Global tax would spoil investors’ plastic party 1 Jun 2023 The world is drowning in waste, but demand for durable polymers is soaring. This may change if UN talks to end plastic pollution by 2040 succeed in introducing a levy. That will shrink a bonus market for Big Oil and cut packaging firms’ margins.
Chinese battery cash will fuel Europe’s EV drive 31 May 2023 The country’s investments in foreign plants and projects to power electric cars quadrupled to $15 bln, chiefly into the EU. Over-reliance on tech leader CATL and its compatriots is a risk. But European rivals are few and carmakers like VW and BMW have more to gain than lose.
Capital Calls: Disney, Thyssenkrupp 24 Apr 2023 Concise views on global finance: The CEO of the $180 billion entertainment company has to thread the needle between layoffs and degrading value as he finds a successor; the 4 bln euro German steel-to-cars group’s shares tanked after CEO Martina Merz left.
Counting the cost of the US-China chip war 11 Apr 2023 Six months into Washington’s sweeping export restrictions on semiconductors, Chinese and global chipmakers including TSMC are navigating the fallout. In this Exchange podcast, author Chris Miller talks about the fight for the critical technology and how Beijing may retaliate.
Bayer’s sunk boss leaves high water mark 21 Mar 2023 In one of his last acts before bowing to activist pressure, Werner Baumann is pledging the $60 bln drugs-to-seeds company will slash rice’s H2O needs by 25%. Leaving aside his legacy as the architect of the Monsanto deal, his ambition is worth emulating.
EU and US green arms race misses bigger picture 16 Mar 2023 The European Union’s response to Joe Biden’s Inflation Reduction Act gives member states leeway to push back with their own green subsidies. Yet plans for production targets are misguided. To decarbonise while managing China risks, it’s better to seek common ground with the US.
Bolloré buyback delays possible Vivendi M&A action 15 Mar 2023 The French tycoon’s eponymous holding company is buying back 10% of its shares, potentially boosting the family’s control. The outlay drains cash that could have been used to boost its stake in media group Vivendi. But that’s still a logical endpoint for Bolloré and his children.
Capital Calls: SVB found old concentration risk 10 Mar 2023 Concise views on global finance: The busted bank counted half of all U.S. venture capital-backed startups as clients. As with financiers to oil barons in the 1980s, monomaniacal focus on a booming industry is a way to court disaster.
Capital Calls: Adobe’s lose-lose Figma bind 24 Feb 2023 Concise views on global finance: Shareholders in the $160 bln design technology firm seem to have decided that the only thing worse than doing its blockbuster deal for rival Figma is losing it.
Rolls-Royce strategy bind is a problem best shared 23 Feb 2023 Shares in the $13 bln UK engineer surged as it moved on from pandemic losses. Yet it still needs to spend big on new tech to get ready for the energy transition. Given the costs outweigh its scope to do so, Rolls ought to share them via partnerships with big aircraft makers.
Stellantis has well-padded airbag for car crunch 22 Feb 2023 The Jeep maker’s operating income hit record levels in 2022, but it faces weaker demand from punters and rising competition. Still, CEO Carlos Tavares’s cost cutting and low exposure to China give cause for positivity. Those pluses aren’t reflected in the Stellantis share price.
Capital Calls: Schneider’s sustainable CEO 16 Feb 2023 Concise views on global finance: Jean-Pascal Tricoire’s departure as chief executive of the French industrial software group after nearly two decades at the helm defies the trend of short-lived or underperforming corporate bosses.
European gas savings success hides darker reality 27 Jan 2023 Spurred by soaring prices, the continent used 12% less of the fossil fuel in 2022. Despite a push to conserve energy, much of the drop was due to companies switching to other pollutants or shutting plants. Gas-hungry sectors like chemicals and steel face a protracted struggle.
Adani’s buy now, pay later fundraise could sting 26 Jan 2023 The world’s third-richest man Gautam Adani won anchor investor backing for a $2.4 bln share sale by his flagship company, including from Abu Dhabi’s wealth fund. Yet an Adani group selloff resulting from a short attack means terms that were meant to reward buyers could hurt them.
German economic engine is due an overhaul 23 Jan 2023 Slowing global trade hit the country’s exports while higher energy prices boosted imports. The current account surplus shrank last year to 4% of GDP, its lowest level since 2003. As globalisation recedes, Berlin has to reassess the old export-led economic model.
Orsted increasingly merits its investor blowback 20 Jan 2023 The $38 bln Danish wind farm group flagged lower-than-expected 2023 targets as its key offshore arm struggled. Shareholders always granted Orsted a premium valuation, due to growth expected from new projects. Construction delays and rising rates are putting that in question.
Emerson’s hostility tests aggressive M&A tools 17 Jan 2023 Disclosing its unsolicited $6.9 bln offer for NI ends a quiet eight-month standoff. Going public forces the issue, but along with the target’s strategic review also inflates the price. A bid battle threatens the potential value of a deal and may inform takeover tactics elsewhere.
Cheaper gas is temporary salve for Europe Inc 9 Jan 2023 Warm winter days and enough reserves to offset Russian imports have halved the fuel’s cost. Yet Europe’s energy security also hinges on abundant liquefied natural gas purchases. As China’s fuel-guzzling economy reopens post-Covid, industrial giants like BASF may still suffer.
Chip mergers are more urgent and awkward in 2023 5 Jan 2023 Western Digital has revived talks with Japan's Kioxia after efforts for a $20 bln deal stalled in 2021. Price wars plague sales of semiconductors storing data and M&A can help as demand plunges. The duo will have to be creative to convince politicians fretting about chip wars.
GE healthcare spinoff gets unduly glum prognosis 4 Jan 2023 The industrial giant’s newly listed MRI-to-ultrasound division flatlined on its debut as a $25 bln listed company, trading 40% below what peer valuations would suggest it’s worth. A discount plagues parent GE too. The apple hasn’t yet fallen far enough from the tree.