Hong Kong’s last governor on dealing with China 21 Jun 2022 Chris Patten was Britain’s top representative in the colony before its handover 25 years ago. In this edition of The Exchange podcast he talks about his newly published diaries, businesses sucking up to the People’s Republic, and whether the West will defend international rules.
Wirecard exposed finance’s scary credulity 17 Jun 2022 The payments group collapsed in 2020 after admitting $2 bln of its cash was fake. “Money Men”, a book by the FT journalist who uncovered the scandal, describes a chaotic and unsophisticated fraud. All the more shocking that analysts, advisers, auditors and regulators were fooled.
Santander picks anti-Orcel as new CEO 17 Jun 2022 After bungling the hiring of the former UBS banker in 2019, Executive Chair Ana Botín and the board have picked a safe choice in Héctor Grisi. The insider won’t require a hefty payout and has experience running a retail bank. He’ll need it given Santander’s lowly share price.
Samsung opens its wallet to a wary chip market 16 Jun 2022 Boss Jay Y. Lee's European trip has sparked hope that the South Korean conglomerate will finally use its $84 bln cash pile for M&A. Beat-up valuations at mooted targets like NXP make consolidation attractive. Appeasing concerned governments, though, will be a tough sell.
Rift at the top casts doubt on Atos’ breakup plans 15 Jun 2022 The French IT company’s shares slumped after its new CEO resigned just as it broached a tentative plan to divide its cybersecurity and legacy infrastructure businesses. Longer-term, Atos needs radical surgery. In the short run, delivering on its targets would be a start.
EU women-on-boards plan only scratches the surface 8 Jun 2022 The bloc wants listed companies to reserve 40% of non-executive director roles for females. That’s lame, when 60% of graduates are women. And groups with diverse boards tend to deliver higher returns. It’s time for the EU to set a target for full gender parity in the boardroom.
Capital Calls: Fertilizer woes plant seed of doubt 8 Jun 2022 Concise views on global finance: Scotts Miracle-Gro’s profit warning nods to wide effect of commodities price surge.
Wounded PM leaves UK economy in painful limbo 7 Jun 2022 Boris Johnson remains in office even though 41% of his party’s lawmakers voted to oust him. His fragile position, and probable attempts to win back public support, will add to existing economic uncertainty. It’s another reason for companies and investors to look elsewhere.
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.
Terms don’t kill deals, people do 6 Jun 2022 Thoma Bravo and Anaplan have renegotiated their transaction. Elon Musk officially threatened to back out of his $44 bln buyout of Twitter. Nervous markets make mergers less likely to close. The strength of agreements matters less than the fortitude of directors hashing out deals.
Capital Calls: Microsoft micromanages tech jitters 2 Jun 2022 Concise views on global finance: A 1% revenue shortfall because of a strong dollar normally isn’t that important. Microsoft’s warning reflects how nervous tech investors have become.
Facebook sans Sandberg is more vision than company 1 Jun 2022 While the social network had problems under its departing COO, it at least had a business model and a top-tier executive who could sell it to investors. Amid slowing ad sales and co-founder Mark Zuckerberg’s pivot to the metaverse, Sheryl Sandberg’s exit comes at a poor time.
DWS CEO exit is helpful deterrent for greenwashing 1 Jun 2022 Asoka Woehrmann resigned from the $7 bln asset manager as regulators probe allegations it exaggerated its sustainable investing skills. Fund groups have benefitted from booming demand for ESG investments. The fallout at DWS gives other bosses an incentive to tone down the hype.
Pete Stavros and his equity-for-all quest 31 May 2022 The KKR partner started the non-profit Ownership Works to help companies grant stock to entire workforces. He discusses the resistance, the success stories, and an ambitious plan to create $100 bln of wealth for employees on this episode of The Exchange podcast.
Capital Calls: Peltz bolsters Unilever’s M&A cred 31 May 2022 Concise views on global finance: The U.S. investor’s seat on the board should help CEO Alan Jope sell deals to investors.
Big Four split would have few winners, many losers 31 May 2022 EY may separate its accounting arm from the unit that advises on strategy and IT. The consulting spinoff, worth some $60 bln, might win more business due to fewer conflicts and scandals. Yet the rump auditing business may struggle to attract staff, and push up prices for audits.
Subdued Alibaba strikes fitting new tone 27 May 2022 New finance chief Toby Xu's focus on cost cuts and better-than-expected sales growth powered a 15% stock rally. The regulatory-thwacked e-commerce group is taking control where it can but exercising discipline on the bottom line in a slowing Chinese economy invites trouble too.
New Toshiba board’s work extends beyond Toshiba 27 May 2022 The embattled $19 bln conglomerate nominated a Houlihan Lokey banker to be chair and directors from pushy investors Elliott and Farallon. The main job now is to end a tortuous saga with a sale. Success would help show Japan’s supine shareholders how dogged engagement pays off.
Shopify’s governance revamp is so 2021 26 May 2022 Shareholders are being asked to give Tobi Lütke the ability to keep his voting power even if his ownership stake falls. That might have been palatable at the end of last year, when Shopify’s shares were worth five times as much as they are now. Now it just adds insult to injury.
Renault split requires very careful driving 26 May 2022 The $7.7 bln French carmaker may separate its electric and fossil fuel units. That could boost a lagging valuation and open the door to fresh capital, but would also increase costs and complexity. It’s a risky manoeuvre, but CEO Luca de Meo has few other options.