Breakingviews

Edward Hadas: Nikkei joins demographic denial cult

By Edward Hadas
July 29, 2015

Nikkei is the latest Japanese company to look for growth outside the shrinking domestic market. Its Financial Times purchase may work out, but the approach is flawed. Few companies can profitably escape their demographic destiny. It may be better to accept steady decline.

John Thain leads way for U.S. regional bank M&A

July 22, 2015

The CIT boss – and last CEO of Merrill Lynch – secured regulatory approval to buy OneWest. It’s the first deal to create a systemically important financial institution. It should clear the way for more mergers for banks fearful of regulators but in need of profit boosters.

Pearson sale of FT could stick this time

By Guest Contributor
July 20, 2015

The $16 bln publisher may offload the pink-hued newspaper, according to new reports. The Financial Times looks increasingly out of place in a group focused on U.S. education. The healthy M&A market might encourage potential buyers to bid a price acceptable to Pearson.

U.S. bank bosses get greedy in latest merger

July 14, 2015

The Fed has approved BB&T’s purchase of Susquehanna, one of the industry’s biggest transactions in years. Other lenders may be relieved to see the deal pipeline flow again. The buyer’s top brass, meanwhile, will share an undeserved $2.5 mln bonus, a blot on otherwise good news.

Microsoft gets $7.6 billion wakeup call from Nokia

July 8, 2015

The U.S. software goliath is writing off most of what it paid for the Finnish business in 2014. Microsoft’s M&A-related writedowns tally $14 bln over the past three years. CEO Satya Nadella, who has already splurged on Minecraft and eyed Salesforce, should be taking the hint.

Willis-Towers Watson insure against market turmoil

June 30, 2015

The insurance broker and the risk consultant plan to merge. There’s positive logic: combining Towers’ knowhow and Willis’ client relationships could drive revenue. But $125 mln of cost synergies would also help the group weather an insurance sector wrestling with low rates.

Antitrust food fight messes up outlook for mergers

June 24, 2015

A U.S. court halted Sysco’s $3.5 bln US Foods purchase, saying the deal would probably harm national competition despite local rivals. A similar argument threatens Staples’ $6.3 bln bid for Office Depot. The bottom-line economics still look tasty, but legal precedent has soured.

Rob Cox: Don’t underestimate Exor’s John Elkann

June 23, 2015

Fiat Chrysler CEO Sergio Marchionne is the one leading a coercive charm offensive for car industry consolidation, but it wouldn’t be happening without the Agnelli scion’s support. Exor’s hostile bid for PartnerRe signals a hard-nosed approach that GM and others shouldn’t dismiss.

Tokio Marine learning lessons in value destruction

June 10, 2015

The 38 pct premium the Japanese insurer is paying in its $7.5 bln purchase of HCC is only half as absurd as in its two previous U.S. deals. Those extravagant forays should give it scope to cut costs. By slicing 15 pct of HCC’s overhead it might even finally make a deal stack up.

Intel chips in for elusive post-M&A pricing power

June 1, 2015

Its $17 bln swoop on Altera is the third big semiconductor deal of late. The six participants’ market caps have jumped by up to $35 bln. Cost cuts account for well under half that. The rest may reflect hopes that the acquirers can work magic on their top lines. That’s optimistic.