Deals

SoftBank’s reduced Arm price tag is still too high

5 Sep 2023

The Japanese group may float its UK chip designer for $50-54 bln. That’s lower than initially hoped, but still implies an implausible future where revenue and profitability soar. If Arm merely grows at recent rates and nudges up margins, its market worth is more like $35 bln.

Twinkies maker will give food brands a sugar high

1 Sep 2023

Sweet-treat purveyor Hostess is mulling a sale to a conglomerate seven years after private equity firm Apollo took it public for $2.3 bln. At its current valuation, and as the pandemic sugar rush fades, there’s not much cream left for the next buyer to squeeze.

Capital Calls: Microsoft in the EU, Dollar General

31 Aug 2023

Concise views on global finance: The software giant will sell its Teams communications app separately from other software in the European Union; the discount retailer’s poor results reflect a more resilient US economy.

Body Shop sale may give Natura skin-deep makeover

30 Aug 2023

After offloading Aesop for top dollars, the Brazilian beauty giant may struggle to fetch the cosmetics brand’s original $1 bln price tag in a sale. The M&A spree reversal will simplify Natura’s structure. But sprucing up its surviving Avon arm and other labels looks hard.

Alphabet moonshots are ready for launch

29 Aug 2023

Google’s parent lost $6 bln last year on experimental ventures, such as health-data cruncher Verily and self-driving outfit Waymo. As CFO and former tech banker Ruth Porat takes charge of the unit, it’s probably a good time to consider carving out some and refocusing on others.

UK biotech sale offers cautionary spin on US pivot

29 Aug 2023

Abcam, a Cambridge-based maker of proteins for research, is selling to Danaher for $5.7 bln. Shifting listing venues from London to New York, as the seller did recently, is in vogue. But given its US buyer has got a good price, it’s a sign that doing so is far from a panacea.

Rolex’s deal is ticking time bomb for retailers

25 Aug 2023

Shares of Watches of Switzerland slumped 28% after the timepiece-maker bought retail chain Bucherer. The fear is that the luxury group wants to sell directly to consumers. Building a store network won’t be quick but WoS’s business model, and its independence, are under threat.

Roark scores sandwich deal better than $5 footlong

24 Aug 2023

Family-owned Subway is settling for a $10 bln price in its sale to the buyout firm. It values the chain at a lower multiple than peers and other deals, including Roark’s Dunkin’ purchase. With IPO markets opening and terms protecting buyers, there’s plenty to nibble on.

Capital Calls: Shein/Forever 21

24 Aug 2023

Concise views on global finance: The Chinese retailer is partnering with Sparc, the operator behind Forever 21. That helps validate Shein before a public listing without the messiness of a merger. Forever 21 gets a new omnichannel and potentially a way to an IPO.

Private funds’ regulatory dream meets logical end

23 Aug 2023

Securities watchdogs are proposing safeguards for private equity and hedge fund investors. The now-$25 trln industry owes its growth partly to lighter regulation than at the banks it is displacing. Tighter rules will irk some, but growing up should bring new responsibilities.

Beware the hedge fund deal that’s not about money

23 Aug 2023

Bill Ackman, Marc Lasry and Boaz Weinstein want to buy Sculptor, which manages $34 bln. Instead, Daniel Och’s former shop accepted a lower bid from real estate investor Rithm. Sculptor’s doubts about the moguls’ funding sounds fishy, as does the idea they couldn’t work it out.

Microsoft rethink puts big tech M&A back on table

22 Aug 2023

The $2.4 trln tech giant will sell streaming rights to Ubisoft in a bid to get UK approval for its $69 bln Activision deal. The big concession is likely to work. It shows a path for tech giants to buy rivals, while sidelining regulators' fears that M&A will kill nascent markets.

Capital Calls: Coinbase’s Circle deal

22 Aug 2023

Concise views on global finance: Crypto exchange Coinbase is investing in struggling $26 bln stablecoin issuer Circle. Tokens tracking the US dollar haven’t delivered on hopes of transforming finance; the deal promises little current payoff, but at least keeps the dream alive.

SoftBank Arm deal is expensive gift to Vision Fund

21 Aug 2023

Masayoshi Son’s group bought 25% of the chip designer from its Saudi-backed investment vehicle. It puffs up the fund’s poor returns, but betrays a lack of confidence in an upcoming float. A pricey $64 bln valuation means Son’s fellow SoftBank shareholders will probably lose out.

Union fights grow US workers’ slice of profit pie

18 Aug 2023

Collective bargaining groups who negotiate for workers in industries from steel to trucking are making life hard for companies. The still-hot job market is giving unions a leg up. With employees getting $120 billion less of corporate cash than in late 2019, workers can win more.

Private equity bites off mostly what it can chew

17 Aug 2023

KKR, GTCR and others are clawing out of a deal bust with modest aims. A recent spate of sub-$2 bln buyouts, including ones involving Simon & Schuster, Avid and ADT, speaks to the trend. It’s a good way to stay active, but a $1 trln hoard of capital can’t sit unspent indefinitely.

China does Intel a small favor

16 Aug 2023

The chipmaker aborted its $5 bln acquisition of Tower Semiconductor after failing to secure approval from Beijing. The questionable deal was made worse by the target’s struggles. And given the cross-border tech tension, a $350 mln break fee at this stage is a small price to pay.

Hostile $7 bln steel war will be forged in fire

14 Aug 2023

Cleveland-Cliffs’ run at 122-year-old metal producer US Steel comes amid a post-Covid slump in the commodity. Strategically and economically it makes sense. But the industry would go from four major producers to three. And the target is, at best, a reluctant participant.

Capital Calls: Exor/Philips

14 Aug 2023

Concise views on global finance: The Agnelli family is making a well-timed bet on the troubled 18 bln euro conglomerate that makes everything from toothbrushes to defibrillators.

Electric vehicle premiums will ride high in India

14 Aug 2023

Temasek handed a punchy $10 bln valuation to Mahindra’s unit but other shareholders barely endorsed the deal. With fewer opportunities to ride the boom than in China, the Singaporean state investor won’t be the last to turn heads in the world’s third largest car market.