Uber and Lyft create Asian valuation conundrum 30 May 2019 U.S. ride-hailing exuberance faded into lacklustre market debuts. At the same time, Singapore’s $14 bln Grab, for example, recently raised capital privately at 7 times expected revenue, compared to Uber’s 5 times. Fast-growing payment units can only justify some of the gap.
U.S. watchdog should throw down Facebook gauntlet 29 May 2019 The FTC is working with the social network on a settlement for failing to protect user data, including a mooted fine of up to $5 bln. A lawsuit against Mark Zuckerberg’s firm might be a better option. It’s risky, but it could grab Facebook’s attention and change its behavior.
Chinese booze behemoth distills a sobering reality 24 May 2019 Kweichow Moutai’s state-owned parent may be planning to sell liquor directly through a separate unit. It could help usurp some $6 bln of value from shareholders, Breakingviews estimates. For new and growing MSCI index investors, it’s a stark reminder of China’s governance risks.
Viewsroom: America’s topsy-turvy regulators 23 May 2019 Qualcomm lost a lawsuit brought by one DC overseer, even as the DOJ intervened, while $26 bln T-Mobile US-Sprint merger is getting yanked around by agencies with opposing views. Doing business is hard when agencies no longer act in unison. Plus: Is Luckin Coffee going cold?
Cox: “China does it” is a bad antitrust argument 23 May 2019 Sheryl Sandberg says Facebook shouldn’t break up since its Middle Kingdom rivals never will. France and Germany pushed hard for an anti-competitive train merger because of a looming Chinese monopoly. Western values should guide competition law, not Beijing’s Communist Party.
Hadas: “Zero privacy” is both blessing and curse 22 May 2019 Back in 1999 a computer executive told people worried about disclosing personal data to “get over it”. They mostly have. Shared information is now too useful for regulation to restore lost innocence. For oppressive governments, meanwhile, individualised media is also valuable.
Corporate clout on the line in Hong Kong fight 22 May 2019 From Washington to Wan Chai, executives are loudly protesting the city’s plan to allow extradition to mainland China. The business community often gets its way in the financial hub. Losing in this standoff would signify a turning point in Hong Kong for more reasons than one.
China exhibits worrying trade war restraint 17 May 2019 Beijing could retaliate against Washington using rare earths, U.S. debt or American companies on the mainland, a popular tabloid suggests. A better question is why such weapons, some deployed in the past, now sit idle. It points to a different, more dangerous, conflict.
Washington and Beijing push tech chasm wider 16 May 2019 President Trump has launched an aggressive assault on telecom giant Huawei, as China moves to strengthen cybersecurity rules. The moves will further divide the sector and complicate trade negotiations. A costly technology cold war looks here to stay.
Recess ends for China’s private-school startups 14 May 2019 Companies like $19 bln tutoring giant TAL have long benefited from foreign enthusiasm for Chinese education plays. Share performance, however, has been inconsistent. Demographic challenges, plus fresh policy headwinds in Beijing and Washington, put growth at risk.
The Exchange: Margrethe Vestager 7 May 2019 The EU’s antitrust commissioner is famous for imposing multi-billion-dollar fines on Alphabet and Apple. She joins Liam Proud and Peter Thal Larsen to explain why combatting the greed, power and fear that stifles competition is even more crucial in a data-driven world.
Aviation is acid test for UK climate credibility 7 May 2019 Britain’s proposal for zero net carbon emissions by 2050 is laudable. But given it’s already struggling to hit a less ambitious goal, success implies tough state action. One way to tell if the UK is serious is if it ramps up taxes that curb customer demand for air travel.
Huawei fracas erodes its European advantage 1 May 2019 Vodafone found flaws in the Shenzhen-based group’s kit. Huawei argues they are common in the sector, and not evidence of Beijing spying. Yet its Chinese roots mean it will be held to higher standards than European peers. Telco customers might decide it’s not worth the risk.
Hong Kong currency peg seduces yet again 29 Apr 2019 Hedge fund manager Kyle Bass is the latest investor to lay out a dire case about a long-time link to the U.S. dollar. His rambling argument suggests overleveraged banks and political ructions make the peg precarious. It probably will require a real crisis to prompt any overhaul.
Facebook will join Wall St in fine-and-forget club 25 Apr 2019 The social network’s market value surged as much as $40 bln after first-quarter earnings despite a likely U.S. data-privacy fine of up to $5 bln. Mark Zuckerberg’s giant can easily absorb multiple hits that size and, just like banks after the financial crisis, move on.
Hadas: Profit flows freely, companies behave badly 25 Apr 2019 An IMF study shows a significant increase in companies’ pricing power since 2000 in developed economies. The trend in profitability is likely to bring less investment, more market-stifling mergers and more smugness from managers. Change requires a rethink of how competition works.
UK supermarket M&A will return in bargain bin 25 Apr 2019 The competition watchdog blocked Sainsbury’s proposed $9 bln takeover of Asda. CEO Mike Coupe has few palatable options to cope with German discounters and the revival of UK peers. Deal fever will resurface after the rot sets in and the grocer’s share price has fallen further.
China’s game makers face a shapeshifting boss 24 Apr 2019 New rules provide some clarity and point toward fewer and blander video-game titles after a freeze on approvals last year. That should be manageable for giants including the $475 bln Tencent. Yet the whims of a revamped regulator finding its feet still warrant a discount.
Why open banking remains a closed shop 23 Apr 2019 It’s over a year since the UK and EU gave tech groups access to account data, supposedly boosting competition. Yet glitches and a narrow focus on current accounts mean the measures are barely used. Change requires more tech-savvy financial institutions – or more regulation.
Short hit pollutes China’s second-hand car lot 17 Apr 2019 Uxin’s stock lost a third of its value after a research firm accused the newly U.S.-listed auto outfit of fudging numbers. True or not, fumes around an industry backed by Tencent and big buyout names are becoming noxious. It’s reason to steer clear of rivals waiting to go public.