Corona Capital: Scotland, EU impasse, Amazon 27 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: Scottish independence gets a viral shot in the arm; Poland and Hungary take a united stand on the European Union’s recovery fund; and the online retail giant delivers a modicum of Christmas cheer to workers.
Sabadell takeover is still only a matter of time 27 Nov 2020 The Spanish lender broke off takeover talks with larger rival BBVA after rejecting an offer worth 2.5 bln euros. Cost savings potentially worth double that mean a deal still makes sense. Boss Jaime Guardiola must hope a vaccine-led rebound allows him to demand a higher price.
AstraZeneca’s messaging warrants a review, too 27 Nov 2020 The $134 bln drug giant may do a new trial of its Covid-19 vaccine to clear up uncertainties over its effectiveness. Even if rivals’ look better, AstraZeneca has a good story to tell. Still, a share price dip this week reflects that overegging results is not where you want to be.
UK mimics Big Tech in quest to reduce its clout 27 Nov 2020 Prime Minister Boris Johnson is setting up a special unit to police dominant firms like Facebook. A sweeping mandate, and the ability to act with tech-like speed, raises the risk of overreach. It’s still an upgrade on the ponderous, court-based approaches of the U.S. and Europe.
Cox: Swiss firms get too global for local britches 27 Nov 2020 From ABB to Zurich, corporations extended their reach in ways that brought outsized pride and prosperity. Now a referendum might make them liable for human rights abuses abroad. Whatever the result, it’s a useful reminder companies need to avoid losing sight of their local roots.
Indonesia builds sovereign fund with daring design 27 Nov 2020 Buyout firms and Gulf nations are being wooed to invest $15 bln in a government-backed mashup of Singaporean and Indian models. It’s an ambitious effort to finance President Joko Widodo’s development plans, but also faces limits on how much outside money will take the plunge.
Beware Chinese used-car dealer’s sticker price 27 Nov 2020 Kaixin Auto is riding electric-vehicle enthusiasm with an odd plan to merge with e-commerce outfit Haitaoche. After going public by way of a shell company in 2018, just 2% of its shares are freely traded. The 2,300% rise in market cap requires a closer look under the hood.
EDF shares’ power surge need not be a one-off 26 Nov 2020 The $44 bln state-owned utility has outperformed rivals in the last six months. A deal to secure higher nuclear prices would repair EDF’s main arm and enable CEO Jean-Bernard Levy to mull a renewable energy spinoff. That could boost the company’s value by over a half.
Italy finds tax trick to prettify risky bank M&A 26 Nov 2020 Rome is letting lenders turn past losses into fiscal credits if they merge. The capital boost may make shaky state-controlled Monte Paschi more appealing to buyers such as UniCredit, without breaking state aid rules. But even healthy groups, like Credit Agricole or BPM, may gain.
Lowly Europe bank values will outlast dividend ban 26 Nov 2020 Big lenders blame frozen payouts for depressing share prices, down 17% on average this year. But the selloff broadly matches the decline in profit forecasts for 2022, suggesting ultra-low interest rates are to blame. Even if dividends return, discount valuations may persist.
Norway’s offices are prize in $3.4 bln bidding war 26 Nov 2020 Sweden’s Castellum launched an offer for Entra days after the Oslo-based group rebuffed a bid from real estate rival SBB. Reliable government tenants and a relatively stable economy are alluring in a sector ravaged by the pandemic. But the bidders will struggle to create value.
Corona Capital: Skis, Italian banks, Dividends 26 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: Europe’s hopes for a common ski policy hit a mogul; Italian lender Credito Valtellinese faces a lonely bidding war; Aviva’s payout cut is less stingy than it looks.
Alibaba and Hong Kong celebrate happy anniversary 26 Nov 2020 Both have been rocked in various ways in the year since the Chinese tech titan completed its landmark $13 bln secondary listing. At the same time, more companies have followed suit and boosted the city’s trading volume. Benefits may keep accruing if indexes retrain their sights too.
Murdoch lets Bertelsmann pay up for publishing 25 Nov 2020 The German media group will buy Simon & Schuster for an eye-popping $2.2 billion in cash. It already owns the massive Penguin Random House and size gives it more power. But it also means U.S. regulators could thwart the deal, leaving Murdoch an opening.
Corona Capital: Record Dow, Basketball, GoCompare 25 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: Vaccine optimism shunts the blue-chip Dow Jones index through 30,000; U.S. college basketball gets back on the court; and UK publisher Future snaps up the bargain-hunting website.
Oil’s latest boost has longer-term thrust 25 Nov 2020 Multiple Covid-19 vaccines have lifted crude prices to March levels on hopes of an economic recovery. Producers may now pump like crazy, but renewed declines look less likely. Meanwhile, Big Oil’s virus-driven cuts to new supply should prop up prices further down the line.
Music royalty boom comes with dissonant undertones 25 Nov 2020 Hipgnosis, set up by bigwig Merck Mercuriadis, has spent $1.8 bln on hits by artists from Rihanna to 50 Cent. A fat yield and low returns elsewhere explain the fund’s pull. Investors must close their ears to poor disclosure, manic dealmaking and a rapidly changing industry.
India adds distress to distressed debt deals 25 Nov 2020 Tycoon Gautam Adani narrowly outbid U.S.-based Oaktree with a $4 bln bid for insolvent housing lender DHFL. The offer, however, was submitted late and cheekily expanded on its original plan. It’s the second time the industrialist has blindsided foreign buyers in a worrying trend.
Bond defaults air China’s dirty municipal laundry 25 Nov 2020 Missed payments and misconduct by state firms are putting provinces like Henan under fresh stress. It’s now having trouble issuing debt even as fiscal revenue shrinks. Henan and its peers are mandated to create millions of jobs, but tighter credit could slow recovery.
Musk passes Gates, but not yet in impact 24 Nov 2020 The Tesla mogul’s wealth edged past the Microsoft founder’s, at just under $128 bln. That’s because Gates has given vast sums to charity and supercharged vaccine development, especially for the poor. Helping out humanity beats amassing wealth. Musk may one day achieve that too.