Deals

Tiffany share drop offers LVMH a bargaining chip

3 June 2020

Fears that Bernard Arnault may pull his $16.2 bln bid amid U.S. unrest have hit the jeweler’s shares. The French billionaire may see an opportunity to renegotiate, but it’s not without risk. Buying Tiffany shares on the market would be a less aggressive way to meet a similar end.

Tech giants dare antitrust deal watchdogs

1 June 2020

Facebook, Microsoft and Apple have been on a buying spree of small companies. U.S. regulators are examining such deals but their work has been hindered by Covid-19. Big Tech can argue some firms would fail otherwise. But the effect on consumers is a mixed bag.

Zynga puts overvalued shares to risky use

1 June 2020

The $9 bln video-game company is buying the Turkish maker of Toon Blast and Toy Blast for $1.8 bln, its biggest deal ever. Zynga is partly financing it with stock puffed up by the pandemic. But the high price and its mixed acquisition record should give investors pause.

Kylie Jenner teaches Coty celeb value is cosmetic

1 June 2020

The perfume maker’s stock fell after Forbes suggested the TV star, who sold 51% of her makeup brand to Coty last year, had exaggerated her wealth. Coty had overpaid either way. But the drama exposes the folly of companies buying brands whose value they can’t really control.

German carmakers step on Chinese electric pedal

29 May 2020

VW is taking big stakes in two Chinese EV firms, while Daimler may invest in battery-maker Farasis Energy’s $480 mln IPO. Demand remains tepid, oil is too cheap, and the targets look richly priced. But these deals lock in supply, and position both to compete with Tesla in China.

Amazon steers towards self-driving leverage

28 May 2020

Jeff Bezos’s $1.2 trln behemoth is one of the obvious big buyers of autonomous vehicles. Acquiring startup Zoox would give it an even bigger say in how the technology gets rolled out. That would also help deepen its customers’ dependence on Amazon’s fast and cheap shipping.

A Ford-VW tie-up would solve a ton of problems

22 May 2020

The two rivals’ souped-up electric and autonomous collaboration won’t solve their respective geographic weaknesses. A merger would. It’d also create value and give Ford’s underperforming boss a graceful exit. The biggest sticking point is the firms’ convoluted ownership.

Morgan Stanley gets closer to real Reliance prize

22 May 2020

Deals are flowing fast as Mukesh Ambani rejigs his empire. The U.S. bank has helped raise $10 bln for the tech unit from Facebook, KKR and others. It wasn’t on a bigger deal inked with Aramco but that’s less important, especially with the $70 bln Jio unit’s IPO on the horizon.

Uber-Grubhub’s big obstacle is delivery not price

18 May 2020

Some to-and-fro over value is normal in a potential merger. But for two money-losing companies with volatile stocks, financial tweaks are a second-order issue. The more critical question about combining their meal-delivery operations is whether antitrust watchdogs would block it.

Uber-Grubhub may get stomachache from deal fuss

14 May 2020

A tie-up would create the top meal-delivery firm in major markets like New York, Boston and Chicago. Uber’s beefed up lobbying efforts might help federal approval, but even then state antitrust watchdogs may be concerned. It’s a tough taste test for the $57 bln ride-hailing app.

Bain’s latest Japan deal gets too cosy for comfort

13 May 2020

Nichii Gakkan is backing a $1.2 bln sale to the Boston buyout shop, whose board seat at the family-owned medical staffing company gave it an inside track. The governance lapses evoke TPG’s shoddy J Crew takeover. If shareholders let it slide, other MBOs in waiting will take note.

Coty applies KKR’s cash to cover deal scars

11 May 2020

The private-equity firm will pay $3 bln for a majority stake in brands Coty bought from P&G for $12.5 bln. A direct investment of $1 bln in Coty will further tone down its crushing debt load. It's a loss of face – but not quite of control – for parent JAB.

Corona Capital: SPAC reversal, Italy, Toilet paper

8 May 2020

Concise views on the pandemic’s corporate and financial fallout: Dan Loeb’s blank-check company tries to nix a deal; Italians warily get back to work; Australian TP panic subsides.

M&A bankers should consider going back to college

8 May 2020

Not for the frat parties. Even before the pandemic, demographics were working against the economics of higher education. Crunched finances make it worse, and online learning has exposed absurd tuition costs. Colleges seeking size, scale and stability will need strategic advice.

Elliott’s utility rescue flips a familiar switch

7 May 2020

Paul Singer’s hedge fund is part of a group investing $1.4 billion in struggling Texas-based CenterPoint. It has had a tough few months, on top of the challenges that power companies in general face. And Elliott has experience: A similar deal with FirstEnergy in 2018 paid off.

Viewsroom: Mega-mega mergers

7 May 2020

The Great Lockdown will inevitably encourage governments to foster the creation of ever-larger “national champions” through corporate consolidation. Rob Cox, Edward Chancellor and Lauren Silva Laughlin discuss possible combos – and why this would be a bad outcome for capitalism.

Biotech M&A deal looks too rich for its blood

5 May 2020

Alexion agreed to pay $1.4 bln for smaller rival Portola and its potentially promising drug to reverse anticoagulants. The target has been on a downward slide for years – but is still bagging a 132% premium. That’s baking in success, but it’s more likely Alexion is overpaying.

Chevron is M&A-ready. Exxon, not so much.

30 April 2020

The oil-price rout has left small and mid-tier U.S. drillers in pain and ripe for takeovers. Major players are hurting too, but Chevron, though not as big as Exxon, has been more prudent with cash and debt, and its stock has held up better. Occidental may even be in its sights.

Corona Capital: Small biz bankruptcies, NFL

27 April 2020

Concise views on the pandemic’s corporate and financial fallout. Small businesses get time but not money; the NFL’s draft viewership does a victory dance.

Hollywood-Bollywood deal may need special effects

27 April 2020

Struggling studios STX and Eros are starring in a complex $1.1 bln merger. It’s a bold bet on video streaming in India by A-list backers including TPG and John Malone. Absent heroic financial achievements in the cutthroat market, there’s a real danger of producing a flop.