Corporate Governance

Crown Resorts disabused of gambler’s conceit

22 Oct 2020

A protest vote by shareholders has belatedly targeted the $4 bln casino operator’s cosy and inexperienced board. At least it’s forcing the Australian company to concede a shakeup is needed to clean up its mess. It’s a good reminder about why the right sorts of directors matter.

SK Hynix’s $9 bln deal is chip sector’s quick fix

20 Oct 2020

The South Korean semiconductor giant will buy Intel's NAND memory business in its largest acquisition ever. Less competition might prop up prices, which have plunged on uncertain demand. In the long term, a beefed-up SK stands a better chance against Chinese entrants.

Daimler’s new driver can jump-start electric drive

28 Sep 2020

Ex-CEO Dieter Zetsche is not taking charge of the $55 bln Mercedes maker’s supervisory board. That’s a rare win for critical shareholders. Still, the company’s plans to almost double its share of battery cars are behind rival BMW. Daimler could use an outsider at the wheel.

India will win by playing tax cricket

28 Sep 2020

By accepting the international arbitration ruling in Vodafone’s favour, India can shake off its reputation for “tax terrorism” as it seeks to woo investment away from China. Resolution will bring long-term investment gains even if defeat entails painful upfront costs.

Evergrande’s too-big-to-fail bind comes to a head

25 Sep 2020

The indebted Chinese property developer beseeched officials to approve its reverse merger plan. Although the company claims the letter is fake, the questions in it regarding systemic risk are real for investors and Beijing. A $21 bln payment due soon will force a reckoning.

Palantir float marks peak investor apathy

23 Sep 2020

The cryptic data-analytics company is setting a guide valuation of $20 billion for its direct listing next week. Its novel governance means the three founders are in control indefinitely. Incoming shareholders should assume their views won’t count.

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.

Toshiba’s chip IPO could short-circuit

17 Sep 2020

Two years after the Japanese company's crown jewel was sold to a Bain-led group, the rebranded Kioxia will list at a $20 bln valuation. It offers a partial exit to the U.S. buyout firm and other backers. But aiming for a premium multiple amid choppy markets may backfire.

Beauty IPO is risky test for UK governance retreat

16 Sep 2020

The Hut Group’s shares soared after a $7 bln float. The skincare and clothing retailer’s fast growth meant investors shrugged off shaky voting rights and a watered-down listing. Its success opens the door for others, if founder Matthew Moulding can grow into his rich valuation.

China Evergrande stands to win a price war

16 Sep 2020

Unwritten credit rules circulated by Beijing have prompted the $29 bln property developer to offer discounts of 30% or more. That will eat further into profit and make it harder to cut debt. The aggressive gambit by Chairman Hui Ka Yan may, however, cripple the competition.

Rio Tinto gets bad recruitment steer from Canberra

15 Sep 2020

Australia’s treasurer wants the miner’s next CEO to be Australian, after Frenchman J-S Jacques stepped down over the destruction of an Aboriginal site. Cultural sensitivity is a priority, but the goal can be achieved in other ways. Shareholders deserve the best boss Rio can find.

Nvidia’s $40 bln Arm deal is risky chess move

14 Sep 2020

The chip specialist led by Jensen Huang will buy the UK company from SoftBank in the industry's biggest deal. It gives Nvidia a boost in the data centre business. But Arm's customers and regulators may baulk, and the chunky price tag presupposes huge growth and market share gains.

India is staring at debt-crisis déjà vu

10 Sep 2020

The central bank has sanctioned a loan rejig. With tight guidelines, it aims to avoid a re-run of the past decade’s banking woes. But the plan gives discretion to lenders that hid problems before. India was turning a corner on credit quality, now it’s almost back to square one.

China’s bad financial habits crack Baccarat

9 Sep 2020

The 256-year-old French crystal maker is under court administration after its owner, a cash-strapped Hong Kong wealth manager, defaulted on private loans used to acquire it, prompting a court battle. It’s safer to sell luxury goods to Chinese consumers than brands to China Inc.

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.

Aussie finance scandal offers universal truths

3 Sep 2020

Storied wealth management giant AMP put itself on the block days after Chairman David Murray quit over the promotion of an executive accused of sexual harassment. The firm has been lurching from problem to problem for years. Fixing culture and regaining trust is hard to do.

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.

Ant squashes some Asian investment bankers

26 Aug 2020

The Chinese fintech outfit’s $20 bln IPO is set to shake up league tables. Citi gets a lift as an unexpected sponsor. Credit Suisse could miss out. And Tencent-aligned Goldman is sidelined. In a region so dependent on equities fees, more than just egos will be bruised.

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.

Pinduoduo gets stung by its own shopping hype

24 Aug 2020

Investors erased $16 bln in market value from the Chinese company as orders on its e-commerce app disappointed. “Gross merchandise value” is a confusing metric and much more so when consumer sentiment is volatile. Boss Chen Lei has had a costly lesson in why hard numbers rule.