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Americas

Yen intervention is a lost cause worth pursuing

29 Apr 2024

Tokyo may have acted to prop up the currency after it dropped below 160 to the dollar. It’s a losing bet until the US Federal Reserve cuts rates or the Bank of Japan tightens monetary policy further. But there is value in signalling to the world that this is not a one-way street.

The Agnellis’ risky Philips bet starts to pay off

29 Apr 2024

The Dutch group settled its US faulty sleeping aid claims for a manageable $1.1 bln, lifting its stock 35%. The relatively quick fix vindicates Exor CEO John Elkann’s $3 bln punt on Philips when legal worries kept investors away. It may also shift the thinking on big litigations.

China is better off doing nothing for TikTok

29 Apr 2024

Beijing has signalled it would rather ByteDance's video app be banned in the US than sold. Unlike Huawei, the company's technology is neither strategic nor desirable. Having a final say over TikTok's fate might be useful political leverage, but retaliation fears look overblown.

Ukraine’s $61 bln lifeline is not enough

29 Apr 2024

The United States last week cleared a vital aid package, but Kyiv still needs a medium-term funding plan to withstand Russia’s onslaught. Mobilising Moscow’s $320 bln of frozen central bank assets to provide compensation for war damages should be central to this.

Exxon and gas markets tell different stories

26 Apr 2024

CEO Darren Woods denies fossil fuels are in decline, thanks to growing populations and rising petrochemicals demand. Yet a glut of natural gas – which reined in quarterly profit at Exxon and rival Chevron – is a real problem, and one that could weigh on prices for a long time.

Thoma Bravo UK cyber deal looks a little too good

26 Apr 2024

The buyout firm finally agreed a takeover of long-term target Darktrace, an IT security specialist. Despite the generous-looking 44% premium on offer, the buyer’s returns seem juicy given a nascent US push. That may raise the chance of shareholders asking for more money.

CVC’s Darwinian pay policy puts rivals on the spot

26 Apr 2024

The buyout shop, which manages $200 bln, allocates 40% of fund profits to staff on a deal-by-deal basis, rather than pooling the spoils. Rivals say it hurts teamwork, but CVC’s returns suggest it works. If the newly public firm keeps out-raising peers, others may follow suit.

Who can serve up the Goldilocks recipe for AI?

25 Apr 2024

Investors slapped down Facebook owner Meta for hefty spending on artificial intelligence with uncertain returns. Conversely, they have feted chipmaker Nvidia for its real-life revenue from AI tools. Microsoft and Alphabet are doing a decent job of landing in the middle.

Detroit’s revenue engines finally start to fire

25 Apr 2024

Ford and GM haven’t grown US electric sales since 2022, despite investing billions of dollars. But under the hood, GM’s new models are gaining momentum, and Ford is focusing on its cash-generating trucks and vans. It helps that they are accelerating in different directions.

US economy is a victim of its own success

25 Apr 2024

The United States emerged as the world’s growth engine at the IMF summit last week. In this Viewsroom podcast, Breakingviews columnists debate whether this debt-fuelled strength means that interest rates will stay high for longer and how that could raise the risk of a recession.

Vote no to bashing proxy advisers

25 Apr 2024

Corporate leaders at JPMorgan and AstraZeneca bridle when ISS and Glass Lewis criticize their governance. No wonder: Some high-stakes shareholder votes this year will be uncomfortable for feather-bedded bosses. Proxy firms are problematic, but they do more good than harm.

Silicon Valley models value of noncompete ban

24 Apr 2024

A new FTC rule forbids US companies from stopping employees joining a rival, or starting one. Freeing up opportunities for a fifth of the workforce should boost pay. California’s tech hub also showcases other benefits of labor mobility. Intel, for example, exists because of it.

TikTok’s fate matters only up to a point for Meta

24 Apr 2024

Under a new US law, owner ByteDance is likely to sell the app without its secret sauce, suffer a ban or win a court challenge. Mark Zuckerberg’s social-media colossus should capitalize on the first two scenarios. Even the third allows it to make decent headway against its rival.

How one firm made child’s play of tricky M&A games

24 Apr 2024

Imagine buying a company without tedious negotiations, rival bids or pricey premiums. A Saudi investor pulled it off by snapping up enough shares to gain control of US retailer The Children’s Place. The feat will be hard to replicate, but there’s now a model for deal masterminds.

Beijing powers up into car wars battleground

24 Apr 2024

The city’s auto show returns, with some 700 exhibitors, for the first time since the pandemic. Foreign brands from Volkswagen to Toyota have to show how they can defend themselves as China’s BYD and new threats like Xiaomi chase market share at home and abroad.

Tesla thumbs a ride on uncertain low-cost future

23 Apr 2024

Elon Musk’s automaker is accelerating a plan to make cheaper electric car models. Yet its recent performance disappointed, and rivals like GM are resurgent. Tesla wants investors to believe the future will be better than the present, and as good as the past. It’s a stretch.

Cruise-ship IPO bets the rich will always float

23 Apr 2024

Viking is seeking an $11 bln valuation in its US listing — a premium price relative to the larger Carnival and Royal Caribbean. As ballast, it offers a focus on high-end customers and less debt than peers. Investors will be reliant on the whims of the few, in more ways than one.

Kate Spade deal veto is lucky dip for trustbusters

23 Apr 2024

US competition cops want to stop Tapestry, owner of the handbag brand, from buying rival Capri. The $8.5 bln merger is a tempting target: well-known products, few political issues, and none of Big Tech’s mighty resources. That offers a chance to road-test novel legal theories.

World economy’s star athlete may run out of puff

23 Apr 2024

The IMF crowned the United States as the champion of global growth at last week's summit. A predicted rise in GDP of 2.7% this year is welcome as Europe and China struggle. But high debt and hard-to-repeat gains in productivity and the workforce will limit American staying power.