Consumer Products and Services

Investors sit on a plastic waste ticking bomb

13 Jan 2023

Four years after vowing to curb packaging, giants like PepsiCo and Mars are far from meeting their goals. Just 9% of global plastic actually gets recycled. If governments decide to firmly turn against corporate polluters, these may face an annual $100 bln cleanup bill.

Capital Calls: BlackRock, Tim Cook’s pay

13 Jan 2023

Concise views on global finance: The asset manager edges closer to its Blackstone roots by expanding in private investments; compensation for Apple’s CEO re-enters Earth’s atmosphere.

CVS maintains unhealthy M&A lifestyle

12 Jan 2023

The drugstore chain owner may buy Oak Street, a fast-growing network of doctors treating older patients. A mooted $10 bln price sounds high given the cash burn and risk of a government crackdown. It would be another ill-advised deal for boss Karen Lynch’s growth strategy.

Capital Calls: Prices down, jobs saved?

12 Jan 2023

Concise views on global finance: New data shows U.S. prices falling 0.1% in December, marking the largest drop since early 2020. With inflation in retreat, the Fed can focus more on keeping Americans employed.

LVMH has smarter way to tackle succession dilemma

11 Jan 2023

Bernard Arnault picked his daughter Delphine to run the luxury giant’s Dior brand. If she proves her mettle, she may win the race among her siblings to eventually replace the 73-year-old tycoon. Naming one heir would help LVMH extend its success to the next generation.

Microsoft’s AI bet: heads I win, tails I also win

10 Jan 2023

If the software giant’s mooted $10 bln investment in ChatGPT's maker goes well, it could reshape Microsoft’s business. If it flops, CEO Satya Nadella will have stopped a rival getting hold of a hot AI property. Creative financial structuring cuts Microsoft’s risk even further.

Wells Fargo labors under $100 bln sin discount

10 Jan 2023

A recent $3.7 bln regulatory settlement is a step in the right direction, but there are many more to take before CEO Charlie Scharf can start catching up to rivals. The 12-digit cost of past misdeeds, including from a punitive cap on assets, represents a ton of value to restore.

Fitness firms’ regime: lots of brands, few assets

6 Jan 2023

Gym chains from boutiques like Barry’s to the no-frills Planet Fitness are reinventing how people get and stay in shape. Yet as the $100 bln fitness business faces competition, the fight for dollars has become much more bruising. The dominant firms are diversified and nimble.

J&J breaks with legal and valuation uncertainty

5 Jan 2023

The $470 bln healthcare giant is jettisoning brands like Listerine and Band-Aid while also putting liabilities related to Tylenol into the new group. The fluctuating valuation of a similar GSK spinoff last year shows the difficulty in valuing potential court settlements.

Crypto bank run vindicates watchdogs’ vigilance

5 Jan 2023

Silvergate Capital, which takes deposits from digital-asset companies like FTX, had to raise funds and flog assets fast after customers pulled $8 bln. It’s a disaster for investors and the ambitions of CEO Alan Lane. For regulators who’ve kept crypto on a tight leash, it’s a win.

Capital Calls: Meta’s fine problem

4 Jan 2023

Concise views on global finance: The social networking giant was penalized nearly $800 million last year in a series of European charges over how it treated user data. While 2023 is young, Meta has just been fined half as much. It's just a start.

Starbucks will go grande on workforce-lite future

4 Jan 2023

The $120 bln latte purveyor is fighting off unions as workers seek better benefits and higher wages. In 2023, it will throw a few concessions. That will tide over employees long enough for it to streamline coffee-making. It’s a playbook for those looking to trim their workforce.

Fed battle has workers taking hit for greedflation

3 Jan 2023

The U.S. central bank has repeatedly warned that cooling inflation will bring "some pain" to workers. Employees already suffered as prices surged and profit climbed during the pandemic. A less aggressive fight against rising prices would give workers some much-needed support.

Disney’s next 100 years hinges on a metaverse

3 Jan 2023

A century ago, the media giant crafted theme parks that withstood decades of changing technology. It isn’t a huge leap from a real Disneyland to a virtual one that melds brands and streaming. Innovation is necessary, but for it, boss Bob Iger’s days need to be numbered.

Stray pet businesses will find new owners in 2023

28 Dec 2022

Americans are expected to spend more than $275 bln on their furry friends by 2030, outpacing GDP growth. Even so, exuberant pandemic-fueled valuations have come crashing down. Nestlé, Mars or Colgate-Palmolive are strong candidates to target the industry’s stand-alone operators.

Weed’s next frontier is in Asia

23 Dec 2022

The cannabis market is estimated to be a $100 billion industry by 2026, but largely confined to the U.S., Canada and parts of Europe. While legalising ganja has been a slow burn in Asia, official attitudes are shifting. Demand from regional consumers will slowly light up.

Microsoft’s $69 bln deal runs on European time

21 Dec 2022

A U.S. effort to block the software developer’s Activision acquisition promises to be a long and uphill climb. Brussels and London, however, could extract concessions sooner. It’s an indication of how other jurisdictions backstop increasingly hardline American regulators.

Mark Zuckerberg will split Meta, take the ‘verse

21 Dec 2022

The Facebook founder’s belief in the promise of a virtual world is failing to sway investors. He may control the company, but capital flight is a problem. The solution will be to break off his pet project and find someone else to run and rebuild the social media empire.

Who will be Wall Street’s un-American idol?

16 Dec 2022

BNP Paribas wants to grab a larger share of the U.S. market for deals and trading. So do Deutsche Bank and Barclays. This time, the goal isn’t to resculpt banking’s Mount Rushmore, but to slow the Americans’ march in Europe. It’s a plan shareholders ought to be able to get behind.

Capital Calls: Satellites deal, EU gas price cap

16 Dec 2022

Concise views on global finance: Private equity firm Advent is paying a 129% premium for Maxar, indicating that the volatile, costly satellite construction business could soar away from public markets; the EU is edging towards a controversial cap for gas future contracts.