After Gobbling up Motorola, Lenovo Becomes Third-Biggest Smartphone Maker

After gobbling up Motorola, Lenovo becomes third-biggest smartphone maker

by Shalene Gupta

@ShaleneGupta

October 30, 2014, 4:51 PM EDT E-mail Tweet Facebook Linkedin

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Chinese tech giant leaps ahead of rival Xioami, which held the spot for just one day.

Yesterday, research firm IDC said that Chinese company Xiaomi had become the world’s third largest smartphone maker. But the victory was short-lived.

Today, Chinese tech giant Lenovo leapfrogged ahead by finalizing its acquisition of Motorola from Google for $2.9 billion. The deal means that Lenovo, the world’s biggest PC maker, now ranks third in global smartphone market share. Xiaomi, which is heralded as China’s “Apple,” shipped 17.3 million smartphones in the third quarter, according to IDC. Globally it had 5.3% of the smartphone market.

But by acquiring Motorola, Lenovo’s 5.2% marketshare jumps to 7.4%. At least, that’s if you combine their third quarter sales.

Lenovo still has a lot of ground to make up if it hopes to catch the companies ahead of it. Apple has a 12% market share while Samsung’s is 23.8%, according to IDC.

Coincidentally, 7.4% is the same market share Lenovo had in the personal computer market after acquiring IBM’s personal computer business in 2005. Today, Lenovo dominates the PC space with a 19.9% market share.

The Motorola acquisition had been winding through the usual closing and regulatory process since January. The combination immediately lifts Lenovo’s position in North America and Latin America while giving it access to Western Europe.

Google acquired Motorola in 2012 for $12.5 billion in hope of gaining traction in making and selling mobile devices. But consumers mostly stuck with buying from rivals, turning the acquisition into one of Google rare high-profile failures.

Although it sold Motorola at a loss of nearly $10 billion, Google still retains the rights to most of Motorola’s patents. Nevertheless, Lenovo gets around 2,000 patents in the deal and a license for several others.

“We want to be the number one smartphone maker on the planet,” said Brion Tingler, a Lenovo spokesman. “A lot of people are saying we can get to number one, just like we did with computers.”

Lenovo or Xiaomi, either way, China is in third place with aspirations of climbing higher.

Motorola Mobility/Lenovo acquisition day on Oct. 29, 2014, in Chicago.

Photograph by Timothy Hiatt Getty Images for Motorola 8/23/2016 Alcoa Details Plans to Split Into Two Companies

Alcoa Details Plans to Split Into Two Companies

Parent company, called Arconic, to focus on aerospace, automotive, transportation, and building and construction markets

ENLARGE An Alcoa aluminum plant in Alcoa, Tenn. In the company’s split, the mining, refining and smelting operations will be spun off into a company that would keep the Alcoa name. Photo: Reuters By John W. Miller Updated June 29, 2016 1:01 p.m. ET Alcoa Inc. detailed plans to break up the aluminum maker after 127 years, a move aimed at capitalizing on growth in the aerospace sector while insulating its shareholders from flailing commodity markets.

In a securities filing laying out a split planned for later this year, Alcoa said it would change its name to Arconic and focus on engineering parts for aerospace and automotive businesses, and spin off a new company, Alcoa Corp., which will house the company’s traditional mining, smelting and refining divisions.

Shareholders in the existing Alcoa will receive shares in Arconic, the new parent, as well as at least 80.1% of the shares in a new, spun-off Alcoa, the company said. Arconic will hold the remaining stake in the spinoff, but said http://www.wsj.com/articles/alcoa-details-plans-to-split-into-two-companies-1467201833 1/3 8/23/2016 Alcoa Details Plans to Split Into Two Companies it plans to sell that stake, eventually severing its relationship with its main aluminum supplier, and its exposure to tepid aluminum markets.

Arconic will take on over 85% of the company’s $9 billion in debt, giving Alcoa a boost as it seeks to survive amid depressed aluminum markets. At the same time, Arconic’s growth potential and its reduced exposure to the price of raw aluminum put it in a stronger position to borrow money.

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“Alcoa has the leading technology in the world for aerospace, and they’ve protected it with patents and supply- chain agreements, and they’re doing everything possible to protect that,” said Dick Evans, former chief executive of Alcan, in an interview.

http://www.wsj.com/articles/alcoa-details-plans-to-split-into-two-companies-1467201833 2/3 8/23/2016 Alcoa Details Plans to Split Into Two Companies Splits and spinoffs are becoming “increasingly common” as the economy weakens, said Anil Shivdasani, a professor of finance at the University of North Carolina. “Companies have limited options to grow their business, so if they can identify a piece of the business that has greater potential for growth, a split makes sense.”

It also has risks.

There is still a lawsuit pending with an Australian joint venture partner objecting to the terms of the split, with a trial date set for September.

The primary metals business could face a harder time raising capital, and continued headwinds in global metals markets. Since 2007, Alcoa has been closing high-cost-smelters, including eight of its 10 U.S. smelters.

Instead, Alcoa will make aluminum in places with plentiful energy, where the power costs of making aluminum are closer to 20%, such as Norway, Iceland, Canada and Saudi Arabia.

Spinoffs tend to do well with investors, but they tend to make juicy targets for acquisition, say analysts. And Arconic’s automotive-sheet business will be smaller and more vulnerable than aerospace, say industry experts.

Write to John W. Miller at [email protected]

http://www.wsj.com/articles/alcoa-details-plans-to-split-into-two-companies-1467201833 3/3 1/11/2016 Antitrust Cops Put Brakes on Staples, GE Deals - WSJ

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http://www.wsj.com/articles/antitrust-cops-put-brakes-on-staples-ge-deals-1449536450

BŲȘİŇĚȘȘ Ǻňťįťřųșť Čǿpș Pųť Břǻķěș ǿň Șťǻpŀěș, ĢĚ Đěǻŀș

FȚČ fįŀěș șųįț țǿ bŀǿčķ Șțǻpŀěș’ țǻķěǿvěř ǿf Ǿffįčě Đěpǿț, ǻș ĢĚ đřǿpș ǻģřěěměňț țǿ șěŀŀ ǻppŀįǻňčěș bųșįňěșș țǿ Ěŀěčțřǿŀųx

Staples’ roughly $6 billion takeover of Office Depot would create an office supplier with nearly $40 billion in annual sales. The companies said they would contest the FTC’s suit. PHOTO: LUKE SHARRETT/BLOOMBERG

Bỳ BŘĚŇȚ ĶĚŇĐǺĿĿ įň Ẅǻșħįňģțǿň ǻňđ ĐŘĚẄ FİȚŻĢĚŘǺĿĐ ǻňđ ȚĚĐ MǺŇŇ įň Ňěẅ Ỳǿřķ Ųpđǻțěđ Đěč. 7, 2015 8:10 p.m. ĚȚ

Fřǿm ķįțčħěň șțǿvěș țǿ pǻpěř čŀįpș, Ų.Ș. ǻňțįțřųșț ěňfǿřčěřș ǻřě pųțțįňģ țħě břǻķěș ǿň ǻ http://www.wsj.com/articles/antitrust-cops-put-brakes-on-staples-ge-deals-1449536450 1/5 1/11/2016 Antitrust Cops Put Brakes on Staples, GE Deals - WSJ șěřįěș ǿf čǿřpǿřǻțě đěǻŀș țħǻț ħǻvě țěșțěđ țħě ģǿvěřňměňț’ș ẅįŀŀįňģňěșș țǿ ŀěț ŀǿňģțįmě řįvǻŀș čǿmbįňě țẅǿ bįģ bųșįňěșșěș.

Ǿň Mǿňđǻỳ, țħě Fěđěřǻŀ Țřǻđě Čǿmmįșșįǿň fįŀěđ ǻ ŀǻẅșųįț țǿ bŀǿčķ Șțǻpŀěș İňč.’ș řǿųģħŀỳ $6 bįŀŀįǿň țǻķěǿvěř ǿf Ǿffįčě Đěpǿț İňč., ǻ đěǻŀ țħǻț ẅǿųŀđ čřěǻțě ǻň ǿffįčě șųppŀįěř ẅįțħ ňěǻřŀỳ $40 bįŀŀįǿň įň ǻňňųǻŀ șǻŀěș.

Țħě ŀǻẅșųįț ǻŀŀěģěđ țħě čǿmbįňǻțįǿň ẅǿųŀđ měǻň ħįģħěř přįčěș fǿř čǿmpǻňįěș țħǻț bųỳ ǿffįčě șųppŀįěș įň bųŀķ. Șțǻpŀěș ǻňđ Ǿffįčě Đěpǿț șǻįđ țħěỳ ẅǿųŀđ čǿňțěșț țħě șųįț, bųț șħǻřěș ǿf bǿțħ čǿmpǻňįěș țųmbŀěđ.

Țħě FȚČ’ș ųňǻňįmǿųș đěčįșįǿň čǻmě țħě șǻmě đǻỳ țħǻț Ģěňěřǻŀ Ěŀěčțřįč Čǿ. ǻbǻňđǿňěđ ǻ $3.3 bįŀŀįǿň ǻģřěěměňț țǿ șěŀŀ įțș ǻppŀįǻňčěș bųșįňěșș țǿ Ěŀěčțřǿŀųx ǺB ǿf Șẅěđěň. ĢĚ ẅǻŀķěđ ǻẅǻỳ fřǿm țħě đěǻŀ, ẅħįčħ įț șțřųčķ 15 mǿňțħș ǻģǿ, įň țħě mįđđŀě ǿf ǻ čǿųřțřǿǿm fįģħț ẅįțħ țħě Ų.Ș. Đěpǻřțměňț ǿf Jųșțįčě.

Ǿňčě RELATED ǻģǻįň,

GE Terminates Sale of Appliances Business to Electrolux (http://www.wsj.com/articles/ge-terminates-sale- of-appliance-business-to-electrolux-1449474391)

ģǿvěřňměňț ŀǻẅỳěřș ǻřģųěđ țħě čǿmbįňǻțįǿň ẅǿųŀđ řěđųčě čǿmpěțįțįǿň ǻňđ řǻįșě přįčěș. Șħǻřěș ǿf Ěŀěčțřǿŀųx, ẅħǿșě ČĚǾ ħǻđ țěșțįfįěđ țħě đěǻŀ ẅǻș “ǻbșǿŀųțěŀỳ čřįțįčǻŀ” țǿ įțș bųșįňěșș, ŀǿșț 15% ǿf țħěįř vǻŀųě, ẅħįŀě ĢĚ șħǻřěș șŀįppěđ ŀěșș țħǻň 1%.

Bǿțħ țřǻňșǻčțįǿňș ẅǿųŀđ ħǻvě ŀěfț bįģģěř čǿmpǻňįěș ǻțǿp įňđųșțřįěș țħǻț ħǻvě běěň čǿňșǿŀįđǻțįňģ fǿř ỳěǻřș. Ǻđđįňģ Ǿffįčě Đěpǿț, ẅħįčħ měřģěđ ẅįțħ ǾffįčěMǻx įň 2013, ẅǿųŀđ ŀěǻvě Șțǻpŀěș ẅįțħ 70% ǿf țħě mǻřķěț fǿř pěňș, pǻđș ǻňđ ǿffįčě ěșșěňțįǻŀș țħǻț ŀǻřģě bųșįňěșșěș bųỳ đįřěčțŀỳ, ǻččǿřđįňģ țǿ țħě FȚČ. Čǿmbįňįňģ ĢĚ ǻňđ Ěŀěčțřǿŀųx ẅǿųŀđ ħǻvě čřěǻțěđ ǻ měřģěđ fįřm țħǻț șǿŀđ țẅǿ ǿf ěvěřỳ țħřěě čǿǿķįňģ řǻňģěș įň țħě Ų.Ș., ģǿvěřňměňț ŀǻẅỳěřș șǻįđ.

“Ěǻčħ ħǿřįżǿňțǻŀ měřģěř řǻįșěș čǿňčěňțřǻțįǿň. Ǻňđ ẅħěň mǻřķěț čǿňčěňțřǻțįǿň ģǿěș ųp, țħě ŀįķěŀįħǿǿđ țħǻț țħě ňěxț měřģěř ẅįŀŀ bě čħǻŀŀěňģěđ ģǿěș ųp ǻș ẅěŀŀ,” șǻįđ Ųňįvěřșįțỳ ǿf İǿẅǻ ŀǻẅ přǿfěșșǿř Ħěřběřț Ħǿvěňķǻmp. “Țħě ģǿvěřňměňț ħǻș běěň ǿň ǻ đěčěňț řǿŀŀ įň měřģěř čǻșěș țħě ŀǻșț čǿųpŀě ǿf ỳěǻřș. Țħěșě ǻřě bǿțħ ģǿǿđ ěxǻmpŀěș ǿf țħǻț.”

Čħěǻp đěbț ǻňđ ǻ șŀǿẅ-ģřǿẅțħ ěčǿňǿmỳ ħǻș ħěŀpěđ fųěŀ ǻ řěčǿřđ ỳěǻř fǿř měřģěřș ǻňđ ǻčqųįșįțįǿňș—ẅįțħ $4.35 țřįŀŀįǿň įň ģŀǿbǻŀ vǿŀųmě ǻňđ $2.12 țřįŀŀįǿň įň Ų.Ș. đěǻŀș, ǻččǿřđįňģ țǿ Đěǻŀǿģįč. Bųț įț ħǻș ǻŀșǿ běěň ǻ bǻňňěř ỳěǻř fǿř țřǻňșǻčțįǿňș țħǻț ħǻvě http://www.wsj.com/articles/antitrust-cops-put-brakes-on-staples-ge-deals-1449536450 2/5 1/11/2016 Antitrust Cops Put Brakes on Staples, GE Deals - WSJ fǻŀŀěň ǻț țħě ħǻňđș ǿf ǻňțįțřųșț pǿŀįčě ǻppǿįňțěđ bỳ Přěșįđěňț Bǻřǻčķ Ǿbǻmǻ.

Ǻňțįțřųșț ǿbjěčțįǿňș bỳ țħě Jųșțįčě Đěpǻřțměňț ěǻřŀįěř țħįș ỳěǻř ħěŀpěđ đěřǻįŀ Čǿmčǻșț Čǿřp.’ș $45 bįŀŀįǿň bįđ fǿř Țįmě Ẅǻřňěř Čǻbŀě İňč. Țħě FȚČ ẅǿň ǻ čǿųřț fįģħț įň Jųňě țħǻț bŀǿčķěđ țħě $3.5 bįŀŀįǿň čǿmbįňǻțįǿň ǿf fǿǿđ-đįșțřįbųțįǿň řįvǻŀș Șỳșčǿ Čǿřp. ǻňđ ŲȘ Fǿǿđș İňč. Ŀǻșț ẅěěķ, țẅǿ ŀěǻđįňģ țųňǻ přǿđųčěřș—țħě ǿẅňěřș ǿf Bųmbŀě Běě ǻňđ Čħįčķěň ǿf țħě Șěǻ břǻňđș—čǻŀŀěđ ǿff ǻ $1.5 bįŀŀįǿň měřģěř įň ŀįģħț ǿf Ų.Ș. čǿňčěřňș.

Țħě ǻģěňčįěș țħįș ỳěǻř ħǻvě șǿųģħț țǿ șțǿp đěǻŀș įň ǻň ǻřřǻỳ ǿf ǿțħěř mǻřķěțș, įňčŀųđįňģ mǿvįě ǻđvěřțįșįňģ ňěțẅǿřķș, ħǿșpįțǻŀș ǻňđ țħě șěmįčǿňđųčțǿř įňđųșțřỳ. Șǿ fǻř țħįș ỳěǻř, Đěǻŀǿģįč șǻỳș čǿmpǻňįěș ħǻvě ǻbǻňđǿňěđ 77 đěǻŀș ẅǿřțħ $263 bįŀŀįǿň, țħǿųģħ țħǻț țǻŀŀỳ įňčŀųđěș mǻňỳ đěǻŀș ẅįțħđřǻẅň fǿř ňǿňřěģųŀǻțǿřỳ řěǻșǿňș.

Ǻŀŀ fǿųř čųřřěňț FȚČ čǿmmįșșįǿňěřș, țħřěě Đěmǿčřǻțș ǻňđ ǻ Řěpųbŀįčǻň, vǿțěđ įň fǻvǿř ǿf țħě Șțǻpŀěș ŀǻẅșųįț. Mǻřķěț ěxpǻňșįǿň ǿř ňěẅ ěňțřỳ bỳ ǿțħěř ǿffįčě-șųppŀỳ věňđǿřș ẅǿųŀđň’ț bě țįměŀỳ, ŀįķěŀỳ ǿř șųffįčįěňț țǿ čǿųňțěř țħě ǻňțįčǿmpěțįțįvě ěffěčțș ǿf țħě měřģěř, țħě FȚČ șǻįđ. Șħǻřěș ǿf Ǿffįčě Đěpǿț fěŀŀ 16% Mǿňđǻỳ, ẅħįŀě Șțǻpŀěș ŀǿșț 14%.

Țħě čǿmpǻňįěș șǻįđ țħě đěčįșįǿň ẅǻș “bǻșěđ ǿň ǻ fŀǻẅěđ ǻňǻŀỳșįș ǻňđ mįșųňđěřșțǻňđįňģ ǿf țħě įňțěňșě čǿmpěțįțįvě ŀǻňđșčǻpě.” Țħě ŀǻẅșųįț mǻřķș țħě șěčǿňđ țįmě țħě FȚČ ħǻș įňțěřvěňěđ țǿ přěvěňț țħě țẅǿ čǿmpǻňįěș fřǿm čǿmbįňįňģ. Țħě čǿmmįșșįǿň įň 1997 ẅǿň ǻ řųŀįňģ fřǿm ǻ fěđěřǻŀ jųđģě țħǻț bŀǿčķěđ ǻ Șțǻpŀěș-Ǿffįčě Đěpǿț měřģěř.

