Americas

Even bitcoin has room for VIPs

19 Mar 2024

Digital asset manager Grayscale has become a victim of its own crusade for US ETFs tracking the cryptocurrency. The exodus from its trailblazing trust now exceeds $10 bln because of low-fee rivals. It’s offering goodies to keep customers, but a premium fund also holds value.

US Steel tug-of-war threatens to pull it apart

19 Mar 2024

Cleveland-Cliffs has put its rival in a bind, rallying political and labor opposition to a $14 bln agreed sale to Japan’s Nippon while pushing its own questionable takeover bid. No deal at all would be bad news for the target’s union workers. A carve-up might be inevitable.

Crypto’s roaring comeback may be harder to undo

19 Mar 2024

Bitcoin’s price broke its record, nearly two years after crypto exchange FTX went bust. In this Exchange podcast, Andreessen Horowitz’s Arianna Simpson explains why digital assets and the ledgers underpinning them are inextricable, and what’s driving new excitement around both.

Mexican wave of nearshoring firms is all at sea

19 Mar 2024

The country’s proximity to the US could make it a preferred destination as multinationals move away from Asia. Companies like Merck and Tesla are building factories there but, so far, manufacturing is not growing. With relocations costs soaring, an economic boom looks elusive.

Alphabet and Apple have cause to circle AI wagons

18 Mar 2024

The $2.7 trln iPhone-maker is in talks to license Alphabet’s artificial intelligence models, according to Bloomberg. Apple has underinvested, but Google search’s pride of place on its devices is also at risk. A deal would help both defend their turf, if regulators don’t kill it.

Like Rome, oil demand won’t be destroyed in a day

18 Mar 2024

Oil producers attending the big industry confab in Houston this week recognize they are under pressure. US firms are merging; Saudi is reinventing itself. Like in any dwindling empire, many leaders will want to take over rivals. Rewarding investors with cash is a better strategy.

Reckitt slump offers a cue to slim down

18 Mar 2024

The $41 bln Lysol maker’s shares fell sharply after it lost a US court case. One option for Reckitt Benckiser is to separate the nutrition arm, focus of the legal woes. That would ease the hit to the rest of the group, but also leave a new arm that may yet be worth something.

Biden’s subsidies are working a little too well

15 Mar 2024

The US president’s incentives for chips and clean energy have provoked a competitive scramble and raised the cost of building factories – which cuts the handouts’ real value to recipients like Intel. The risk is that investment zeal sets the scene for future gluts.

Disney CEO Bob Iger has a lingering legacy problem

15 Mar 2024

The $205 bln company is trolling to replace its longstanding boss. Perhaps its someone in-house or an outsider brought in by a deal. But Tinseltown is skeptical he’ll leave. Iger may bat down activists in an upcoming vote. The best way to ink his legacy is by nudging the board.

AOL-Time Warner architect leaves useful blueprints

14 Mar 2024

Gerald Levin, dead at 84, will forever be linked to the $340 bln M&A disaster, but the strategy behind it was prescient. So was his work championing HBO and pay-TV. Other tech and media CEOs have done value-destructive deals using far weaker rationales, and more are in the works.

Joe Biden out-MAGAs Donald Trump

14 Mar 2024

The US president is siding with union workers who oppose a US Steel takeover by Japan’s Nippon. He also said he would sign a bill forcing TikTok’s Chinese owner to sell the popular app or see it banned. The ad hoc approach to national security concerns sets a dangerous precedent.

Buyout shops take risky exit to bypass deal crash

14 Mar 2024

A lack of M&A and IPOs has left private equity portfolios with $3 trln of companies, many past their sell-by dates. As a result, firms are increasingly cashing out backers while keeping assets. There are guardrails on the structures now, but they could easily spin out of control.

ByteDance’s TikTok woes are never-ending sideshow

14 Mar 2024

US lawmakers edged closer to banning the short-video app. Co-founder and CEO Liang Rubo has grappled with the epic four-year-long fight while rejigging the business at home to focus on e-commerce. ByteDance remains in IPO limbo but its fortunes have not fallen too far.

Japan’s rate shift will hit zombie firms hardest

14 Mar 2024

The central bank could end an era of negative borrowing costs as early as next week. In this Viewsroom podcast, Breakingviews columnists argue that large companies are ready for the tightening, but many struggling small businesses could hit the wall even if policymakers go slow.

AI makes venture capital Big Tech’s country cousin

13 Mar 2024

Early-stage investors have long competed to back the hottest startups. Now artificial intelligence startups seeking capital and computing power are going directly to deep-pocketed giants like Microsoft and Amazon, leaving venture capital firms scrabbling for crumbs in the boom.

Rescuing a bank is like making a fine soufflé

13 Mar 2024

Steven Mnuchin’s $1 bln swoop on New York Community Bank may be more challenging than his rehabilitation of mortgage lender IndyMac in 2009, but the returns could be ample. Bank rescues have many ingredients. Timing, skill and luck separate those that rise from those that sag.

Reddit Google searches ‘how to make money’

12 Mar 2024

The social media firm’s rapid top-line growth suggests it’s attracting ad dollars. But Reddit’s reliance on search engines like Google to attract viewers is a risk. Roughly three-fourths of its new users come through search. Monetizing them keeps the platform on a cost treadmill.

Time continues to be on TikTok’s side

12 Mar 2024

A US bill that would force the social media app’s parent ByteDance to sell the platform is gaining ground. Demands are like those made years ago, only the app is now more powerful, the relationship with China more complicated, and politicians less willing to compromise.

Capital Calls: Small Fed windows

12 Mar 2024

Concise views on global finance: US consumer prices rose 3.2% year-on-year in February, above the Federal Reserve’s 2% target, prompting traders to rein in hopes for rate cuts. The agency’s Chair Jerome Powell could have avoided that by guiding markets towards a higher number.

How to sustain the big rebound in dealmaking

12 Mar 2024

The year kicked off with a 75% increase in global M&A activity, to $525 bln. Speaking to The Exchange podcast from a gathering of merger mavens in New Orleans, Evercore banker Bill Anderson discusses the resurgence and what’s needed to keep the momentum after a two-year slump.