British retailers have leverage over Unilever 13 Oct 2016 The maker of Dove soap wants supermarkets like Tesco to pay more for its goods as the pound weakens. They can’t easily pass that cost on to shoppers. Grocers have two reasons to play tough: Unilever's 15 pct operating margin, and their access to the consumer.
Seven & i is a qualified win for Loeb 12 Oct 2016 New boss Ryuichi Isaka's promotion at the owner of 7-Eleven convenience stores was a major coup for investor Dan Loeb. Yet a new plan to shake up the retail giant looks timid compared to the pushy activist’s original demands. Japan Inc is open to change – but only up to a point.
Tesco recovery plan stacks up 5 Oct 2016 Excellent first-half results have given the UK grocer confidence to raise its ambitions for future operating margins. Three straight quarters of sales growth in the face of stiff competition and plans for more cost savings give investors every reason to buy the turnaround story.
LVMH gets first-class luggage at no-frills price 4 Oct 2016 Louis Vuitton’s owner is buying a majority stake in German suitcase maker Rimowa for 640 mln euros. The multiple of two times sales is less than what Samsonite recently paid for rival Tumi. Perhaps the Arnault clan persuaded family-owned Rimowa to leave some money on the table.
Bass Pro leaves the bank, takes the taxidermy 3 Oct 2016 The private outfitter is buying rival Cabela's for $5.5 billion, a 40 pct premium. Cabela's is a bank in camouflage - most profit comes from a credit-card business that'll be hived off to Capital One. Avoiding financial entanglements should make the deal easier to manage.
Dutch food IPO delivers a lukewarm debut 30 Sep 2016 Shares in Takeaway.com were up 6 percent on its first trading day, less impressive than UK rival Just Eat's 10 percent 2014 debut pop. True, European markets are having a bad day. But pricing was also punchy for a tech group that has yet to become top dog in some of its markets.
Nike laces up its hurdling spikes 28 Sep 2016 The $90 bln sportswear maker is experiencing a slowdown in orders for sneakers and other gear. Margins also are contracting as challengers like Adidas become fleeter with trendier shoes and apparel. To achieve its lofty sales goal, Nike will have to kick into a higher gear.
Dutch food IPO has a German fly in the soup 27 Sep 2016 Meal delivery website Takeaway.com is seeking 350 million euros in an IPO. Revenue is growing rapidly, but so too are losses. Investor appetite for a sales valuation in line with profitable Just Eat rests on whether it can dominate the tough German market.
Sports Direct does leg two of governance triathlon 23 Sep 2016 The UK retailer's CEO will be replaced by owner Mike Ashley, its second big concession to investors in a week. That will satisfy calls for the powerful founder to be held accountable. Shareholders might rather have seen the chairman go, but the move shows the group is changing.
Indonesia’s e-commerce riches will be elusive 22 Sep 2016 Capital is pouring into Southeast Asia's most promising e-commerce market. Alibaba's $1 bln stake in Lazada gives it a head start. But competition is fierce. Issues like logistics and payments will make it costly to replicate the dominance the Chinese group enjoys at home.
Unilever scrubs up venture capitalist credentials 20 Sep 2016 The $136 bln Dove soap maker is buying green products firm Seventh Generation, talking with Jessica Alba's company and acquired Dollar Shave. Assimilating fast-growing niche brands with entrepreneurial cultures isn't easy. Unilever's Ben & Jerry's experience gives it a leg up.
GSK tries out alternative medicine with new CEO 20 Sep 2016 It's a logical move to name consumer head Emma Walmsley as the drugmaker's new chief executive. Pharma companies can learn a lot from the efficient personal care sector. Critics may see a doubling down on GSK’s HIV-to-Horlicks model, without a fix to its weaker pharma business.
Mitsubishi deal is inconvenient for new-look Japan 16 Sep 2016 The trading house will offer $1.4 bln to lift its stake in convenience-store chain Lawson to 50 pct from 34 pct. The price isn't great for minority investors, and the deal turns another public company into a listed corporate subsidiary. That sits oddly with Japan's reform drive.
Morrisons shows there’s life in large supermarkets 15 Sep 2016 Britain’s fourth-largest grocer has racked up three consecutive quarters of positive sales despite being an online laggard and having no fast-growing convenience stores. Operating margins have also improved. CEO David Potts is playing a bad hand well.
Ocado learns inconvenient truth about convenience 13 Sep 2016 Sales at the UK online grocer grew 13.6 percent in the third quarter, and average weekly orders were up strongly. But customers treat Ocado like a convenience store - buying small batches more often. Giving customers what they want is proving to be expensive.
Sugar can’t sweeten AB Foods’ retail slowdown 12 Sep 2016 Sales are slowing at Primark, the fast-fashion chain that accounts for two-thirds of operating profit at the sugar-and-retail conglomerate. The weaker pound may hit the clothing chain's profitability next year. A widening pension deficit further sours AB Foods' prospects.
Gap struggles to refashion with familiar pattern 8 Sep 2016 Boss Art Peck is trying to get stylish clothes onto shelves faster. His predecessors enlisted similar strategies twice before to bring $10 bln Gap back from the depths. This time, e-commerce and other competitive pressures are mounting quickly. A third revival may be harder.
Minority investors should check the returns policy 7 Sep 2016 Sports Direct's shareholders are being trampled by a strong entrepreneur with a 55 pct stake. Italian luxury brand Prada has a similar issue: entrenched founders whose strategy isn’t working. Big shareholders can benefit companies, but other investors end up stuck if things sour.
Sports Direct gets image overhaul half right 6 Sep 2016 The retailer released a harsh report about working conditions before its AGM and announced a corporate governance review. The trouble is both will have been done by its own legal advisers. To really change investors' minds, owner Mike Ashley needs a more independent stock take.
Yum’s new China backers add spice at a price 2 Sep 2016 The KFC owner is selling a slug of its China unit to Alibaba's mobile-payments arm and a firm run by former Goldman Sachs partner Fred Hu. Together, they bring tech nous and connections. It's a better deal than usual for cornerstone investors, but may pay off for Yum's spinoff.