Mark Zuckerberg raises philanthropic bar to 99 pct 1 Dec 2015 It’s not disruption, but Facebook’s founder has built on The Giving Pledge championed by Warren Buffett and Bill Gates. Zuckerberg will give away nearly all his wealth, not half, in his lifetime. After moving fast and breaking things, he’s moving judiciously and learning things.
Morgan Stanley tackling final profits puzzle piece 1 Dec 2015 CEO James Gorman may lay off a quarter of fixed-income traders. The unit’s wild quarterly swings usually decide whether the firm hits or misses financial-return targets. While cuts will help, what the bank does with the division’s product mix and capital would be more telling.
BlueCrest pinpoints major drag on returns: clients 1 Dec 2015 The $8 billion hedge fund will return capital to investors. High costs, increasingly risk-averse clients, and uninspiring performance didn’t mix well. From now on, BlueCrest will be free to chase higher returns, but finding them means taking on much more leverage.
Spinoff may recharge drained RWE 1 Dec 2015 The German power group may soon list renewable, grid and retail units separately, leaving behind a dirty old coal and nuclear business laden with debt. It looks like an attractive way to boost the 6.3 billion euro valuation. The downside is a potentially huge stock overhang.
Sumner Redstone’s health ails corporate governance 1 Dec 2015 The mental capacity of the Viacom and CBS chairman is being called into question again, this time in a lawsuit filed by a former girlfriend. At this point, shareholders in both media companies deserve a clearer idea of whether the ailing 92-year-old is fit to lead the boards.
Gases suppliers caught by two deflating bubbles 1 Dec 2015 Linde cut its medium-term EBITDA forecasts by 5 percent, knocking its shares hard. The German industrial gas company is exposed to emerging markets and oil prices. Its dour outlook will blow cold air on the sector, including rival Air Liquide’s $13 bln bid for Airgas.
BTG Pactual depends on trust more than ex-boss 30 Nov 2015 The arrested André Esteves owns a controlling stake. Over time, though, he has made Brazil’s No. 1 investment bank more international and diversified. The new co-CEOs are experienced, too. The firm may not need Esteves, but it does need trading partners to shrug off the crisis.
BHP’s Brazil disaster points to dividend cut 30 Nov 2015 The Anglo-Australian miner needs to conserve cash to pay for the Samarco dam disaster in Brazil. Forecast earnings already fall short of the $6.5 billion it paid shareholders last year. BHP would be wise to get ahead of the curve and scrap its commitment to progressive payouts.
Delta Lloyd waves white flag on insurer capital 30 Nov 2015 The Dutch insurer is raising capital equivalent to over half its market value to prepare for new Solvency II rules. But it’s also ditching its own solvency model for a tougher version supplied by regulators. If peers follow suit, insurer capital would be much more simple.
Abengoa has creditors over a barrel 27 Nov 2015 The beleaguered Spanish engineering group might survive if lenders take haircuts of two-thirds. In liquidation, losses could mushroom due to the group’s spiralling working capital needs, complex business and slow Spanish courts. Abengoa needs a speedy resolution and more cash.
Indian sale makes Bain Capital rare buyout hero 27 Nov 2015 The U.S. firm has sold its remaining $116 mln stake in Hero MotoCorp four years after investing in the world’s largest motorbike maker. In rupee terms, Bain doubled its money in four years. As private equity pours into India, it’s a reminder that getting money out remains harder.
Barclays money-laundering rap is oddly reassuring 26 Nov 2015 The UK bank has been fined for cutting corners on a 1.9 bln stg deal for politically sensitive clients in 2011. The temptation for banks to bend the rules for VIPs is just as strong today. But more vigilant regulators are chipping away at the idea that this is business as usual.
Jack Ma paper chase is test of newsprint’s appeal 26 Nov 2015 The Alibaba founder is interested in buying Hong Kong’s South China Morning Post. The 112-year old title’s earnings are under pressure, and the financial logic looks thin. But as fellow e-commerce boss Jeff Bezos showed with the Washington Post, newspapers still have trophy value.
Bank regulator’s blunder sums up Europe’s troubles 25 Nov 2015 Lenders’ capital ratios are higher than previously calculated, the European Banking Authority has said. The watchdog’s technocratic remit makes the error galling. Such confusion could deter investment just as the region’s financial institutions are doing more to deserve it.
Europe’s terrible banks look their best in years 25 Nov 2015 Capital levels, profitability and lending rose in the six months to June, the European Banking Authority says. Bad loan ratios are almost double those of U.S. banks, and more EU quantitative easing could be bad for business. Even so, lenders are proving surprisingly healthy.
Abengoa’s creditors face certain pain 25 Nov 2015 The heavily indebted engineering firm is seeking creditor protection after a new investor backed out of injecting fresh equity. Abengoa is probably viable, but only with a lot less debt. That makes debt-for-equity swaps and writeoffs the likely next step.
CalPERS gets what it pays for from private equity 24 Nov 2015 The U.S. pension giant revealed that $24.2 bln of net gains from the asset class over 25 years came at the cost of $3.4 bln in so-called carried interest for fund managers. Private equity is pricey and hitherto opaque, but CalPERS’ analysis so far helps justify the fees.
Icahn Xeroxing the HP breakup playbook for Xerox 24 Nov 2015 The activist took a 7.1 pct stake in the faded technology icon, which appears to be in a state of permanent restructuring. The $10 bln copier maker has some decent assets inside a disappointing whole. Finding buyers for some, and milking others for cash, looks logical.
Time for Germany to let EU banking union fly 24 Nov 2015 The European Commission wants a mutualised deposit insurance scheme for banks by 2024. Berlin may be averse to the idea of financing non-German busts. But there are some safeguards, and unpicking the link between banks and states would better avoid trouble in the first place.
Allianz coal ban will change investment climate 24 Nov 2015 The German insurer is to pull $4.3 bln out of investment in coal companies, ditching its scepticism against blanket anti-carbon policies. This rethink suggests big asset managers are taking climate change seriously. Other carbon-heavy industries like oil and cement may be next.