Americas

7-Eleven owner faces an inconvenient value truth

3 Sep 2024

Seven & i shares leapt on Couche-Tard's approach but trade at a big discount to the sum of its parts. Boss Ryuichi Isaka can speed up his existing strategy but has failed for years to unlock value. New owners have a better shot at helping the $38 bln retailer reach its potential.

Murdoch’s UK property gambit has a price ceiling

2 Sep 2024

Australian property listings site REA Group is eyeing $6 bln UK peer Rightmove. The News Corp-backed suitor can use cash and higher-valued shares to pay a 30% premium. Beyond that, Rupert Murdoch’s outfit might struggle to combine a successful bid with keeping him in control.

Raw economics will trump migration’s sour politics

2 Sep 2024

Nearly 900 mln people would like to live in another country, but most can’t move due to political and social opposition to foreigners. These attitudes are hard to shift. But deepening demographic crises mean a migration-fuelled boost to labour supply is critical for growth.

Tech’s also-rans are ripe for the plucking

30 Aug 2024

Buyout barons are back to spending their $2.6 trln of dry powder, scooping up software companies like PowerSchool and Squarespace. With regulators restraining Big Tech and public market investors increasingly discerning, beleaguered sellers might be ready to take the money.

Nvidia drives path Tesla would find familiar

29 Aug 2024

Like Elon Musk’s carmaker at its peak, the $3 trln chip giant has a huge lead in a transforming industry, dented only by production glitches. Unlike Tesla, Nvidia’s valuation by some measures looks fairly sane. The bigger it gets, the higher the stakes of even small hiccups.

Dollar General is being nickel-and-dimed

29 Aug 2024

Rising costs have taken a toll on the low-cost US retailer, whose shares fell 25% Thursday. Sales growth and decent margins suggest the $20 bln company is striking a fine balance over what shoppers get for their dollar. But frugality is rarely fun, for customers or retailers.

OpenAI’s mooted $100 bln value is relatively sober

29 Aug 2024

The ChatGPT maker may be worth just 16% more in its next share sale than in February’s funding round, according to reports. That looks modest, given AI darling Nvidia’s shares have nearly doubled. Senior departures and competition from rivals like Elon Musk justify a modest bump.

NFL gives buyout barons a view from cheap seats

28 Aug 2024

The US football league is giving private equity firms access to a coveted investment venue. Returns like the one on the $6 bln Washington Commanders are tempting enough for Carlyle and others to accept tough terms and cede some profit. It’s a steep price for a lousy ticket.

Carry trade chaos charts outlines of next selloff

28 Aug 2024

BIS researchers reckon cascading margin calls helped turn a local Japanese wobble into a global rout in early August, eventually wiping $1 trln off US tech stocks. It’s a similar story to a March 2020 slump and 2022’s UK bond collapse. Worse, the core drivers remain in place.

Poison pills will hurt Seven & i and Japan

28 Aug 2024

The 7-Eleven owner wants the government to discourage dawn raids on its stock to help defend against a Couche-Tard takeover, per Bloomberg. Such protection would undermine Tokyo's shareholder value push. With other bidders likely, the best course is to encourage a fair process.

Trophy asset extras serve purpose at own expense

27 Aug 2024

Sellers of media properties are in a bind: empires’ charms often appeal to the heart, but not cold financial logic. Perennial tire-kickers – like Edgar Bronfman Jr. who just dropped a run at Paramount – can add FOMO. Problem is, the runner-up’s credibility has a breaking point.

Buyout shops would cash in redesigned blank checks

27 Aug 2024

Shell-company activity has slowed, but not halted. Deals involving SPACs old and new ensure Wall Street steady fees. A wider resurgence, however, may depend on structural changes. With $3 trln of aging assets in need of exits, private equity could benefit by leading a charge.

New EU antitrust tsar has better tools, harder job

27 Aug 2024

The European Union will soon have a new competition commissioner. Margrethe Vestager’s replacement has greater scope to go after Big Tech and Chinese subsidies. But he or she will also have to defend the single market from the assault of EU members’ national industrial policies.

Japan can afford to keep quiet on 7-Eleven bid

27 Aug 2024

Convenience stores play a special role in the country, so the government must approve any takeover of parent Seven & i by Canada’s Couche-Tard. A veto would undercut an official governance push. Still, the bidder must clear big hurdles before it puts politicians on the spot.

Intel will be forced to find a plan B

26 Aug 2024

The US chipmaker staked everything on erasing rival TSMC’s technological lead. But the Taiwanese firm will invest $30 bln this year to stay ahead. That’s 15% more than Intel, and as its business shrinks, the gap will grow. Boss Pat Gelsinger is fighting a losing battle.

KKR bank sale will gauge India’s fee-paying power

26 Aug 2024

The sponsor is looking for a buyer for Avendus, an investment bank rising up league tables and advising on hot deals, possibly including Swiggy's $1.2 bln IPO. It's a good time to push a sale of the tech sector's banker of choice after an earlier attempt to offload it stalled.

Jay Powell’s task: reconcile markets and reality

23 Aug 2024

The Federal Reserve chair and skittish investors are now on the same page: the labor market is cooling, and it’s time to act. Punters are pricing in a relatively swift pace of rate cuts. The question is whether the Fed is really ready to move so quickly - or will be forced to.

Euro is reluctant wearer of King Dollar’s crown

23 Aug 2024

The currency is up nearly 3% against the greenback this month. That is odd because markets think European interest rates will fall more than US ones. Worries about Washington’s budget deficit are a factor, but the export-led euro zone can ill afford a strong exchange rate.

Sunbird momentum trade could go into reverse

22 Aug 2024

Americans moved in their millions from cold states to hot, but climate change is making that trend less durable. Florida, a $1.6 trln economy underpinned by inflows of young retirees, is one state that could start feeling the heat, in a bad way.

Robinhood finds riskier ways to take from the rich

22 Aug 2024

Having recovered from a post-IPO slump, the $18 bln online brokerage is thinking big. Founder Vlad Tenev wants to lure millennial wealth, including trillions left behind by boomers, with new products at low prices. The catch: putting more of the company’s own money on the line.