Software

Darktrace’s cut-price IPO still looks risky

26 Apr 2021

The cyber firm’s $2.6 bln float values it at around 10 times 2020 revenue, well below listed CrowdStrike and Zscaler. But the loss-making business is vulnerable to rivals. Close links with investor Mike Lynch, who’s facing U.S. fraud charges, could also leave investors exposed.

EQT spins Micro Focus misfortune into gold

26 Apr 2021

The Swedish buyout firm may float software group SUSE for up to $10 bln, having paid its struggling UK owner $2.5 bln in 2018. It’s a classic corporate carveout on steroids. One lesson is that CEOs should put more effort into retaining possible upside when selling their castoffs.

Capital Calls: The $2 trln toybox

23 Apr 2021

Concise views on global finance: Mattel’s 47% sales growth tees up a spree of discretionary spending, as American consumers raid pandemic savings.

Panasonic’s $7 bln deal will leave investors blue

23 Apr 2021

The Japanese group is paying a pricey 33 times forecast EBITDA for Blue Yonder, its biggest acquisition in a decade. The target's expertise in supply-chain software and steady stream of subscription sales are appealing, but the implied return on investment is a huge downer.

Capital Calls: Bank of America, WeWork, Kering

20 Apr 2021

Concise views on global finance: The bank’s shareholders voted against a deeper dive into its impact on racial inequality; the office landlord is taking bitcoin as payment, for now; the Gucci owner needs to run faster to catch arch-rival LVMH.

UiPath’s $28 bln IPO may be as hot as Snowflake

19 Apr 2021

The company's revenue from software robots that replace humans doing boring back-office tasks is growing 80% annually. A valuation of over 40 times last year's sales looks feverish in objective terms, but cheap relative to in-demand technology peers like data outfit Snowflake.

Epic’s $29 bln price tag looks beyond “Fortnite”

14 Apr 2021

Its latest fundraising values the maker of the cult shoot-’em-up game at two-thirds more than last August. That’s a bigger bump than listed peers got from the pandemic. Investors are counting on boss Tim Sweeney’s bets on digital marketplaces and game-making software to pay off.

Capital Calls: Christine Lagarde, Bernie Madoff

14 Apr 2021

Concise views on global finance: The European Central Bank president’s quest for inflation will take a while to achieve its goal; investor gullibility will live on after the death of the Ponzi schemer in a U.S. federal prison.

SAP’s nice surprise makes case for value discount

14 Apr 2021

The $166 bln German IT group is wooing customers to its cloud software, boosting revenue. Yet investors aren’t giving CEO Christian Klein much credit. It’s hard to predict when clients will roll off SAP’s old-school products. A track record of shifting targets doesn’t help.

Grab’s $40 bln debut comes with twin airbags

13 Apr 2021

The Southeast Asian taxi-to-fintech firm is going public at a sales multiple twice Uber’s. U.S. SPAC sponsor Altimeter is contributing to a $4 bln PIPE and signing a long lockup. It’s a smart way to underwrite an amped-up valuation and sets a template to speed others to market.

Capital Calls: LVMH surges back to full health

13 Apr 2021

Concise views on global finance: The 300 billion euro luxury conglomerate’s first-quarter sales surpass pre-Covid-19 levels.

Capital Calls: U.S. CEO pay

12 Apr 2021

Concise views on global finance: The median big-company boss is ending up with $13.7 mln for the 2020 pandemic year, a payout that's heading for a record.

Gaming weakness puts Ubisoft on M&A last life

9 Apr 2021

Shares in the “Assassin’s Creed” publisher have languished since a failed takeover by Vivendi in 2018. Despite a pandemic boost, CEO Yves Guillemot’s $10 bln group suffers from dour profitability. That leaves him open to attack by rivals like Activision Blizzard or Tencent.

Box KKR deal kills two birds with three stones

8 Apr 2021

Activist Starboard Value wanted a sale of the $4 bln cloud-services group and board changes. Now KKR will invest $500 mln in convertible preferred stock, which Box will use to repurchase regular shares. Governance improvements are a plus, but it's a complicated way to buy time.

Atos’ April Fool surprise is no laughing matter

1 Apr 2021

The French IT group’s shares fell 14% after it flagged accounting problems at two U.S. units. The 1 bln euro hit to its market value looks harsh given they bring in only 11% of sales. Fears of more financial bugs will stymie CEO Elie Girard’s efforts to close the gap with rivals.

Capital Calls: Elon Musk, LeBron James

1 Apr 2021

Concise views on global finance in the Covid-19 era: Endeavor, Ari Emanuel’s entertainment group, is hoping the Tesla boss’s stardust will help a second attempt at an IPO; the basketball star’s stake in the Red Sox is a foil to Steve Cohen’s Mets deal.

Hitachi’s $9.6 bln buy defies some global logic

31 Mar 2021

The Japanese group is paying a huge 38 times forecast EBITDA for U.S.-software firm GlobalLogic. That’s only partly justified by the target’s superfast growth in a hot “digital transformation” market. Boss Toshiaki Higashihara will need serious synergies to eke a decent return.

Robinhood IPO comes with forest of perils

30 Mar 2021

The U.S. retail brokerage has expanded its user base and profile fast. But its main revenue, payments from market makers, is under pressure from regulators and rivals. Other parts of the top line are under pressure too. It’s hard to square that with a $30 billion valuation.

Capital Calls: BlackRock’s Archegos angle, SPACs

30 Mar 2021

Concise views on global finance in the Covid-19 era: The fallout from the collapse of Bill Hwang’s family office gives regulators reasons to focus on funds, not fund managers; and bosses of blank-check companies don’t take investor questions.

Review: “A World Without Email” is a long way off

26 Mar 2021

Tending to electronic communication takes a third of our working day, making us miserable and less productive, Cal Newport argues. Virtual to-do lists are useful hacks to regain control. Yet even if email is defeated, interruption by pervasive digital messages seems here to stay.