing.
China Evergrande spinoff is draped in red flags 30 Mar 2021 The indebted property conglomerate plans to list its online market for flats and cars, valued at $23 bln. Unlike rival Ke, the unit has grown by taking stakes in customers, mostly real estate agencies, and giving them equity. Brash financial engineering is unlikely to pay off.
SpongeBob emerges from market chaos mostly intact 29 Mar 2021 ViacomCBS pocketed $3 bln by raising equity after a meteoric share-price rise, only to find itself at the center of a selloff triggered by hedge fund Archegos. The broadcaster’s shares are still up over 20% this year, but its next capital raising may not be so easy.
Banks’ prime broking blowup reveals lurking danger 29 Mar 2021 Credit Suisse and Nomura could lose up to $6 bln on the default of Archegos Capital. Neither have been forthcoming yet about how a single client cost them so much. But such glaring control failures raise questions about what other risks are hidden in banks’ trading books.
AstraZeneca could use a shot of under-promising 29 Mar 2021 The pharma group got caught in a spat between states over vaccine supplies, partly due to PR gaffes and overhasty pledges. A refresh of the board and chairman would be one way to overcome an episode that has hurt credibility and hampered rollout of a good product millions want.
Vaccine halo merits the effort for American pharma 29 Mar 2021 The success of Pfizer, J&J and Moderna in developing Covid-19 jabs and scaling up production has buffed their reputations. The immediate financial gain – about $4 bln of profit for Pfizer this year – may pale beside the benefit from having regulators and lawmakers on their side.
Capital Calls: WFH deals, Suez Canal, NorNickel 29 Mar 2021 Concise views on global finance in the Covid-19 era: Fintech firm Broadridge pays a full price for trading platform; with the waterway clear, all sides will be taking up positions for a legal battle royal; the Russian nickel producer cashes in on high copper prices.
Archegos mess revisits Wall Street weak spots 29 Mar 2021 Bill Hwang’s family office may not have been overleveraged, but rhymes plenty with previous blowups. Some $15 bln easily could have distracted fee-hungry brokers from concentration risk, dangerous derivatives and a past trading ban. It’s exactly why banks need oodles of capital.
Cazoo’s $7 bln deal depends on European car drive 29 Mar 2021 The UK online used-car seller is going public in New York through a blank-cheque merger. A multiple of more than twice projected 2022 sales is lower than U.S. peer Carvana. Still, those numbers require the company to grab a big chunk of a growing market at home and in the EU.
Singapore dynasty falls into China property trap 29 Mar 2021 A spat between the Kwek family’s City Developments and its struggling mainland partner has gone public. The souring of a $655 mln deal hailed just 11 months ago as a tie-up between old friends serves as a warning of the pitfalls in distressed Chinese property.
WeWork finally dons office-appropriate attire 26 Mar 2021 Merging with a SPAC will give the shared-office lessor $1.3 bln in fresh cash and a $9 bln valuation far below the price tag it flaunted in 2019. The resilience of its revenue is encouraging. But whiffs of the old WeWork remain, like a reliance on aggressive growth assumptions.
ESG wave crashes into Volkswagen’s narrow straits 26 Mar 2021 U.S. eco-investors have pushed ordinary shares in the $153 bln automaker way above equal preference stock after CEO Herbert Diess upgraded battery car plans. Investors’ need for voting rights plus VW’s small free-float may explain why. But the lack of clarity invites a snapback.
Credit Suisse has PAF to redemption over Greensill 26 Mar 2021 Funds linked to the collapsed supply-chain firm may have billions of dollars in bad debt. The bank and its employees are culpable and should share losses with clients. Reviving a post-2008 asset-backed bonus vehicle would be one way for senior staff to shoulder some of the risk.
Allianz leaps back into M&A game in pricey Poland 26 Mar 2021 Europe’s top insurer will buy Aviva’s Polish unit for 2.5 bln euros. After more than a decade of eschewing large deals, CEO Oliver Baete is paying a rich 17 times earnings for scale in a key market. Projected savings make the price tag stack up. It may be a sign of more to come.
Capital Calls: Sports versus the Trump slump 26 Mar 2021 Concise views on global finance in the Covid-19 era: Political news startup Axios may merge with sports site The Athletic.
China delisting drama stings U.S. investors worse 26 Mar 2021 Stocks like $70 bln Baidu have been whomped as Washington pushes to kick out Chinese firms unless Beijing allows audit inspections. That might tempt bosses to exit New York early. Recent lowball bids suggest minority shareholders have more to lose than the companies themselves.