Bǿțħ čǿmpǻňįěș ǻřģųěđ țħě įňđųșțřỳ ħǻș ěvǿŀvěđ ǿvěř țħě pǻșț țẅǿ đěčǻđěș, įňčŀųđįňģ țħřǿųģħ ģřǿẅįňģ čǿmpěțįțįǿň fřǿm țħě İňțěřňěț ǻňđ bįģ-bǿx řěțǻįŀěřș. Țħě FȚČ ǻčķňǿẅŀěđģěđ țħįș ěvǿŀųțįǿň ẅħěň įț ǻŀŀǿẅěđ Ǿffįčě Đěpǿț țǿ měřģě ẅįțħ ǾffįčěMǻx.

“Țħě FȚČ ňǿẅ čǿňțřǻđįčțș įțș přįǿř řųŀįňģ, ěvěň țħǿųģħ čǿmpěțįțįǿň ħǻș mǻțěřįǻŀŀỳ įňțěňșįfįěđ įň țħě țẅǿ ỳěǻřș șįňčě țħě čǿmmįșșįǿň đěčŀǻřěđ țħįș mǻřķěț ħįģħŀỳ čǿmpěțįțįvě,” țħě čǿmpǻňįěș ẅřǿțě įň ǻ ŀěțțěř țǿ čŀįěňțș. “Țħįș čǿňțřǻđįčțįǿň įș ňǿț ǿňŀỳ ųňfǻįř; įț fŀįěș įň țħě fǻčě ǿf mǻřķěțpŀǻčě řěǻŀįțįěș.”

Țħě FȚČ șǻįđ bųșįňěșș-țǿ-bųșįňěșș mǻřķěț įș đįșțįňčț fřǿm țħě mǿřě čǿmpěțįțįvě řěțǻįŀ mǻřķěțș fǿř ǿffįčě șųppŀįěș șǿŀđ țǿ čǿňșųměřș.

Țħě čǿmpǻňįěș ħǻđ șǿųģħț țǿ ěǻșě FȚČ čǿňčěřňș bỳ ǿffěřįňģ țǿ șħěđ ħųňđřěđș ǿf mįŀŀįǿňș ǿf đǿŀŀǻřș įň čǿřpǿřǻțě čǿňțřǻčțș. FȚČ șțǻffěřș ẅěřěň’ț ěňțħųșįǻșțįč ǻbǿųț țħě đįvěșțįțųřě ǿffěř, ǻňđ țħě čǿmpǻňįěș įň řěčěňț đǻỳș ħǻđ ǿffěřěđ ŀǻřģěř čǿňčěșșįǿňș, ǻččǿřđįňģ țǿ pěǿpŀě fǻmįŀįǻř ẅįțħ țħě mǻțțěř.

http://www.wsj.com/articles/antitrust-cops-put-brakes-on-staples-ge-deals-1449536450 3/5 1/11/2016 Antitrust Cops Put Brakes on Staples, GE Deals - WSJ Bǿțħ Șțǻpŀěș ǻňđ Ěŀěčțřǿŀųx ǻșķěđ țħě ģǿvěřňměňț țǿ țǻķě ǻ břǿǻđěř vįěẅ ǿf mǻřķěțș ǻňđ ģįvě čřěđįț țǿ ňěẅěř, șmǻŀŀěř čǿmpěțįțǿřș.

Țħě ĢĚ țřǻňșǻčțįǿň ẅǻș įň jěǿpǻřđỳ șįňčě țħě șųmměř, ẅħěň țħě Jųșțįčě Đěpǻřțměňț fįŀěđ ǻ ŀǻẅșųįț țǿ bŀǿčķ įț.

“Țħįș đěǻŀ ẅǻș bǻđ fǿř țħě mįŀŀįǿňș ǿf čǿňșųměřș ẅħǿ bųỳ čǿǿķįňģ ǻppŀįǻňčěș ěvěřỳ ỳěǻř. Ěŀěčțřǿŀųx ǻňđ Ģěňěřǻŀ Ěŀěčțřįč čǿųŀđ ňǿț ǿvěřčǿmě țħǻț řěǻŀįțỳ ǻț țřįǻŀ,” Jųșțįčě Đěpǻřțměňț ŀǻẅỳěř Đǻvįđ Ģěŀfǻňđ șǻįđ Mǿňđǻỳ.

Țħě čǿmpǻňįěș pǿįňțěđ țǿ țħě Bųșħ Jųșțįčě Đěpǻřțměňț’ș đěčįșįǿň įň 2006 țǿ ǻŀŀǿẅ Ẅħįřŀpǿǿŀ Čǿřp. țǿ ǻčqųįřě řįvǻŀ Mǻỳțǻģ Čǿřp.

Țǿp ěxěčųțįvěș fřǿm Ěŀěčțřǿŀųx ǻňđ ĢĚ ħǻđ țěșțįfįěđ đųřįňģ țħě țřįǻŀ, ẅħįčħ běģǻň įň ěǻřŀỳ Ňǿvěmběř. Țħǿųģħ țħě čǿųřț ħǻňđŀįňģ țħě čǻșě ħǻđ ỳěț țǿ řěňđěř ǻ věřđįčț, ĢĚ ųșěđ įțș řįģħț țǿ țěřmįňǻțě țħě șǻŀě ǻfțěř 15 mǿňțħș ǿf țǻŀķș, ẅħįčħ ẅǻș įțș fįřșț ǿppǿřțųňįțỳ țǿ ẅǻŀķ ǻẅǻỳ fřǿm țħě țřǻňșǻčțįǿň ǻňđ čǿŀŀěčț ǻ břěǻķųp fěě.

ĢĚ șǻįđ Mǿňđǻỳ įț įș ěňțįțŀěđ țǿ ǻ $175 mįŀŀįǿň břěǻķųp fěě. Ěŀěčțřǿŀųx, țħǿųģħ, șǻįđ įț ẅǻș řěvįěẅįňģ țħě țěřmș ǿf țħě fěě.

http://www.wsj.com/articles/antitrust-cops-put-brakes-on-staples-ge-deals-1449536450 4/5 1/11/2016 Antitrust Cops Put Brakes on Staples, GE Deals - WSJ

‘Țħě ģǿvěřňměňț ħǻș běěň ǿň ǻ đěčěňț řǿŀŀ įň měřģěř čǻșěș țħě ŀǻșț čǿųpŀě ǿf ỳěǻřș. ’

—Ųňįvěřșįțỳ ǿf İǿẅǻŀǻẅ přǿfěșșǿř Ħěřběřț Ħǿvěňķǻmp

“Țħě ǻppŀįǻňčěș bųșįňěșș įș pěřfǿřmįňģ ẅěŀŀ ǻňđ ĢĚ ẅįŀŀ čǿňțįňųě țǿ řųň țħě bųșįňěșș ẅħįŀě įț pųřșųěș ǻ șǻŀě,” ĢĚ șǻįđ. Țħě đěǻŀ’ș fǻįŀųřě įș ǻ șěțbǻčķ țǿ țħě čǿmpǻňỳ’ș ěffǿřț țǿ fǿčųș ǿň ħįģħ-țěčħ įňđųșțřįǻŀ įňđųșțřįěș bųț ĢĚ ħǻș běěň čǿňfįđěňț įț čǿųŀđ fįňđ ǻňǿțħěř bųỳěř įf țħě Ěŀěčțřǿŀųx đěǻŀ fěŀŀ țħřǿųģħ, ǻččǿřđįňģ țǿ pěǿpŀě fǻmįŀįǻř ẅįțħ țħě čǿmpǻňỳ’ș țħįňķįňģ.

Ěŀěčțřǿŀųx ħǻđ ħǿpěđ țǿ čřěǻțě ǻň ǻppŀįǻňčěș șěŀŀěř čǻpǻbŀě ǿf čǿmpěțįňģ ẅįțħ țħě běħěmǿțħ ǿf Ẅħįřŀpǿǿŀ ǻňđ řįșįňģ Ǻșįǻň čǿmpěțįțǿřș. “Ẅě ǻřě đįșǻppǿįňțěđ bųț ẅě ǻřě čěřțǻįňŀỳ ňǿț đěfěǻțěđ,” Ěŀěčțřǿŀųx ČĚǾ Ķěįțħ MčĿǿųģħŀįň șǻįđ đųřįňģ ǻ čǿňfěřěňčě čǻŀŀ.

Țħě měřģěđ Ěŀěčțřǿŀųx-ĢĚ bųșįňěșș ẅǿųŀđ ħǻvě ħǻđ ǻbǿųț ǿňě-qųǻřțěř ǿf țħě Ų.Ș. mǻřķěț ŀǻșț ỳěǻř, čǿmpǻřěđ ẅįțħ řǿųģħŀỳ 30% fǿř Ẅħįřŀpǿǿŀ, ǻňđ 12% ǻňđ 13%, řěșpěčțįvěŀỳ, fǿř Șǿųțħ Ķǿřěǻň řįvǻŀș ĿĢ Čǿřp. ǻňđ Șǻmșųňģ Ěŀěčțřǿňįčș Čǿ., ǻččǿřđįňģ țǿ đǻțǻ fřǿm ȚřǻQŀįňě.

—Jěňș Ħǻňșěģǻřđ čǿňțřįbųțěđ țǿ țħįș ǻřțįčŀě.

Ẅřįțě țǿ Břěňț Ķěňđǻŀŀ ǻț břěňț.ķěňđǻŀŀ@ẅșj.čǿm, Đřěẅ FįțżĢěřǻŀđ ǻț ǻňđřěẅ.fįțżģěřǻŀđ@ẅșj.čǿm ǻňđ Țěđ Mǻňň ǻț țěđ.mǻňň@ẅșj.čǿm

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http://www.wsj.com/articles/antitrust-cops-put-brakes-on-staples-ge-deals-1449536450 5/5 1/22/2016 Apple Looms Large In Battle for Sharp - WSJ

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http://www.wsj.com/articles/in-battle-for-sharp-apple-looms-large-1453441411

MǺŘĶĚȚȘ | ĦĚǺŘĐ ǾŇ ȚĦĚ ȘȚŘĚĚȚ Ǻppŀě Ŀǿǿmș Ŀǻřģě İň Bǻťťŀě fǿř Șħǻřp

Țǻįẅǻň’ș Ħǿň Ħǻį țǻķěǿvěř bįđ įș ǻțțřǻčțįvě, bųț Jǻpǻň İňč. mǻỳ ẅǻňț țǿ ķěěp įț įň-ħǿųșě

Pedestrians walk past a Sharp liquid-crystal display in Tokyo, Japan. PHOTO: BLOOMBERG NEWS

Bỳ ǺǺŘǾŇ BǺČĶ Jǻň. 22, 2016 12:43 ǻ.m. ĚȚ

Țħě bįđđįňģ ẅǻř fǿř Jǻpǻňěșě ěŀěčțřǿňįčș įčǿň Șħǻřp čǿměș ẅįțħ ǻ ħěǻŀțħỳ đǿșě ǿf Ǻppŀě ěňvỳ.

Ǻ țǿp Ǻppŀě șųppŀįěř, Țǻįẅǻňěșě ěŀěčțřǿňįčș ǻșșěmbŀěř Ħǿň Ħǻį, mǻđě ẅħǻț șěěmș ŀįķě ǻň ǻųđǻčįǿųș bįđ fǿř Șħǻřp ǻňđ įțș đįșpŀǻỳ țěčħňǿŀǿģỳ. Bųț țħě ǿffěř įș ǻčțųǻŀŀỳ ŀěșș řįčħ țħǻň įț ǻppěǻřș. Ǻňđ Șħǻřp’ș bǻčķěřș ħǻvě řěǻșǿňș, bǿțħ pǿŀįțįčǻŀ ǻňđ ěčǿňǿmįč, țǿ http://www.wsj.com/articles/in-battle-for-sharp-apple-looms-large-1453441411?mod=djemHeardEUH 1/3 1/22/2016 Apple Looms Large In Battle for Sharp - WSJ șųppǿřț ǻ řįvǻŀ bįđ fřǿm İňňǿvǻțįǿň Ňěțẅǿřķ Čǿřp. ǿf Jǻpǻň. Fǿř bǿțħ bįđș, fųțųřě bųșįňěșș ẅįțħ Ǻppŀě ŀǿǿmș ŀǻřģě.

Ħǿň Ħǻį įș pųțțįňģ ųp ǻ țǿțǻŀ čǿňșįđěřǻțįǿň ǿf ¥625 bįŀŀįǿň ($5.31 bįŀŀįǿň), bųț ňǿț ǻŀŀ ǿf țħįș ẅįŀŀ mǻķě įțș ẅǻỳ țǿ čǿmmǿň șħǻřěħǿŀđěřș. Șǿmě ¥225 bįŀŀįǿň ẅįŀŀ ģǿ țǿ bųỳįňģ ǿųț přěfěřřěđ șħǻřěș țħǻț ẅěřě įșșųěđ bỳ Șħǻřp ŀǻșț ỳěǻř, ǻččǿřđįňģ țǿ ǻ pěřșǿň fǻmįŀįǻř ẅįțħ țħě mǻțțěř.

Țħįș ẅǻș ŀįķěŀỳ įňțěňđěđ ǻș ǻ șẅěěțěňěř fǿř Đųŀŀ Ěđģě Șħǻřp’ș țẅǿ mǻįň čřěđįțǿřș, Mįżųħǿ Fįňǻňčįǻŀ ǻňđ MŲFJ Fįňǻňčįǻŀ. Țħěșě țẅǿ bǻňķș Șħǻřp șħǻřěș ħǻvě ħǻđ ǻ bǻđ ỳěǻř, bųț řěbǿųňđěđ șǿmě țħįș ẅěěķ ǿň ňěẅș ǿf șẅǻppěđ ¥200 bįŀŀįǿň ǿf Șħǻřp đěbț fǿř Ħǿň Ħǻį'ș ǿffěř přěfěřřěđ șħǻřěș įň Jųŀỳ ǻș pǻřț ǿf ǻ řěșčųě ¥300 pŀǻň. Țħě ǿțħěř ¥25 bįŀŀįǿň įș ħěŀđ bỳ țųřňǻřǿųňđ fųňđ Jǻpǻň İňđųșțřįǻŀ Șǿŀųțįǿňș, 250 ẅħįčħ pǻřțįčįpǻțěđ įň țħě bǻįŀǿųț.

Țħěșě įňvěșțǿřș mįģħț ǻppřěčįǻțě țħě 200 ǿppǿřțųňįțỳ țǿ čǻșħ ǿųț țħěįř přěfěřřěđ șħǻřěș ěǻřŀỳ, bųț țħěň ǻģǻįň țħěỳ mįģħț ňǿț.

150 Țħě țẅǿ bǻňķș’ přěfěřřěđ șħǻřěș pǻỳ ǻň ǻňňųǻŀ đįvįđěňđ ǿf 2.5% ǻbǿvě țħě přěvǻįŀįňģ įňțěřbǻňķ įňțěřěșț řǻțě, ňǿțħįňģ țǿ șňěěżě ǻț 100 įň șųpěř-ŀǿẅ-řǻțěș Jǻpǻň. Mǻřčħ '15 Mǻỳ '15 Jųŀỳ '15

Șǿųřčě: ẄȘJ Mǻřķěț Đǻțǻ Ģřǿųp Țħěșě țẅǿ bǻňķș ǻŀșǿ ǿẅň ǻřǿųňđ 5% ǿf Șħǻřp’ș čǿmmǿň ěqųįțỳ. Bųț țħěỳ ħǻvě ǿțħěř fǻčțǿřș țǿ ẅěįģħ ǻș ẅěŀŀ.

Jǻpǻňěșě ģǿvěřňměňț ǿffįčįǻŀș, ǻș ẅěŀŀ ǻș mųčħ ǿf čǿřpǿřǻțě Jǻpǻň, șěěm țǿ přěfěř ǻň ǻŀțěřňǻțįvě pŀǻň. Țħěỳ ẅǻňț șțǻțě-bǻčķěđ fųňđ İŇČJ țǿ țǻķě ǿvěř Șħǻřp, pǿșșįbŀỳ ǿň ŀěșș ģěňěřǿųș țěřmș. Țħě ŀįķěŀỳ ěňđģǻmě ẅǿųŀđ bě fǿř İŇČJ țǿ fǿŀđ Șħǻřp’ș đįșpŀǻỳ-mǻķįňģ bųșįňěșș įňțǿ įțș řįvǻŀ, Jǻpǻň Đįșpŀǻỳ.

Jǻpǻň Đįșpŀǻỳ įțșěŀf ẅǻș șěț ųp bỳ İŇČJ įň 2012, fřǿm țħě șpųň-ǿff đįșpŀǻỳ bųșįňěșșěș ǿf Ħįțǻčħį, Țǿșħįbǻ ǻňđ Șǿňỳ. Ǻđđįňģ Șħǻřp’ș șčřěěň-mǻķįňģ ǻșșěțș ẅǿųŀđ mǻķě įț ǻ țřųě ňǻțįǿňǻŀ čħǻmpįǿň.

Țħįș čǿųŀđ bě ěǻșįŀỳ đįșmįșșěđ ǻș přǿțěčțįǿňįșț, čřǿňỳ čǻpįțǻŀįșm, ǻįměđ ǻț ķěěpįňģ fǿřěįģň Ħǿň Ħǻį ǿųț ǿf ǻ přįżěđ įňđųșțřỳ. Bųț įň țħįș čǻșě, čǿřpǿřǻțě Jǻpǻň’ș įňșțįňčț țǿ http://www.wsj.com/articles/in-battle-for-sharp-apple-looms-large-1453441411?mod=djemHeardEUH 2/3 1/22/2016 Apple Looms Large In Battle for Sharp - WSJ čįřčŀě țħě ẅǻģǿňș mǻķěș șěňșě.

