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Jul 3, 2012
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Will Microsoft learn through self-flagellation?

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By Robert Cyran

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

Will Microsoft learn from self-flagellation? The software giant squandered shareholder treasure for years to break into internet services, gaming and consumer electronics. Writing down the $6 billion it blew on aQuantive in 2007 should mark a turning point where Microsoft at long last returns to its knitting and focuses on enterprise. Thankfully for its shareholders, there are glimmers that this may already be happening.

Jul 2, 2012
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Bristol-Myers and Astra make fat bet on obesity

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By Robert Cyran

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

Bristol-Myers Squibb and AstraZeneca have made a fat bet on obesity. The U.S. and UK drug giants are teaming up in the $7 billion purchase of Amylin Pharmaceuticals. Seven times estimated sales is a hefty price to pay for a biotech whose main drugs face stiff potential competition. But Amylin’s focus on diabetes, a sadly expanding market across the globe, makes this a healthier financial endeavor.

Jun 29, 2012
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iPhone anniversary marks triumph over crisis

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By Robert Cyran

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

Apple rolled out its iconic iPhone five years ago, just as Bear Stearns subprime hedge funds sounded the alarm on a systemic trauma. Financial woe often impedes development. But the iPhone is proof that innovation can defy the odds and overcome hard times.

Jun 27, 2012
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China’s U.S. home loan risks being a subprime idea

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By Robert Cyran

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

China Development Bank appears to be toying with a subprime idea. The Asian firm is considering lending U.S. homebuilder Lennar $1.7 billion to construct two housing projects, according to the Wall Street Journal – one of them on a polluted man-made island in an earthquake zone. It has all the hallmarks of globally distorted economic incentives forcing yield-starved investors to take risky bets they don’t understand.
 
Real estate investing can be tricky for any bank. And converting Treasure Island, a former naval base near San Francisco, into housing isn’t straightforward, due to the competing governmental, environmental and seismic issues. But a good rule of thumb holds that the further afield a project, the greater the danger that the lender is getting out of its depth.
 
Of course, the projects have potential. The timing looks promising, as they could be investing at, or near, the bottom for housing. Average home prices actually rose 1.3 percent in April, according to the S&P/Case Shiller index. These projects won’t be finished for a decade or more, by which point markets could once again be sizzling. San Francisco has few spaces as well placed geographically as these two for big developments. And China Development Bank isn’t completely naïve – it has increasing amounts of experience investing in countries ranging from Australia to Pakistan.

Jun 26, 2012

BREAKINGVIEWS:China’s U.S. home loan risks being a subprime idea

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

By Robert Cyran

NEW YORK, June 26 (Reuters Breakingviews) – China
Development Bank appears to be toying with a subprime idea. The
Asian firm is considering lending U.S. homebuilder Lennar
(LEN.N: Quote, Profile, Research) $1.7 billion to construct two housing projects,
according to the Wall Street Journal – one of them on a polluted
man-made island in an earthquake zone. It has all the hallmarks
of globally distorted economic incentives forcing yield-starved
investors to take risky bets they don’t understand.

Jun 22, 2012
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Canada scraps to sidestep U.S.-like housing woes

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

Canada is doing its best to avoid the housing woes experienced by its neighbor to the south. A new set of mortgage reforms will make it even harder for Canucks to borrow. Yet ultra-low interest rates keep feeding a residential real estate boom that three previous government initiatives haven’t stopped. Prudent regulation can only limit so much the distortions created by easy money.

Jun 20, 2012
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Quest board cleverly squeezes more out of MBO

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By Robert Cyran

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

Quest Software’s directors have come up with a canny plan to squeeze more money out of a buyout offer backed by Chief Executive Vincent Smith. They were put on the defensive in March when Smith, who owns a third of the enterprise software company, teamed up with private equity shop Insight Venture Partners for a lowball bid. But independent board members managed to level the playing field by offering Dell an option to acquire a 19.9 percent stake in the firm if Smith didn’t support its superior bid. That bagged shareholders a 12 percent bump in the purchase price.

Jun 19, 2012
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KKR gets rich prescription for top-of-market LBO

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By Robert Cyran and Quentin Webb
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

KKR has found the right formula to exit Alliance Boots, its top-of-the-market drugstore deal. Walgreen’s two-stage acquisition of its European rival should more than double the investment KKR and its partners made at the peak of the leveraged buyout frenzy. What the U.S. drug chain’s investors will get for their money – as much as $16.2 billion – is harder to fathom.

The first stage sees Walgreen pay about $6.7 billion in cash and stock for 45 percent of Boots. The firm’s ownership is currently split fairly equally between KKR funds, Boots Executive Chairman Stefano Pessina and outside investors. Pessina, who will become a Walgreen director, takes proportionately more stock than the financial investors.

Jun 19, 2012
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Microsoft tablet suffers from lack of greatness

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By Robert Cyran

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

Microsoft has managed to pull off a welcome surprise. Considering the software giant’s poor track record selling consumer gadgets, few would have been surprised if it managed to produce another doozy with its foray into the market for tablets. But Microsoft’s “Surface,” which it introduced late Monday afternoon, shows it is getting the hang of it. But with other firms already well entrenched, producing just a decent offering probably isn’t enough.

Jun 12, 2012

Breakingviews: Apple and Facebook become frenemies versus Google

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

By Robert Cyran

NEW YORK (Reuters Breakingviews) – Apple (AAPL.O: Quote, Profile, Research) and Facebook (FB.O: Quote, Profile, Research) have become frenemies versus Google (GOOG.O: Quote, Profile, Research). The iPhone maker hasn’t figured out social networks. Remember Ping? Facebook fears losing control to the makers of operating systems powering mobile gadgets. Making the social network work smoothly on Apple devices can boost revenue for both – and allow them to thwart their mutual nemesis Google.

    • About Robert

      "Robert Cyran, U.S. tech columnist, joined Breakingviews in London in 2003 and moved four years later to New York, where he continues to cover global technology, pharmaceuticals and special situations. Robert began his career at Forbes magazine, where he assisted in the start-up of the international version of the magazine. Before working at Breakingviews he worked as a market researcher and reporter covering the pharmaceutical industry. Robert has a Masters degree in economics from Birmingham University and an undergraduate degree from George Washington University."
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