Americas

Bribery case against Wal-Mart harder than it looks

23 Apr 2012

U.S. law bars payoffs for new contracts from foreign officials. But Wal-Mart Mexico allegedly greased low-level palms to grow existing business. That’s arguably not covered. Watchdogs should beware bending an already suspect law to punish what may technically just be unethical.

Biotech’s blistering M&A pace should continue

23 Apr 2012

The industry is off to one of its best years in a decade. As Pfizer’s sale of its nutrition business for $12 bln suggests, Big Pharma is forgoing mega-deals for smaller, targeted acquisitions of innovators like Ardea and Amylin, who are needed to refill empty drug pipelines.

Wal-Mart scandal demands spirit of Sam Walton

23 Apr 2012

Chairman Rob Walton must channel his father’s integrity and initiate an independent probe into how managers, including current executives, suppressed strong evidence of widespread bribery and corruption in Mexico. To recover, heads will need to roll without fear or favor.

Conoco’s last pre-split report better than it looks

23 Apr 2012

A decline in first-quarter profit to $2.9 bln suggests the U.S. oil giant, soon to split in two, is going out with a whimper. But underlying growth trends in chemicals and U.S. oil could boost prospects at the slimmed-down Conoco and at Phillips 66, the new standalone refiner.

Pfizer baby food gives Nestle a $12 bln sugar rush

23 Apr 2012

The Swiss food giant is paying a hefty 4.9 times sales for the U.S. group’s infant nutrition arm. That’s partly down to an M&A tug-of-war with rival Danone. But it also reflects Nestle’s rock-solid balance sheet - and the scarcity of big emerging-market growth plays.

Hugo Dixon: IMF-euro conditions not what they seem

23 Apr 2012

The rest of the world is insisting that strings are attached to any new bailouts from the fund’s enlarged warchest. But the IMF is actually keen on less austerity in the euro zone, not more. It’s now in a stronger position to get its way.

Growth gap puts IMF in endless campaign mode

23 Apr 2012

The BRICs are already clamoring for more sway at the IMF - even before previous boosts in voting strength are finalized. With developing nations forecast to grow twice as fast as rich rivals in the next five years, haggling over heft will be a permanent feature of IMF meetings.

GE offers Citi starting point for fixing CEO pay

20 Apr 2012

Investors voted against Vikram Pandit’s comp largely due to his wooly incentive plan. Facing similar discontent last year, GE added decent hurdles to better align boss Jeff Immelt’s pay to the conglomerate’s performance and shareholder returns. Citi should go a step further.

Oil majors can’t afford to shun Argentina

20 Apr 2012

Beyond the YPF asset grab, Cristina Fernandez may overhaul the entire energy sector. But Argentina’s shale is too important to ignore and Big Oil knows how to navigate tricky regimes, including Venezuela’s. Even with risks higher and returns lower, the long game could pay off.

Review: Redeemers who led Latin America astray

20 Apr 2012

The Spanish-American War led a group of intellectuals and charismatic politicians to anti-Americanism. The resulting deep antipathy to free markets led to a century of relative economic decline. The continent should ignore its intellectuals and listen to worthy business leaders.

Ackman gets closer to permanent capital grail

19 Apr 2012

The activist hedgie’s planned $4 bln London-listed vehicle would dwarf other public funds, which often trade at a big discount to net asset value. The scale plus fee sweeteners may give Ackman an edge. And his focus on easily priced bets could shrink the NAV problem.

Twitter gives peace a chance in patent wars

19 Apr 2012

The social network will allow engineer-inventors to veto lawsuits against alleged infringers. That’s a model for curbing the expensive legal salvos that Apple, Microsoft and others lob just to slow each other down. If the rest of tech one day follows, innovation could benefit.

U.S. absence from whip-round leaves IMF short

19 Apr 2012

Fund boss Lagarde is now aiming for $400 bln in extra firepower to handle any European bailout - down from a hoped-for $600 bln. The refusal of U.S. lawmakers to contribute has crimped the IMF’s ambition and may do the same, long-term, for America’s global financial clout.

Verizon Wireless sneeze will sicken some rivals

19 Apr 2012

The No. 1 U.S. cellphone service provider will unload valuable, unused spectrum if it gets regulatory approval to buy other licenses. The decision up-ends conventional wisdom that operators can’t have too much spectrum. That’s bad news for hoarders like Dish Network and Clearwire.

Glaxo’s Human Genome bid smacks of opportunism

19 Apr 2012

The British drugmaker is already a partner of Human Genome Sciences and is thus the obvious acquirer. But the U.S. biotech is wise to rebuff a $2.6 bln offer. GSK can take big cost savings, and the bid looks cheap even given scaled-back expectations for the duo’s key product.

Morgan Stanley merits immunity from Moody’s blues

19 Apr 2012

The credit rater is considering a three-notch downgrade of the Wall Street firm. But Morgan Stanley’s first-quarter results show it’s making good progress with its turnaround. It also now boasts a huge three-year liquidity buffer. Given that, a rating cut would be bizarre.

BofA doesn’t deserve much more love from investors

19 Apr 2012

The 60 pct rally in the bank’s shares this year easily bests its peers. But its Q1 results, though better, leave much to be desired. Its return on equity is still in the dumps even after stripping out the noise. At around half of book value, its stock now looks fairly valued.

Argentina’s oil-asset grab is both normal and odd

19 Apr 2012

The decision to take control of YPF puts Argentina in the oil industry mainstream - 75 percent of global production comes from government-controlled companies. What is odd, though, is the desire to micromanage the company and the willingness to annoy the rest of the world.

Frannie generosity could cost taxpayers $128 bln

18 Apr 2012

Their regulator appears close to caving and may allow the agencies to reduce loans for underwater borrowers. That shouldn’t be a problem if aid is well targeted. But political pressure could turn such loan forgiveness into a moral hazard and almost double Frannie’s bailout tab.

News Corp finds yet another way to annoy investors

18 Apr 2012

The Murdoch empire’s discovery that non-U.S. holders control 36 pct of its voting stock - breaching the 25 pct limit for owners of American broadcasters - has led it to suspend voting rights. Even shareholders resigned to disenfranchisement should worry about the cock-up.