Tech’s virus pain would have trustbusters Yelping 21 Apr 2020 The online-review site helped spur D.C. probes of ad giants like Google. Now it, Groupon and other mid-size Silicon Valley firms can’t get small-business aid, are laying off thousands and may not survive the crisis. That’d leave Big Tech’s worrying dominance more entrenched.
Corona Capital: HCA Healthcare, Kering 21 Apr 2020 Concise views on the pandemic’s corporate and financial fallout: The virus helps one part of the U.S. healthcare industry, but harms another; and luxury group Kering's Chinese fortunes may depend on an end to Italy's lockdown.
UK’s inward M&A muddle comes home to roost 21 Apr 2020 China-backed buyout firm Canyon Bridge is trying to wrest control of Imagination Technologies, a British chip designer it acquired in 2017. The UK government lacks the grounds and the legislation to intervene. And its nuanced position on Huawei complicates a tougher approach.
Car industry’s growth engine is running on fumes 21 Apr 2020 The churn of new car lease sales has come to a grinding halt in March. It’s a double whammy for the likes of Ford and VW that are facing steep devaluations on cars that will be handed back by cash-strapped customers. A painful financial reckoning lies around the corner.
Virgin Australia could struggle to regain altitude 21 Apr 2020 The carrier has gone into administration with over $3 bln of debt after a bailout failed to materialise. Australia is loath to leave Qantas a monopoly, which should help spur a solution, maybe with local pension funds. Remaking Virgin into a success is a different story, though.
Spurned Caltex can do some refining on its own 21 Apr 2020 Canada’s Couche-Tard abandoned its $5.5 bln plan to buy and break up the petrol station operator because of the pandemic. The Australian company’s mooted property spinoff looks like a poor consolation prize. It would make more sense just to proceed with the suitor’s blueprint.
U.S. virus bailouts portend Occupy Wall Street 2.0 20 Apr 2020 Uncle Sam is helping out everyone from Harvard to hedge fund managers to Potbelly in its emergency relief programs. A hastily structured deal and inadequate oversight are allowing room for taking advantage. That may be a necessary evil, but it will also fuel the backlash.
Glencore mine grab would have a tiny silver lining 20 Apr 2020 Zambia may seize assets, including the commodity giant’s Mopani copper mine, to help with Chinese debt relief, the WSJ says. That would make the African state a pariah and confirm fears of debt-trap diplomacy by Beijing. At least Glencore might win some useful U.S. sympathy.
Corona Capital: Pemex, Bond liquidity 20 Apr 2020 Concise views on the pandemic’s corporate and financial fallout: Pemex becomes world’s chunkiest fallen angel, and bond liquidity gets a needed boost.
Singapore oil trading mess creates a long slick 20 Apr 2020 The founder of Hin Leong Trading, O.K. Lim, fessed up to hiding $800 million in losses. That’s bad for auditors and the banks holding $3.9 bln of related debt. It’s also tricky for the city-state’s status as an energy hub, and perceptions of privately held commodities firms.
Japanese hospitality has a long way to go in M&A 20 Apr 2020 Lone Star is buying Unizo, ending a process marred by murky disclosures, a lack of engagement with bidders and conflict of interest allegations. Lawmakers last year introduced guidelines to make takeovers fairer, but the tussle suggests boards may need a bigger kick.
Anti-Amazon antitrust is UK’s latest crisis victim 17 Apr 2020 Britain cleared a $575 mln investment in Deliveroo led by the U.S. giant because the food delivery startup would go bust otherwise. The pandemic has weakened the regulator’s scrutiny of big tech firms. As in the financial crisis, authorities may regret deals they hastily allow.
Dividend cuts are the new shareholder-value trade 17 Apr 2020 Schlumberger’s stock surged after the company slashed its payout by 75%. Granted, it’s because investors are now more comfortable with the $19 bln oil-services firm’s balance sheet. But as virus pain spreads across industries, ditching dividends’ sacrosanct status is a must.
Market’s remedy rally more rational than it sounds 17 Apr 2020 Drugmaker Gilead’s anecdotal success treating Covid-19 sent its stock and the broader market up. It’s not total fantasy – even small changes in the odds of society reopening ought to boost asset prices. The gain in Gilead’s own stock is harder to explain.
Review: Facebook and Instagram deserve each other 17 Apr 2020 The social network had a tense relationship with the photo-sharing app it bought in 2012. Sarah Frier’s “No Filter” offers fresh insight into the troubled $1 bln deal. A bigger problem was that their common pursuit of a higher purpose obscured the threat they posed to society.
Corona Capital: Amazon, Procter & Gamble 17 Apr 2020 Concise views on the pandemic’s corporate and financial fallout: Amazon CEO Jeff Bezos pokes the French government; consumer giant P&G’s good fortune will be hard to keep.
Hoarding to extend sell-by date of tired brands 17 Apr 2020 Consumers stockpiled pantries and freezers with long-life grub, boosting dowdy products like frozen Hot Pockets. Unilever and Nestlé had been tilting towards higher-end brands. Lockdowns will force CEOs and investors to reconsider the value of what’s in their cupboards.
India’s Tatas crack open $84 bln piggy bank 17 Apr 2020 Tata Consultancy is nearly quintupling its dividend, handing $685 mln to the Tata Sons parent company. The money could help fund charities and other weaker parts of the empire. Cash-rich and with no plans to cut jobs, the IT services provider can afford to try and have it all.
Wall Street pay shows early resistance to virus 16 Apr 2020 Goldman, JPMorgan and Morgan Stanley only modestly cut the compensation pool last quarter, even though pandemic costs hit shareholders hard. Unlike 2008, protecting staff makes sense. And there's plenty of time left to slash bonuses the more the Covid-19 rout eats into profit.
Viewsroom: Freebies no more 16 Apr 2020 Breakingviews columnists check in from home in New York, San Francisco and Hong Kong to discuss disappearing Silicon Valley perks like free meals and booze, office activism at tech firms, the mystery of China’s 20 million lost mobile-phone subscribers and an ascendant TikTok.