Breakingviews

U.S. $16 bln paper deal requires precise folding

January 26, 2015

Rock-Tenn and MeadWestvaco shareholders will split their combined company evenly, with a balanced board. Investors are already inking in $300 mln of annual cuts, pushing both stocks up. Mergers that look equal, though, can still provoke business and cultural upheaval.

More Wall Street CEO cash is hint for shareholders

January 23, 2015

JPMorgan is paying a portion of Jamie Dimon’s bonus in hard money for the first time since 2011. Goldman is boosting Lloyd Blankfein’s cash. Meanwhile, stock gains are slowing. Bank bosses still get most of their comp in shares. But the switch may suggest equity has less to offer.

RBC’s foray south a pricey bet that two’s a charm

January 22, 2015

The Canadian bank is paying $5.4 bln for U.S. lender City National, a 26 pct premium that planned cost cuts don’t justify. The so-called banker to Hollywood stars is growing well. But RBC’s last venture into American retail banking was a mess. It needs to prove it can do better.

Rob Cox: It took the Grim Reaper to restructure GM

January 14, 2015

The carmaker’s swift bankruptcy sparked less soul-searching than the process of determining who died from faulty ignitions. Bringing Ken Feinberg in will go down as CEO Mary Barra’s smartest decision. She should go a step further and memorialize the dead in the lobby of GM’s HQ.

Tech steering carmakers down valuation dead end

January 12, 2015

As the Detroit auto show kicks off, manufacturers from Toyota to Ford to VW are getting little, if any, credit for profit growth. Recalls, currencies and geopolitics are all to blame. Longer term, they’ll feel the squeeze from connected vehicles. Low multiples may be here to stay.

Cheap oil lubricates Li Ka-shing’s corporate rejig

January 12, 2015

Asia’s richest man is shifting a 6 pct stake in Canada’s Husky Energy to his holding company as part of a broader shake-up. The move is vital to keeping Li’s grip on the telco-to-property empire. Though shareholders may object, the falling oil price has worked in their favour.

Proxy fight as much about Peltz’s Trian as DuPont

January 9, 2015

The billionaire activist is seeking four board seats at the chemicals group, his first public contest since Heinz nine years ago. Flexing muscle sends a message to other stubborn targets, like Pepsi. It also gives younger staff at Trian Partners experience in the trenches.

Santander finally gets the message on capital

January 8, 2015

The Spanish lender had resisted raising equity. Now new Chair Ana Botin is seeking 7.5 bln euros in a share sale. A 6-8 pct discount may be needed, and there are no pre-emption rights. But the bank gets capital sorted, boosted by a dividend cut, before markets potentially worsen.

StanChart equities closure is overdue but welcome

January 8, 2015

The emerging markets bank has pulled the plug on its share trading and underwriting arm, cutting 200 jobs. It’s a rational but still-rare step for a business that suffers from chronic overcapacity. Rivals will feel extra pressure to justify their decision to soldier on.

Dick’s buyout has financially sporting chance

January 8, 2015

The $6 bln U.S. golf-to-guns vendor is mulling a sale to private equity. Low debt at Dick’s Sporting Goods means even with a chunky premium, attractive returns look possible. It would, however, require healthy growth when stiff online competition is challenging many retailers.