Divestment

Capital Calls: Walmart whiplash

16 Aug 2022

Concise views on global finance: The U.S. mega-retailer revised its profit forecast yet again, just weeks after sounding the alarm.

Cancer scare leaves GSK castoff adrift

11 Aug 2022

Shares in Haleon have fallen by nearly a fifth on fears of litigation linked to a heartburn drug. It’s another worry for the $28 bln business which GSK spun off after loading it up with debt, amid recession fears. The uncertainty means investors can’t even hope for a takeover.

SoftBank’s Alibaba sale could end breakup taboo

10 Aug 2022

Masayoshi Son’s group will cut its stake in the Chinese e-commerce giant to 15% from 24%. It’s a sensible, albeit belated, move. The holding contributes to a 55% conglomerate discount, which would be narrowed further by spinning off Arm and selling more of its Japanese telco.

Capital Calls: Disney turns screws on Netflix

10 Aug 2022

Concise views on global finance: The Magic Kingdom now has as many subscribers to its streaming products as Netflix. It needs all the fairy dust it can get ahead of a looming price war.

SoftBank chagrin is poor defence against bad bets

8 Aug 2022

The Japanese investor suffered a $23 bln net loss from falling markets and a weak yen. Boss Masayoshi Son says he has learned lessons. But exiting ride-hailer Uber with a 5% annual return supports the view of SoftBank as a firm that can only follow, not outperform, the crowd.

GSK spinoff boost may be as good as it gets

18 Jul 2022

The drugmaker’s Haleon consumer unit started trading at 40 bln pounds including debt – below the 50 bln pound offer it rejected from Unilever. The Sensodyne maker has hefty borrowings and two big investors eager to sell. But its valuation mostly prices in a healthier future.

GSK split gives CEO fresh M&A test

15 Jul 2022

Emma Walmsley is hiving off the $102 bln drugmaker’s consumer unit. What’s left is currently valued at a discount to pharma peers, despite fast-growing vaccines sales, due to loss of exclusivity on key drugs. Walmsley needs to show she can buy businesses as well as break them up.

Telecom Italia breakup opens new M&A lines

7 Jul 2022

The struggling former state monopoly is saddled with 23 bln euros of net debt. Selling its prized fixed-line network would eliminate most of that, slashing leverage for the services company left behind. For investors, the hope is that Telecom Italia’s rump also comes into play.

Naspers “put” tackles one of its Tencent problems

27 Jun 2022

The South African firm and its Dutch offshoot will buy back stock by slowly trimming their $133 bln stake in the Chinese tech giant. Tax liabilities and clunky governance remain valuation drags. But investors can worry less about Naspers blowing its riches on other startups.

Kellogg’s three-way breakup plan lacks crunch

21 Jun 2022

The $24 bln Frosties maker is spinning off its North American cereals and plant-based foods, leaving behind a faster-growing global business. Dividing businesses by their prospects may boost performance. But any valuation uplift seems unlikely to justify the cost of the carve-up.

Big four breakup plan, America’s big spenders

2 Jun 2022

EY is considering splitting its audit unit from its fast-growing consulting practice. In this Viewsroom podcast, Breakingviews columnists debate a possible $60 bln valuation and why the plan may create few winners. Also, inflation is creating a murky economic picture stateside.

Capital Calls: Inflation-proof Dr Martens, Saipem

1 Jun 2022

Concise views on global finance: The UK bootmaker’s polished results offer glimmer of hope to embattled retailers; the Italian energy-services group reassures investors with $550 mln sale of its onshore drilling unit.

Big Four split would have few winners, many losers

31 May 2022

EY may separate its accounting arm from the unit that advises on strategy and IT. The consulting spinoff, worth some $60 bln, might win more business due to fewer conflicts and scandals. Yet the rump auditing business may struggle to attract staff, and push up prices for audits.

SlimFast maker could be tasty swig for Nestlé

4 May 2022

An activist wants Irish protein powder seller Glanbia to break up. Listing its consumer unit in the U.S. could double its 3 bln euro value, but would take time and carries risk. That opens the door to a cash-rich buyer like the Swiss giant, which is bulking up its health lines.

Russian nickel king laughs all the way to the bank

3 May 2022

Vladimir Potanin has snapped up his third financial asset since the war began. The Norilsk Nickel CEO has so far evaded U.S. sanctions despite links to President Putin. Dozens of Russian billionaires are in similar boats, poised to make out like bandits from the Western exodus.

HSBC breakup push requires delicate brushoff

1 May 2022

Chinese insurer Ping An wants the $125 bln bank to spin off its Asian arm. Overall performance has been disappointing, but a messy and costly split could negate any valuation uplift. The challenge for Chair Mark Tucker is to politely tell his biggest investor that it’s wrong.

Just Eat Takeaway faces humiliating U.S. exit

20 Apr 2022

The food delivery group may sell Grubhub, a business it bought last year for $7.3 bln, an embarrassing U-turn for CEO Jitse Groen. Expanding into the tough U.S. market always looked tricky. Getting out when there are few buyers, just as consumers are squeezed, will be harder.

SocGen avoids the worst in costly Russian exit

11 Apr 2022

The French bank is selling Rosbank back to the oligarch it bought the unit from 16 years ago. Despite a 3 bln euro writeoff, the hit to its capital ratio is less than half the worst-case scenario it outlined last month. It’s a fitting end to a long and unhappy Russian story.

National Grid gas sale has green edge on Macquarie

28 Mar 2022

The $54 bln UK company is selling 60% of its gas pipelines arm to a group led by the Australian finance house. The $13 bln deal has financial benefits for both. But National Grid’s switch to electricity is more immediate than the buyers’ plan to pump hydrogen through the pipes.

Capital Calls: White-collar crime, Rusal rejig

7 Mar 2022

Concise views on global finance: The U.S. attorney general wants to go after more individuals as well as companies for corporate crimes. Even law firm Wachtell says top bosses should pay attention; a plan to separate Rusal’s non-Russian bits looks like a challenge.