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from Breakingviews:

Qualcomm signals $2.5 bln belief in Bluetooth

By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Qualcomm’s 1.6 billion pound ($2.5 billion) deal to buy Britain’s CSR sends a positive signal to rivals on Bluetooth. The U.S. chipmaker’s $120 billion market cap means the purchase isn’t a stretch - but it comes at a high price and an odd time.

Qualcomm’s 900 pence-a-share offer represents a toppy 57 percent premium to where CSR shares were trading in late August before another suitor, Qualcomm’s smaller rival Microchip Technology, first emerged. That desire to see off a competitor presumably helps explain the big sweetener.

The bid also looks rich in multiple terms. The price is 27 times 2015 forecast earnings, based on Starmine data which weights analysts’ estimates based on their track record. Rivals trade on a maximum of 20 times forward 12-month earnings - although trading multiples do not include the control premium paid in a takeover.

from Breakingviews:

AbbVie U-turn shows Shire was mostly about tax

By Neil Unmack

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

AbbVie’s U-turn shows its Shire deal was mostly about tax, after all. Despite initially holding firm as the Obama administration clamped down on tax-driven “inversions,” the American group has now cooled on a $55 billion takeover of its Dublin-based peer. There’s an unwelcome read-across for AstraZeneca.

from Breakingviews:

Rio Tinto can dig in against Glencore

By Quentin Webb

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Rio Tinto can dig in against Glencore. On Oct. 7 the miner admitted rebuffing an approach in July from the commodity trading giant. Fair enough. The timing seems expedient following a slump in Rio’s dominant product, iron ore. A $160 billion “merger” also smacks of a takeover on the cheap. Rio can justifiably demand a real premium or no deal.

from Breakingviews:

Asset price disinflation may be next big thing

By Edward Hadas

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The great divergence may be about to come to an end. For investors in almost everything but the safest bonds, that is bad news.

from Hugo Dixon:

How to manage a corporate crisis

How should companies manage a crisis? Tesco is the latest large corporate to go through the wringer after it revealed last month that it had overstated its half-year profit estimate by 250 million pounds. The Financial Conduct Authority has started a probe and speculation is swirling that the UK retailer may need a rescue rights issue.

Tesco’s travails offer a case study about what to do (and what not to do) when disaster strikes. Two other big UK corporate crises – the ones that afflicted Barclays following the Libor interest-rate scandal in 2012 and BP after its Macondo oil rig blew up in 2010 – back up these lessons.

from Edward Hadas:

In praise of restrained enterprise

By Edward Hadas

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

British supermarkets are doing something unusual. They are following the rules of textbook economics: responding to competition by cutting prices. Such behaviour is rare. While business bosses often say they admire free enterprise, we actually live in a restrained enterprise economy. Everyone should be grateful.

from Breakingviews:

Cameron takes deficit amnesia to a new level

By Ian Campbell

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

David Cameron crowed when UK opposition leader Ed Miliband forgot the deficit in a keynote speech last week. Yet Britain’s prime minister has now taken deficit amnesia to a new level, insisting on the need to tackle the country’s biggest problem while simultaneously pledging a tax giveaway. It’s an electoral bribe he can’t afford.

from Breakingviews:

UK retail fails to weather the patently obvious

By Robert Cole

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Talking about the weather is a British national pastime. It cannot have escaped the notice of anyone living on an island in Europe’s north west fringe that it has been unseasonably warm in the last few weeks.

from Hugo Dixon:

UK faces unpalatable election choice

By Hugo Dixon

Hugo Dixon is Editor-at-Large, Reuters News. The opinions expressed are his own.

The UK faces an unpalatable choice in next May’s general election. The Labour opposition, which is currently ahead in the polls, has a somewhat anti-business agenda. Meanwhile, the Conservatives want to hold a referendum on Britain’s EU membership. If the people vote to quit the EU, industry will lose full access to its biggest external market.

from Breakingviews:

Tesco chairman should step aside

By Chris Hughes

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Tesco’s chairman should step aside. Richard Broadbent will struggle to restore market confidence in the troubled UK supermarket group, and to convince investors the board is on top of matters. This week’s accounting scandal has compounded existing concerns about his period at the helm. The priority should be an orderly handover to the right successor as soon as possible.

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