Internet

Review: Venture capital is a victim of own success

21 Jan 2022

Sebastian Mallaby’s “The Power Law” traces the $1.8 trln industry’s history back to the 1950s. Early investors’ triumphs invited imitators, making capital into a commodity and empowering cocksure startup founders. The lesson is that VCs’ influence over companies may have peaked.

Netflix could be Activision’s Plan B

20 Jan 2022

Microsoft’s $69 bln bid for the “Call of Duty” maker may fall foul of trustbusters – and the same issue could deter other tech firms like Alphabet and Meta Platforms. That creates an opening for Netflix. Activision could neatly further the streaming giant’s video game ambitions.

Capital Calls: Siemens Gamesa, Psych SPAC

21 Jan 2022

Concise views on global finance: The 11 billion euro wind turbine manufacturer serves up its third profit warning in nine months; Hope for drugs to treat depression is tempered after rivals suffer mishaps.

Microsoft’s Activision deal has on virtual goggles

18 Jan 2022

The software giant is paying $69 bln for the gaming firm, a 45% premium, though less than Activision’s value a year ago. It’s a good fit and gives Activision shareholders a way to cash out. But it is likely to catch the eyes of watchdogs, who have mostly let Microsoft skate by.

China’s Great Firewall 2.0 will repel smart money

14 Jan 2022

Once focused on blocking offshore websites, authorities are increasingly hiding government pages, ship movements and even bus schedules from prying foreign eyes. They’re confident overseas funds will keep flowing in even with less access to information. That’s only half-right.

Zuckerberg has metaverse rivals who mean business

23 Dec 2021

Meta Platforms and Epic Games are trumpeting visions of an immersive, 3D internet. But even ignoring the technological challenges, consumers’ appetite for full-on virtual socialising is uncertain. The corporate world is a more manageable target – and that is Microsoft’s domain.

Rare Oracle deal would be anything but spontaneous

17 Dec 2021

The software group might spend $30 bln on healthcare IT specialist Cerner. That would mark a shift from buying back $100 bln of stock in four years. But Cerner has been in Oracle’s sights for nearly 20 years. It’s the last company still available on a longstanding shopping list.

KKR sends strong buy signal on European telecom

17 Dec 2021

The private equity firm is paying 1 bln euros for half of a Spanish fibre-optic network at a multiple of 22 times EBITDA. It already owns Madrid-based Masmovil, tilted at Dutch operator KPN in May and is stalking Telecom Italia. Eventually, public investors will get the message.

KKR can still find gems in Telecom Italia’s wreck

16 Dec 2021

Chopped into bits, the struggling Italian telecom operator may be worth 38 bln euros including debt. Its network alone, in which its U.S. stalker has a stake, is probably worth almost half that. A breakup may add a quarter to the fund’s 10.8 bln euro prospective offer.

China’s metaverse will be a tiny place

16 Dec 2021

Stocks in local companies associated with digital worlds blew up in 2021. The country’s video-games industry, tech expertise and masses of disaffected youth make it an ideal place to push the bleeding edge of virtual reality. That’s precisely why Beijing is squashing it.

Billionaire Drahi plays the long game at BT

14 Dec 2021

The Franco-Israeli tycoon has upped his stake in the UK telco to 18%. The government would almost certainly nix a full bid, especially with BT’s fibre-optic rollout hitting top speed. But with operators across Europe falling into private hands, Drahi can afford to sit and wait.

Capital Calls: Securitas

8 Dec 2021

Concise views on global finance: The Swedish security specialist’s acquisition of Stanley Black & Decker’s alarms unit should boost growth and margins.

LG’s $11 bln battery spinoff is fully charged

8 Dec 2021

The South Korean group is eyeing a $60 bln valuation for its crown jewel in what could be the country's biggest IPO. The hot play on electric vehicles hopes to entice investors by offering a discount to peer CATL. LG's track record of recalls, though, warrants caution.

Capital Calls: Microsoft, AT&T, American Airlines

7 Dec 2021

Concise views on global finance: Microsoft is finally being scrutinized with Europe’s probe of its $16 bln Nuance deal; U.S. lawmakers have antitrust worries about the telecom firm’s Discovery deal; American Airlines’ retiring CEO leaves shareholders short-changed.

Capital Calls: Fund services M&A, Mattress mystery

6 Dec 2021

Concise views on global finance: Shareholders of Amsterdam-listed Intertrust dodge a regulatory crackdown with a 1.8 bln euro sale; the western man credited with Chinese retailer DeRucci’s success finally has his identity revealed.

Alibaba’s new CFO signals shifting priorities

6 Dec 2021

The Chinese e-commerce company, whose market value has halved to $300 bln this year, is replacing finance chief Maggie Wu. During her seven-year tenure, Alibaba successfully courted foreign investors. Successor Toby Xu’s experience suggests there will be a greater focus at home.

Didi faces long and perilous journey to Hong Kong

3 Dec 2021

The $38 bln ride-hailing group is eschewing its New York listing for one in the Asian hub amid pressure from Beijing. A take-private would be costly; migrating American depositary receipts could be tricky. Didi will have to navigate Hong Kong's tougher IPO requirements too.

Legal challenge affirms logic of Nvidia mega-deal

3 Dec 2021

U.S. trustbusters are suing to block the chipmaker’s controversial Arm acquisition. A growing price tag, from $40 bln to about $75 bln, undermines the financial value. At least the FTC is, in a way, buttressing the strategic rationale of buying the Switzerland of semiconductors.

Super-app Grab gets rear-ended

3 Dec 2021

The group’s shares plunged 20% on debut following its $31 bln SPAC merger. Unlike China’s Didi or India’s Paytm, the crash wasn't so much its fault; the Altimeter- and Temasek-backed deal was well-enough constructed. But Grab is in a market pile-up that won’t clear soon.

Bondholders are biggest losers in telco LBO frenzy

1 Dec 2021

Telecom Italia’s bonds fell on fears that the securities may not be redeemed if KKR’s $37 bln buyout succeeds. The M&A boom has made unexpected targets of large public companies. Even when investors enjoy stronger protections, as with UK rival BT, these offer limited solace.