Chill on M&A lawsuits puts heat on Wall Street 14 Oct 2015 A judge has poured cold water on HP’s attempt to settle claims over its $2.7 bln Aruba purchase, slamming the practice of buying peace with fees. But suing bankers over conflicts provides better kindling. Efforts to cut deal litigation are simply blowing legal fires elsewhere.
Twitter patches broken wing with chairman choice 14 Oct 2015 Putting Google’s Omid Kordestani atop the board kills two birds with one appointment. It supplements Jack Dorsey’s stretched position as a two-timing CEO and adds a much-needed money man to survey a foundering business model. Ideally, they’d reverse the roles completely.
TripAdvisor’s Priceline deal leaves rivals in dust 14 Oct 2015 The travel review site had plenty of users but its dependence on advertising made it an internet laggard. Sharing business with the hotel-booking powerhouse gives it fee revenue and a shot to become a one-stop tourist site. Peers are quickly receding in the rearview mirror.
Tech sector softness is etched in ASML’s slowdown 14 Oct 2015 The $38 bln Dutch microchip-printer maker has said Q4 revenue will be 10 pct below the previous quarter. Weaker demand in China and elsewhere is affecting the entire semiconductor industry but investment spending is being curbed sector-wide. ASML should still hit longer-term targets.
EMC investors get $67 bln ticket out of trouble 12 Oct 2015 Michael Dell and others are paying $33 a share for the tech conglomerate. Sure, most of the notional 38 pct premium comes as a flaky tracking stock in EMC sub VMware. But there are no other obvious bidders and breaking up the company is a risky alternative for only slight gains.
Dell takes $67 bln EMC challenge out of public eye 12 Oct 2015 The PC maker has deleveraged since going private in 2013. That’s also how it plans to handle the disk storage firm after adding debt to buy it. A waning EMC core business, a need for revenue synergies and other twists make this another deal best tackled behind closed doors.
Review: Steve Jobs, both man and machine 9 Oct 2015 A new Hollywood biopic directed by Danny Boyle provides a glossy, fictionalized yet revealing glimpse of the human being behind Apple’s iconic products. A recent documentary has a harder critical edge. Four years after his death, Jobs’ flawed genius defies categorization.
Elon Musk whistles past Tesla’s graveyard 9 Oct 2015 Apple poached engineers from the electric-car maker. CEO Musk dismissed the threat, saying: “If you don’t make it at Tesla, you go work at Apple.” His ventures are impressive, but Michael Dell and Steve Ballmer, among others, can attest to the perils of underestimating Apple.
Dell’s gnarly $50 bln EMC idea smells of peak M&A 8 Oct 2015 The PC maker may offer to buy the data-storage firm. Borrowing $40 bln or so wouldn’t be easy. Spinning off part of EMC’s 81 pct stake in its $35 bln subsidiary VMware would add complexity, too, and make it tough for the numbers to work for everyone. It could be a deal too far.
China web merger is latest sign of funding fatigue 8 Oct 2015 A mooted $15 bln tie-up between two discount shopping sites comes months after the country’s top taxi apps joined forces. Web giants like Alibaba and Tencent have poured billions into startups that connect local services to users. But subsidy wars are testing investors’ patience.
Scandal exposes long odds for fantasy sports sites 7 Oct 2015 DraftKings and FanDuel rely heavily on fees members pay to bet on pro games. Allegations that employees used inside information to wager may well drive those customers away. Add advertising expenses and legal challenges, and the companies may be headed for blow-out losses.
EU data ruling could stunt single digital market 6 Oct 2015 Europe’s top court has called an agreement over data transfer between the euro zone and America “invalid”. Legal alternatives exist, but will be costly for smaller companies. It will make it harder for Europe’s tech industry - and a single, regional internet market - to blossom.
New Twitter CEO flaps with one wing behind back 5 Oct 2015 Co-founder Jack Dorsey is now the micro-blogging site’s permanent boss. But he also leads payments service Square, which is considering an IPO later this year. Perhaps he can succeed at these two very demanding jobs. Twitter, though, has saddled its investors with a risky gamble.
Online lending unicorns like SoFi need stamina 1 Oct 2015 The student loan refinancing startup raised $1 bln this week, and online loan shop Avant pulled in $325 mln. The involvement of smart investors suggests these multibillion-dollar upstarts have room to run. More important, though, is whether they can endure the credit cycle.
Western Digital deal may thread U.S.-China needle 30 Sep 2015 The data storage company’s sale of $3.8 bln of stock to China’s Tsinghua exchanges a minority interest at a premium price for a seat on the board. Politics make selling control tough, but this kind of arrangement may help smooth Western Digital’s path in Chinese markets.
Henry Blodget makes most of Wall Street ban 29 Sep 2015 Selling most of Business Insider to Axel Springer for $343 mln is another step in the disgraced former dot-com analyst’s rehab. Blodget’s media outlet has made money and created jobs – despite the distorted market for talent that Wall Street created and Silicon Valley is aping.
Yahoo’s Alibaba spinoff troubles may outlast boss 29 Sep 2015 Marissa Mayer plans to complete the internet firm’s separation from the Chinese e-commerce company. Resolving tax issues may take years, though, if authorities challenge the deal. With Yahoo’s business stagnant and competition rising, the CEO may be gone before wrangling ends.
Pure Storage unicorn shivers in cooling market 29 Sep 2015 The computer-storage maker was valued at over $3 bln last year, as backers latched onto its fast growth selling flash memory that’s cheaper and more efficient than rival offerings. But losses and competition are mounting, and the risks threaten a lower valuation at IPO.
Modi offers Silicon Valley the welcome Xi won’t 25 Sep 2015 The Indian leader is visiting California days after his Chinese counterpart met U.S. tech bosses. Though India’s economy is smaller and harder to navigate, the door is open. For foreign players, India’s promised growth may outweigh China’s giant but hard-to-reach opportunity.
Headhunting firm searches for new M&A dialectic 24 Sep 2015 Korn/Ferry is buying HR consultancy Hay Group for $450 mln to form a “people” juggernaut. Layoffs will be limited, with $20 mln of annual savings coming from IT and real estate. For two companies that deal in disgruntled workers, they haven’t benchmarked merger history too well.