Conglomerates

Toshiba gets in its own way yet again

14 Jan 2021

The $13 bln Japanese conglomerate is under fire from hedge fund Farallon over its strategy while Effissimo wants a probe into a vote scandal. Their demands for shareholder meetings reflect a lack of trust in boss Nobuaki Kurumatani that’s also evident in a lacklustre valuation.

New World sets better template for climate bonds

13 Jan 2021

The Hong-Kong-based developer has sold sustainability-linked 10-year paper that carries a penalty for missing green goals. In a twist, its forfeit doesn’t go to investors via higher interest payouts but into carbon offsets. That’s better for the planet and the bonds’ credibility.

Guest view: Woke markets present growing dangers

18 Dec 2020

The politicisation, and even weaponisation, of ESG investing is a concern, argues Frank Sixt, finance director at CK Hutchison. Exclusionary strategies are too prone to populist influence and ratings are chaotic. Absent quick changes, capital allocation distortions will rise.

Japan Inc confronts limit of corporate carbon cuts

4 Dec 2020

Companies including Sony are lobbying for more renewable power in Japan. They need to satisfy clients like Apple, who have committed to carbon-neutral supply chains as soon as 2030. But even an edict from the $2 trln tech titan can’t force change where policymakers lag behind.

Murdoch lets Bertelsmann pay up for publishing

25 Nov 2020

The German media group will buy Simon & Schuster for an eye-popping $2.2 billion in cash. It already owns the massive Penguin Random House and size gives it more power. But it also means U.S. regulators could thwart the deal, leaving Murdoch an opening.

Thyssenkrupp is acid test of German green resolve

19 Nov 2020

The ailing giant’s steel arm lost 950 mln euros last year and is a major carbon dioxide polluter. Right now it would cost a bomb to convert the division into a hydrogen-powered, low-carbon star. Still, extending subsidies would chime with Berlin’s commitment to a green recovery.

Samsung chairman bequeaths a tainted empire

25 Oct 2020

Lee Kun-hee, who transformed a noodle business into a smartphone and chipmaking colossus, has died at 78. The second-generation leader's mark on Korea Inc will endure, as do scandals that follow the family. Their challenge is to clean up the messy parts of his $355 bln legacy.

Hyundai is primed for a chaebol tune-up

23 Oct 2020

Days after heir Euisun Chung officially ascended to run the South Korean conglomerate, it warned of another $3 bln charge for engine problems. The results, however, should show how electric cars are paying off. That would provide momentum to tackle a broader restructuring.

Cathay is still overweight after layoffs

21 Oct 2020

Hong Kong's flagship airline will cut 8,500 jobs and ditch its Cathay Dragon brand. That's less aggressive than some other carriers, although shareholders took it well. The cuts will only slow the cash burn rate to around HK$1.5 bln per month. More savings will have to be found.

Samsung enjoys Washington gift that keeps giving

8 Oct 2020

The South Korean giant expects quarterly operating profit to jump 58% to $10.6 bln, as U.S. sanctions forced Huawei to stockpile chips. Those sales are gravy from U.S. restrictions hitting the Chinese company. Taking its telecom gear and smartphone customers is the real prize.

M&A 101 will speed end of Tata’s investor fight

23 Sep 2020

After a long legal spat, the family of ousted chairman Cyrus Mistry is ready to sell its 18% stake in the holding company of Tata group. But a mooted $24 bln price tag double counts the value of India’s top household name. The conglomerate has rare reason to play down its brand.

Reliance becoming the envy of big conglomerates

9 Sep 2020

Silver Lake’s purchase of a 1.75% stake values the shopping arm of Mukesh Ambani’s empire at $57 bln. KKR wants in too. It prices up the third pillar, after the core energy unit and digital platform Jio, without a discount. The tycoon’s challenge will be to keep it that way.

SoftBank shows true colours with U.S. tech binge

7 Sep 2020

Masayoshi Son’s conglomerate has bought $30 bln of exposure to U.S. tech stocks with $4 bln of call options, media reports say. It’s yet another risky proposition that exposes the company’s weak governance. Months of steady progress suggest more buybacks might have been better.

SoftBank divestitures set stage to shop again soon

1 Sep 2020

Offloading a 22% stake in the Japanese telecom arm will help reach a $41 bln fundraising target set in March. Chip designer Arm may go too. Prodding from Elliott has helped SoftBank shares more than double, but boss Masayoshi Son is a buyer at heart. He must be getting itchy.

Reliance ties golden bow onto its shopping deal

31 Aug 2020

Mukesh Ambani is bulking up in a fight against Amazon by acquiring retail businesses from Future for $3.4 bln. Kishore Biyani’s outfit first needs shareholder approvals to consolidate assets. His terms are only so-so, but Reliance buying into the rump should help secure checkout.

India Insight: Ambani, a maverick Rockefeller

25 Aug 2020

Data is the new oil for the tycoon who wants his $185 bln Reliance to serve all the needs of Indian consumers. He’s backed by America’s tech monopolists. Just as the Standard Oil energy cartel birthed U.S. antitrust law, Mukesh Ambani will amass power until told to stop.

GE bonus reset doubles down on bad corporate habit

21 Aug 2020

Its stock having tanked, the U.S. conglomerate has replaced Larry Culp’s original sign-on bonus with one that has much less ambitious share price targets. The award was already flawed – putting in a lower hurdle in a strong stock market makes everything worse.

SoftBank lives the high life on yard sales

11 Aug 2020

The $129 bln group returned to profit last quarter, buoyed by a T-Mobile stock sale and other investment gains. Asset sales fuelled share buybacks that narrowed a wide group discount, and there are large Vision Fund exits to come. Boss Masayoshi Son can keep coasting for now.

Mukesh Ambani’s retail M&A would wipe competition

4 Aug 2020

The tycoon’s Reliance might buy Future Group for $3.6 bln. It would enlarge a shopping giant bigger than all its major brick-and-mortar rivals combined. Amazon might also invest in the behemoth. The deals would shore up Ambani’s dominance, and blunt India’s shopping revolution.

Speedway adds financial inconvenience for 7-Eleven

3 Aug 2020

The retail chain’s Japanese owner, Seven & i, is gearing up to expand its U.S. footprint by buying Marathon’s gas station business for $21 bln. The synergies could help to eke out a sensible return. But investors have already discounted $2 bln, about half of their net value.