United States of America

Infosys U.S. woes tarnish India’s star sector

16 Apr 2012

Outsourcing was a bright spot amid worries about India’s growth prospects. But an investigation into alleged visa violations by Infosys could herald a tougher time for the industry. Until the IT group’s papers are in order, investors have another reason to shun Indian stocks.

Wells Fargo justifies its premium to JPMorgan

13 Apr 2012

The top two U.S. banks performed solidly enough in Q1. But both posted ho-hum 12 pct returns on equity flattered by government programs and extra risks. Wells, however, has better core growth and relies less on trading. That makes it deserving of a higher valuation than JPMorgan.

Tumi IPO should bag Doughty Hanson a big return

13 Apr 2012

The high-end suitcase-maker is set for a $300 mln float. Making luggage a bit more luxurious has helped Tumi double sales under Doughty Hanson. The UK buyout firm is likely to recoup six times its original investment, a thumping 26 pct annual return.

Review: "Idea Factory" produces a few of its own

13 Apr 2012

How does innovation happen? Jon Gertner outlines how brilliance, contradictions, chance and steady hands resulted in five decades worth of astonishing products such as radar and Nobel-prize winning ideas like the transistor at Bell Labs.

Google rejoins tech’s governance race to bottom

12 Apr 2012

Zynga and Facebook show little regard for common shareholders. Google is copying its rivals’ shenanigans by adding a third class of non-voting shares eight years after leading the dual-stock charge. That’ll entrench insiders and enable the future abuse of minority shareholders.

Green energy may yet survive poison of cheap gas

12 Apr 2012

The collapse of U.S. natural gas prices below $2 is a fresh blow to solar just as another industry IPO is pulled. But don’t write it off. Solar is getting cheaper, too, and providers can set costs for decades. Gas, which America may soon be exporting, offers no such guarantee.

JPM, Wells boards are hurdle to governance revamp

12 Apr 2012

Both banks navigated the crisis well. But that doesn’t mean they don’t need separate chairmen and CEOs. The firms’ boards are stuffed with company honchos used to holding both titles. It may take shareholder votes to open their eyes to the clear merits of splitting the top jobs.

Oaktree IPO gets marked to Howard Marks

12 Apr 2012

The investment firm’s co-founder made clear from the start that gathering assets takes a backseat to generating client returns. Investors took him to heart, buying fewer shares and now whacking them. Shareholders hungry for fees will find a growing Carlyle more to their liking.

U.S. sale could kickstart Aviva’s spring clean

12 Apr 2012

The UK-based insurer is mulling a sale of its U.S. arm, according to reports. Offloading North American operations would make regulatory sense. But it would also be a welcome sign that Aviva is getting to grips with parts of its empire that aren’t pulling their weight.

Coty will need to up its Avon game

11 Apr 2012

The U.S. cosmetics group has spurned Coty’s $10 bln approach and hired a new CEO. If Avon’s European suitor is really keen to marry makeup to its fragrances, it needs to pay more. A new Breakingviews calculator shows just how much bigger Coty’s proffered engagement ring could be.

If Apple, publishers plotted they didn’t need to

11 Apr 2012

U.S. trustbusters say Apple and e-book producers conspired to raise download prices. But the model they came up with makes sense even without collusion. It gives publishers a better chance of survival. And if readers pay a bit more, at least it means books will keep coming.

Kraftwerk bangs home note on tech obsolescence

11 Apr 2012

The tale of how an odd German electronic band from the 1970s remains relevant enough to merit an eight-night gig at New York’s MOMA helps explain why some innovations fade and others flourish. Ultimately, success in technology - as in art - is more about big ideas than gadgets.

Titanic’s century-old metaphor misses the point

11 Apr 2012

The famous 1912 sinking tells us something eternal. Life, even the most privileged, is like an ocean voyage, and then the ship goes down and you die. It also seems like a warning against modern hubris. But an iceberg couldn’t stop the spread of ever more advanced technologies.

Will Zaoui Freres join the boutique brigade?

10 Apr 2012

Yoel Zaoui, one of Europe’s top M&A bankers, is leaving Goldman Sachs. The firm’s reputational battering hasn’t stopped it bagging big deals, nor will this. But it may mean a bit more competition if he joins older brother Michael to create yet another go-it-alone advisory firm.

Election debate can finally pivot to the economy

10 Apr 2012

With Rick Santorum out, the race between Mitt Romney and Barack Obama is on - so the debate can turn to issues that move markets. Less noise from distractions like birth control will force the two candidates to explain their fixes for taxes, budgets and jobs. Now policies matter.

Buyout firms lack artistry on Michaels deal

10 Apr 2012

Bain and Blackstone paid $6 bln for the U.S. crafts retailer near the top of the cycle in 2006. The bad timing was papered over by the success of scrapbooking and beading as cheap family fun in the downturn. That should enable the firms to chalk up a modest return in an IPO.

Facebook’s defensive Instagram M&A raises red flag

9 Apr 2012

Online photos are supposed to be a core Facebook competence. Paying $1 bln for the picture-sharing app may boost the social network in mobile. But paying over the odds for revenue-free rivals is usually what anxious, mature firms do - not growth companies seeking to go public.

New image top priority for Conoco refining spinoff

9 Apr 2012

Phillips 66, the $30 bln-odd firm set to separate from the U.S. oil major on May 1, wants to be something else. Refiners get low valuations next to racier pipeline and chemical firms. But with 84 pct of Phillips’ capital tied up in refining, investors will take some persuasion.

Argentina case puts bite in holdout hedgies’ bark

9 Apr 2012

Elliott Associates spurned the nation’s debt swap but may still get paid, thanks to a U.S. judge’s plan for blocking payouts to other bondholders. If upheld, the ruling might muddle sovereign lending and workouts. But it should also reassure creditors that deal terms have teeth.

Microsoft opens pricey new front in patent wars

9 Apr 2012

The software giant is spending $1.1 bln to buy some 800 patents from AOL. At over $1 mln apiece, the rate tops even the huge ones paid last year for intellectual property for mobile phones. This first salvo in the Internet space throws down the gauntlet at Google and Facebook.