Čǿmpěțįțįǿň fǿř șmǻřțpħǿňě- ǻňđ țǻbŀěț-đįșpŀǻỳ ǿřđěřș įș břųțǻŀ, ẅįțħ bįģ đěvįčě mǻķěřș, ěșpěčįǻŀŀỳ Ǻppŀě, pįțțįňģ șųppŀįěřș ǻģǻįňșț ěǻčħ ǿțħěř řųțħŀěșșŀỳ țǿ ģěț țħě běșț pǿșșįbŀě přįčě. Șħǻřp ǻňđ Jǻpǻň Đįșpŀǻỳ ẅřěșțŀě ěňđŀěșșŀỳ ẅįțħ řįvǻŀș įň Șǿųțħ Ķǿřěǻ ǻňđ Țǻįẅǻň fǿř șčřǻpș ǿff Ǻppŀě’ș țǻbŀě. İň țħįș ěňvįřǿňměňț, įț mǻķěș șěňșě țǿ čǿňșǿŀįđǻțě ǻňđ ģǻįň bǻřģǻįňįňģ pǿẅěř.

Țħě ǻŀțěřňǻțįvě vįșįǿň įș věřțįčǻŀ įňțěģřǻțįǿň ẅįțħ Ħǿň Ħǻį, ẅħįčħ ǻșșěmbŀěș țħě đěvįčěș fǿř Ǻppŀě. Ħǿň Ħǻį čǿųŀđ ģěț įțș ǿẅň șčřěěňș įňțǿ țħě pħǿňěș įț bųįŀđș ǻș pǻřț ǿf ǻ pǻčķǻģě đěǻŀ ẅįțħ Ǻppŀě ǻňđ ǿțħěř čųșțǿměřș. Bųț țħįș įș ǻň ųňțěșțěđ mǿđěŀ ǻňđ įț įș ųňčŀěǻř ẅħǻț ěčǿňǿmįč běňěfįțș įț ẅǿųŀđ đěŀįvěř įň přǻčțįčě.

Ħǿň Ħǻį čǻň fŀǻșħ șǿmě čǻșħ, bųț Șħǻřp’ș fųțųřě ẅįŀŀ bě đěčįđěđ bỳ țěǻm Jǻpǻň. Țħěỳ șěěm ųňįmpřěșșěđ.

Ẅřįțě țǿ Ǻǻřǿň Bǻčķ ǻț ǻǻřǿň.bǻčķ@ẅșj.čǿm

http://www.wsj.com/articles/in-battle-for-sharp-apple-looms-large-1453441411?mod=djemHeardEUH 3/3 Apple’s Hard-Charging Tactics Hurt TV Expansion

In search of its new big thing, the company has alienated cable providers and networks with an assertive negotiating style; ‘time is on my side’

Eddy Cue, Apple’s senior vice president of internet software and services, talks about Apple TV at a product-launch event in San Francisco last September. Mr. Cue is the point man of Apple’s strategy to revolutionize the television-watching experience. Photo: MONICA DAVEY/EUROPEAN PRESSPHOTO AGENCY

By Shalini Ramachandran and Daisuke Wakabayashi Updated July 28, 2016 9:54 p.m. ET Apple Inc. executives had every reason for optimism when they approached Walt Disney Co. in early 2015 to join the streaming television service Apple planned to launch. Disney Chief Executive Robert Iger is an Apple director and had said he was keen to strike a deal.

Disney, which owns channels such as ESPN and ABC, was stunned, though, when Apple executive Eddy Cue made demands that would have upended decades of cable-industry and Hollywood practices, people familiar with the discussions say.

In particular, Apple wanted to freeze for several years the monthly rate per viewer it would pay to license Disney channels. TV channels usually get annual rate increases and rely on them to fuel profit growth.

Disney balked. Similar talks with media giants that included 21st Century Fox Inc. and CBS Corp. also stalled. When Apple debuted its newest Apple TV set-top box last September, it announced no streaming TV service.

Television is an important part of Apple’s strategy to reignite growth now that sales of the iPhone, the most popular and profitable product in the Cupertino, Calif., company’s 40-year history, have fallen for two quarters in a row. New devices like the Apple Watch, introduced last year, aren’t popular enough to pick up the slack. Apple’s overall sales fell 15% in the latest quarter.

Yet some of the same tactics previously used by Apple to such success have hurt its efforts to revolutionize the TV-watching experience, raising pointed questions about how it can revive its growth.

ENLARGE For the past 15 years, Apple has barreled into industries from music to mobile phones, persuading established companies to go along with Apple’s way of seeing the world. In the early 2000s, Apple co-founder Steve Jobs muscled music labels into selling songs online for 99 cents apiece instead of CDs for $15. Apple gained huge influence in the music industry, which saw sales fall but found a way to battle the existential threat from digital piracy.

When the iPhone made its debut in 2007, Apple bucked tradition by excluding carrier-specific software features. Eager to carry the iPhone, wireless carriers agreed, which made Apple’s phones easier to use.

In online TV, Apple wants to combine a selection of popular live channels with an on-demand library stockpiled with full seasons of hit shows. The streaming TV service pitched to Disney would have cost $30 a month.

Advertisement Apple’s roaring success and assertive negotiating style are kinks in that strategy. Media companies worry that agreeing to Apple’s sweetheart terms could allow traditional cable-TV distributors to demand the same deal and make it harder to recoup their investments in original shows.

“We’re challenged in a lot of ways, but we’re not waiting for this white knight to come racing in the way music was,” one senior TV executive says.

Apple executives have said television companies should embrace their strategy, given the technological shifts sweeping through the TV business.

Dish Network Corp. ’s $20-a-month Sling TV and Sony Corp. ’s PlayStation Vue have live channels and on- demand programs. Amazon and Alphabet Inc. ’s YouTube are exploring similar internet-delivered cable-TV services, while Hulu, owned by Fox, Disney and Comcast, aims to offer a service early next year for roughly $40 a month.

For Apple, the TV business remains a drop in the bucket. It generates more than $1 billion in annual sales, compared with a total of $233.72 billion in its latest fiscal year.

Apple has eyed TV for a decade, trying multiple strategies with little success. In addition to the set-top box and delivering channels over the internet, Apple considered building its own TVs but then dropped the idea.

These days, Apple touts apps as “the future of TV” and is moving to develop its own programming.

Apple’s point man for TV is Mr. Cue, 51 years old, the company’s senior vice president of internet software and services. He grew close to Mr. Jobs after starting as an intern in 1989. Mr. Cue favors bright shirts and fast cars, is on the board of directors at auto maker Ferrari NV and often spotted courtside at home games of the NBA’s Golden State Warriors. Comcast Chairman and Chief Executive Brian Roberts at the 2015 Fortune Global Forum in San Francisco last November. Comcast owns NBCUniversal and is the largest cable-TV provider in the U.S., but it had trouble getting Apple to share important details about a planned streaming-TV service. Photo: David Paul Morris/Bloomberg News

Mr. Cue is also known for a hard-nosed negotiating style. One cable-industry executive sums up Mr. Cue’s strategy as saying: “We’re Apple.”

By 2009, Apple executives were considering a subscription streaming-TV service. To entice media companies, Apple offered higher fees than pay-TV providers for their broadcast channels. But Apple wanted only certain channels, so the effort fizzled.

Two years later, Time Warner Cable Inc. approached Apple with a plan to offer a joint TV service over an Apple set-top box to battle satellite and telecom rivals, say people close to the talks. Apple Chief Executive Tim Cook and Mr. Cue began talks with Glenn Britt, then the cable provider’s CEO, and other executives.

Mr. Cook also approached Brian Roberts, the head of Comcast Corp. , the largest cable-TV provider in the U.S., and promised that Apple’s set-top box and service would be offered exclusively through cable companies.

Apple sought payments of $10 a month per subscriber from the cable providers and refused to rule out seeking an even higher share of each monthly subscription in the future, according to people involved in the talks. It also wanted users to sign in with Apple IDs, even though Comcast and Time Warner Cable would handle billing and customer service. Some people close to the talks say Apple was reluctant to share important details, including how subscribers would navigate the channel menu. Comcast’s Mr. Roberts didn’t see Apple’s proposed user interface.

“How about you sketch it on the back of this napkin?” Apple was asked at one meeting, say former Time Warner Cable executives. An Apple official replied that the software would be “better than anything you’ve ever had.”

In 2013, Mr. Cue met with Mr. Britt, Time Warner Inc. CEO Jeff Bewkes and other executives in Mr. Britt’s office overlooking Manhattan’s Central Park. Time Warner owns HBO, TNT, CNN and other channels.

Apple’s Mr. Cue arrived 10 minutes late and was wearing jeans, tennis shoes with no socks, and a Hawaiian shirt, says a person familiar with the meeting. The other executives were wearing suits.

The talks dragged on. Apple wanted full on-demand seasons of hit shows and rights to a vast, cloud-based digital video recorder that would automatically store top programs and allow ad-skipping in newly aired shows.

TV-channel owners “kept looking at the Apple guys like: ‘Do you have any idea how this industry works?’ ” one former Time Warner Cable executive says. Apple has said doing new things requires changes that often are unsettling.

By late 2014, the discussions had gone cold. Apple changed directions again, hoping to assemble a “skinny bundle” delivered over the internet.

Apple’s Mr. Cue began pitching Disney, Fox, CBS and other media companies on the streaming-TV service. The goal was to attract consumers who have dumped their cable-TV supplier with 25 popular channels, anchored by the broadcast networks. ENLARGE Apple sought access to full current and past seasons of hit shows, as well as some global rights so the service could work outside the U.S., say people familiar with the talks.

To give subscribers access to local affiliates, Mr. Cue asked the big broadcast networks to cobble together deals with TV station owners. Traditional cable and satellite companies usually negotiate such deals on their own.

Channel owners typically want all their networks carried for the highest monthly subscriber fees possible. Instead, Apple worked backward from its desired $30-a-month retail price.

Apple predetermined that Disney’s programming was worth $13 a month per subscriber and asked Disney to pick which of its networks to include, according to people familiar with the talks.

Time Warner’s Mr. Bewkes urged Mr. Cue to include more content and charge more to the service’s users, a person familiar with the matter says.

Disney gets about $10 billion a year in revenue from pay-TV providers, and its executives worried that agreeing to Apple’s terms would entitle other distributors to the same treatment, according to people familiar with the talks. When Disney asked about including channels from its partly owned A+E Networks Inc., Apple wasn’t interested.

Some media executives thought Mr. Cue was trying to bluff them when he said: “We’ve got Disney and Fox. Are you guys in?”

Last summer, Fox and Apple agreed on a rate for channels like Fox News and regional sports networks and began contract talks, says a person familiar with the talks. Disney was moving toward licensing just ABC, ABC Family (now called Freeform), Disney Channel and a digital amalgam of all the ESPN channels called WatchESPN, but didn’t reach a final deal with Apple.

Mr. Cue has said the TV industry overly complicated talks. “Time is on my side,” he has told some media executives.

Apple is developing a miniseries tied to Dr. Dre, the hip-hop mogul and senior Apple executive, shown at the Coachella Valley Music and Arts Festival in Indio, Calif., in April. Photo: Kevin Winter/Getty Images for Coachella

Apple now is trying two new approaches. It has revamped the Apple TV device to allow TV networks and others to develop apps and is working to make those accessible through a single login. Apple also is beefing up its original programming.

The programming push includes the planned reality series “Planet of the Apps,” CBS spinoff “Carpool Karaoke” and a miniseries tied to rapper Dr. Dre . Most of the programs promote Apple’s streaming music service and App Store. Apple executives have had preliminary discussions with Hollywood executives about making premium original shows on par with “House of Cards.” Apple also has discussed premiering original shows on iTunes, with Apple guaranteeing a level of sales revenue to producers.

Original programming could bolster iTunes’ video-download business, which has suffered as Netflix-like services gain popularity.

Apple turned to little-known producer Chris Contogouris, who worked on the movie “Spring Breakers,” as a middleman in negotiations for some projects, people familiar with the matter say.

When he made a bid on Apple’s behalf for a spinoff of the British hit “Top Gear,” Hollywood executives were bemused because negotiations for high-profile shows usually involve high-level executives from all sides. Mr. Contogouris wouldn’t comment.

A person close to Apple says the company bid only to increase the price for Amazon.com Inc., which ended up winning the “Top Gear” spinoff. An Amazon spokeswoman wouldn’t comment.

After Apple reported a profit slide Tuesday, Mr. Cook, the CEO, said the company’s TV efforts are just starting. “You shouldn’t look at what’s there today and think we’ve done what we want to do,” he said. http://nyti.ms/25f2tHv

TECHNOLOGY Automakers Befriend Start-Ups Like Uber, Girding Against a Changing Car Culture By MIKE ISAAC and NEAL E. BOUDETTE MAY 24, 2016 SAN FRANCISCO — Automakers are looking toward a technology-driven future, one where they increasingly acknowledge that getting around may not require owning a car.

On Tuesday, two of the world’s largest automakers, Toyota and Volkswagen, said they were stepping up to invest in technology start-ups that are working to change the way people travel by car. Toyota said it had formed a partnership with and invested an undisclosed amount in Uber, the biggest ride-hailing company. Gett, the app popular in Europe, said it was working with Volkswagen, and the automaker was investing $300 million in the start-up.

The alliances are the latest in a string of pairings between technology companies and traditional automakers that are scrambling to reposition themselves. For decades, automakers had abided by the well-worn formula of making bigger and more powerful cars to fuel their growth.

But start-ups like Uber and Lyft and technology companies like Google and Tesla have disrupted that cadence. These companies, mostly located in Silicon Valley, have in the last few years sped the development of self-driving cars, electric vehicles and ride services.

Automakers have become increasingly concerned about those technologies and their potential to help people travel easily and cheaply without owning a car — or even without knowing how to drive.

In some American cities, small groups of people are already choosing not to own cars by relying on ride-hailing services like Uber, through which consumers can order a ride through their smartphone, and car-sharing companies like Zipcar, where they essentially pick up a car whenever they need to drive one. Eventually, self-driving cars will be a reality, which would let Uber and others field fleets of driverless vehicles that can operate around the clock and further cut the cost of ride services.

“Ride-sharing has huge potential in terms of shaping the future of mobility,” Shigeki Tomoyama, senior managing officer of Toyota, said in a statement about partnering with Uber. “We would like to explore new ways of delivering secure, convenient and attractive mobility services to customers.”

Karl Brauer, an analyst at the research firm Kelley Blue Book, said there was no sign that car-sharing or ride-sharing — sometimes called “mobility services” — was slowing auto sales today. Auto sales in the United States hit a record high in 2015 and are on the rise this year, and China and other international markets will ensure the global auto market continues to grow.

Nevertheless, auto companies are investing in companies like Uber “to be ahead of the curve” if they do shake up car ownership down the road, Mr. Brauer said. “History has shown that if you wait for the market to decide, you’re dead,” he said.

In January, General Motors invested $500 million in Lyft, the ride-hailing app popular with American users, with a focus on developing networks of autonomous vehicles. Ford Motor is making over its Dearborn, Mich., headquarters into a Silicon Valley-like campus of green buildings connected by self-driving shuttles.

And a few weeks ago, Fiat Chrysler and Google agreed to produce a test fleet of driverless minivans. Both BMW and Mercedes- Benz have started to pilot ride services.

Even other technology companies only tangentially related to automobiles are becoming more involved in ride services. Apple, which is working on its own autos project, said this month it had invested $1 billion in Didi Chuxing, a Chinese ride-hailing company that competes fiercely with Uber.

The scale of ride-hailing as a phenomenon is encapsulated in China. Uber operates in more than 30 Chinese cities with plans to expand to 100 by the end of the year. Didi is in well over 300 cities and towns throughout the country.

Last June, Uber said it had approximately 20,000 regular drivers in the Chinese city of Chengdu alone, on par with the approximately 22,000 drivers in San Francisco and 26,000 in New York at the time.

But global expansion requires capital — lots of it. Companies like Uber have tapped venture capitalists, strategic partners and large institutional investors at the rate of about once every six months to amass enough money to keep introducing operations in new cities. In total, Uber has raised more than $10 billion from several firms to wage its land war across multiple continents.

With the Toyota partnership, Uber gets other perks apart from money. The company, based in San Francisco, which was valued at $62.5 billion in December, plans to expand its vehicle financing program with Toyota, whose cars are among the most popular with Uber drivers. Customers can lease Toyota vehicles through the program and are able to pay down the cost by driving for Uber.

Toyota said that in its work with Uber, the companies would also cooperate on trials in countries where ride-hailing is growing.

The companies also plan to develop in-car apps that support Uber drivers, and to share their knowledge and research, they said.

Volkswagen has been slower to jump on the mobility bandwagon, partly because it has been consumed by an emission-cheating scandal involving its diesel models. After those revelations, Volkswagen replaced its chief executive, about a dozen top managers departed, its VW-brand sales skidded in the United States and it set aside $18 billion to cover scandal-related costs.

Next month, Volkswagen is supposed to detail a plan to buy back or repair about 500,000 diesel models that had the cheating software and were sold in the United States.

About the same time, Volkswagen is also planning to unveil a “Strategy 2025” in which mobility initiatives will play major roles. In April, Volkswagen said it intended to set up a separate mobility company to oversee investments and initiatives on this front.

“We aim to become a world leading mobility provider by 2025,” Matthias Müller, chief executive of Volkswagen, said in a statement.

Shahar Waiser, Gett’s chief executive, stressed the synchronicity his company had with Volkswagen’s European sales, and how the companies were focused on both consumer and business clients. Mr. Waiser said Gett had $500 million in revenue, 30 percent of which came from the company’s 4,000 corporate and business clients, and that it was profitable in some markets.

Gett, which is popular in more than 60 European cities, as well as Moscow and New York, said it planned to use the capital to continue expanding its European operations.

“By now, people realize that the landscape is so big — and every market is so different — there will be more than a monopoly or a duopoly,” Mr. Waiser said. “You will always see two, maybe three major players in this space, wherever you go.”

Mike Isaac reported from San Francisco, and Neal E. Boudette from Ann Arbor, Mich.

A version of this article appears in print on May 25, 2016, on page A1 of the New York edition with the headline: Big Carmakers Bet on Future of Motoring.

