Breakingviews

Savvy NRG step may tip scale against utility deal

December 16, 2011

’s uncommon to see a supplier try to spoil a marriage between customers. But the U.S. power producer is hoping to break up Northeast Utilities’ $4.7 bln takeover of NSTAR. NRG’s arguments hint at how big and inflexible a utility the deal, if approved, could create.

Gray market trading sucking life from IPOs

December 19, 2011

Facebook’s float will grab headlines next year. But as Zynga’s tepid debut shows, multiple private investment rounds and the ability to trade shares before going public mean there are slim pickings when public market investors finally get their chance to participate.

Alwaleed pushes the limits with edgy Twitter stake

December 19, 2011

Even though Prince Alwaleed bin Talal is known as a bold investor, his $300 mln stake in the regime-usurping social network is decisively edgy. The Saudi royal family member increases his cool factor, but supporting unregulated speech might not sit well in the kingdom.

Global bank capital rules add “G-Sifi envy” to mix

December 20, 2011

Labeling 29 lenders as globally systemic will introduce a new dynamic to finance in 2012. Banks on the list must hold more capital, yet gain a too-big-to-fail halo. Smaller competitors may try to join the club. It’s a race to the top, but not in the way regulators envisaged.

Oracle’s rare stumble triggers double concern

December 21, 2011

The software giant lost some $20 bln in market value after a subpar earnings report. The sell-off could be overdone: Larry Ellison’s firm may soon regain ground, as its bosses expect. But the rare miss could signal both a weak environment and a hiccup in Oracle’s own trajectory.

The poorly performing, must-have 2012 investment

December 22, 2011

It’s hedge funds. The typical one has lost 4 pct so far in 2011, lagging stocks and bonds. Investors aren’t deterred, though. They want 8 pct annual returns but face low debt yields and dim prospects for stocks. If fundamentals again guide markets, hedgies could bridge the gap.

Missing at the New York Times – a dividend?

December 22, 2011

The Gray Lady has regrouped since flirting with oblivion three years ago. After purging non-core assets, cutting debt and parting ways with its CEO, the Times looks ready for a deeper digital dive. Before it can take that plunge, the firm may need to pay its controlling family.

LBO debt gluttons have now gorged on equity too

December 23, 2011

Buyout barons are sitting on nearly $400 bln of cash committed by investors - or over $1 trln of purchasing power. A big slug of it belongs to mega-funds at or approaching their use-by date, pressuring firms to deploy capital or return it. Expect some overpriced deals in 2012.

Brazil’s Itaú is the bank to watch next year

December 23, 2011

It bills itself as “The Global Latin American Bank.” Thing is, it’s not - or at least not yet. But solid finances, determined management, a robust stock-market value and a wealth of opportunities from the misfortunes of others could make Itaú’s bold ambitions come true in 2012.

Investors may find Citi’s the joke on them in 2012

December 27, 2011

The bank now boasts a trimmer figure and some $65 bln of capital it should be in a position to start handing back, on top of any earnings. If Vikram Pandit can be the first CEO to steer Citi clear of crisis next year and beyond, he may even best JPMorgan in the payout department.