JD certifies that old buyback habits die hard 18 Mar 2020 The Chinese e-commerce giant unveiled a $2 bln share repurchase plan amid a global crash. A possible second listing in Hong Kong may explain it, and JD is at least using cash on hand. Corporate obsession with such financial engineering probably will be pandemic-proof.
HSBC’s now-permanent CEO gets a hospital pass 17 Mar 2020 Interim boss Noel Quinn has finally been confirmed in the job after seven months. The fact that others, like UniCredit’s Jean Pierre Mustier, turned it down may dent his authority. The virus crisis, meanwhile, means his new strategy to boost returns is already out of date.
Siren call of trading halts is entirely resistible 17 Mar 2020 The virus prompted the Philippines to shutter its bourse; U.S. SEC chief Jay Clayton says such moves are unnecessary. There are tempting reasons to temporarily freeze markets, which New York and others have done before. But the costs of closures exceed their fleeting benefits.
CEOs finally have a licence to cite “uncertainty” 17 Mar 2020 Despite being paid to deal with doubt, bosses abuse the term as an excuse for poor performance or to criticise disliked policy. Covid-19 is the real deal, though, making it truly hard to read supply, demand and government action. It’ll be a 2020 buzzword alongside “coronavirus”.
Yes Bank draws down Team India’s power 16 Mar 2020 Private institutions from HDFC to ICICI are joining a $1.4 bln state-led rescue of the troubled lender. There is self-interest in collectively trying to help restore systemic confidence. With more bad debt bound to turn up, though, it is also an early drain on limited resources.
Oxy victory would help Icahn’s poor oil-patch rep 12 Mar 2020 By raising his stake in Occidental Petroleum, the activist has upped the odds of getting his way, or reaching a truce. It helps that his demands – a new CEO and a sale of the company – both make sense. A trail of rocky energy investments means Icahn could use a high-profile win.
Frère hands minorities two carrots and one stick 12 Mar 2020 GBL, the holding company of Belgium’s Frère and Canada’s Desmarais families, wants minorities to swap shares in its parent for shares in itself. The catch is the families get double voting rights. The appeal is the offer looks reasonable and the new structure could create value.
Wells Fargo stuck on hidden route to recovery 10 Mar 2020 New boss Charlie Scharf won’t say when he thinks the U.S. bank will have fixed the “broken culture” that led to fines, or even if it will hit an important Fed deadline. It can be sensible not to chase milestones too doggedly. But the opacity leaves investors in valuation limbo.
Holding: Governance brawl a boon for stakeholders 10 Mar 2020 Attorney Martin Lipton and Harvard’s Lucian Bebchuk are at it again, with the latter saying company pledges to serve the greater good are illusory. Lipton counters that firms really are moving past shareholder primacy. At least the debate could benefit all corporate constituents.
Ironman sale threatens Chinese owner’s endurance 10 Mar 2020 Wanda Sports had lost 70% of its value since going public last July, hurt by disappointing results and debt concerns. It may now offload the division that houses the crown-jewel triathlon. Parting with such a big part of the IPO pitch hardly inspires confidence about the rest.
Boeing airworthiness takes new viral hits 9 Mar 2020 The aircraft maker’s shares have plunged 25% in under a month – double the damage to the S&P 500. On top of the 737 MAX grounding, a possible pandemic weakens Boeing’s airline customers while also disrupting its supply chain. New CEO David Calhoun needs more than an apology tour.
Activists leave Twitter with unspoken ultimatum 9 Mar 2020 The $26 bln social network struck a deal with Elliott and Silver Lake involving board seats, fresh capital and a $2 bln share buyback. Twitter also effectively pledged to grow users by 20%. If CEO Jack Dorsey can’t deliver, he may find himself under pressure to sell the company.
Big shots will help women bridge startup gap 9 Mar 2020 The average value of a seed round for female-founded ventures tripled to $1.2 mln in the past decade. And a record number of outfits with women founders achieved “unicorn” status in 2019. The divide is still huge. Even so successes like Luckin Coffee will accelerate progress.
White House race mirrors corporate diversity trap 5 Mar 2020 Senator Elizabeth Warren dropped out of the race to become America’s first woman president. More females are in Congress and closer to the C-suite than ever, but the pipeline breaks down at the top. In politics, voter whim plays a big role. Companies don’t have that excuse.
Exclusive: UBS CEO tips Swiss to better governance 2 Mar 2020 Sergio Ermotti will become chairman of Swiss Re after his 9-year term ends. It would have been tempting to hold out for the chance to chair Switzerland’s largest bank. But this allows him to embark on a new chapter without complicating life for his successor Ralph Hamers.
Nokia CEO’s to-do list starts with spring clean 2 Mar 2020 The Finnish telecom-kit maker’s new boss Pekka Lundmark needs to hit the ground running. Improving the 19 bln euro firm’s profitability is the first step. That will help him navigate choppy waters between Washington and Beijing, and prepare for the next wave of software-based 5G.
Malaysian upheaval turns back clock for Goldman 2 Mar 2020 A surprise new prime minister is supported by the party whose ex-leader is on trial over 1MDB. That undercuts a fight against corruption. It also resets talks with the Wall Street bank over its role in the fund scandal, even if this government may reconsider an $8 bln tab.
Barclays CEO pick is next activist flashpoint 28 Feb 2020 The choice of Jes Staley’s successor will determine the UK lender’s strategy for years. Executives with investment banking chops, like Bill Winters and Jean Pierre Mustier, would fit. That could spark a new showdown with investor Ed Bramson, who wants to trim the wholesale unit.
Italy SpA’s game of musical chairs grows tiresome 28 Feb 2020 Directors at Eni, Enel and other state-backed firms worth 40% of Milan’s main index are up for renewal. A three-year rotation gives politicians in Rome too much meddling power and inhibits longer-term planning. Italy, and investors, would be served better by longer tenures.
New Reckitt Benckiser boss embarks on deep clean 27 Feb 2020 Laxman Narasimhan is making up for past neglect at the Dettol maker with a major overhaul. The pain of a 5 bln pound write-down on baby-food group Mead Johnson is only partly soothed by ambitious medium-term growth goals. Splitting the health and hygiene units will have to wait.