Jeffrey's Feed
Dec 15, 2011
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P&G didn’t crunch its Pringles partner adequately

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

Procter & Gamble didn’t crunch the details on its Pringles partner adequately. Troubles escalated for Diamond Foods, the agreed buyer of the chips brand, on Thursday as the Securities and Exchange Commission initiated a probe into its accounting on the heels of the snack food company’s own internal inquiry. The scale of the issues being investigated suggests the consumer giant missed some warning signs.

Everything looked crisp back in April when the $2.4 billion transaction was announced. Diamond shares soared as it appeared to fulfill ambitions to grow from a walnut co-operative to a global player in salty treats. For P&G, a craftily-structured deal allowed it to finally exit the food business.

Dec 7, 2011
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Don’t boo U.S. football’s zero-coupon perpetuals

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

The Green Bay Packers are on some kind of streak. The venerable U.S. football team has followed up last year’s Super Bowl victory with 12 consecutive wins to start this season. It is now parlaying the local exuberance into an unconventional investment achievement.

Dec 2, 2011
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Thomson finally completes takeover of Reuters

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

Thomson agreed to buy Reuters in May 2007. It didn’t really merge the two companies until just a few months ago. And now, with the resignation of Chief Executive Tom Glocer, the takeover is finally complete.

Nov 30, 2011
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Buffett steals page from odd playbook: Murdoch’s

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

Warren Buffett and Rupert Murdoch don’t often come up in the same context. But both these octogenarian billionaires can’t shake a soft spot for newspapers. Buffett proved as much by agreeing on Wednesday to buy his local publisher, the Omaha World-Herald Co, in defiance of his own investment advice.

Nov 29, 2011
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P&G may need to pop a plan B for Pringles

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

Things aren’t sparkling for Diamond Foods. A month ago, the snack food maker delayed its $2.4 billion plan to buy Pringles from Procter & Gamble to look into accounting concerns. Now, the company is burying news about the probe and increasing payments to walnut-growing directors. These and other inconsistencies don’t seem to augur well for the investigation – or for P&G’s deal.

Nov 11, 2011
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Music gods again divert EMI’s destiny

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

The music gods have meddled again with EMI’s destiny. In the minds of financiers and industry wags, the union of the British music group – home to the Beatles and the Beastie Boys – with U.S. rival Warner Music was just a matter of time. But the star-crossed match has been knocked off course again by the sale of EMI’s two divisions to Sony and Vivendi’s Universal Music.

Nov 10, 2011
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Life continues sweetly for the .001 percent

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

Contemporary art may have been on sale at Sotheby’s last night. But the scene was more befitting a surrealist. Just hours before financial markets had one of their worst days in months. Embattled Italy threatened to destabilize the underpinnings of the global economy. Hundreds of protesters clamored outside the famed art house, alongside the buyers’ limousines, for greater income equality. Inside, the ultra-rich splashed out over $300 million in what connoisseurs called an epic auction.

Nov 8, 2011
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Citi risk measurement scheme warrants closer look

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

Walter Wriston, the vaunted former chairman of Citibank, famously said risk is a four-letter word. Vikram Pandit, chief executive of the larger successor organization, Citigroup, reckons it has nine letters: benchmark.

Nov 3, 2011
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P&G deal partner probe proves shorts aren’t nuts

By Jeffrey Goldfarb
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.Skeptical investors who went nuts over Diamond Foods may not be so crazy after all. More than a third of the snack food company’s shares were out on loan in late September in anticipation of the company’s planned December purchase of the Pringles brand from Procter & Gamble. That’s indicative of interest from short sellers, who questioned Diamond’s accounting. Now, the company is undertaking an internal investigation, putting the $2.6 billion deal on hold.

Diamond’s expansion plans excited shareholders. Its soaring stock price, which hit an all-time high of over $92 six weeks ago, reflected a heady enterprise value of more than 14 times pro forma EBITDA, including Pringles, for the 12 months to July 31. But the odd timing of certain payments made to suppliers – big enough amounts of money to potentially make the company’s results look materially different – piqued the interest of the shorts and other observers, including Breakingviews.

Oct 25, 2011
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Rupert Murdoch’s sham governance on full display

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

Rupert Murdoch still gets a kick out of the “fair and balanced” slogan used by his Fox News channel. He had a good laugh about it only last week at News Corp’s annual shareholder meeting. The results of a vote conducted at that gathering, released Monday, show that everyone’s now equally in on the joke about the company’s shameful corporate governance as they are the conservative bias of his TV news operation.