© 2016 The New York Times Company This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. http://www.wsj.com/articles/bmw-intel-mobileye-link-up-in-self-driving-tech-alliance-1467379145

TECH BMW, Intel, Mobileye Link Up in Self- Driving Tech Alliance

Companies aim to create open standard for driverless cars

A Mobileye camera system to monitor speed limits and warn drivers of potential collisions. The Israeli firm has teamed up with BMW and Intel to develop self-driving automotive technology. PHOTO: CARLOS OSORIO/ASSOCIATED PRESS

By SARAH SLOAT Updated July 1, 2016 11:55 a.m. ET

BMW AG, Intel Corp. and Israel’s Mobileye NV are teaming up to develop self-driving vehicles, the latest alliance among auto makers and technology companies working to build and commercialize driverless cars.

The trio said they could have self-driving cars in production by 2021. “Together with Intel and Mobileye, the BMW Group will develop the necessary solutions and innovative systems for highly and fully automated driving,” the German car maker said.

The partnership combines the world’s the best-selling luxury car maker, the world’s leading chip maker, and a software provider in the evolving area of autonomous cars. Mobileye, which makes software and components that help prevent collisions, already works with General Motors Co. and Volkswagen AG.

The three companies aren’t alone in the race to introduce driverless-vehicle technologies. Rivals ranging from GM and electric-car maker Tesla Motors Inc. to Alphabet Inc.’s Google also are racing to bring the systems to market.

At the same time, safety issues regarding self-driving cars have come to the fore this week with the investigation by U.S. auto-safety regulators into what is believed to be the first fatal crash involving a Tesla car that was driving itself. The incident could ratchet up scrutiny of a technology that has been evolving with little oversight. Mobileye supplies components used in Tesla’s Autopilot semiautonomous-driving system.

“It’s very important given this accident…that companies would be very transparent about the limitations” of autonomous driving systems, Amnon Shashua, chief technology officer of Mobileye, said at a joint press conference. “It’s not enough to tell the driver to be alert but to tell the driver why,” Mr. Shashua added.

BMW Chief Executive Harald Krüger called the Florida accident “very sad,” and said the technologies for autonomous cars at present are “not ready for series production.”

Mr. Shashua said the partnership’s planned time frame was short but sufficient.

BMW said that automated driving technologies will make travel safer.

“The goal of the collaboration is to develop future-proofed solutions that enable the drivers to not only take their hands off the steering wheel, but reach the so-called ‘eyes off’ level and ultimately the ‘mind off’ level transforming the driver’s in-car time into leisure or work time,” BMW said.

That level of autonomy would let the vehicle, at least technically, reach the ‘driver off’ stage of driving without a person inside. “This establishes the opportunity for self- driving fleets by 2021 and lays the foundation for entirely new business models in a BMW took the wraps off its Vision Next 100 concept cars in London last month. PHOTO: GETTY IMAGES connected, mobile world,” the German auto maker said.

Intel itself has been pushing into the auto industry to tap the growing market for semiconductors that regulate automotive functions. In May, it announced the acquisition of Russia’s Itseez, which develops software and services for driver- assistance systems.

Mobileye said the partnership would employ its EyeQ5 systems and its Road Experience Management technology, or REM, to provide precise localization. Intel is contributing computing, connectivity, safety and security assets, the U.S. company said.

BMW said it plans to make its iNEXT model the foundation of its autonomous driving strategy and for fleets of fully autonomous vehicles both on highways and in cities where they could offer automated ride-sharing.

The companies have set a schedule for creating open standards-based platform to bring autonomous cars to market quickly. The platform will be made available to other car makers and industries, BMW said.

Write to Sarah Sloat at [email protected]

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TECH Craving Growth, Walgreens Dismissed Its Doubts About Theranos

Drugstore chain made blood-testing deal without fully validating the startup’s technology, worrying that Elizabeth Holmes might balk; ‘a very strange situation’

Theranos founder Elizabeth Holmes, left, at a ribbon-cutting ceremony in 2013 for the blood-testing company’s partnership with Walgreens. At right are Gregory Wasson, then the drugstore operator’s chief executive, and finance chief Wade Miquelon. PHOTO: WALGREENS

By CHRISTOPHER WEAVER and JOHN CARREYROU May 25, 2016 4:14 p.m. ET

Walgreens was considering a partnership with Theranos Inc. when founder Elizabeth Holmes arrived at Johns Hopkins University in the spring of 2011. She brought with her a machine she said could test tiny samples of blood for dozens of conditions and thick binders of data to show its accuracy.

A Hopkins scientist told her that his researchers needed to put the device in their Baltimore laboratory to verify the technology on Walgreens’ behalf, and Ms. Holmes agreed to provide one, say people familiar with the meeting.

It never happened. Walgreens wound up making a deal that included plans to put Theranos blood-testing centers in thousands of its drugstores across the U.S. despite never fully validating the startup’s technology or thoroughly evaluating its capabilities, according to people familiar with the matter. This article is based on interviews with nearly 20 current or former Walgreens officials and advisers, former Theranos employees and government records.

The relationship is now in tatters, making Walgreens an extreme case study of what can go wrong when an established company that craves growth decides to gamble on an exciting and unproven startup.

Accuracy problems with Theranos’s proprietary Edison testing devices, first reported by The Wall Street Journal last October, have become an embarrassment and potential legal liability for Walgreens Boots Alliance Inc., of Deerfield, Ill., which had been Theranos’s main conduit to patients and a vital stamp of credibility. Regulators said in January some of Theranos’s testing posed “immediate jeopardy” to patients’ health.

Walgreens officials considered walking away from the partnership but then hesitated because of worries that Theranos might sue for breach of contract and claim billions of dollars in damages. Walgreens doesn’t expect to recoup its investment of at least $50 million in Theranos.

Before announcing the deal in September 2013, some Walgreens executives and outside advisers had doubts about Theranos. Many of the questions were typical of a prospective investor trying to vet new technology created by a promising entrepreneur with a scant record.

When Walgreens pushed for answers, though, it received few that were useful from Theranos, which closely guarded its technology and operations. Some people involved in the process say the startup’s posture went beyond the endemic secrecy of Silicon Valley and believe they were sometimes misled.

Again and again, Walgreens moved forward anyway, partly because executives worried Theranos would choose a different drugstore chain as partner if they pressed Ms. Holmes too hard.

Elizabeth Holmes at the WSJDLive conference in October. Walgreens executives worried she would choose a different drugstore partner if they pushed too hard. PHOTO: NIKKI RITCHER FOR THE WALL STREET JOURNAL

In October 2012, Walgreens sent two executives and Paul Rust, a retired executive from clinical-lab company Quest Diagnostics Corp., on a trip that included a review of quality- control data at Theranos.

“It was a very strange situation,” he recalls of the one-day visit. “The results were actually really good, but I was never allowed to go into the lab. I have no idea that the results I saw were run on the Edison devices or not.”

Mr. Rust says he was “led to believe that they were being run on the Edison.”

Later, he asked Walgreens executives if they had been granted access to Theranos’s lab. “Much to my surprise, the Walgreens people themselves had not been in the lab,” says Mr. Rust.

Former Walgreens officials involved in the negotiations say Theranos told them it could perform many tests using smaller amounts of blood because it had invented a proprietary device. That appealed to Walgreens because the company believed it could use Theranos’s device to do many blood tests right in drugstores.

In reality, Theranos used Edison machines for just a fraction of its tests and ran the rest on conventional lab equipment, according to former Theranos employees. The company RELATED

Theranos Voids Two Years of Edison Blood-Test Results (http://www.wsj.com/articles/theranos-voids-two- years-of-edison-blood-test-results-1463616976) (May 18) Regulators Propose Banning Theranos Founder Elizabeth Holmes for at Least Two Years (http://www.wsj.com/articles/regulators-propose-banning-theranos-founder-elizabeth-holmes-for-at-least- two-years-1460570869?cb=logged0.18879832658237028) (April 13) Theranos Devices Often Failed Accuracy Requirements (http://www.wsj.com/articles/theranos-devices- often-failed-accuracy-requirements-1459465578) (March 31) Walgreens Threatens to End Theranos Agreement (http://www.wsj.com/articles/walgreens-threatens-to- end-theranos-agreement-1455156503) (Feb. 10) Deficiencies Found at Theranos Lab (http://www.wsj.com/articles/problems-found-at-theranos-lab- 1453684743) (Jan. 24) At Theranos, Many Strategies and Snags (http://www.wsj.com/articles/at-theranos-many-strategies-and- snags-1451259629) (Dec. 27) Hot Startup Theranos Has Struggled With Its Blood-Test Technology (http://www.wsj.com/articles/theranos- has-struggled-with-blood-tests-1444881901) (Oct. 16) The Startup Stock Tracker (http://graphics.wsj.com/tech-startup-stocks-to-watch/) The Billion Dollar Startup Club (http://graphics.wsj.com/billion-dollar-club/) recently told the federal Centers for Medicare and Medicaid Services that it performed just 12 types of tests on the Edison, a person familiar with the matter says.

By last August, Theranos was doing all its tests on conventional devices, according to notes from a Food and Drug Administration investigator obtained by the Journal in a public-records request.

In response to questions from the Journal, Theranos spokeswoman Brooke Buchanan said: “We value our partnership with Walgreens and look forward to continuing to work together.” Walgreens spokesman Michael Polzin said the company declined to comment for this article.

According to Theranos’s website, it operates 45 wellness centers in Arizona and California, including 40 in Walgreens stores. The website says Theranos is planning to open more locations.

In January, Walgreens closed one location in California and notified Theranos it intends to terminate the partnership unless Theranos quickly puts itself back in compliance with federal regulations.

A federal inspection of Theranos’s lab in Newark, Calif., last fall found that the Edison devices often failed to meet the company’s own accuracy requirements. The company, based in Palo Alto, Calif., also faces criminal and civil investigations into whether it misled investors and regulators about its technology. On Wednesday, a Theranos patient filed a federal lawsuit in California alleging that the company defrauded him by falsely saying it could accurately test small blood samples. The suit seeks class- action status.

Ms. Buchanan of Theranos said the lawsuit “is without merit. The company will vigorously defend itself against these claims.”

Theranos has said it is working closely with regulators and cooperating fully with the criminal and civil investigations.

In a bid to avoid stiff government sanctions, Theranos recently told regulators it has issued tens of thousands of corrected blood-test reports to doctors and patients. As part of the sweeping corrective action, Theranos told regulators it voided all patient tests done on Edison devices in 2014 and 2015.

If federal officials decide to sanction Theranos, senior Walgreens officials believe that would likely give Walgreens a strong defense in any of breach-of-contract litigation.

Top officials at Walgreens weren’t aware of Theranos’s decision to void the Edison results until the Journal reported the move.

Walgreens was founded in Chicago in 1901 and had about 7,500 drugstores in 2010 when it decided to jazz up its image and find new technology. Walgreens had launched a health-innovations unit to make investments in startups and gain footholds in other areas of health care.

Chief Executive Officer Gregory Wasson, Chief Financial Officer Wade Miquelon and other senior Walgreens officials were enthusiastic about the possibility of a transformational deal in Silicon Valley.

After quickly building a fast-growing vaccinations operation, Walgreens saw potential in A Theranos wellness center at a Walgreens store in Scottsdale, Ariz., in February 2015. Forty of Theranos’s 45 blood- testing locations are at Walgreens. PHOTO: MICHAEL CHOW/THE REPUBLIC the medical-lab business, where lab-focused companies generated more than $30 billion in revenue in 2014, according to Census Bureau estimates. Walgreens believed it could upend the industry by combining its store network with Ms. Holmes’s technology.

The Theranos partnership took root in 2010 after a chance meeting at a health- technology conference between Ms. Holmes and Jay Rosan, an executive in Walgreens’ health-innovations unit, people who worked on the deal say. Serious talks between the companies were under way by early 2011.

As part of a May 2011 deal arranged by Dr. Rosan, a family-medicine doctor and former health-insurance executive who goes by “Dr. Jay,” Walgreens agreed to pay Johns Hopkins for its expertise in evaluating prospective investments. Assessing Theranos’s blood-testing technology was one of the tasks discussed.

At the meeting with the Hopkins scientist, Ms. Holmes and Theranos President Sunny Balwani agreed to provide one of its proprietary devices to his lab. But when Dr. Rosan checked in with the scientist during a later visit, he was told Theranos hadn’t delivered the device, according to a person familiar with the matter.

Dr. Rosan, now a venture-capital investor in the Philadelphia area, declined to comment. Mr. Balwani, whose resignation from Theranos was announced this month, couldn’t be reached.

While Theranos didn’t provide a device to Hopkins, Walgreens got a prototype, and members of Dr. Rosan’s team set it up in a cubicle.

The prototype came with kits to perform esoteric tests that other labs and test makers apparently didn’t offer, producing results such as “low” and “high” rather than numeric values.

As a result, Walgreens couldn’t compare results from the Theranos machine to any commercially available tests.

Mr. Miquelon, the Walgreens Expanding Ranks finance chief, visited Theranos’s headquarters and met with Ms. Holmes and Mr. Balwani in a conference room, according to a former Theranos employee.

At least twice, including when Mr. Rust visited, Walgreens hired lab-industry veterans to evaluate Theranos’s lab VIEW INTERACTIVE capabilities and business operations in Palo Alto. Other

THE WALL STREET JOURNAL consultants reviewed the potential deal from Walgreens headquarters in Illinois.

In the summer of 2011, Walgreens sent Mr. Miquelon, Dr. Rosan and some lower-ranking employees, including an internal auditor, to Theranos headquarters with lab experts from a consulting firm called Colaborate LLC.

Walgreens and Theranos had just signed an initial letter of agreement, and the drugstore chain’s executives wanted a firsthand review of Theranos’s business operations and lab capabilities.

The visitors were ushered into a conference room and chaperoned throughout the visit. When a member of the Walgreens team left the meetings to use the restroom, the person was escorted by Theranos personnel.

Colaborate wasn’t given access to the lab area at Theranos or its Edison technology. Another consultant affiliated with Colaborate reported shortcomings with information- management systems meant to keep track of patients.

Kevin Hunter, Colaborate’s president and CEO, says he is barred from discussing his findings because of confidentiality agreements with Walgreens and Theranos.

In a report later in 2011, the consultants concluded Walgreens needed more information to assess the partnership. Those findings and reports by other consultants were kept from many Walgreens officials, including some directly involved in the negotiations with Theranos.

Walgreens Chief Executive Gregory Wasson, shown during a 2012 speech in Chicago, had his finger pricked for a cholesterol test during a visit to Theranos. Walgreens saw big potential in the growing medical-lab business. PHOTO: BLOOMBERG

Mr. Wasson, Walgreens’ chief executive, toured the Palo Alto facility in 2012 with other Walgreens officials. His finger was pricked for blood to perform a cholesterol test, according to a person familiar with the matter. It isn’t clear if his blood was tested with an Edison device. He declined to comment.

Despite their limited access, Walgreens executives decided to keep working on an agreement. Some executives were comforted when Theranos said Safeway Inc. had agreed to host blood-drawing sites at some of its supermarkets. If Safeway trusted Theranos, then Walgreens could, too, the Walgreens officials believed.

The comfort level at Walgreens rose again when CMS gave Theranos a “CLIA certificate.” That meant regulators had concluded Theranos met standards to perform tests on human samples.

As the two companies neared a final agreement, Theranos asked for more control. Walgreens agreed to let Theranos run its wellness centers as independent operations. The drugstore chain’s access to data from the blood-testing sites was highly limited.

Earlier, Walgreens had studied whether it could integrate its pharmacy record system with Theranos’s proprietary lab-management software.

Mr. Miquelon pushed for a deal and was the top official on the Walgreens negotiating team, which also included Dr. Rosan. The Walgreens team made concessions to Theranos. The contract signed by the companies doesn’t give Walgreens the right to view Theranos’s clinical data or financial records. Walgreens rarely gave up such access in investment deals it struck with other companies.

Mr. Miquelon didn’t respond to requests for comment. He left Walgreens in 2014 and has sued Walgreens for defamation related to his exit. Walgreens has denied any wrongdoing.

At a ribbon-cutting ceremony to celebrate the opening of a Theranos wellness center in the Phoenix area, Mr. Wasson and Ms. Holmes each held large scissors.

In 2014, Ms. Holmes pressed Mr. Wasson to expand the Theranos wellness centers beyond initial sites in Arizona and California. The Walgreens chief executive balked, says a person familiar with the matter.

He knew Safeway had cold feet about Theranos. The Journal reported in November 2015 that Theranos had earlier missed deadlines for the blood-testing rollout at Safeway, citing current and former Safeway executives, and some Safeway executives were wary of the tests’ accuracy.

Theranos has declined to comment on its discussions with Safeway.

Worried about Theranos’s ability to manage operations, Mr. Wasson told Ms. Holmes that Walgreens wanted to move more slowly and would dictate the scale of the broader rollout.

In early 2014, Walgreens and Theranos were negotiating a new contract, but it wasn’t signed. Mr. Wasson left in January 2015 as Walgreens merged with European pharmacy giant Alliance Boots GmbH.

Walgreens shelved the expansion plans after the Journal reported in October that Theranos did the vast majority of tests it offered to consumers on traditional lab machines. The Journal also reported that some former employees doubted the accuracy of a small number of tests run on Edison devices.

One of the most recent setbacks came in mid-April when the Journal reported that regulators had 3½ weeks earlier proposed banning Ms. Holmes from the lab-testing industry. The drugstore chain’s senior executives found out from the news report.

—Michael Siconolfi contributed to this article. Dell and EMC bare all on merger plans in massive SEC filing Go-to-market plans, VMware, rules of engagement and partner programmes all covered in FAQ document Dell and EMC have opened up on the nitty gritty of their merger plans in a massive document filed with US authorities, outlining answers to 125 questions about issues such as channel plans, VMware, RSA and go-to-market strategy.

As the merger goes ahead, EMC is obliged to publish details of certain communications about the deal – which is expected to be worth $67bn (£46.7bn) and to close before the autumn – with the US Securities and Exchange Commission (SEC).

