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Capital Calls: Better.com SPAC

25 Aug 2023

Concise views on global finance: From presidential hopefuls to a new blank-check acquisition, this week was a reminder that the speculative SPAC movement will be hard to kill.

Arm’s changing business model is wildcard for IPO

24 Aug 2023

As well as jumping on the AI bandwagon, SoftBank’s soon-to-float chip designer has altered the way it charges big customers to boost growth and smooth out revenue. If it works, a valuation north of $60 bln looks slightly less implausible. But investors lack evidence so far.

Prigozhin exit leaves Putin’s weakness alive

24 Aug 2023

The apparent death of the former convict-turned-chief mercenary comes two months after his mutiny against the Kremlin. Prigozhin’s actions had raised doubts about the stability of the Putin regime and its capacity to get out of the Ukrainian morass. His exit leaves those intact.

Capital Calls: Shein/Forever 21

24 Aug 2023

Concise views on global finance: The Chinese retailer is partnering with Sparc, the operator behind Forever 21. That helps validate Shein before a public listing without the messiness of a merger. Forever 21 gets a new omnichannel and potentially a way to an IPO.

Germany’s plight is good news for bond investors

24 Aug 2023

Yields on Berlin’s 10-year obligations have spiked this month, mirroring US ones. That looks overdone: Europe’s largest economy is slowing, inflation is falling and the central bank is unlikely to hike rates much more. Such Teutonic frailty should firm up debt valuations.

Capital Calls: Diversity initiatives

23 Aug 2023

Concise views on global finance: The group that got the Supreme Court to overturn affirmative action at universities is suing financial firms to end programs for diverse applicants. It will make companies rethink recent diversity initiatives.

Italy faces bumpy round trip on the Silk Road

23 Aug 2023

Prime Minister Giorgia Meloni may quit Chinese President Xi Jinping’s infrastructure club. Like other European fans, Italy gained little economic benefit from signing up to the Belt and Road Initiative. Yet leaving may provoke retaliation, perhaps against its luxury industry.

Leaving the office for dead may haunt investors

23 Aug 2023

Landlords’ valuations are half pre-pandemic levels due to the boom in hybrid work. Yet looser labour markets are giving bosses more power and companies like Google want staff to spend more time in their buildings. Fund managers betting on a trend reversal may be on to a winner.

Microsoft rethink puts big tech M&A back on table

22 Aug 2023

The $2.4 trln tech giant will sell streaming rights to Ubisoft in a bid to get UK approval for its $69 bln Activision deal. The big concession is likely to work. It shows a path for tech giants to buy rivals, while sidelining regulators' fears that M&A will kill nascent markets.

Arm’s IPO risks shine brighter than its potential

22 Aug 2023

SoftBank’s chip group is leaning on the artificial-intelligence boom to justify a hoped-for float valuation north of $60 bln. There’s no evidence to support that in the numbers, which show lumpy, shrinking sales. China risks and lack of investor control also call for a discount.

Telecom Italia debt legacy outlasts its initiator

22 Aug 2023

Two decades after the Italian telco’s landmark leveraged takeover its architect, Roberto Colaninno, has passed away. His bold acquisition ended up saddling the ex-monopolist with a huge debt pile. A KKR-led deal, blessed by Rome, may finally end the sorry saga.

Capital Calls: Coinbase’s Circle deal

22 Aug 2023

Concise views on global finance: Crypto exchange Coinbase is investing in struggling $26 bln stablecoin issuer Circle. Tokens tracking the US dollar haven’t delivered on hopes of transforming finance; the deal promises little current payoff, but at least keeps the dream alive.

World Bank’s green overhaul is slowly taking shape

21 Aug 2023

The multilateral lender needs $200 bln more annually to make the world’s $3 trln green transition goal less of a pipe dream. Its shareholders have pledged just $50 bln over 10 years. President Ajay Banga’s new plan is a start, but he will need more ideas to reach the target.

Capital Calls: Instacart IPO

18 Aug 2023

Concise views on global finance: The grocery delivery startup once valued at $39 bln is gearing up to unveil plans for a market debut after two years of flirting with the process. The delay may prove costly.

Climate change eats into reinsurers shrinking pie

18 Aug 2023

Wildfires and other catastrophes caused $120 bln of damage in the first half of 2023, far above the 10-year average. Bigger losses allow groups like Swiss Re and Munich Re to raise prices. That may ultimately make cover harder to afford, forcing governments to step in instead.

Saudi binge is fiscal free kick for European clubs

18 Aug 2023

The Kingdom’s top league has spent some 600 mln euros this year buying star soccer players, like striker Neymar. The boom in transfers helps Europe’s teams meet new wage rules. It could be an own goal, but Saudi’s dream of becoming a football powerhouse looks like a distant risk.

Samsung’s ASML sale highlights vexing cash bind

18 Aug 2023

South Korea’s $330 bln chipmaker more than halved its stake in the Dutch group to raise an estimated $2 bln for its expansion plans. Yet the company already has $66 bln in the bank. Trouble is, much of that is probably trapped abroad, necessitating some creative funding choices.

Capital Calls: Walmart’s Goldilocks moment

17 Aug 2023

Concise views on global finance: The $431 bln US retailer’s valuation has held up much better than Target and Amazon, validated by another strong quarter. But it has done that only by keeping its multiple steady.

Fickle Big Tech customers wash away Adyen’s moat

17 Aug 2023

Shares in the Dutch payment group slumped 25% after first-half earnings missed forecasts. The former market star is seeing margins eroded by a hiring push. But the real issue is that users can easily switch to cheaper rivals. To fix that, the company needs a broader client base.

ECB core obsession raises risk of policy mistake

17 Aug 2023

Euro zone inflation excluding energy and food costs is rising 5.5%, faster than the headline number. Frankfurt hawks want to keep rates high until that ‘core’ measure nears 2%. But the narrower gauge can lag the main one: focusing on it raises the odds of excessive tightening.