BHP investors throw CEO too short an M&A leash 26 Apr 2024 The miner’s stock fell 4.6% after the company proposed to buy Anglo American at a $39 bln valuation. It suggests shareholders fear boss Mike Henry will end up overpaying. But with his low-ball opener leaving plenty of wriggle room to justify upping the bid, that looks premature.
Time for Kering’s king to consider a step back 24 Apr 2024 François-Henri Pinault, heir to the family fortune, has been at the helm of the 40 bln euro French luxury conglomerate for nearly 20 years. With returns shrinking and as flagship brand Gucci struggles, Kering may benefit from fresh blood – and possibly a new CEO.
Shell’s value gap is more strategy than geography 19 Apr 2024 CEO Wael Sawan may shift the $230 bln UK oil giant’s listing to New York if a discount to rivals like Exxon Mobil persists beyond 2025. But Shell’s shifting priorities, slower growth, and unreliable dividends weigh on its valuation. Those factors defy a superficial fix.
UK music fund may walk off stage without encore 18 Apr 2024 Hipgnosis Songs Fund accepted $1.4 bln in cash from US rival Concord Chorus. The 32% premium pitches songs by Neil Young and Shakira at the lower end of their shrunken fair value. With higher-for-longer rates, it’s far from clear that its Blackstone-owned manager will pay more.
Telecom tycoon ensnared by his hefty debt machine 18 Apr 2024 Patrick Drahi built the ocean-spanning Altice empire on the back of aggressive dealmaking and $60 bln of borrowing. The bill is coming due with interest rates elevated. In this Viewsroom podcast, Breakingviews columnists discuss what comes next as bondholders get restless.
Berlusconis have narrow window for German TV bid 16 Apr 2024 The Italian clan’s broadcasting group MFE had banks lined up for a potential $4 bln offer for ProSiebenSat.1, Reuters reported. If they could replicate the savings from a past Spanish merger, the numbers work. The risk is the target’s shares keep rising, undermining the logic.
CVC may leave some money on the table – for once 15 Apr 2024 Valued in line with private-market peers EQT and Blackstone, the group could be worth 20 bln euros. Yet its IPO is raising little new money, and selling shareholders will keep big stakes. That gives CVC a reason to play it safe, unlike when it’s selling portfolio companies.
How Patrick Drahi can clamber out of his debt hole 11 Apr 2024 The tycoon’s Altice telecom empire is straining under $60 bln of borrowings, and creditors of its French unit are gunning for a fight. Yet loose bond terms, and the debt’s low trading prices, lend Drahi an escape route. He just needs to hope investors have short memories.
India can grow fast with or without Narendra Modi 10 Apr 2024 The prime minister is hot favourite to secure a third term, and to lead the country into another decade of economic expansion. Yet projections of 6%-plus annual GDP growth are below the country’s own track record. And hitting the mark does not depend on one man.
Bob Iger now under pressure to wow with an encore 3 Apr 2024 Disney’s CEO worked some magic to stop mouthy Nelson Peltz from being elected to the board. The next trick is to fix streaming and narrow a valuation gap with Netflix. Even if Iger pulls another contract extension out of his hat, shareholders want to see a financial showstopper.
Soho House’s private party may prove disappointing 2 Apr 2024 Executive Chair Ron Burkle could bless a de-listing of the loss-making $1.1 bln chain of members’ clubs, which he reckons will one day generate handsome earnings. He’s only right if the new sites, like São Paulo and Bangkok, prove as popular as the older ones. It’s a gamble.
Profitability is next sacrifice at inflation altar 2 Apr 2024 Central bankers want LVMH, Pepsi and others to pay higher wages without raising prices. Bottom lines in the euro zone already have dipped to 40% of output, the lowest rate since 2020, and Big Tech accounts for most US margin growth. CEOs and investors can expect leaner times.
Sergio Ermotti has a path to Wall Street-style pay 28 Mar 2024 UBS handed its CEO $16 mln for nine months’ work last year. That’s more than his European rivals, but less than the bosses of US lenders like Morgan Stanley, whose valuation the $100 bln Swiss bank aspires to. Tweaked terms next year give Ermotti a chance to narrow the gap.
Eni’s green shoots are taking time to blossom 28 Mar 2024 Italy’s $53 bln energy major trades at a discount to rivals. An overhang from Rome’s potential stake sale and falling gas prices are drags. But CEO Claudio Descalzi’s plan to raise cash by spinning off energy transition-focused business units is also yet to fully shape up.
Tata’s forced IPO will only bring problems 28 Mar 2024 A central bank decision requires the $194 bln holding company of the Indian cars-to-tech conglomerate to list. It could lump Tata Sons with a huge discount and also spotlight the special tax treatment the group’s ultimate owners enjoy. That could force an even bigger upheaval.
How to get the best new boss for Boeing? Ask GE 25 Mar 2024 Dave Calhoun failed to fix the 737 MAX maker’s problems; ensuring its next CEO does better requires financial incentives equal to the mammoth task. Engine manufacturer GE’s controversial $232 mln inducement for boss Larry Culp offers a blueprint, if Boeing avoids its missteps.
China and foreign CEOs dance ever trickier tango 25 Mar 2024 Premier Li Qiang welcomed 100 bosses from giants like Apple to a Beijing business confab. Yet Tim Cook is shifting iPhone supply chains elsewhere, while China is pressing ahead with phasing out overseas tech like chips. The increasingly uneasy relationship is primed for missteps.
Disney’s CEO still has time to be a hero 20 Mar 2024 Shareholders will soon vote on the $200 bln entertainment firm’s board line-up, the culmination of a bitter battle between long-serving chief Bob Iger and activist Nelson Peltz. Iger is likely to prevail. He should invite Peltz to join the Mouse House as a director anyway.
Deeper Gucci woes test new CEO’s luxury touch 20 Mar 2024 Sales at Kering’s top brand are falling fast. An unproven designer, China weakness and a volatile client base are behind the group’s discount valuation. With M&A limiting hopes of buybacks, Gucci boss Jean-François Palus has a harder task convincing investors to stay the course.
Unilever’s sweet exit comes with sour aftertaste 19 Mar 2024 The $126 bln consumer giant is splitting off its unit that makes Cornetto ice cream. Doing so cuts exposure to food, and may boost sales growth. But Unilever investors are bearing the costs of the split, and their company remains big in the edible version of stranded assets.