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

LONDON — What beats Oxford and costs less than Harvard? A group of star UK professors has an answer: their new, 18,000 pounds-a-year ($29,400) arts-only college. It’s like the educational equivalent of setting up a boutique investment bank.

By Chris Hughes
The author is a Reuters Breakingviews columnist. The opinions expressed are his own –

LONDON — Glencore’s flotation has become an excruciating case study in how not to organise an initial public offering. The Swiss commodities trader made a serious error by confirming its intention to float without having finalised the appointment of an independent chairman. Hours later, a chairman was found: but in circumstances that are close to comedy.

Glencore has everything in place for a possible record-breaking London float. Everything, that is, apart from an independent chairman. Leading the commodities trader’s initial public offering should be a prestigious gig. But it also represents a big corporate governance challenge. That gives the candidates some leverage over the terms on which they might accept the chairman’s role. 

To outsiders, privately-held Glencore has the look of a family business used to doing things its own way. Chief executive Ivan Glasenberg and outgoing chairman Willy Strothotte are part of the furniture. The fear is that even the toughest of corporate cookies will struggle to stamp some authority on the board. Add in the fact that Glencore is a complicated business operating in far-flung markets, and the group is in danger of being lumbered with a discount rating. A strong chairman would help reassure prospective shareholders. 

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

LONDON — The UK is starting to look like a safe haven for nuclear power. Britain’s decision to set a floor price for electricity generated from fossil fuels is not an explicit endorsement of new reactors. But it may help tip the balance for companies contemplating investment in new capacity. It’s not obvious that Japan’s disaster has set back Britain’s nuclear ambitions very far.

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

LONDON — It feels like 2007 again over at Glencore towers in Baar. The Swiss commodities trader says earnings in the fourth quarter were $1.26 billion, just 3 percent below the quarterly average in the boom of four years ago. It looks auspicious for this year’s likely initial public offering. But the impressive financial performance isn’t in itself a guarantee that Glencore can get a float away at the $60 billion equity valuation being mooted in the market.

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

By Chris Hughes

The conventional wisdom that modern revolutions are powered by the Internet and mobile phones faces a challenge. Vodafone and other mobile networks in Egypt have found themselves instruments of the state as much as of the people. Using powers that are surprisingly common in operating licenses, the authorities sent blanket text messages without attribution, possibly creating the impression that the operator was behind them. The messages, for example, urged customers to confront what were referred to as criminals and traitors, according to one website.

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

LONDON — M&A has resumed in 2011 with a textbook deal — DuPont’s $5.8 billion agreed cash offer for Danish enzymes group Danisco. Initially, the market got carried away with the transaction, pushing Danisco stock above the value of the U.S. chemical giant’s 665 crown-a-share offer. But expectations of a counterbid proved short lived.

It’s nearly over. Wall Street bank Goldman Sachs has settled fraud allegations with the U.S. Securities and Exchange Commission with a $550 million slap on the wrist. BP has shown it can halt the flow of oil from its bust well in the Gulf of Mexico, giving confidence to recent research that the leak could cost the UK oil group less than $30 billion. But shareholders have paid a far heavier price for these episodes than the quantifiable damage suggests. That deficit has one obvious explanation: the cost of reputational damage.

Take Goldman. Its shares rose only modestly on Thursday’s deal with the regulator, leaving its market capitalisation at $74.8 billion, 21 percent lower than its value on April 15, the last day before the SEC filed charges. Almost half of that is attributable to the fall in global equity markets, taking the MSCI World Index as a benchmark. After backing out the paltry fine, there is $9.7 billion of value destruction to explain — 11 percent of Goldman’s value adjusted for falling markets.
It’s a similar story at BP. The group is worth 77.6 billion pounds, 36 percent less than its value before the Gulf well blew on April 20. Adjust for the fall in global markets over the course of the spill, and back out 19 billion pounds for the latest estimate of the known costs of the clean up and compensation, and there’s still 16.1 billion pounds of value destruction to account for. That is 14 percent of BP’s adjusted market value.