Hotel-deal hostility just piles on extra baggage 13 Dec 2023 Radisson-owner Choice is taking its $7 bln offer directly to Wyndham shareholders. The target’s stock price reflects some doubts about chances for success. Even with the added threat of a proxy fight, investors have good reason to want more cash and less of the buyer’s equity.
Choice Hotels takes a vacation from reality 21 Nov 2023 The Comfort Suites operator has taken another stab at its unsolicited and unwelcome $9.8 bln offer for rival Wyndham. The part-shares deal is easy to rebuff in a wobbly market where cash is king. But switching it to cash could leave Choice with hefty debt and unhappy customers.
Capital Calls: Starbucks’ wages 6 Nov 2023 Concise views on global finance: Only US baristas with five years of experience will get above-average raises in 2024. Despite more than 9,000 organized workers, Starbucks is dodging the labor pressures faced by shipping firms and automakers this year.
Capital Calls: Paramount’s stricter streaming 3 Nov 2023 Concise views on global finance: The media stalwart’s shares popped 10% as boss Bob Bakish predicted that losses from its costly streaming push have topped out. But the company still faces a cutthroat market full of better-resourced rivals.
Wyndham suitor is unprepared to check in just yet 18 Oct 2023 After months of talks, rival hotelier Choice went public with a $10 bln offer, putting pressure on its target’s board. Despite a 38% premium, the deal lacks a compelling valuation and could lard on heavy debt. It also glosses over competition risks. There’s some tidying up to do.
Retailer ‘shrink’ becomes too big to box up 3 Oct 2023 American stores lost $73 bln to theft last year, a nearly 20% rise from 2021, while Target just blamed crime for nine closures. Few chains report specifics, however, stirring doubts about anecdotal evidence. Consistent disclosure would help keep investors from getting fleeced.
Tidy-up puts $70 bln tobacco giant in good company 26 Jul 2023 India’s ITC is spinning off its hotels business but keeping a 40% stake. It’s a partial break from the firm that counts British American Tobacco as its top owner. Yet it may be the best way to close a valuation gap with its Tata-backed rival and fully cash in on a tourism boom.
Capital Calls: Eli Lilly gorges on obesity options 27 Jun 2023 Concise views on global finance: The drugmaker found patients losing an incredible 24% of their weight on one of its latest treatments. First-movers don’t always win out in pharma, however, as Pfizer proved with Lipitor. That’s why Lilly is wise to keep investing in alternatives.
MGM’s bet on Asia’s next Macau may age well 26 Apr 2023 The US casino operator will open Japan’s first casino. It isn’t an obvious destination for gambling: Sands and Wynn stayed away, preferring Singapore and the UAE. But the Osaka resort could be as big a money spinner for the operator as its properties in the Chinese hub.
Capital Calls: Starbucks 21 Feb 2023 Concise views on global finance: The $123 billion coffee chain’s new patent filing speaks to popular TikTok campaigns for more bespoke beverages – and other labor challenges.
Macau bounces into Year of the Rabbit 19 Jan 2023 Spring has sprung in the casino hub with the end of China’s zero-Covid. Operators will return to profit. Yet from Sands to SJM, balance sheets are stretched. How quickly they are repaired depends on if punters spend as much as before. Pandemic policies will leave other scars too.
Capital Calls: Barbarians at the check-in desk 22 Dec 2022 Concise views on global finance: Hotel landlord Vivion is engaged in a war of words with short-seller Muddy Waters, but it could fight back more effectively with cash.
China’s dreary Golden Week has shades of grey 10 Oct 2022 Domestic tourism sales during the country's top holiday fell to less than 50% of pre-pandemic levels. Cities like Shanghai might get a welcome boost from shoppers that stayed put, but the sector drives roughly 30% of consumption. That’s cold comfort for the weakening economy.
China’s Hawaii washes away an economic sandcastle 8 Aug 2022 A Covid-19 outbreak has locked down cities in Hainan, stranding over 80,000 visitors. It sets back a decent recovery in tourism, a generator of more than 11% of pre-pandemic GDP. With other growth pillars shaky, it’s the worst time to give consumers another reason to check out.
MGM and SJM fuel Macau recovery hopes and fears 4 Aug 2022 The $15 bln U.S. group’s record results in Las Vegas suggests its Chinese casinos should prosper, too, once Beijing’s zero-Covid policy lifts. That, though, is becoming a long-term bet, and cash-burning rivals like SJM are already having to raise more money to stay at the table.
Missing Chinese tourists augur hard economic treks 14 Jun 2022 From Phuket to Paris, destinations that banked on the $255 bln mainlanders spent in overseas hotels, shops and restaurants each year are awakening to the possibility they might be gone indefinitely. It will challenge governments to find new and more sustainable sources of growth.
Casino SPAC is for hardened gamblers only 7 Jun 2022 A legal battle over Okada Manila resort turned physical when its ousted boss seized the property last week. That could scupper its $2.7 bln deal with a U.S. blank-cheque firm. But unfriendly politicians, dubious financial reports and more stack the odds against investors, too.
Hong Kong co-living boom bets on more lonely years 17 May 2022 Warburg Pincus is among those buying hotels in the Asian hub to convert into upscale shared digs for millennials. Given a 99% drop in visitors in the past three years and a belief that won’t reverse soon as officials stick with China’s zero-Covid policy, more deals look likely.
Capital Calls: Buffett’s HP bet, Gambling M&A 7 Apr 2022 Concise views on global finance: Berkshire Hathaway takes a hefty stake in the computer and printer maker; Betting group 888 negotiates a better price for buying UK bookie William Hill.
Capital Calls: U.S. truck drivers go missing 4 Apr 2022 Concise views on global finance: Bonuses and concessions from Washington aren't enough to fill the industry's empty cabs.