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Feb 3, 2011
via Breakingviews

U.S. directors are getting a J Crew makeover

By Rob Cox and Lisa Lee

American company directors may be getting a J Crew makeover of sorts. The anger that retailer elicited from investors in handling its buyout is creating ripples at other companies targeted by private equity buyers. It probably explains the decision by the academically-heavy board of BJ’s Wholesale to kick off an auction after six months of deer-in-the-headlights inaction. It’s a good sign for shareholder rights.

By hiring Morgan Stanley to explore options on Thursday, the $2.7 billion club retailer – which toils away in the shadows of mega-rivals Costco and Wal-Mart – is saying no to the kind of closed-door, sweetheart deal that J Crew CEO Millard “Mickey” Drexler engineered for himself and private equity backers TPG and Leonard Green & Partners. It’s no secret the latter has been itching to take BJ’s private for months.

Feb 2, 2011
via Breakingviews

Goldman shows a little leg

By Rob Cox

When Goldman Sachs released the findings of its Business Standards Committee and some new numbers on Jan. 11, investors focused on the bank’s heightened disclosure of its proprietary trading activity and profit. But regulators entrusted with a bigger responsibility — the safety of the financial system — are more excited about what Goldman has yet to reveal.

In its new disclosure, and again in its fourth-quarter earnings report on Jan. 19, Goldman added a fourth business segment, known as “Investing & Lending,” to its income statement, enabling analysts to see a bit more of the firm’s money-making machine. Yet Goldman’s business standards manifesto also promised expanded balance sheet disclosures. These are expected this month in the annual report.

Feb 1, 2011
via Breakingviews

Vikram Pandit can’t rock’n'roll like Guy Hands

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

Vikram Pandit has been banging his head for years over Citigroup’s financial problems. But that doesn’t qualify him as an expert on heavy metal. So expect the bank to quickly offload EMI, the Iron Maiden-to-Katy Perry music publishing and recording business it seized on Tuesday.

Jan 10, 2011
via Breakingviews

Playboy, like Hef’s sex life, better off private

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

NEW YORK — Some things, like Playboy founder Hugh Hefner’s sex life, are best kept behind closed doors. So it is with the massive restructuring of the media business built on Hef’s nudie magazine. Playboy may be iconic — but its future is bleak. So while the newly engaged octogenarian is still having his way with shareholders in his latest low-ball bid, they might as well take his money.

Jan 6, 2011
via Breakingviews

Goldman Facebook coup embarrasses rest of Wall St

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

Goldman Sachs’ rivals must be kicking themselves. The firm’s near $2 billion investment hook-up with Facebook is relatively small beans financially, but it’s a big win in franchise terms. After the lumps Goldman took last year, the deal shows the firm can still lead the way wrapping its tentacles around a key client for mutual benefit.

Dec 28, 2010
via Breakingviews

Will 2011 be the year that Facebook’s value gets real?

By Robert Cyran and Rob Cox

Facebook may at last become a real, rather than virtual, money spinner in 2011. The social network doesn’t need capital to grow, but expectations from backers and employees for an IPO are too high for founder Mark Zuckerberg to ignore. There’s just one challenge: trading in Facebook’s unlisted shares values the website at more than $40 billion. Getting to that number requires some astonishing growth assumptions.

That’s not to say it’s impossible for Facebook to attain a public market value at least as big as its current implied worth. Facebook is both valuable and becoming more so. It has more than 500 million users and it’s adding thousands by the minute. But rarely has a private company attracted such a large — and relatively liquid — financial status as Facebook.

Dec 22, 2010
via Breakingviews

Endangered financial species: U.S. community banks

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

NEW YORK — It’s the time of year when families gather to watch Jimmy Stewart play George Bailey, the small-town banker who with a little angelic intervention extends credit to his neighbors in “It’s a Wonderful Life.” Yet though Bailey remains emblematic of a benign banking system, most Americans probably don’t realize he’s the most endangered species in finance.

Dec 17, 2010
via Breakingviews

Buyout bigwigs get one-upped by community banker

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

It’s not every day that the barons of the buyout industry find themselves on the shorter end of a sweet deal. But that’s arguably the case in the turnaround of BankUnited, a relatively small Florida bank that’s about to return to the public markets. John Kanas, the seasoned Long Island banker who led the deal and runs the bank, is poised to skim off nearly $100 million of the profits his private equity partners will make.

Dec 14, 2010
via Breakingviews

Goldman has chance to top off Wall St governance

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

Wall Street rivals usually follow where Goldman Sachs leads. It is unlikely to be any different when the findings of Goldman’s Business Standards Committee become public early next year. But on one important point Goldman lags some big competitors — the separation of the chief executive and chairman jobs. Now it has a chance to catch up.

Dec 13, 2010
via Breakingviews

Energy bankers may be 2011′s hottest commodity

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

NEW YORK — Bankers in the oil and gas business know a thing or two about the laws of supply and demand. But they’re not accustomed to being the commodity in question. Some of the world’s cities may be overrun with financial types, but with energy sector activity rising they’re scarce in swampy, sprawling Houston. Bankers there may benefit accordingly in 2011.

    • About Rob

      "Rob Cox helped establish Breakingviews in 2000 in London. From 2004 he spearheaded the firm's expansion in the United States and edited its American edition, including the daily Breakingviews columns in the New York Times and Wall Street Journal. Rob has worked as a financial journalist in London, Milan, New York, Washington, Chicago and Tokyo. Rob graduated from Columbia University’s Journalism School and the University of Vermont. Follow Rob on Twitter @rob1cox"
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