Breakingviews

Viewsroom: Clippy’s resume, Big Mac for Chicago, Lax gun laws

June 17, 2016

Microsoft’s willingness to plunk down $26 bln for LinkedIn proves the software giant is slipping back to its old habit of illogical deals. Plus McDonald's move to Chicago is a win for the broke city and why lax gun laws in the U.S. are hurting the country’s influence abroad.

Chancellor: Why I have voted for Brexit

June 16, 2016

Prophecies of economic turmoil if Britain leaves the EU lack credibility. If the EU cared for its citizens, substantive reforms would have been enacted. A vote for Brexit shows solidarity with Europe’s public - and with the principles of Kant, the great Enlightenment philosopher.

Fantasy-sports merger would face harsh reality

June 15, 2016

There may be logic to uniting FanDuel and DraftKings for backers that include Fox, Google, Comcast and KKR. The legal-defense synergies alone sound promising, although a deal could ignite new antitrust concerns. State lawmakers also can curb one big site as easily as two.

Microsoft’s CEO abandons prudence with LinkedIn

June 13, 2016

Satya Nadella’s $26 bln deal could reinvigorate the software giant’s slipping grip on corporate computer systems and employee interactions. Paying a 50 pct premium for a flawed business raises several red flags, however. Microsoft’s M&A record doesn’t inspire confidence, either.

Williams admits stress fracture in $22 bln deal

June 9, 2016

The U.S. pipeline owner said it may slash its dividend if the sale to Energy Transfer falls through. Despite the buyer’s efforts to renegotiate or wriggle out of the merger, Williams has held firm. The payout warning may be a tactic, but failure until now hasn’t been an option.

Shareholder ire at Tribune board is well earned

June 7, 2016

Over 40 pct of owners voted against all the publisher’s eight director candidates. That’s virtually unheard of when proxy advisers like ISS haven’t called for it. Maybe the board will be embarrassed enough to make tin-eared Chairman Michael Ferro listen to Gannett’s overtures.

J&J’s corpulence defense weighs heavy

June 2, 2016

The bulging healthcare conglomerate is swallowing hair-care firm Vogue for $3.3 bln in defiance of calls to break up. J&J’s $312 bln market value makes it a hard target for activists. Yet its obesity has created ailments from poor M&A digestion to mediocre shareholder returns.

Salesforce fluffs up cloud business at a high cost

June 1, 2016

The online-software company agreed to pay $2.8 bln for e-commerce specialist Demandware. That may add some zing to slowing growth while boosting a heated rivalry with old-school Oracle. But the price includes a lofty premium of nine times estimated revenue, a sign of fog ahead.

U.S. $12 bln utility coupling lacks spark

May 31, 2016

Great Plains Energy’s deal for larger neighbor Westar has the modest premium and coy savings target typical in deals between regulated firms. Even if synergies come in higher than hinted, customers may get any surplus. Investors may be right to worry that the buyer is overpaying.

China’s sports deals hit the hogwash jackpot

May 31, 2016

Mainland money is pouring into Western teams, rights, agents, and competitions. Bold M&A often comes with empty talk and hyperbole. The world of sport is not much better. Throw in the grand designs of China’s political leaders and you have a near-unbeatable trifecta of nonsense.