30SC

Trade wars are holding cross-border M&A hostage

31 Dec 2019

Global deals exceeded $3.8 trln in 2019, but takeovers where buyer and seller are in different countries fell by a quarter. Geopolitical tensions make any big transaction a potential target. Spats between the United States, China and the EU look set to keep weighing on activity.

Wealth managers will inflate superprime bubble

30 Dec 2019

Over a decade ago loans to subprime homebuyers blew up the financial system. Now UBS and others are cranking up credit to the uber rich. Lending against unlisted stocks or art collections brings risk. It’s still safer than helping the wealthy launder money or dodge taxes.

Direct listings will move nearer IPOs – and Europe

27 Dec 2019

After Spotify and Slack’s non-standard floats in 2018 and 2019, respectively, expect more direct listings in the United States in the year ahead. The method could start borrowing more features from traditional IPOs, and the whole notion may jump across the Atlantic too.

Credit Suisse spy scandal calls for CEO bonus cut

23 Dec 2019

Swiss regulators are probing the lender’s surveillance of two senior executives. The fiasco undermines the $33 bln bank’s internal controls, and may deter clients and dealmakers. While he hasn’t been directly blamed, boss Tidjane Thiam owes investors a gesture of solidarity.

New BoE boss is only partly the safe choice

20 Dec 2019

Andrew Bailey is the next governor of the Bank of England. His CV is more complete than internal rivals, and Brexit arguably means the role needs an unflashy Brit more than a carbon copy of Canadian incumbent Mark Carney. But Bailey will need to prove that his BoE is independent.

Audio feed goof makes BoE look naive – and stingy

19 Dec 2019

Traders got faster access to Bank of England briefings by paying the contractor responsible for internal broadcasts. The BoE should have better monitored what was happening. But the problem could have been avoided altogether had it invested in overhauling its two-speed system.

Peugeot and Fiat hit the road in a low gear

18 Dec 2019

PSA and FCA are to create the world’s fourth-largest carmaker. But with investors yet to buy into the promise of 3.7 bln euros of annual savings, a deal was the easy part. Peugeot boss Carlos Tavares still has to work his integrational magic to get the market on side.

Unilever boss needs to channel his inner activist

17 Dec 2019

The consumer goods giant warned sales in 2019 will grow less than 3%. CEO Alan Jope blames weakness in countries like India, but the miss heaps pressure on him to turn around the sprawling business. Setting out clear targets for dumping sluggish food brands would be a start.

DuPont comes out smelling of roses in $45 bln deal

16 Dec 2019

Executive Chairman Ed Breen is merging his nutrition and biosciences business into International Flavors & Fragrances. He has secured a premium valuation, cash sweetener and a tax-free transfer for DuPont shareholders. IFF gets little besides the dubious benefits of scale.

Corbyn loss offers economic pointers for Democrats

13 Dec 2019

Victorious Prime Minister Boris Johnson was an eminently beatable candidate, approval ratings showed. But the Labour leader’s radically socialist alternative proved a bigger turn-off. Despite local differences, there are lessons for those hoping to challenge Donald Trump.

AB InBev’s Oz M&A party leaves antitrust headache

12 Dec 2019

The world’s biggest brewer’s $11 bln sale of its Australian unit to Asahi has been challenged by the country’s watchdog. Its tough stance on beer and cider competition may hurt boss Carlos Brito’s plan to cut debt. The Corona-maker has other options, albeit less appetising ones.

Wait six months for Saudi Aramco’s true value

11 Dec 2019

The oil giant’s shares jumped 10% on its first day of trading. A $1.9 trln valuation reflects an oversubscribed book, likely helped by hedge funds looking for a quick buck and local investors who may be incentivised to buy. A less pumped-up price should emerge over time.

Deutsche places bet on thinned-out investment bank

10 Dec 2019

Christian Sewing’s crucial 2022 target for an 8% return on tangible equity looks a stretch. The Deutsche Bank boss knows it will be tough given negative rates, but hopes extra revenue from his traders and dealmakers will help. That’s doubtful given cuts and their recent showing.

Just Eat offer is taster for Christmas food fight

9 Dec 2019

Internet investor Prosus sweetened its cash bid for the UK food delivery company to $6.5 bln. That’s tastier than rival Takeaway.com’s all-share proposal, but still well below Just Eat’s market value. Shareholders are expecting a few more helpings before the end of the year.

Swiss Re swallows pride with $4.2 bln UK castoff

6 Dec 2019

The Zurich-based insurer will sell its British business to rival Phoenix at a valuation similar to its cancelled public listing. CEO Christian Mumenthaler had few other options. Given the threat of Brexit, foregoing a takeover premium is a price worth paying for a cleaner sale.

Glencore’s new probe applies shove to succession

5 Dec 2019

British police are investigating possible bribery at the commodity giant. Two days ago 62-year-old boss Ivan Glasenberg, whose firm also faces a U.S. probe, said he could retire next year. Having to fight a legal war on two fronts may help him make up his mind.

Moncler offers costly fix for Kering’s Gucci habit

5 Dec 2019

The French fashion conglomerate run by Francois-Henri Pinault may buy Remo Ruffini’s 11 bln euro puffer jacket maker. A deal would help Kering diversify away from its largest brand, but likely at a rich price. And extracting value from a company already at its peak would be hard.

EU single market is better exported than muzzled

4 Dec 2019

The Netherlands wants the European Union to apply state aid rules to companies backed by foreign governments. That would hike Chinese import prices. Yet Europe’s economic heft gives scope to negotiate, and is better than breaking EU rules to create Siemens-Alstom-style champions.

Franco-U.S. cheese war will hit prudent tax reform

3 Dec 2019

Emmanuel Macron and Donald Trump may struggle to back down if the U.S. puts 100% duties on Roquefort. Exporters on both sides will hurt. The bigger casualty, though, is an OECD-led corporate tax rethink, which had some good ideas for taxing Big Tech.

TCI plays outrider to Mark Carney’s climate drive

2 Dec 2019

Chris Hohn’s hedge fund plans to penalise directors at companies who don’t publish climate change data. If others follow suit, it could boost the Bank of England governor’s push for transparency. What’s less clear is whether greater disclosure delivers investment rewards.