Morgan Stanley gives Covid-19 a materiality test 9 Apr 2020 Boss James Gorman has recovered from the virus investors didn’t know he had. Companies have huge leeway when it comes to disclosing the boss’s ill health; Warren Buffett and Steve Jobs show extremes. Privacy is important, but there are advantages to radical transparency.
CEO pay sacrifices could use a pinch of altruism 9 Apr 2020 Disney, HSBC and Solvay are just a few big companies where bosses are volunteering pay. Solidarity with staff, prudence ahead of government bailouts and dwindling cash are the key motivators. Real generosity will need to come from those that are thriving amid the crisis.
Treasury Wine’s posh-plonk split calls for a toast 9 Apr 2020 The $5 bln Australian winemaker could spin off its prized Penfolds business. That should deliver a higher valuation for the upmarket label and separate it from a ragbag of other brands that need restructuring. A coronavirus-induced glut of luxury grapes will eventually help, too.
For staff, Jeff Bezos is more CEO than trailblazer 8 Apr 2020 The Amazon founder has transformed shopping. But the way the $950 bln firm treats its workers is not so futuristic. Like Walmart, it only recently provided protective gear to warehouse employees. That might fit with short-term profit, but not with long-term innovation.
Centerview picks risky moment for Parisian push 8 Apr 2020 The U.S. advisory firm hired Matthieu Pigasse to open its French office. Luring the ex-Lazard star is a coup, though he and 14 other bankers won’t have come cheap. With the coronavirus dampening corporate spirits, Centerview needs a V-shaped recovery for its bet to pay off.
Cox: How long can you last in this environment? 7 Apr 2020 That’s really the only question that CEOs need to answer when they start releasing quarterly earnings, penning shareholder letters and holding virtual annual meetings in the coming weeks. Cash is the king of metrics. Employee welfare comes next. Avoid predictions. And no whining.
Wall Street stuck with Luckin Coffee dregs 7 Apr 2020 Morgan Stanley, Credit Suisse and others face big losses after the founder of Starbucks' Chinese rival defaulted on $518 mln of loans amid fraud charges. The lenders are stuck offloading a huge stack of share collateral in a falling market. It’s the price of blindly chasing fees.
HSBC retail investors pick odd time for a fight 6 Apr 2020 Thousands of Hong Kongers are rallying to act against the UK bank for halting dividends. The lender has complex ties with the Asian hub, where it makes most of its profit. The city needs more grassroots activism. But at a time of profound uncertainty, the agitation lacks class.
Buffett’s main asset isn’t money but patience 3 Apr 2020 The Nebraska billionaire rescued companies before - think GE and Goldman. Lower asset prices give him a chance to double down on troubled investments, or buy firms outright. But with government aid buoying values, there's little reason to move until things get really desperate.
China’s wannabe fashion empire unravels 3 Apr 2020 Two years after agreeing to buy Swiss luxury brand Bally from JAB for $600 mln, Shandong Ruyi has failed to nail down financing. Its large and complex debt structure looks increasingly shaky. Even an HNA-like fire sale for the Lycra and SMCP owner will be tough in these times.
Luckin spills hot bezzle over credulous investors 2 Apr 2020 Fraud expands with good times and emerges in bad. A U.S.-listed Chinese coffee-shop disruptor once worth $13 bln just said much of its revenue last year may be fictitious. In this case, it didn’t take a downturn, just auditors doing their job. Just wait until the tide goes out.
Corona Capital: Uncle Sam’s penchant for boutiques 2 Apr 2020 Concise views on the pandemic’s corporate and financial fallout. The U.S. government has given a boost to independent investment banks by hiring Moelis. Perella Weinberg and PJT are its bailout advisers. Megabanks like JPMorgan and Goldman Sachs, meanwhile, are left on the shelf.
Corona Capital: Rich vs. poor, Carnival 31 Mar 2020 Concise views on the pandemic’s corporate and financial fallout: The rich may save even more while the coronavirus rages while the poor will be further squeezed, and Carnival tries to bail out its sinking cruise business with a big sale of equity and debt.
Green investing loses star player at bad time 31 Mar 2020 Hiro Mizuno is leaving Japan’s $1.5 trln pension fund. The chief investment officer led the way in focusing more on environmental, social and governance factors. Asset management can ill afford the exit of such a figurehead just as Covid-19 pushes these issues to the backburner.
Mitsubishi is too mild a mediator for Nissan 27 Mar 2020 Mitsubishi Corp, second-largest shareholder in the eponymous carmaker, is mulling a 10% stake in Renault, Reuters reports. It’s a small step, but could signal an overdue adjustment within the troubled troika. The French group will have to give more to get Nissan on board.
Cox: Virus-ebbed tide exposes the better leaders 26 Mar 2020 Politicians, central bankers and CEOs will soon be judged by their handling of the health crisis. Impressive new options who have shown courage, effectiveness and moral purpose have started to emerge. Preconceived choices – like Biden vs. Trump – are rapidly becoming passé.
Korean Air drama risks ending in corporate tragedy 25 Mar 2020 Feuding siblings, white knight Delta Air Lines, and a pushy activist are all battling over the country’s top carrier. Change is overdue, but debt worth 862% of equity has left Korean Air more vulnerable than peers to a pandemic. Any victory from the proxy battle will be pyrrhic.
Masayoshi Son’s bold streak works in reverse too 23 Mar 2020 The acquisitive SoftBank boss plans to sell up to $41 bln of assets to retire debt and buy back the company’s deeply discounted shares. Balance sheet concerns had reached fever pitch. There are good reasons to worry, but Son is showing he has big levers and is ready to pull them.
Tortuous Japanese hotel deal takes viral twist 20 Mar 2020 Unizo is backing a sweetened $1.9 bln bid from Lone Star that matches Blackstone’s price. Top owner Elliott is ready to accept, eight months into the bidding war. Fresh Covid-19 volatility may accelerate an endgame, but also calls into question the frontrunner’s takeover plan.
Cox: Are taxpayers ready to rescue the jerks too? 19 Mar 2020 Workers will be human shields for reckless CEOs in the crisis clamor to save jobs. Consider Penn National: The U.S. casino group gorged on debt and bought brash Barstool Sports a month ago. If capitalism had any purity, or morality, Penn would go bust. Watch it get bailed out.