Breakingviews

Vodafone’s India tax victory may come with a twist

By Jeff Glekin

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

Vodafone’s victory over India’s tax authorities may have a sting in the tail. The UK phone giant’s $2.2 billion Supreme Court win is a boost to India’s battered reputation. It also bodes well for firms such as AT&T, which are threatened with similar tax bills. But if the government now changes the law, future offshore M&A deals may not escape so easily.

UK fee disclosure shows bankers rule the M&A roost

By Quentin Webb

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

When it comes to carving up M&A fees, bankers rule. That’s the revelation from new UK rules that force buyers of listed companies to disclose how much they pay their armies of advisers. It’s too early to judge whether the new regime, probably the world’s most transparent, will force down takeover fees. But the initial data provides hard evidence of just how much banks benefit.

A speech on taxes that would help Romney’s run

By Daniel Indiviglio

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

The following is an imagined speech that Mitt Romney could deliver to handle attacks on his private equity background and low personal tax rate while simultaneously appealing to moderate U.S. voters to help his run for the White House.

Connecticut finally steps up to vet utility merger

By Rob Cox

The author is a Reuters Breakingviews columnist and a Northeast Utilities customer. The opinions expressed are his own.

More than a year after rubber-stamping Northeast Utilities’ $4.7 billion takeover of NSTAR, Connecticut’s regulators have decided, after all, to take a close look at the transaction, intended to create a $17 billion electric monopoly in New England. It took a couple of storms to expose Northeast’s incompetence and prod the Nutmeg State’s watchdogs into action. Now that they’ve woken up, they needn’t be shy of killing the deal.

Japan makes better hangar for RBS air unit

By John Foley

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

Royal Bank of Scotland’s aircraft leasing arm has flown to a better place: Japan. The UK bank’s $7.3 billion deal to sell the division, which includes 206 planes, to Japan’s Sumitomo Mitsui Financial Group will free up vital capital at a good price. For the buyer, which now becomes the world’s number three leaser of planes, it should provide a much needed lift to returns.

BankUnited sends ominous sign with its white flag

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

BankUnited’s stock market return represented a rare glimmer of hope in American banking a year ago. Here was a failed Florida lender rescued from the dustbin, impregnated with fresh capital and led by highly incentivized and experienced managers. They planned to forge an exemplary industry path, rolling up small banks, squeezing out efficiencies and creating more competition. Now they’re waving a white flag.

It’s easy to see BankUnited’s decision to hire Goldman Sachs to canvass buyers as confirmation that Chief Executive John Kanas and his private equity backers wanted a quick flip all along. With the bank worth some $2.5 billion, they’ve already made their $900 million back and then some.

TPG can be forgiven its mile-high club fetish

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

David Bonderman hasn’t forgotten his first fling. The former lawyer parlayed his 1982 experience as trustee for Braniff Airlines into a deal to buy Continental Airlines out of its second Chapter 11 filing a little over a decade later. That successful bet enabled the Texas takeover artist to co-create buyout biggie TPG. Since then, he has continued to chase airlines the world over, including now bankrupt American. A recent failure hasn’t dampened Bonderman’s ardor.

Carlyle’s big payday does private equity no favors

By Jeffrey Goldfarb

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

Carlyle Group isn’t doing its industry any favors. As part of the private equity firm’s initial public offering process, this week it revealed the lucre reaped by its three founders last year. David Rubenstein, William Conway and Daniel D’Aniello took home a combined $400 million in cash payouts. That’s on top of their nearly $4 million salaries and the profits on $200 million of distributions on personal investments in the firm’s funds. Carlyle’s timing is impeccable.

Ferretti’s yachts find fitting berth in China

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

Few companies embody the highs and lows of turbo-charged modern finance better than Ferretti. Once the luxury yachtmaker made a mint for private equity. Now a state-backed Chinese industrial conglomerate is buying it for at most a fifth of its peak value.

Predictions 2012: Upside down and inside out

By Robert Cole

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

Planet finance has a propensity to turn itself upside down and inside out. It’s up to its old tricks again. A new collection of commentaries from Breakingviews sets the financial agenda for the next 12 months.