BlackRock’s social activism stick is big and pointy 16 Jan 2018 Larry Fink’s investment firm is demanding companies make a positive contribution to society for the long term. Having $4.1 trln of passively managed assets gives a big bully pulpit. BlackRock may have self-interest at heart, but if the private sector bucks up, that’s just fine.
Viewsroom: China’s dubious shot across U.S. bow 11 Jan 2018 Talk of buying fewer of Uncle Sam’s bonds may be Beijing’s way of showing some teeth as the Trump administration mulls import tariffs. But as with other retaliatory trade tactics, it would hurt China too. Plus, why Nelson Peltz doesn’t want to be called an activist investor.
Wells Fargo, Under Armour may attract activists 10 Jan 2018 They at least were the favorites in two informal Breakingviews polls on Tuesday. Fallout from the big lender’s scandals and the athletics brand’s stock-market loser status in 2017 are among the reasons. By investor Nelson Peltz’s criteria, though, both have drawbacks as targets.
Tech backlash catches up to Apple 8 Jan 2018 Jana Partners and pension giant CalSTRS want the company to give parents better controls over their kids’ iPhones. It’s an unusual issue for an activist, and apps from Facebook and Snap would make better targets. But focusing on Apple shows how much technology has lost its halo.
Can Nelson Peltz clean up at P&G? 8 Jan 2018 Now that Trian Management founder Nelson Peltz is on the board of consumer-goods giant Procter & Gamble, Breakingviews has created a calculator to show how the market value of the $230 billion group could increase if revenue growth and margins improve.
Peltz may go from nice to nasty at P&G 8 Jan 2018 The activist, now on the $230 bln consumer-goods giant’s board, has said P&G should slash costs and steal market share. That may boost the stock by over 10 pct, Breakingviews calculates. To get much more, Peltz might suggest a deeper cut: offloading razor maker Gillette.
Guest view: Proxy fights as commonplace in 2018 5 Jan 2018 Though 2017 was the year of big-time contests like Trian versus P&G, get ready for more contentious and expensive battles for control of Corporate America, argues Columbia Business School's Wei Jiang. She offers four key factors that boards and investors should consider.
Viewsroom: Debt markets set for wild ride 4 Jan 2018 More government borrowing and less central bank buying will force bondholders to fend for themselves, Breakingviews predicts. Plus, passive funds will force out a CEO, electric vehicles give gasoline cars a run for their money and soccer clubs’ spending splurge will intensify.
Activists’ guide to 2018 (sponsored by P&G) 2 Jan 2018 Investors seeking new strategies, more dividends or board seats aren't going away. The siege of the Pampers maker by Trian, which ultimately won a board seat, will embolden others to take up the cause. Resistance isn't futile, but needs to be more carefully considered.
Passive funds will claim a CEO scalp in 2018 2 Jan 2018 Index trackers keep winning market share but companies can’t take their passivity for granted. State Street campaigns for gender diversity, Vanguard and BlackRock defied Exxon on climate change, and the latter backed Nelson Peltz at P&G. Firing a poor manager is the next step.
Viewsroom: Investors target sexual misconduct 29 Dec 2017 Companies that sweep settlements for bad behavior under the carpet will feel shareholder ire in 2018, Breakingviews predicts. Plus, Apple will float past the EU’s roving eye, splintering political parties are a ticking U.S. time bomb and bank bosses may hang up their hats.
Icahn wins SandRidge battle but war isn’t over 29 Dec 2017 The oil driller has dropped its $746 mln bid for rival Bonanza, something the activist and others wanted. But its poison pill – which bars Icahn from upping his stake and makes a takeover more difficult – remains in place. The investor should see this fight through to the end.
Geely could be useful back-seat driver at Volvo 27 Dec 2017 Seven years after buying Volvo Cars, the Chinese group is acquiring Cevian’s 8.2 pct stake in the Swedish truckmaker. The activist gets a decent exit after 11 years, while Volvo gets help with electric vehicles and China. The risk is Geely is getting in at the top of the cycle.
Ebenezer Scrooge is ripe for shareholder activism 22 Dec 2017 Companies are swerving toward more active corporate giving and better conditions for workers. Investors should be pleased, but they might also have to recalibrate their idea of what makes a good company. One activist fund in particular isn’t feeling the festive spirit.
Pushy investors on board for 2018 Pacific cruise 22 Dec 2017 Campaigns at BHP and Myer could set the stage for a pick-up in Australian shareholder activism. Sydney offers enticing targets, shareholder-friendly rules and potentially supportive institutional owners. Expect to see more governance skirmishes Down Under in the coming year.
Oil shareholders try capping sorry governance well 21 Dec 2017 SandRidge adopted a poison pill to fend off investors unhappy with a recent deal. Hess faces another fight with Elliott. Exxon is only now allowing owners to talk to the board. The shareholder pushback is welcome, but the industry’s slow response leaves it exposed to other risks.
Activists are at the back door of fortress luxury 21 Dec 2017 Big family stakes allow purveyors of high-end brands to hoard cash and tolerate second-rate governance. But Elliott’s Samsung campaign shows that entrenched owners are not immune. And minority shareholder rights make names like Prada more vulnerable than they look.
LSE needs plan for itself, not just its bosses 20 Dec 2017 Hedge fund TCI's aggressive campaign to remove Chairman Donald Brydon failed. Yet the bruising soap opera over ex-CEO Xavier Rolet has exposed a lack of forethought. As well as its two top jobs, the exchange group needs to consider acquisitions – or selling itself.
Steinhoff meltdown has silver lining for hedgies 20 Dec 2017 The S. African retailer’s bonds collapsed amid an accounting mess. But investors are not suffering equally. Steinhoff's fondness for convertibles means more of them are now being sold, pushing them to lower prices than potentially riskier paper. Nimble traders can take advantage.
Indispensable execs demand higher disclosure 18 Dec 2017 CSX’s turnaround expert Hunter Harrison is dead months after joining the railroad. A rich signing package and $10 bln added to the firm’s market worth showed his importance. If companies and markets think and act as if leaders are irreplaceable, key-man risks must be disclosed.