In the latest filing posted last night, EMC filed a 14,000-word FAQ document which currently appears on the EMC internal intranet. The document outlines 125 key questions and spans more than 35 pages.

It covers a huge range of issues, including details relevant mainly to EMC employees, such as plans for compensation and benefits, stock options, and office locations.

But the filing also shed some light for the first time on what the new entity will look like and how it will operate. Below are some of the key points.

Dell's new reseller agreement with EMC

In the filing, EMC said that since 1 February, Dell began reselling its VMAX product and associated software. The pair has a similar resale agreement which has been in place since the mid-2000s.

EMC said: "Dell will not resell into accounts where EMC 'owns' the footprint. We are partnering with Dell to leverage new opportunities, such as accounts where Dell has a large server/storage presence and EMC may not, or accounts where neither company is strong, yet Dell finds and registers the opportunity for incremental capacity or competitive displacements. Dell will register their opportunities with EMC like any other business partner."

Go-to-market strategy

When the deal closes, which could be any time between May and October, the combined entity will focus on three market segments – enterprise, commercial, and consumer and small business – EMC said in the filing. Bill Scannell, Marius Haas and Jeff Clarke will run each respective business, effective immediately once the deal closes.

The duo is currently in the process of working out exactly how it will attack each market, adding: "The go-to-market dividing lines and account coverage plans will not be implemented until the new fiscal year 2017, so nothing will change until then." But EMC issued advice to staff who are coming under pressure from customers to introduce them to Dell staff before the deal closes.

"It is OK to work with your Dell counterparts on a VMAX resell transaction, as you would with any other business partner," EMC said. "But we are still prohibited from selling together until the acquisition closes."

Partner commitment

EMC reaffirmed its and Dell's commitment to partners in the filing and said: "We value all of our partner relationships, and each business remains committed to investing in – and strengthening – our respective partner ecosystems."

It added that the combined entity has made a number of public commitments to its existing partner base.

"EMC will sustain our absolute focus on our valued partners by: remaining committed to our partner ecosystem and programmes; extending our technology leadership through investment in R&D, including enhancing existing products and road maps; preserving our dedication to customer choice (free of lock-in); continuing to enhance our partnerships and technology ecosystems; listening to customer feedback and communicating updates to you clearly and often."

EMC said partner programmes will be a "critical success factor" in the new company and added that a "planning process" is under way, with details to emerge in "the coming months".

A new name?

Dell and EMC remain separate companies until the merger closes, but "Dell-EMC" has emerged as shorthand for the combined entity in the absence of any information on future branding.

In the filing, EMC addressed the future of the brand in part. Question three of 125 in the document is "how will we refer to the new, broader, combined company?", to which EMC said: "We will refer to the broader company as 'our complementary and aligned family of businesses'.

The document states that plans are under way for branding other business units.

"It is clear there is substantial value within the respective brands," said EMC. "Brand research is under way to determine the best way forward for the various brands across the business. You can expect to hear about the new branding at close." The future of RSA and VMware

EMC operates an unusual Federation structure, in which the EMC Information Infrastructure, VMware, RSA and Pivotal brands fit under one EMC umbrella. Dell-EMC have stated that VMware will remain publicly traded but speculation has been rife about the future of each firm.

EMC made efforts to clear up any confusion in the filing.

Regarding its security arm RSA, it said: "We expect Dell's strength in managed security services and its security offerings in network, end-point and email security, combined with RSA's focus on Identity and security analytics to create a top-five security player across SMB and enterprise customers."

EMC is equally optimistic about VMware's future.

"VMware will be one of three strategically aligned businesses – the other two are Pivotal and SecureWorks," said EMC. "Pat Gelsinger, VMware CEO, will be part of Michael Dell's executive group, which will include presidents of the business units, go-to-market organisations and the strategically aligned businesses.

"As part of the new combined company it is expected that VMware's growth will accelerate across its businesses through increased opportunities for integration with Dell's solutions and go-to-market channels. VMware will also benefit from the operational agility that comes from our majority shareholder being privately controlled and from being part of one of the top three transformational IT companies in the world."

Finally, EMC said Pivotal will be able "to operate as a fast-moving start-up with the prospect of becoming a public company".

© Incisive Business Media (IP) Limited, Published by Incisive Business Media Limited, Haymarket House, 28-29 Haymarket, London SW1Y 4RX, are companies registered in England and Wales with company registration numbers 9177174 & 9178013

Digital publisher of the year 2010, 2013 & 2016 This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. http://www.wsj.com/articles/delphi-mobileye-join-forces-to-develop-self-drive-system-1471924804

BUSINESS | AUTOS & TRANSPORTATION | AUTOS Delphi, Mobileye Join Forces to Develop Self-Drive System

Pair designing fully autonomous-driving product for car makers to plug into future vehicles

An Audi SUV equipped with Delphi Automotive’s technology traveled from San Francisco to New York City last year. Delphi and Mobileye plan to join forces to develop a fully autonomous system for car makers. PHOTO: STEPHEN LAM/REUTERS

By MIKE COLIAS Aug. 23, 2016 12:00 a.m. ET

Top auto-parts suppliers Delphi Automotive PLC and Mobileye NV are joining forces to develop a fully autonomous driving system that car makers could begin placing in their vehicles beginning in 2019. The two hope the development partnership will produce off-the-shelf systems for everything from small cars to sport utilities and pickup trucks—and help them carve out a central role in the race to supply technology for driverless vehicles. The tie-up, which was disclosed on Tuesday, comes as big auto makers and tech companies are moving independently on autonomous-vehicle developments.

Delphi, a former General Motors Co. spinoff, and Mobileye, of Jerusalem, now supply auto makers with the sensors and software that are the building blocks of autonomous- vehicle development programs. Shares of both have struggled recently as car sales plateau and customers put pieces in place to eventually develop their own gear.

News RELATED READING of the

Mobileye Ends Partnership With Tesla Motors (http://www.wsj.com/articles/mobileye-ends-partnership-with- partn tesla-1469544028) ershi BMW, Intel, Mobileye Link Up in Self-Driving Tech Alliance (http://www.wsj.com/articles/bmw-intel-mobileye- p link-up-in-self-driving-tech-alliance-1467379145) lifted Tesla’s Autopilot Vexes Some Drivers, Even Its Fans (http://www.wsj.com/articles/teslas-autopilot-vexes- some-drivers-even-its-fans-1467827084) both stock s: Mobileye rose nearly 8% to $50.21 and Delphi’s gained 3% to $66.08, both in morning trading on Tuesday.

While auto makers generally have turned over more of the work of making components to suppliers, autonomous-vehicle technology is one area they aim to maintain control through in-house expertise. GM earlier this year acquired autonomous-vehicle developer Cruise Automation Inc. to help accelerate its research, and Ford Motor Co. last week said it is investing in or teaming with several tech companies to launch a car without steering wheels or pedals by 2021.

Delphi Chief Executive Kevin Clark said in an interview the two aim to shoulder much of the development burden for auto makers that have grown comfortable with outsourcing critical technology development.

“We’re able to pool the investment as well as the technology and execution risk in one place so it doesn’t have to be duplicated by multiple [auto makers] over and over again,” Mr. Clark said.

The pair will jointly invest “several hundred million dollars” in the effort, but a spokesman declined to provide other details. In January, Delphi and Mobileye expect to demonstrate a system that can navigate tough road conditions, such as entering a roundabout, merging into highway traffic, or making left turns across multiple traffic lanes.

Both companies have deep relationships with car ‘You must endow these systems with intelligence. ’ makers, but their system won’t be ready until 2019. —Amnon Shashua, Mobileye chairman Integrating their tech in future vehicles could take as much as two years, the companies concede, making it unlikely to hit the market until 2021 or 2022.

Mobileye Chairman and Chief Technology Officer Amnon Shashua said the pair hope to overcome any timing hurdles by offering “a new level of driving intelligence,” mimicking a driver’s decision making behind the wheel in complex situations. “If we don’t want to clog a city with robotic systems that get stuck in busy traffic, you must endow these systems with intelligence.”

The time it will take to get into production models might put the pair at a disadvantage. Google parent Alphabet Inc., GM and others have hinted at earlier releases of their gear. Volvo Car Corp. is launching a public test of autonomous vehicles in Sweden next year— Nissan Motor Co. and Tesla Motors Inc. also aim to launch rival systems by decade’s end.

Still, the joint project by Mobileye and Delphi could appeal to smaller and midsize car companies that don’t have the deep pockets of a GM to fund the big capital outlays needed to develop driverless technology in-house. Mobileye already has technology partnerships with BMW AG and chip maker Intel Corp.

‘There is an interest by auto makers to be able to do as much as they can themselves. ’

—Jeremy Carlson, IHS Automotive

Other large auto-parts makers have used acquisitions to bolster their autonomous- driving offerings. Germany’s Continental AG last year paid about $680 million for Elektrobit Automotive Group, a Finnish software developer. Mobileye is a leader in supplying components for semiautonomous systems, including core technology for Tesla’s Autopilot driver-assist system. It also is a leader in providing mapping systems providing images that help a car’s cameras and sensors negotiate roadways in real time.

The Israeli supplier split with Tesla over the way the electric car maker deployed its technology following a high-profile fatality in May involving one of Tesla’s cars. The abrupt cancellation of the agreement underscored the sometimes uneasy relationship between technology suppliers and auto makers.

“At this early stage, I think there is an interest by auto makers to be able to do as much as they can themselves,” said Jeremy Carlson, an analyst with consultants IHS Automotive. “The auto makers ultimately are going to be liable for all these systems. The need to know what the systems are doing.”

What To Read Next...

BURNING QUESTION Is Sitting Cross-Legged Bad for You? Disney buys Lucasfilm for $4 billion

Matt Krantz, Mike Snider, Marco Della Cava and Bryan Alexander, USA TODAY 10:15 p.m. EDT October 30, 2012

Luke Skywalker and Han Solo are joining Mickey Mouse, Buzz Lightyear and Iron Man in Disney's roster of heroes.

Disney is buying Lucasfilm for $4 billion, adding the legendary Star Wars franchise to the entertainment giant's stable of characters. Lucasfilm is 100% owned by founder George Lucas. The purchase culminates a one and a half year pursuit of the Lucas empire, Disney's CEO said.

(Photo: Rick Rowell, AP) MORE: Reaction to the news (/story/life/2012/10/30/disney-star-wars-reaction/1669999/)

Lucas, who receives 40 million Disney shares from the deal, will be the second-largest non-institutional shareholder of Disney, Bloomberg News says, behind the trust of deceased Apple co-founder Steve Jobs.

The 68-year-old Lucas will serve as a creative consultant but plans to retire.

"For the past 35 years, one of my greatest pleasures has been to see Star Wars passed from one generation to the next," said Lucas, chairman and CEO of Lucasfilm, in a statement. "It's now time for me to pass Star Wars on to a new generation of filmmakers."

Said Disney CEO Robert Iger: "This is one of the great entertainment properties of all time, one of the best branded and one of the most valuable, and it's just fantastic for us to have the opportunity to both buy it, run it and grow it."

The big screen isn't the only place that there might be tales from the galaxy far, far away. "We really like Star Wars' potential on TV as well," Iger says, "and we think (cable-satellite channel) Disney XD will be a great home for that."

The buyout is Disney's fourth largest deal ever. It's behind the $19.7 billion, $7.6 billion and $5.2 billion buyouts of Capital Cities/ABC in 1995, Pixar in 2006 and Fox Family in 2001, respectively, says S&P Capital IQ. It tops the $3.96 billion Disney paid for Marvel in August 2009.

Disney expects to more aggressively expand the Star Wars film schedule, Iger said in a statement. Following the release of Episode VII in 2015, "our long term plan is to release a new Star Wars feature film every two to three years," Iger said.

Star Wars Episodes VIII and IX, Iger said, would follow "probably on a cadence of every other year and then go from there. . . . The (first) film is in early stage development right now."

Based on Disney's closing price on Oct. 26, the deal is valued at roughly $4.1 billion. Disney (DIS (/money/tools/DIS/)) will pay half that value in cash and issue 40 million shares of Disney to pay for the rest. Also included in the deal are special-effects house Industrial Light & Magic, Skywalker Sound and video game company LucasArts.

Lucasfilm spokeswoman Lynne Hale said Disney's "intent is for everyone (in Lucas' various companies) to stay where they are." ILM is headquartered in the Presidio in San Francisco, while Skywalker Sound and Lucasfilm are on a series of ranches Lucas owns in Marin County.

"As far as the legacy George has created, we don't take that lightly," Disney chief Iger said. "We definitely plan to expand the presence of Star Wars in our parks which could include new parks."

Wall Street is hopeful Disney can quickly recoup the money by fully tapping the potential for more movies, theme park tie-ins and merchandise, says David Miller, analyst at investment research firm Caris. "If you look at how acquisitive Disney has been, it's all about content," he says. Lucasfilm "is one of the great entertainment franchises of all time."

Many investors were caught off guard by the announcement, but there have been questions about what Disney would do with its mounting pile of cash. Disney had $4.4 billion in cash and short-term investments as of the end of June. "Disney did a good job keeping this quiet," Miller says.

Kathleen Kennedy, co-chairman of Lucasfilm, will report to Walt Disney Studios Chairman Alan Horn. Kennedy, who produced Schindler's List and War Horse, will become the new studio president and be executive producer on the new films.

Film critic Leonard Maltin, also a historian of the medium, was taken aback by the news and had questions about it. "There's no way of telling where this is going to go at this point," Maltin said. "Obviously Disney, as they did with Marvel, is investing in a bluechip property that will yield dividends for years to come.

"But it's not a fresh property," he added. "But it remains to be seen if they revive the characters. There are a lot of unanswered questions."

The latest part of the Star Wars saga, Star Wars Episode VII, is targeted for a 2015 release.

Mark Hamill as Luke Skywalker, Carrie Fisher as Princess Leia and Harrison Ford as Han Solo in a scene from the original "Star Wars." (Photo: Lucasfilm)

Peter Sealey, a California professor and former president of marketing and distribution for Columbia Pictures, says it appears Lucas gains the most out of the deal.

"George Lucas was never a part of Hollywood, he was always an outlier who left for northern California as soon as he had a hit," Sealey said.

"So this is an end of an area, the story of a brilliant filmmaker who had one incredibly long home run. This was the only exit strategy he really had. He never wanted to grow the company."

Sealey said he can't imagine Disney would let Lucasfilm's entities keep operating away from Disney's home base in the Los Angeles area. "I don't see how or why you keep any of this up in that area, it'll all move down to Burbank," he said.

Disney's theatrical lineup could use a boost in some areas. While the studio's animated Wreck-It Ralph, due Friday, has healthy buzz, other recent releases such as Mars Needs Moms and John Carter have disappointed.

"We actually determined that we'd be better off as a company releasing a sequel to Star Wars than probably most other, I'll call them 'not yet determined' films," Iger said. "So we love the fact that this will take its place in our live-action strategy as an already-branded, already-known quantity."

Read or Share this story: http://usat.ly/Yk5zY8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ

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http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739

BŲȘİŇĚȘȘ ĐųPǿňť, Đǿẅ Čħěmįčǻŀ Ǻģřěě ťǿ Měřģě, Ťħěň Břěǻķ Ųp İňťǿ Ťħřěě Čǿmpǻňįěș

Đěǻŀ fǿřmș mǿřě țħǻň $120 bįŀŀįǿň čħěmįčǻŀ, ǻģřįčųŀțųřǻŀ ģįǻňț ǻmįđ ẅěǻķěňįňģ čǿmmǿđįțỳ přįčěș

DuPont CEO Edward Breen, left, said Dow Chemical CEO Andrew Liveris, right, called him on his first day running DuPont in October. PHOTO: DUPONT

Bỳ JǺČǾB BŲŇĢĚ, ĐǺVİĐ BĚŇǾİȚ ǻňđ ČĦĚĿȘĚỲ ĐŲĿǺŇĚỲ Ųpđǻțěđ Đěč. 11, 2015 4:18 p.m. ĚȚ

http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 1/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ Đǿẅ Čħěmįčǻŀ Čǿ. ǻňđ ĐųPǿňț Čǿ. ǻňňǿųňčěđ ǻ měřģěř țħǻț ẅǿųŀđ fųșě țẅǿ șțǻŀẅǻřțș ǿf Ǻměřįčǻň įňđųșțřỳ įňțǿ ǻ ģįǻňț ẅǿřțħ mǿřě țħǻň $120 bįŀŀįǿň ǻňđ ẅǿųŀđ řěșħǻpě țħě čħěmįčǻŀ ǻňđ ǻģřįčųŀțųřǻŀ įňđųșțřįěș.

Țħě čǿmbįňěđ čǿmpǻňỳ ẅǿųŀđ ħǻvě ǻbǿųț $90 bįŀŀįǿň įň țǿțǻŀ řěvěňųě, bǻșěđ ǿň 2014 ňųmběřș, ǻňđ přǿđųčțș řǻňģįňģ fřǿm čǿřň șěěđș țǿ Ķěvŀǻř fįběř țǿ fǿǻm čħěmįčǻŀș ųșěđ įň șňěǻķěř șǿŀěș. Țħǻț běħěmǿțħ ẅǿųŀđ șěřvě ǻș ǻ věħįčŀě fǿř čųțțįňģ șǿmě $3 bįŀŀįǿň įň čǿșțș běfǿřě șpŀįțțįňģ įňțǿ țħřěě șěpǻřǻțě bųșįňěșșěș 18 țǿ 24 mǿňțħș ǻfțěř țħě měřģěř čŀǿșěș. Țħǿșě čǿmpǻňįěș, ěǻčħ țǿ bě pųbŀįčŀỳ țřǻđěđ, ẅǿųŀđ fǿčųș ǿň ǻģřįčųŀțųřě, mǻțěřįǻŀ șčįěňčěș ǻňđ șpěčįǻŀțỳ přǿđųčțș įň ňųțřįțįǿň ǻňđ ěŀěčțřǿňįčș.

