Corporate Governance

Corona Capital: Payments systems, Shale

22 Jun 2020

Concise views on the pandemic’s corporate and financial fallout: Payments systems get some good news, shale oil drilling’s double whammy.

Ancient Chinese governance tech stymies SoftBank

22 Jun 2020

The Japanese firm’s Chinese chipmaking venture can’t get rid of its CEO because he won’t return the company seal. It’s a common problem in the People’s Republic. Still, it puts 20% of Arm revenue at risk and adds to a list of investment headaches for SoftBank boss Masayoshi Son.

Virgin Australia suitors strain to soar like TPG

22 Jun 2020

Buyout shop Bain and hedgie Cyrus are jostling to buy the carrier out of bankruptcy. The industry has foiled everyone from Warren Buffett to Gordon Gekko. David Bonderman’s TPG is one of the few with happy tales to tell. Replicating its success will require some fancy flying.

Crisis patience will reward buyout barons in Asia

19 Jun 2020

Private equity dealmaking in the region is up, defying a global slump, thanks to big purchases by Bain, KKR and others. Funds are hunting for bargains, but some of the worst deals were done during the last crisis. Sitting it out and delaying exits may help to avoid past mistakes.

Perfect storm blows Swire Pacific model away

16 Jun 2020

The Hong Kong conglomerate expects big first-half losses in its property, airline and marine services units. Protests, Covid-19 and weak oil demand have taken their toll. The sprawl wasn’t providing much of an edge before disaster struck, however, and warrants reconsideration.

Tencent’s China car deal defies and disappoints

15 Jun 2020

A consortium led by the tech giant has agreed to buy New York-listed Bitauto for $1.1 bln, the same price proposed months ago. Globally, buyers have tried to cut lower prices on pre-pandemic deals. But the outlook for China’s auto market is rosier: Tencent is getting a bargain.

Ackman can help SPACs, but can SPACs help Ackman?

11 Jun 2020

Hedge fund maestro Bill Ackman is raising more than $1 bln for a blank-check company. These acquisition vehicles are having a good year, and so is Ackman. There’s room to make so-called SPACs work better – but they can also come with wrinkles. Ask rival investor Dan Loeb.

Citi uncomfortably straddles Hong Kong-China fence

10 Jun 2020

The $124 bln U.S. lender has avoided taking sides on Beijing’s new security law for the territory. That could allow it to exploit dissatisfaction with those that have, like HSBC. But if the White House sanctions Chinese banks, Citi could become a convenient target.

Hong Kong tacks on Cathay to complicated itinerary

9 Jun 2020

The government is leading a $5 bln bailout of the struggling carrier, buying preferred shares. Owner Swire also vowed to keep control as part of an accompanying rights issue. That eases concerns about an Air China takeover, but it’s still a dicey deal amid the city’s unrest.

Reliance makes clever use of buy now, pay later

4 Jun 2020

Purchases by installment are hot in retail but the Indian conglomerate is bringing them back to capital markets. Investors buying into a $7 bln rights issue can settle up through November 2021. It sidesteps a Covid-19 cash crunch and boss Mukesh Ambani’s backstop covers up flaws.

Even a chastened SoftBank leans on engineering

2 Jun 2020

Boss Masayoshi Son is scrambling to clean up his “foolish” and costly WeWork mess. Instead of just selling some Alibaba shares, though, he’s using derivatives linked to them to raise $11.5 bln. The transactions are fiddly, but in this case may be a good use of creative finance.

Chinese online tutor gets lesson in multiplication

29 May 2020

GSX Techedu deflected one sloppy short-seller attack and a second sensational one. A third from Muddy Waters calling the $7 bln company a fraud hit as Luckin buckled and Congress moved on U.S.-listed Chinese stocks. Growing scepticism will require targets to have strong defences.

Bad borrowing habits come home to roost in India

27 May 2020

A London court ordered Anil Ambani, the brother of Asia’s richest man, to pay $700 mln to Chinese banks led by ICBC over a personal guarantee on a loan. The case is indicative of the unorthodox funding practices used by the country’s tycoons. It should help clean up their acts.

Index makeover sets fresh benchmark for Hong Kong

20 May 2020

The main Hang Seng tracker is welcoming companies with secondary listings and dual-class shares, opening the door to Alibaba, Xiaomi and more. That will help diversify baskets overstuffed with banks and such. It also underscores the local bourse’s plight to attract tech startups.

Sony embraces its inner conglomerate

20 May 2020

The Japanese giant is buying the rest of its financial arm for $3.7 bln as part of a broader shakeup. A new holding company structure clumsily tries to reposition Sony beyond its electronics roots. At least it’s managing the sprawl while thumbing its nose at activist Dan Loeb.

Nomura circulates an awkward startup pitchbook

19 May 2020

Boss Kentaro Okuda unveiled his plan for a digitally savvy investment bank catering to entrepreneurs. Buzzwords like AI and disruptive growth accompanied slides full of arcs and arrows. The clunky approach only makes it harder to believe Nomura can pull off this belated strategy.

SoftBank’s clouds come with some silver linings

18 May 2020

A record $12.7 bln annual loss surpassed its warnings. But activist Elliott’s push is yielding results, funds are being spent less giddily and asset sales are on. The board is getting a revamp too, as Alibaba’s Jack Ma exits. The taming of boss Masayoshi Son is gaining traction.

Review: The devil wears Ferragamo

8 May 2020

The life of a junior banker is hell, and Bill Keenan offers a guided tour from his Deutsche Bank days. Through a torrent of Excel emergencies and late-night food deliveries he grasps Wall Street’s rapacious essence. That makes “Discussion Materials” an enjoyable if grating read.

Nomura plays it too safe during downturn

8 May 2020

The Japanese bank posted a quarterly loss of $325 mln as slumping markets dented its asset management unit. Nor did its trading desk produce the sort of bump enjoyed by rivals like Morgan Stanley. New boss Kentaro Okuda has some work to do in restoring Nomura’s killer instincts.

Hong Kong bourse walks fine line on CEO succession

7 May 2020

Boss Charles Li plans to step down by October 2021. Ample lead time helps HKEX shareholders and should ensure a clean handover, but he also risks becoming a long-term lame duck. Finding someone equally able to balance the interests of Beijing and foreign investors will be tough.