Unilever defies buyback vigilantes
(The author is a Reuters Breakingviews columnist. The opinions expressed are his own)
By Chris Hughes
LONDON, April 30 (Reuters Breakingviews) – Unilever (ULVR.L: Quote, Profile, Research) (UNc.AS: Quote, Profile, Research) is breaking some of the basic rules of corporate finance. Investors, being keen on financial logic, aren’t impressed.
EU bonus lesson: self-regulate or worse follows
By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
The regulation of pay in Europe marks an unwelcome watershed in post-crisis financial reform. European Union lawmakers on Thursday finally approved rules to cap bank bonuses relative to base salaries. Regulating for competition or financial stability is one thing. Intervening in how people are paid is quite another.
EU bonus crackdown means more cash for bankers
(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own)
By Chris Hughes
LONDON, Feb 19 (Reuters Breakingviews) – If Europe wants to
hard wire excess pay for bankers, it is going the right way
about it. Proposals to set a maximum ratio of bonuses to salary
are so manifestly counterproductive that it’s hard to believe
they have gained almost unstoppable momentum among European
Union members. Bad policy is what happens when weak management
in the financial industry collides with the politics of envy.
Liberty pushes envelope for post-crisis M&A debt
By Christopher Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Liberty Global’s $23 billion offer for Virgin Media marks a turning point in post-crisis deal finance. This cable-TV mega-merger has most of the hallmarks of the pre-crisis boom. The target’s shareholders are being paid partly in their own cash, which will be extracted from Virgin Media through some ambitious financing operations. Leverage may not be pushed up to pre-crisis highs, but this is still a big moment.
“Don’t be evil” business mantra not conflict-free
By Chris Hughes
DAVOS, Switzerland, Jan 25 (Reuters Breakingviews) -
G oogle’s (GOOG.O: Quote, Profile, Research) mantra, “Don’t be evil,” sounds so easy. But
businesses, including the search giant, have struggled with
avoiding harm while aspiring to do good. Executives gathered at
the World Economic Forum in Davos see a simple logic: comporting
themselves in socially beneficial ways can hurt financially in
the short term, but must be good for business over time.
Immediate conflicts, however, could make that promise difficult
to uphold.
The pressure to change comes from society. In banking, it’s
because taxpayers rescued the banking system. A financial firm
that devises complicated structures to help clients minimise tax
bills is going to find itself vilified by the media. Tax
structuring is, in theory, a perfect post-crisis business for
banks: it requires no capital and is highly profitable. But it
doesn’t pass a socially useful test and can damage the brand. On
balance, that makes a decision to exit easy.
Davos desperately seeking the next Internet
By Christopher Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
To feel good again, the world’s financial elite need a growth catalyst like the Internet. America’s shale gas revolution fits the bill. Ask delegates at the World Economic Forum in Davos for their 2013 outlook, and that simple idea features in most answers. It may only surface as a passing reference in conversations around the Swiss ski resort. But in the echo chamber of Davos, the notion that shale gas is a reason to be bullish has become common wisdom.
Heathrow needs decisive capacity fix
By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Heathrow spent more than 36 million pounds on improving its snow defences after the chaos in 2010. The result? More bad publicity for London’s hub airport when this winter’s first blizzards hit. Heathrow’s operational upgrades have failed to address the fundamental problems it faces.
Coffey to go
By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
Greg Coffey’s retirement at 41 from Moore Capital marks the end of the big personality era in hedge funds. The macro trader’s success was based on drive, personality and talent, plus the usual hedge fund ingredients – luck, leverage and high management and performance fees. His luck ran out at GLG Partners when the Lehman crisis hammered his illiquid positions. Clearly, something else has gone at Moore Capital.
BAE needs a new chairman
By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
BAE Systems needs a new chairman. Dick Olver’s management of the attempt to merge the UK defence group with EADS was poor. He has also presided over a sustained period of share-price underperformance. After eight years on the board, he should make room for fresh talent.
BSkyB should start to build in new bid premium
By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
BSkyB shares should start to reflect the chance of a second bid from News Corp. Ofcom, the UK media watchdog, has confirmed that Rupert Murdoch’s media group is a suitable lead shareholder in the satellite broadcaster despite the phone-hacking scandal in News Corp’s UK newspaper business. The clarification removes a potential obstacle to it taking full control of the business.
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