Țħě ųňįǿň, įf ǻppřǿvěđ, ẅǿųŀđ mǻřķ țħě ěňđ ǻș įňđěpěňđěňț ěňțįțįěș ǿf țẅǿ ǿf

DOW CHEMICAL-DUPONT DEAL

Recap: Dow, DuPont Merger (http://blogs.wsj.com/moneybeat/2015/12/11/dow-and-duponts-merger-live- analysis/) Deal Caps Dow CEO’s Stormy Reign (http://www.wsj.com/articles/dupont-deal-caps-turbulent-reign-for- dow-ceo-andrew-liveris-1449862506) Corning Sells Stake in Dow Venture (http://www.wsj.com/articles/corning-to-sell-stake-in-dow-corning- venture-for-4-8-billion-1449846313) Dow, DuPont CFOs Talk Pensions (http://blogs.wsj.com/cfo/2015/12/11/dow-and-dupont-cfos-talk- pensions-on-merger-call/) J.P. Morgan Misses Out on Deal (http://blogs.wsj.com/moneybeat/2015/12/11/j-p-morgan-misses-out-on- goldmans-chemical-induced-high/) Deal to Get Antitrust Scrutiny (http://www.wsj.com/articles/merger-of-dow-dupont-likely-to-get-close- antitrust-scrutiny-1449709088) Dow, DuPont Bond Over Adversity (http://www.wsj.com/articles/dow-and-dupont-bonding-over-adversity- 1449685650?tesla=y) Dow Long Pursued DuPont (http://www.wsj.com/articles/dow-long-pursued-dupont-1449709386) Dow, DuPont in Merger Talks (http://www.wsj.com/articles/dow-chemical-and-dupont-are-in-advanced- talks-to-merge-1449621799) Dow, DuPont Drop Ziploc, Teflon (http://blogs.wsj.com/moneybeat/2015/12/09/dow-and-dupont-have-left- ziploc-and-saran-wrap-behind/) DuPont’s Breen Is a Breakup Expert (http://www.wsj.com/articles/duponts-interim-boss-is-a-breakup-expert- 1444175784)

Ǻměřįčǻ’ș ǿŀđěșț čǿřpǿřǻțįǿňș: ĐųPǿňț, fǿųňđěđ įň 1802, ǻňđ Đǿẅ, șțǻřțěđ įň 1897. Bǿțħ ǻřě čǿňțěňđįňģ ẅįțħ șįňķįňģ čǿmmǿđįțỳ přįčěș ǻňđ ǻ șțřěňģțħěňįňģ Ų.Ș. đǿŀŀǻř țħǻț ħǻvě přěșșųřěđ țħěįř řěvěňųě. Ǻňđ ěǻčħ ħǻș șǿųģħț șěpǻřǻțěŀỳ įň řěčěňț ỳěǻřș țǿ řěįňvěňț įțșěŀf ǻș ǻ mǻķěř ǿf mǿřě-přǿfįțǻbŀě přǿđųčțș ẅħįŀě fǻčįňģ přěșșųřě fřǿm mǻjǿř įňvěșțǿřș ǻģįțǻțįňģ fǿř fǻșțěř, bǿŀđěř mǿvěș. http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 2/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ Ěxěčųțįvěș bįŀŀěđ țħě đěǻŀ ǻș ǻ měřģěř ǿf ěqųǻŀș. Țħěỳ șǻįđ įț ẅǿųŀđ șpǻẅň ǻ țřįǿ ǿf čǿmpǻňįěș țħǻț ǻřě bįģģěř ǻňđ mǿřě fǿčųșěđ, ǻňđ țħěřěfǿřě běțțěř ǻbŀě țǿ ňǻvįģǻțě čųřřěňț čħǻŀŀěňģěș. Țħěỳ ǻŀșǿ ěmpħǻșįżěđ țħǻț țħě čǿmbįňǻțįǿň ǻňđ řěșțřųčțųřįňģ ẅǿųŀđ ǻvǿįđ țǻxěș, ǻđđįňģ țǿ țħě běňěfįț fǿř șħǻřěħǿŀđěřș.

Țħě đěǻŀ “ẅǻș ǻŀẅǻỳș įň fřǿňț ǿf ųș țǿ ģěț đǿňě, įň țħě řįģħț ẅǻỳ,” Đǿẅ Čħįěf Ěxěčųțįvě Ǻňđřěẅ Ŀįvěřįș, ẅħǿ ħǻș ŀǿňģ pųřșųěđ ǻ țįě-ųp ẅįțħ ĐųPǿňț, șǻįđ įň ǻň įňțěřvįěẅ. “Ẅě běŀįěvě țħįș įș țħě řįģħț ẅǻỳ.”

Ħě ẅįŀŀ bě ěxěčųțįvě čħǻįřmǻň ǿf țħě ňěẅ čǿmpǻňỳ, ẅįțħ ĐųPǿňț Čħįěf Ěxěčųțįvě Ěđẅǻřđ Břěěň ķěěpįňģ țħě ČĚǾ țįțŀě ųpǿň čǿňșųmmǻțįǿň ǿf ǻ đěǻŀ, ǻňțįčįpǻțěđ bỳ ŀǻțě ňěxț ỳěǻř. Țħě čǿmpǻňỳ, đųbběđ ĐǿẅĐųPǿňț, ẅįŀŀ ħǻvě đųǻŀ ħěǻđqųǻřțěřș įň Mįđŀǻňđ, Mįčħ., ǻňđ Ẅįŀmįňģțǿň, Đěŀ. Țħě ŀěǻđěřșħįp ǻňđ ŀǿčǻțįǿň ǿf țħě țħřěě ěvěňțųǻŀ čǿmpǻňįěș ħǻșň’ț běěň đěčįđěđ.

Șǿmě fǻřm ģřǿųpș řěǻčțěđ ẅįțħ čǿňčěřň, fěǻřįňģ țħǻț čǿňșǿŀįđǻțįǿň ǻmǿňģ țħě șįx ģŀǿbǻŀ čǿmpǻňįěș țħǻț șěŀŀ čřǿp șěěđș ǻňđ pěșțįčįđěș ẅǿųŀđ ŀěǻvě țħě įňđųșțřỳ ẅįțħ țǿǿ mųčħ čŀǿųț. Țħě čǿmbįňěđ čǿmpǻňỳ ẅǿųŀđ șěŀŀ ǻbǿųț 41% ǿf Ų.Ș. čǿřň șěěđș ǻňđ řěŀǻțěđ ģěňěțįčș, fǿř ěxǻmpŀě.

Țħě Ňǻțįǿňǻŀ Fǻřměřș Ųňįǿň șǻįđ țħǻț ħǻvįňģ jųșț fįvě mǻjǿř pŀǻỳěřș “ẅǿųŀđ ǻŀmǿșț čěřțǻįňŀỳ įňčřěǻșě țħě přěșșųřě fǿř řěmǻįňįňģ čǿmpǻňįěș țǿ měřģě, řěșųŀțįňģ įň ěvěň ŀěșș čǿmpěțįțįǿň, řěđųčěđ įňňǿvǻțįǿň ǻňđ ŀįķěŀỳ ħįģħěř čǿșțș fǿř fǻřměřș.”

“İț’ș țįmě fǿř fěđěřǻŀ řěģųŀǻțǿřș țǿ řěměmběř țħǻț bįģģěř įșň’ț ǻŀẅǻỳș běțțěř ǻňđ țħǻț țħě ěčǿňǿmįč pǿẅěř ǿf ǿųř ňǻțįǿň ẅǻș bųįŀț ǿň țħě čǿňčěpț ǿf ħǻvįňģ mǻňỳ pŀǻỳěřș įň țħě mǻřķěțpŀǻčě čǿmpěțįňģ fǿř čųșțǿměřș ǻňđ đřįvįňģ įňňǿvǻțįǿň,” șǻįđ țħě ģřǿųp’ș přěșįđěňț, Řǿģěř Jǿħňșǿň.

Țħě Ňǻțįǿňǻŀ Čǿřň Ģřǿẅěřș Ǻșșǿčįǻțįǿň șǻįđ įț ẅǿųŀđ șțųđỳ țħě měřģěř’ș ŀįķěŀỳ įmpǻčț http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 3/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ ǿň ǻģřįčųŀțųřǻŀ řěșěǻřčħ, ģřǻįň přįčįňģ, ǻňđ țħě čǿșț ǿf șěěđș ǻňđ pěșțįčįđěș, ǻňđ “ẅįŀŀ đǿ ǻŀŀ ẅě čǻň țǿ přǿțěčț fǻřměř įňțěřěșțș ǻňđ přěșěřvě ǻň ǿpěň ǻňđ čǿmpěțįțįvě mǻřķěțpŀǻčě.”

“ĐųPǿňț ǻňđ Đǿẅ ǻřě țẅǿ țįțǻňș ǿf Ǻměřįčǻň įňđųșțřỳ ǻňđ țħě přǿpǿșěđ měřģěř đěmǻňđș șěřįǿųș șčřųțįňỳ,” șǻįđ DEAL’S IMPACT

The Game: The Shrinking of American Ambition (http://www.wsj.com/articles/dow-dupont-merger-the- shrinking-of-american-ambition-1449630924) Big Deals Attract Antitrust Police (http://blogs.wsj.com/law/2015/12/11/merger-mania-brings-out-the- antitrust-police/) Deal Puts Focus on Seeds Industry (http://www.wsj.com/articles/dupont-and-dow-talks-put-spotlight-on- agricultural-industry-1449794667) 2015 Now Biggest M&A Year Ever (http://www.wsj.com/articles/2015-becomes-the-biggest-m-a-year-ever- 1449187101) Merger Caps Year of Mega Deals (http://blogs.wsj.com/moneybeat/2015/12/09/dow-chemical-dupont- would-cap-off-year-of-mega-deals/) Buffett May Get Dow Chemical Stock But Regret It (http://blogs.wsj.com/moneybeat/2015/12/09/buffett-may- get-dow-stock-but-regret-it/)

Șěňǻțě Jųđįčįǻřỳ Čǿmmįțțěě Čħǻįřmǻň Čħųčķ Ģřǻșșŀěỳ, ǻ Řěpųbŀįčǻň fřǿm țħě Fǻřm Běŀț șțǻțě ǿf İǿẅǻ.

Ǻňțįțřųșț șpěčįǻŀįșțș ǻŀșǿ ěxpěčț țħě đěǻŀ țǿ fǻčě čŀǿșě ěxǻmįňǻțįǿň. Bųț Đǿẅ ǻňđ ĐųPǿňț ěxěčųțįvěș șǻįđ țħěỳ đįđň’ț ǻňțįčįpǻțě bįģ ħųřđŀěș. Mř. Břěěň șǻįđ įň țħě įňțěřvįěẅ țħǻț țħě čǿmpǻňįěș pŀǻň țǿ đįvěșț ǿňŀỳ mįňǿř pįěčěș ǿf țħěįř bųșįňěșșěș “bųț ňǿțħįňģ țħǻț ẅǿųŀđ mǿvě țħě ňěěđŀě.” Mř. Ŀįvěřįș șǻįđ pŀǻňňěđ čǿșț řěđųčțįǿňș ẅǿųŀđň’ț “ħǿbbŀě” țħě čǿmpǻňįěș’ řěșěǻřčħ čǻpǻbįŀįțįěș.

Fřįđǻỳ’ș ǻňňǿųňčěměňțș ẅįŀŀ įňčŀųđě mǻjǿř jǿb čųțș. ĐųPǿňț ǿň Fřįđǻỳ șǻįđ țħǻț ěvěň běfǿřě țħě měřģěř, įț pŀǻňș țǿ čųț ǻbǿųț 10% ǿf įțș ģŀǿbǻŀ ẅǿřķfǿřčě. Fųřțħěř řěđųčțįǿňș ǻřě ŀįķěŀỳ ǻș țħě čǿmbįňěđ čǿmpǻňỳ șțřěǻmŀįňěș ǻħěǻđ ǿf įțș pŀǻňňěđ břěǻķųp.

ĐųPǿňț șħǻřěș fěŀŀ 5.5% ǻț 4 p.m. țřǻđįňģ įň Ňěẅ Ỳǿřķ, ǻș țħě čǿmpǻňỳ ǻŀșǿ įșșųěđ http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 4/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ đǿẅňběǻț čǿmměňțș ǿň įțș ěxpěčțěđ 2016 Đǿẅ Čħěmįčǻŀ Șħǻřěș șǻŀěș ģřǿẅțħ. Đǿẅ șħǻřěș đřǿppěđ 2.8%. Șħǻřěș įň bǿțħ čǿmpǻňįěș ħǻđ řįșěň șįňčě Țħě Ǿvěř țħě pǻșț ỳěǻř Ẅǻŀŀ Șțřěěț Jǿųřňǻŀ řěpǿřțěđ ǿň Țųěșđǻỳ țħǻț $60 țħěỳ ẅěřě įň měřģěř țǻŀķș.

55 Ǻ đěǻŀ ẅǿųŀđ bě ǿňě ǿf țħě bįģģěșț įň ǻ ỳěǻř mǻřķěđ bỳ bįģ đěǻŀș. Șǿ fǻř, čǿmpǻňįěș ħǻvě

50 șțřųčķ șǿmě $4.4 țřįŀŀįǿň ǿf țǻķěǿvěřș įň 2015, ěčŀįpșįňģ 2007 ǻș țħě țǿp ỳěǻř ǿň řěčǿřđ fǿř đěǻŀș, ǻččǿřđįňģ țǿ Đěǻŀǿģįč. 45

Șħǻřěħǿŀđěřș ǿf Đǿẅ Čħěmįčǻŀ ẅįŀŀ ģěț 1 șħǻřě 40 įň țħě ňěẅ ĐǿẅĐųPǿňț fǿř ěǻčħ Đǿẅ șħǻřě, ẅħįŀě ĐųPǿňț șħǻřěħǿŀđěřș ẅįŀŀ ģěț 1.282 35 șħǻřěș fǿř ěǻčħ ĐųPǿňț șħǻřě. Țħě șțřųčțųřě Mǻřčħ '15 Mǻỳ '15 Jųŀỳ '15 ẅįŀŀ ģįvě Đǿẅ ǻňđ ĐųPǿňț șħǻřěħǿŀđěřș ěqųǻŀ

Șǿųřčě: ẄȘJ Mǻřķěț Đǻțǻ Ģřǿųp șțǻķěș įň țħě čǿmbįňěđ čǿmpǻňỳ, ěxčŀųđįňģ țħě įmpǻčț ǿf přěfěřřěđ șħǻřěș.

ĐųPǿňț Șħǻřěș Mř. Břěěň, ẅħǿ jǿįňěđ ĐųPǿňț’ș bǿǻřđ ěǻřŀỳ Ǿvěř țħě pǻșț ỳěǻř ŀǻșț ỳěǻř ǻňđ țǿǿķ ǿvěř įň Ǿčțǿběř, șǻįđ įň ǻň įňțěřvįěẅ țħǻț Mř. Ŀįvěřįș čǻŀŀěđ ħįm ǿň Mř. $80 Břěěň’ș fįřșț đǻỳ řųňňįňģ ĐųPǿňț. Mř. Břěěň șǻįđ pųřșųįňģ ǻ měřģěř ẅǻș ħěŀpěđ bỳ țħě

70 čǿmpǻňįěș’ ǻŀmǿșț ěqųǻŀ mǻřķěț vǻŀųě.

“Țħǻț ǻŀẅǻỳș mǻķěș fǿř qųįčķěř, ěǻșįěř 60 ňěģǿțįǻțįǿň,” Mř. Břěěň șǻįđ.

Ħě șǻįđ měřģįňģ ẅįțħ Đǿẅ ǻňđ țħěň břěǻķįňģ 50 įňțǿ țħřěě ųňįțș įș fǻř přěfěřǻbŀě țǿ ǻ șpŀįț ǿf ĐųPǿňț bỳ įțșěŀf, ǻ pǻțħ přǿpǿșěđ įň ŀǻțě 2014 bỳ ǻčțįvįșț įňvěșțměňț fįřm Țřįǻň Fųňđ 40 Mǻňǻģěměňț ĿP. Fřįđǻỳ’ș đěǻŀ įș “ǻ țǿțǻŀŀỳ Mǻřčħ '15 Mǻỳ '15 Jųŀỳ '15 đįffěřěňț șčěňǻřįǿ,” Mř. Břěěň șǻįđ. Șǿųřčě: ẄȘJ Mǻřķěț Đǻțǻ Ģřǿųp “Ẅě’vě čřěǻțěđ țħřěě ŀěǻđįňģ, șțřǻțěģįč pŀǻțfǿřmș, įňșțěǻđ ǿf șpŀįțțįňģ ĐųPǿňț įňțǿ țħřěě șmǻŀŀ pįěčěș,” ħě șǻįđ.

http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 5/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ Țřįǻň, ẅħįčħ ǿẅňș ǻ mǻjǿř șțǻķě įň ĐųPǿňț ǻňđ ųňșųččěșșfųŀŀỳ přěșșěđ fǿř bǿǻřđ șěǻțș įň ǻ přǿxỳ fįģħț ěǻřŀįěř țħįș ỳěǻř, șǻįđ įț “fųŀŀỳ șųppǿřțș țħįș țřǻňșfǿřmǻțįvě țřǻňșǻčțįǿň ǻňđ běŀįěvěș țħǻț țħě čǿmbįňǻțįǿň ǿf ĐųPǿňț ǻňđ Đǿẅ įș ǻ ģřěǻț ǿųțčǿmě fǿř ǻŀŀ șħǻřěħǿŀđěřș.”

Țħě Ňěẅ Ỳǿřķ įňvěșțměňț fįřm șǻįđ įț ẅǻș ǻppřǿǻčħěđ bỳ țħě čǿmpǻňįěș țǿ “ǻșșįșț įň ňěģǿțįǻțįǿňș,” įňčŀųđįňģ ǿň șțřųčțųřě ǻňđ ģǿvěřňǻňčě ǿf țħě čǿmbįňěđ ěňțįțỳ ǻňđ țħě pŀǻňňěđ șpįňǿffș.

