Klarna’s new $11 bln valuation looks a stretch 15 Sep 2020 The Swedish buy-now-pay-later startup’s new funding round means it has doubled its worth in a year. That looks reasonable relative to rival Afterpay’s market valuation. It looks less so once you use multiples that better reflect competition and regulatory risks.
Cox: Bernard Arnault is acting like a spoiled brat 15 Sep 2020 Europe’s richest man had to have Tiffany when times were good and agreed to pay too much for the American jeweller. When Covid-19 hit the fan, LVMH’s boss got buyer’s remorse. Now he's throwing all the toys out of his cashmere-lined crib to get his way. Which he probably will.
Corona Capital: Kraft Heinz, U.S. poverty 15 Sep 2020 Concise views on the pandemic’s corporate and financial fallout: The food giant is boosting advertising outlays, even as it continues cutting costs; and the poverty rate in the United States hit a low at the end of 2019, according to new data, only to run into a Covid reversal.
Fiat-Peugeot deal rejig removes car merger angst 15 Sep 2020 The Jeep maker’s investors will get about half a jumbo dividend expected via a tie-up with the French group, but more savings and part of Faurecia. The new entity’s balance sheet will now be stronger. And lingering uncertainty about the deal happening should evaporate.
Sewage keeps Parisian banking elite in Hermès ties 15 Sep 2020 Veolia’s hostile approach to rival Suez is providing utility-like returns to some 16 banks and M&A boutiques. Not bad for a 2.9 bln euro bid. But as private equity eyes a potential entrée, the fees may add up to more than wastewater and put an end to a pandemic-induced drought.
Rio Tinto gets bad recruitment steer from Canberra 15 Sep 2020 Australia’s treasurer wants the miner’s next CEO to be Australian, after Frenchman J-S Jacques stepped down over the destruction of an Aboriginal site. Cultural sensitivity is a priority, but the goal can be achieved in other ways. Shareholders deserve the best boss Rio can find.
The Exchange: China’s bad debt opportunity 15 Sep 2020 Beijing is letting lenders go belly-up as it attacks systemic risk. That’s all fine for Benjamin Fanger, founder of ShoreVest, a manager $1.8 bln of soured loans. He talks with Pete Sweeney about the message China is sending bankers, and the opportunity for foreign investors.
Big Tech eases Ant’s march into public markets 15 Sep 2020 A long who’s who list, including Thailand’s richest man and China’s national pension fund, stand to clean up from Jack Ma’s fintech titan. Not long ago, a $200 bln IPO might have made public investors look like suckers. This number is less scary thanks to Apple and others.
Battered airlines deploy frequent-flyer parachute 14 Sep 2020 Delta is raising $6.5 bln on the back of its miles program; other U.S. carriers have done the same. Transforming what starts as a liability into an asset sounds like accounting magic. But credit card issuers, who buy miles, make them valuable, especially when people stay home.
Snowflake-led IPO boomlet puts hope over profit 14 Sep 2020 The cloud-data firm’s $3 bln public debut will be the largest IPO this year, in the busiest week for new listings since 2014. The glut of tech-heavy deals will keep investment bankers happy. But with many of the candidates losing money, investors are betting big on fast growth.
BP limbers up for green transition high-wire act 14 Sep 2020 The UK group is the first oil major to pivot to wind and solar in a big way. To fund the shift, CEO Bernard Looney has cut the dividend and assumes higher oil prices. Even then, investors face years of relatively spartan payouts, and uncertain returns from green investments.
Canada peer offers G4S cheeky get-out-of-jail card 14 Sep 2020 BC Partners-owned Garda World may offer 3 bln pounds for the UK prison operator and outsourcer. That’s below the target’s price before Covid-19 closed airports and hit live events. But given its likely slow recovery and patchy track record, shareholders may prefer a surer thing.
Verizon $6 bln deal marks return to wheelhouse 14 Sep 2020 The U.S. telecoms group is buying Tracfone, a prepaid cellphone business. Past media acquisitions like Yahoo have not panned out. Boss Hans Vestberg is steering the $257 bln Verizon back toward what it knows best. It’s a different course from the one chosen by rival AT&T.
Gilead goes all-in to inject excitement 14 Sep 2020 The $82 bln biotech attracted attention with a Covid-19 drug but has been unable to shake its low valuation multiple. Recent M&A hasn’t helped, either. A $21 bln deal to buy Immunomedics is a huge bet on a breast cancer treatment. Failure could even turn Gilead into a target.
Corona Capital: Amazon, NYC and Trump 14 Sep 2020 Concise views on the pandemic’s corporate and financial fallout: Amazon’s hiring boom highlights its weakness, and U.S. President Donald Trump could throw New York City a bone.
Son’s largesse may finally help SoftBank investors 14 Sep 2020 The CEO is selling chip group Arm to Nvidia for little more than he paid in 2016. It’s a poor return for the Japanese group’s investors during a tech boom. Yet if Son decides to take SoftBank private, as news reports suggest, shareholders could cash out while valuations are high.
Polish e-commerce IPO requires anti-Amazon defence 14 Sep 2020 Cinven-backed Allegro may be worth as much as $12 bln when it lists in Warsaw. Covid-19 helped boost net revenue more than 50% in the first half. And with only 8% of Polish retail sales online, there’s more room for growth. The danger is that global giants flood the market.
Nvidia’s $40 bln Arm deal is risky chess move 14 Sep 2020 The chip specialist led by Jensen Huang will buy the UK company from SoftBank in the industry's biggest deal. It gives Nvidia a boost in the data centre business. But Arm's customers and regulators may baulk, and the chunky price tag presupposes huge growth and market share gains.
India grips too tight to keep tech IPOs at home 14 Sep 2020 New Delhi is considering forcing domestic companies that list shares overseas to do so at home as well. China has wooed Alibaba and others back to Hong Kong and Shanghai, but by making it easier not by fiat. A heavy-handed approach risks pushing Indian startups away even sooner.
TikTok-Oracle deal leaves room for surprises 13 Sep 2020 ByteDance has chosen Larry Ellison’s firm as the “tech partner” for its video-app unit but any deal that stops short of a full sale will raise national security worries. With raging anti-China rhetoric and elections, Oracle’s ties to U.S. President Donald Trump are no cure-all.