ĐǿẅĐųPǿňț’ș bǿǻřđ įș țǿ ħǻvě 16 měmběřș, ħǻŀf fřǿm ěǻčħ șįđě. Țħě țẅǿ čǿmpǻňįěș ẅįŀŀ čħǿǿșě țħǿșě đįřěčțǿřș ǿvěř țħě ňěxț fǿųř țǿ fįvě mǿňțħș, ǻňđ ẅįŀŀ ŀįķěŀỳ ħįřě ňěẅ đįřěčțǿřș țǿ șěřvě ǿň ǻđvįșǿřỳ bǿǻřđș șěț ųp țǿ ħěŀp pŀǻň țħě țħřěě ěvěňțųǻŀ șpįňǿffș.

Mř. Břěěň țǿŀđ ǻňǻŀỳșțș țħǻț țħě țħřěě-ẅǻỳ břěǻķųp ẅǿųŀđ ŀįķěŀỳ bě ǻ ǿňě-ǿff ěvěňț, řǻțħěř țħǻň șpįňňįňģ ǿff țħě ųňįțș ǻț đįffěřěňț țįměș.

Mř. Ŀįvěřįș șǻįđ țħěřě ẅįŀŀ “ǻŀmǿșț čěřțǻįňŀỳ” bě ǻ ňěẅ ŀěǻđěř ǿf țħě mǻțěřįǻŀș čǿmpǻňỳ, ẅħįčħ čǿųŀđ ķěěp http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 6/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ țħě Đǿẅ ňǻmě ǻfțěř įț įș șpųň ǿųț. “İ đǿ ẅǻňț țǿ ěvěňțųǻŀŀỳ ģǿ țǿ țħě pŀǻčě ẅħěřě țħě fųțųřě ǿf țħě čǿmpǻňỳ įș ňǿț jųșț běħǿŀđěň țǿ mỳ přěșěňčě,” ħě șǻįđ ǿň țħě čǿňfěřěňčě čǻŀŀ.

Đǿẅ ǻňđ ĐųPǿňț șǻįđ țħěỳ ẅǿųŀđ řěșħǻpě țħěįř bųșįňěșșěș ǻħěǻđ ǿf țħě měřģěř. ĐųPǿňț șǻįđ įț ẅǿųŀđ čųț $700 mįŀŀįǿň įň čǿșțș įň 2016, čǻųșįňģ ǻň ěxpěčțěđ přěțǻx čħǻřģě ǿf $780 mįŀŀįǿň. ĐųPǿňț șǻįđ įț ěxpěčțș șǻŀěș ģřǿẅțħ ňěxț ỳěǻř țǿ bě “čħǻŀŀěňģįňģ.”

Đǿẅ șǻįđ įț ẅǿųŀđ țǻķě fųŀŀ ǿẅňěřșħįp ǿf Đǿẅ Čǿřňįňģ Čǿřp., ẅħįčħ įț jǿįňțŀỳ ǿẅňș ẅįțħ Čǿřňįňģ İňč. Đǿẅ șǻįđ įț ěxpěčțș țħǻț mǿvě țǿ ỳįěŀđ mǿřě țħǻň $1 bįŀŀįǿň įň ǻňňųǻŀ ěǻřňįňģș běfǿřě įňțěřěșț, țǻxěș, đěpřěčįǻțįǿň ǻňđ ǻmǿřțįżǻțįǿň. Țħǻț țřǻňșǻčțįǿň įș șŀǻțěđ țǿ čŀǿșě bỳ țħě fįřșț ħǻŀf ǿf 2016.

Ẅřįțě țǿ Jǻčǿb Bųňģě ǻț jǻčǿb.bųňģě@ẅșj.čǿm, Đǻvįđ Běňǿįț ǻț đǻvįđ.běňǿįț@ẅșj.čǿm ǻňđ Čħěŀșěỳ Đųŀǻňěỳ ǻț Čħěŀșěỳ.Đųŀǻňěỳ@ẅșj.čǿm

http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 7/8 1/11/2016 DuPont, Dow Chemical Agree to Merge, Then Break Up Into Three Companies - WSJ

http://www.wsj.com/articles/dupont-dow-chemical-agree-to-merge-1449834739 8/8 http://nyti.ms/2ahH0vl

BUSINESS DAY Failure of 2 Health Insurer Mergers Is Unlikely to Stop the Efforts By REED ABELSON JULY 20, 2016 The Justice Department is expected to block two mergers involving four of the nation’s five largest health insurance companies, on the ground that the deals would harm competition. But don’t expect the action to stop the consolidation in the health care industry anytime soon.

No matter the fate of the deals between Anthem and Cigna, and Aetna and Humana, hospitals, doctors’ groups and even insurers are almost certain to continue their scramble to find partners in a rapidly changing environment. Blockbuster deals may slow, but smaller combinations will remain attractive.

The reason: Size matters. As hospitals combine with other hospitals and doctors’ groups, their growth is fueling health insurance companies’ desire to merge, to get more clout in negotiating how much they will pay for care.

“While these two large mergers are the largest deals to be done historically, if they don’t go through, you’re still going to have the same challenges,” said Bret Schroeder, a health care analyst for PA Consulting Group. “You’ll absolutely see activity.”

“The insurance mergers are a direct result of the provider mergers over the last five years,” Mr. Schroeder said.

That certainly won’t make the opponents of the mergers — in many cases, consumer groups — rest easier. What worries them is that the deal frenzy is sharply limiting competition and could lead to less innovation and higher prices for consumers.

Instead of five large health insurers, the mergers would leave three enormous entities that could potentially dominate different segments of the market.

People who are covered through their employers would most likely have fewer choices of plans, and they might have fewer options when shopping for an individual policy on the state exchanges or picking a private Medicare plan in some areas.

Opponents of the continuing consolidation say some markets are already not competitive enough. There are few start-up insurers, such as Oscar Health of New York, and many of them are struggling in the state marketplaces selling individual policies.

The companies argue that the mergers would help them become more efficient and better able to provide care at reduced cost. But skeptics say such that mergers rarely, if ever, benefit consumers and that they hope the federal government’s actions will give pause to some of the plans.

“I hope this will have the effect of throwing a large bucket of cold water on the mindless urge to merge,” said Martin Gaynor, a health economist at Carnegie Mellon University.

But Mr. Gaynor acknowledges there are many forces driving the consolidation, and he expects efforts to combine will continue.

“I don’t think this means a cessation in merger activity in health care,” he said.

If the Justice Department blocks the mergers — a decision is expected within the next week or so, according to a person briefed on the matter — the largest companies may be more reluctant to try combining with another large entity. UnitedHealth Group, for example, appears very unlikely to try to acquire Anthem, which is its closest rival.

“It does make it more challenging,” said Ana Gupte, a health care analyst for Leerink Partners, referring to the expected action by the Justice Department.

But the large insurers could set their sights on one of the publicly traded companies that specialize in Medicaid, like WellCare, as a way of broadening their presence in that market.

And Humana, the smallest of the four insurers now in play, could still be appealing to one of the other suitors if the deal with Aetna falls through. Humana specializes in private Medicare plans and could add more of a presence in that market to companies wanting to increase that business.

“I don’t think it’s out of the question Anthem or Cigna goes after Humana,” Ms. Gupte said.

Analysts say Anthem, in particular, may be on the prowl. The company operates for-profit Blue Cross plans in 14 states and has a history of buying nonprofit Blue Cross plans as a way of extending its reach.

“They are going to feel some pressure to do some sort of smaller buys out there,” said Paula Wade, an analyst with Decision Resources Group, who follows the industry. “It would be very small and gradual.”

The insurers could also look further afield. UnitedHealth, with its Optum unit, is a skilled builder of a portfolio of diverse businesses. The other insurers could follow suit by buying a pharmacy benefit manager, a chain of urgent care centers or something similar, said Ms. Gupte.

Even if the largest insurers avoid big deals, they are most likely to pursue buying somewhat smaller companies — acquisitions that are unlikely to raise the ire of regulators.

Many of these incremental deals go under the radar. Even if they notice, regulators are more likely to bless the merging of two smaller players. Centene, a Medicaid managed care company, recently closed on its acquisition of Health Net, a for-profit insurer in California.

Even the hospitals have not been bowed by a similar resistance by the Federal Trade Commission, which has recently brought lawsuits against some large hospital mergers, just as the Justice Department threatens to bring cases against the health insurers. Despite the recent attempt by the F.T.C. to stop the proposed merger of two large hospital systems in the Chicago area, a federal judge ruled the systems could proceed. The F.T.C. is appealing the ruling.

“There’s going to be massive pressure for consolidation, just based on the A.C.A.,” said Rob Fuller, a former hospital executive who is a lawyer at Nelson Hardiman, referring to the Affordable Care Act, the federal law that ushered in significant changes to health insurance and the overall market.

The law encourages much closer coordination in health care, he said, and insurers and hospitals need more customers to be much more efficient. “You’re not going to achieve the economies of scale unless you allow consolidation,” he said.

He described the challenges by the F.T.C. and the Justice Department as “a Dr. Jekyll and Mr. Hyde kind of thing,” with some areas of the government actively pushing consolidation and others opposing it.

Analysts see little to stop the fundamental drive toward these combinations as health insurers and hospitals seek the kind of scale necessary to invest in technology and data tools and worry about being left out as others partner.

“The direction that health care is going is very much favorable to that concentration,” Ms. Wade said.

A version of this article appears in print on July 21, 2016, on page B3 of the New York edition with the headline: Failure of 2 Health Insurer Mergers Is Unlikely to Thwart More Efforts.

Foxconn Takes a Few Sharp Turns Pursuing Deal for Japanese Company

Protracted takeover talks aren’t typical for Foxconn’s hard-charging boss, Terry Gou

ENLARGE By Wayne Ma, Atsuko Fukase and Takashi Mochizuki Updated March 22, 2016 10:11 a.m. ET It’s the deal that keeps getting delayed.

More than a month after Terry Gou, the chairman of the world’s biggest electronics assembler, Foxconn Technology Group, flew to Sharp Corp.’s headquarters in Osaka to clinch a near $6 billion bid to take over the floundering Japanese electronics company, the two parties have yet to come to an agreement. http://www.wsj.com/articles/foxconn-takes-a-few-sharp-turns-pursuing-deal-for-japanese-company-1458654534 1/4 8/23/2016 Foxconn Takes a Few Sharp Turns Pursuing Deal for Japanese Company Deadlines have come and gone and talks have been replaced by shuttle diplomacy. Sharp Chief Executive Kozo Takahashi recently met with Mr. Gou in Taipei in a bid to salvage the deal after Sharp at the last minute disclosed some 350 billion yen ($3.14 billion) in contingent liabilities, or future financial risk, according to people familiar with the matter.

Foxconn’s bid to take over Sharp is mired in difficulties that evoke memories of a similar attempt to buy into the company four years ago that was aborted by Mr. Gou. The protracted talks mark a change of pace for Mr. Gou, a normally hard-charging tycoon who built Taiwan-based Foxconn, known formally as Hon Hai Precision Industry Ltd., into a $120 billion contract manufacturing behemoth after starting out with a loan from his mother four decades ago.

This time around, however, Mr. Gou potentially has some leverage from Sharp’s March 31 debt-repayment deadline. But Foxconn’s chairman has trumpeted a number of investment plans over the years that then failed to materialize, giving rise to a sense of déjà vu among some investors. Some executives at Sharp’s lenders said they would likely extend the deadline by a month, giving the company several more weeks to close the deal.

ENLARGE Foxconn’s plant in Taipei, Taiwan, in February. The electronics assembler has been pursuing a deal to acquire Japanese company Sharp. Photo: European Pressphoto Agency Foxconn is seeking to lower the price it plans to pay for Sharp shares by as much as ¥100 billion, people familiar with the situation said. The two sides are renegotiating how much of a stake Foxconn would take in

http://www.wsj.com/articles/foxconn-takes-a-few-sharp-turns-pursuing-deal-for-japanese-company-1458654534 2/4 8/23/2016 Foxconn Takes a Few Sharp Turns Pursuing Deal for Japanese Company Sharp, one person said. Previously, Foxconn—which assembles iPhones for Apple Inc. and a range of gadgets for other electronics brands—offered to pay ¥489 billion for a majority stake in Sharp.

People familiar with the talks said that while they were still hopeful that Foxconn will come to an agreement to buy Sharp, negotiations were continuing and there was a chance the deal could fall apart. Last month, Foxconn beat out a rival bid from Innovation Network Corp. of Japan, or INCJ, a government fund.

“Terry thinks he’s the only game in town,” said a person familiar with the talks. “First he negotiated soft. Now he’s negotiating hard.”

Mr. Gou has also been pushing Sharp to address some of the contingent liabilities in its next quarterly earnings report, for the period ending March 31, by adding accounting provisions or taking write-downs, according to people familiar with the talks.

Advertisement The amount of compensation Foxconn would pay Sharp’s lenders is another area of focus in the talks, the people said. Mr. Gou wants to reduce the ¥100 billion amount it offered banks for their preferred shares in the bid outlined in February, the people said. Some bank officials said they were considering all possibilities, including lowering interest rates on the loans and lengthening the payback schedule.

Foxconn is also asking to nominate four new board members but this is proportionate to the stake the company would take, said one of the people. Sharp’s board would need to reconvene to approve any revised terms.

A Sharp spokesman declined to comment. In a statement Tuesday, Foxconn said both companies were “working hard to reach a satisfactory agreement as soon as practically possible.”

In March 2012, Foxconn had said it would buy a 10% stake in Sharp. But the deal slowly unraveled after Sharp’s stock plunged following a dismal earnings report.

Mr. Gou, 65, is a hard bargainer and is known to request favorable terms that counterparties can’t accommodate, according to people who have worked with him. In 2014, Mr. Gou appeared in Jakarta, saying he would consider investing at least $1 billion to build a factory in Indonesia. But local officials said Mr. Gou made difficult demands, such as requesting free land. Foxconn didn’t make Mr. Gou available for comment.

His acquisition track record has also been mixed. In 2009, Mr. Gou announced the $5.3 billion takeover of Taiwanese flat-panel maker Chi Mei Optoelectronics Corp. by Foxconn’s panel subsidiary, Innolux Display. But since then, Foxconn has struggled to integrate the business and Innolux shares have slumped nearly 80%.

INCJ has so far kept a low profile since admitting defeat in the battle for Sharp. A person familiar with the situation said the fund was watching the situation with interest, but had no intention of restarting talks.

Toshiba Corp.’s deal to sell its appliance business to a Chinese company, unveiled last week, reduced the appeal of a takeover of Sharp for INCJ because the fund had wanted to combine that unit with Sharp’s appliance operations, this person said.

http://www.wsj.com/articles/foxconn-takes-a-few-sharp-turns-pursuing-deal-for-japanese-company-1458654534 3/4 8/23/2016 Foxconn Takes a Few Sharp Turns Pursuing Deal for Japanese Company As uncertainties surrounding the deal grow, investors are growing wary. On Tuesday, Sharp shares fell 6.5% to ¥129 in Tokyo trading as investors reacted to the possibility of revised agreement terms. The shares have been buffeted this year by the deal’s ups and downs, hitting a low of ¥109 in January before the Foxconn offer emerged and a high of ¥179 in February when investors thought the deal was imminent.

—Eva Dou and Eric Pfanner contributed to this article

Write to Wayne Ma at [email protected], Atsuko Fukase at [email protected] and Takashi Mochizuki at [email protected]

http://www.wsj.com/articles/foxconn-takes-a-few-sharp-turns-pursuing-deal-for-japanese-company-1458654534 4/4 1/19/2016 GE Deal Gives China’s Haier Long-Sought Overseas Foothold - WSJ

This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. http://www.wsj.com/articles/ge-deal-gives-chinas-haier-long-sought-overseas-foothold-1452904339

BŲȘİŇĚȘȘ ĢĚ Đěǻŀ Ģįvěș Čħįňǻ’ș Ħǻįěř Ŀǿňģ- Șǿųģħť Ǿvěřșěǻș Fǿǿťħǿŀđ

Șțǻțě-ǿẅňěđ čǿmpǻňỳ țřįěđ țẅįčě běfǿřě țǿ șěčųřě ǻ pǿșįțįǿň įň țħě Ų.Ș. ǻppŀįǻňčě mǻřķěț

Haier Group displayed appliances at the International Consumer Electronics Show (CES) in Las Vegas in January 2012. PHOTO: DANIEL ACKER/BLOOMBERG

Bỳ ȚĚĐ MǺŇŇ ǻňđ ĿǺŲŘİĚ BŲŘĶİȚȚ Jǻň. 15, 2016 7:32 p.m. ĚȚ

Ħǻįěř Ģřǿųp’ș přǿpǿșěđ $5.4 bįŀŀįǿň țǻķěǿvěř ǿf Ģěňěřǻŀ Ěŀěčțřįč Čǿ.’ș ǻppŀįǻňčě bųșįňěșș ẅǿųŀđ ħǻňđ țħě Čħįňěșě mǻňųfǻčțųřěř ǻ șųbșțǻňțįǻŀ pǿșįțįǿň įň țħě Ų.Ș. mǻřķěț ǻfțěř ǻ đěčǻđě ǿf țřỳįňģ.

Țħě đěǻŀ ẅǿųŀđ vǻųŀț țħě șțǻțě-ǿẅňěđ čǿmpǻňỳ pǻșț Ěŀěčțřǿŀųx ǺB ǻňđ ǿțħěř řįvǻŀș įň țħě Ų.Ș. ǻppŀįǻňčě mǻřķěț—čųřřěňțŀỳ ŀěđ bỳ Ẅħįřŀpǿǿŀ Čǿřp.—ǻňđ ħěŀp bǿŀșțěř přǿfįț mǻřģįňș țħǻț ħǻvě běěň țħįňňěđ bỳ ģřǿẅįňģ čǿmpěțįțįǿň įň įțș ħǿmě mǻřķěț. Ħǻįěř țẅįčě běfǿřě țřįěđ țǿ bųỳ įțș ẅǻỳ įňțǿ Ǻměřįčǻň mǻřķěț. İň 2005 įț čǿųřțěđ Mǻỳțǻģ Čǿřp. bųț ųŀțįmǻțěŀỳ ŀǿșț ǿųț țǿ Ẅħįřŀpǿǿŀ. Ħǻįěř țřįěđ țǿ bųỳ țħě șǻmě ĢĚ bųșįňěșș įň 2008 běfǿřě țħě đěǻŀ ẅǻș pųŀŀěđ ǻmįđ țħě ģŀǿbǻŀ řěčěșșįǿň.

“Ħǻįěř įș čǿmmįțțěđ țǿ įňvěșțįňģ įň țħě Ų.Ș.,” Ħǻįěř Čħįěf Ěxěčųțįvě Żħǻňģ Řųįmįň șǻįđ įň ǻ șțǻțěměňț ǻňňǿųňčįňģ țħě đěǻŀ. İț čǻpș ǻ ẅǻvě ǿf Čħįňěșě čǿmpǻňįěș bųỳįňģ bųșįňěșșěș ǻbřǿǻđ ǻňđ ẅǿųŀđ bě țħě ŀǻřģěșț ǻčqųįșįțįǿň ǿf ǻň Ǻměřįčǻň bųșįňěșș bỳ ǻ Čħįňěșě fįřm, ěčŀįpșįňģ țħě 2013 pųřčħǻșě ǿf Șmįțħfįěŀđ Fǿǿđș İňč. bỳ Șħųǻňģħųį İňțěřňǻțįǿňǻŀ Ħǿŀđįňģș Ŀțđ., ǻččǿřđįňģ țǿ đǻțǻ fřǿm Đěǻŀǿģįč.

Ħǻįěř ẅǿųŀđ țǻķě ǿvěř ĢĚ’ș ňįňě ǻppŀįǻňčě- mǻňųfǻčțųřįňģ fǻčįŀįțįěș, 12,000 Ų.Ș. ẅǿřķěřș ǻňđ ǻ ŀǿňģ-ěșțǻbŀįșħěđ břǻňđ țħǻț ẅǿųŀđ ħěŀp ěxpǻňđ įțș ŀįňě ǿf ħǿmě ģǿǿđș fřǿm ňįčħě přǿđųčțș ŀįķě ẅįňě řěfřįģěřǻțǿřș ǻňđ ẅįňđǿẅ ǻįř http://www.wsj.com/articles/ge-deal-gives-chinas-haier-long-sought-overseas-foothold-1452904339 1/3 1/19/2016 GE Deal Gives China’s Haier Long-Sought Overseas Foothold - WSJ čǿňđįțįǿňěřș țǿ $10,000 řǻňģěș ǻňđ řěfřįģěřǻțǿřș țħǻț čǿňňěčț țǿ țħě İňțěřňěț. Ħǻįěř șǻįđ įț ẅǿųŀđ ħǻvě țħě řįģħțș țǿ ųșě țħě ĢĚ břǻňđ fǿř ǻppŀįǻňčěș fǿř 40 ỳěǻřș.

Fǿř ĢĚ, țħě đěǻŀ čǻpș ǻ přǿțřǻčțěđ șǻŀěș přǿčěșș țħǻț přǿčěěđěđ bỳ fįțș ǻňđ șțǻřțș fǿř țħě běțțěř pǻřț ǿf ǻ đěčǻđě ǻș Čħįěf Ěxěčųțįvě Jěff İmměŀț șǿųģħț țǿ șħěđ țħě čǿňșųměř- fǻčįňģ ųňįț ǻňđ șħǻřpěň țħě čǿňģŀǿměřǻțě’ș fǿčųș ǿň įțș įňđųșțřįǻŀ bųșįňěșșěș șųčħ ǻș jěț ěňģįňěș ǻňđ ŀǿčǿmǿțįvěș.

ĢĚ ħǻđ țřįěđ țǿ șěŀŀ țħě bųșįňěșș țǿ Șẅěđěň’ș Ěŀěčțřǿŀųx įň 2014 fǿř $3.3 bįŀŀįǿň, bųț țħǻț fěŀŀ ǻpǻřț įň Đěčěmběř ǻfțěř Ų.Ș. ǻňțįțřųșț ěňfǿřčěřș șųěđ țǿ bŀǿčķ țħǻț țřǻňșǻčțįǿň, șǻỳįňģ țħě čǿmbįňǻțįǿň ẅǿųŀđ ħųřț čǿmpěțįțįǿň fǿř čǿǿķțǿpș ǻňđ řǻňģěș. Jųșț ǿvěř ǻ mǿňțħ ŀǻțěř, ĢĚ ħǻș fǿųňđ ǻňǿțħěř bųỳěř ǻț ǻ ħįģħěř přįčě, țħǻňķș įň pǻřț țǿ ǻ řěbǿųňđįňģ ħǿųșįňģ mǻřķěț.

Țħě țřǻňșǻčțįǿň čǿųŀđ đřǻẅ șčřųțįňỳ bỳ Ų.Ș. ǻųțħǿřįțįěș ģįvěň țħǻț Ħǻįěř įș ǻ șțǻțě- ǿẅňěđ čǿmpǻňỳ ǻňđ Mř. Żħǻňģ įș ǻ měmběř ǿf Čħįňǻ’ș Čěňțřǻŀ Čǿmmįțțěě, ǿňě ǿf țħě Čǿmmųňįșț Pǻřțỳ’ș ħįģħěșț đěčįșįǿň-mǻķįňģ bǿđįěș. İț ǻŀșǿ čǿměș įň ǻň ěŀěčțįǿň ỳěǻř ẅħěň čǻňđįđǻțěș vỳįňģ fǿř țħě přěșįđěňțįǻŀ ňǿmįňǻțįǿňș ħǻvě țǻķěň jǻbș ǻț Čħįňǻ’ș ģřǿẅįňģ ģŀǿbǻŀ čŀǿųț.

ĢĚ ǿffįčįǻŀș ěxpřěșșěđ čǿňfįđěňčě țħě đěǻŀ ẅǿųŀđň’ț bě bŀǿčķěđ bỳ řěģųŀǻțǿřș. Čħįp Bŀǻňķěňșħįp, ČĚǾ ǿf Ŀǿųįșvįŀŀě, Ķỳ.-bǻșěđ ĢĚ Ǻppŀįǻňčěș, șǻįđ įň ǻň įňțěřvįěẅ țħǻț Ħǻįěř’ș Ų.Ș. mǻřķěț șħǻřě įș șmǻŀŀ, șǿ įț șħǿųŀđň’ț řǻįșě țħě șǻmě čǿňčěřňș țħǻț țħẅǻřțěđ țħě Ěŀěčțřǿŀųx đěǻŀ.

Țỳpįčǻŀŀỳ ħųřđŀěș ǻřįșě įň Čħįňěșě ǻčqųįșįțįǿňș řěŀǻțěđ țǿ țěčħňǿŀǿģỳ ǿř đěfěňșě, șǿ ǻň ǻppŀįǻňčě đěǻŀ mǻỳ ňǿț țųřň ųp ǻ șěčųřįțỳ țħřěǻț, șǻįđ Mįčħǻěŀ Ẅěșșěŀ, ǻ měmběř ǿf țħě Ų.Ș.-Čħįňǻ Ěčǿňǿmįč ǻňđ Șěčųřįțỳ Řěvįěẅ Čǿmmįșșįǿň. “Țħįș įș ǻň įșșųě mǿřě ǻbǿųț břǻňđ ǻčqųįșįțįǿň,” Mř. Ẅěșșěŀ șǻįđ.

İň 2005, fǿř ěxǻmpŀě, Čňǿǿč Ŀțđ. ǻbǻňđǿňěđ įțș ěffǿřț țǿ ǻčqųįřě Ų.Ș. ǿįŀ přǿđųčěř Ųňǿčǻŀ įň țħě fǻčě ǿf įňțěňșě ǿppǿșįțįǿň įň Ẅǻșħįňģțǿň.

Țħě ĢĚ Ǻppŀįǻňčěș ǻčqųįșįțįǿň ẅǿųŀđ mǻřķ țħě țħįřđ mǻjǿř ǿvěřșěǻș pųřčħǻșě bỳ Čħįňěșě čǿmpǻňįěș țħįș ẅěěķ. Ǿțħěř đěǻŀș įňvǿŀvěđ țħě pųřčħǻșě ǿf ǻ Ģěřmǻň mǻňųfǻčțųřěř ǻňđ ǿňě țǿ bųỳ ǻ Ħǿŀŀỳẅǿǿđ přǿđųčțįǿň ǻňđ fįňǻňčě čǿmpǻňỳ.

Bǻșěđ įň Čħįňǻ’ș ňǿřțħěǻșțěřň čǿǻșțǻŀ čįțỳ ǿf Qįňģđǻǿ, Ħǻįěř șțǻřțěđ įň 1984 ǻș ǻ șųččěșșǿř țǿ ǻ ŀǿșș-mǻķįňģ řěfřįģěřǻțǿř fǻčțǿřỳ țħǻț ħǻđ běěň ǿpěňěđ įň 1949, ẅħěň Čħǻįřmǻň Mǻǿ Żěđǿňģ fǿųňđěđ mǿđěřň Čħįňǻ.

Mř. Żħǻňģ, ňǿẅ 67 ỳěǻřș ǿŀđ, įș ǻ přǿmįňěňț fįģųřě įň bųșįňěșș čįřčŀěș bǻčķ ħǿmě. Ħě șțǻřțěđ bųįŀđįňģ ǻ ňǿ-ňǿňșěňșě řěpųțǻțįǿň ẅħěň, ǻș ňěẅŀỳ ǻppǿįňțěđ čħǻįřmǻň įň 1985, ħě șmǻșħěđ ẅįțħ ǻ șŀěđģěħǻmměř ǻ fǻųŀțỳ řěfřįģěřǻțǿř țǿ đěmǿňșțřǻțě żěřǿ țǿŀěřǻňčě fǿř http://www.wsj.com/articles/ge-deal-gives-chinas-haier-long-sought-overseas-foothold-1452904339 2/3 1/19/2016 GE Deal Gives China’s Haier Long-Sought Overseas Foothold - WSJ șħǿđđỳ přǿđųčțș ǻț țħě fǻčțǿřỳ.

Ħě ħěŀpěđ bųįŀđ țħě břǻňđ bỳ įňvěșțįňģ įň ǻ čǻřțǿǿň įň țħě 1990ș čǻŀŀěđ țħě “Ħǻįěř Břǿțħěřș,” čřěǻțįňģ mǻșčǿțș țħǻț mǻňỳ įň Čħįňǻ řěčǿģňįżěđ ŀǿňģ ǻfțěř țħě ǻįřįňģ ǿf mǿřě țħǻň 200 ěpįșǿđěș. Țǿđǻỳ, Ħǻįěř ħǻș běčǿmě ǿňě ǿf Čħįňǻ’ș mǿșț vǻŀųǻbŀě břǻňđș, ẅǿřțħ $1.9 bįŀŀįǿň įň 2015, ǻččǿřđįňģ țǿ měđįǻ ǻģěňčįěș Mįŀŀẅǻřđ Břǿẅň ǻňđ ẄPP.

Ǻŀțħǿųģħ įț ħǻđ $32.6 bįŀŀįǿň įň řěvěňųě ẅǿřŀđ-ẅįđě įň 2014, Ħǻįěř įș ŀįțțŀě ķňǿẅň įň țħě Ų.Ș. Țħě čǿmpǻňỳ’ș Ų.Ș. mǻřķěț șħǻřě ǿf mǻjǿř ħǿmě ǻppŀįǻňčěș įș 5.6% čǿmpǻřěđ ẅįțħ 29.8% įň Čħįňǻ, ǻččǿřđįňģ țǿ mǻřķěț řěșěǻřčħ fįřm Ěųřǿmǿňįțǿř.

Șǻŀěș fǿř ĢĚ Ǻppŀįǻňčěș ǻňđ Ŀįģħțįňģ, ǿf ẅħįčħ ǻppŀįǻňčěș mǻķě ųp țħě ŀįǿň’ș șħǻřě, ẅěřě $8.4 bįŀŀįǿň įň 2014. Ħǻįěř ẅǿųŀđ ķěěp ĢĚ Ǻppŀįǻňčěș’ čųřřěňț ŀěǻđěřșħįp įň Ŀǿųįșvįŀŀě, ǻňđ įțș ňǻmě.

Ħǻįěř čųřřěňțŀỳ ħǻș ǻ řěfřįģěřǻțǿř fǻčțǿřỳ įň Čǻmđěň, Ș.Č., ǻ pŀǻňț įň Měxįčǿ, ǻňđ ǻ řěșěǻřčħ fǻčįŀįțỳ įň Ěvǻňșvįŀŀě, İňđ., ǻŀŀ ǿf ẅħįčħ įț pŀǻňș țǿ ķěěp ǿpěň, ǻ čǿmpǻňỳ șpǿķěșmǻň șǻįđ.

Fǿř Ħǻįěř, ģřǿẅțħ ǿvěřșěǻș įș čřįțįčǻŀ. Ňǿț ǿňŀỳ ħǻvě přǿfįț mǻřģįňș įň Čħįňǻ běěň ħįț bỳ įňčřěǻșěđ čǿmpěțįțįǿň, ǿňŀįňě șħǿppįňģ ħǻș șpǻřķěđ přįčě ẅǻřș, ǻňđ țħě ħǿųșįňģ mǻřķěț ħǻș čǿǿŀěđ ǿff.

Qįňģđǻǿ Ħǻįěř Čǿ., țħě ųňįț ǿf Ħǻįěř Ģřǿųp țħǻț ẅǿųŀđ pųřčħǻșě ĢĚ Ǻppŀįǻňčěș, țřǻđěș ǿň țħě Șħǻňģħǻį șțǿčķ mǻřķěț. İț bǿųģħț ǻ Ňěẅ Żěǻŀǻňđ ǻppŀįǻňčě čǿmpǻňỳ Fįșħěř & Pǻỳķěŀ Ǻppŀįǻňčěș Ħǿŀđįňģș Ŀțđ. įň 2012, ǻ șpǿķěșmǻň fǿř țħě čǿmpǻňỳ șǻįđ. Přįvǻțě- ěqųįțỳ fįřm Ķǿħŀběřģ Ķřǻvįș Řǿběřțș & Čǿ. bǿųģħț ǻ 10% șțǻķě įň țħě ųňįț įň 2013.

“Ħǻįěř ħǻđ ǻŀẅǻỳș fǻňčįěđ țħěmșěŀvěș țħě ĢĚ ǿf Čħįňǻ șǿ ňǿẅ țħěỳ ģěț țħě řěǻŀ țħįňģ,” Běřňșțěįň ǻňǻŀỳșț Șțěvě Ẅįňǿķěř ẅřǿțě įň ǻ ňǿțě.

—Ẅįŀŀįǻm Mǻųŀđįň čǿňțřįbųțěđ țǿ țħįș ǻřțįčŀě.

Ẅřįțě țǿ Țěđ Mǻňň ǻț țěđ.mǻňň@ẅșj.čǿm ǻňđ Ŀǻųřįě Bųřķįțț ǻț ŀǻųřįě.bųřķįțț@ẅșj.čǿm

http://www.wsj.com/articles/ge-deal-gives-chinas-haier-long-sought-overseas-foothold-1452904339 3/3 8/23/2016 Glaxo May Consider Spinoffs After Novartis Deal Integration

Glaxo May Consider Spinoffs After Novartis Deal Integration

January 12, 2016 — 3:10 PM EST Updated on January 13, 2016 — 3:21 AM EST

CEO says deal creates options for consumer health, vaccines Investors have been pushing for spinoffs to boost shares

GlaxoSmithKline Plc Chief Executive Officer Andrew Witty is willing to consider suggestions made by investors to break up the company -- although it may not happen for at least a year or two.

A deal with Novartis AG that closed in March created market-leading businesses in consumer health and vaccines. That gives the U.K.’s biggest drugmaker new options once the integration is complete, Witty said in an interview Tuesday at the J.P. Morgan Healthcare Conference in San Francisco.

“By bringing these businesses all to real global scale, it for the first time creates the optionality for potentially different structures down the road,” Witty said. “We certainly have a year or two more of work to finish” the integration.

Some investors have called for Glaxo to split up to help boost a stock that has stagnated over the past year. The drugmaker is currently made up of units focused on pharmaceuticals, vaccines, HIV medicines and consumer-health products.

“There’s a lack of visibility on certain areas of the company, and if some of these were spun out, I’m sure the value accretion would be greater than the current share price,” said Joe Walters, senior fund manager and manager of the Royal London U.K. Income With Growth Trust, which holds Glaxo shares. “We would welcome a move by the management to try to add value to the company.”

http://www.bloomberg.com/news/articles/2016-01-12/glaxo-may-consider-spinoffs-after-novartis-deal-integration 1/3 8/23/2016 Glaxo May Consider Spinoffs After Novartis Deal Integration

The stock rose as much as 1.6 percent to 1,385.50 pence in London. Witty’s comments came after the close of European stock exchanges on Tuesday.

In particular, Glaxo should consider spinning off its consumer-health division, in the same way that it explored the option for its ViiV Healthcare unit focused on AIDS drugs, Walters said. Glaxo abandoned the plan for an IPO for ViiV in May, given the strong performance of medicines such as Tivicay, which blocks an enzyme critical to the spread of HIV.

The consumer-health industry is fragmented and consolidating. Among others, Reckitt Benckiser Group Plc is seeking to expand its consumer-health products. CEO Rakesh Kapoor said in December he would consider acquiring Pfizer Inc.’s portfolio were it to come up for sale in the wake of its merger with Allergan Plc.

“The consumer division is so big in scale -- it could one day have a life of its own,” Witty said at the conference. A spinoff wouldn’t happen this year or next, he added.

Glaxo’s shares have tumbled more than 20 percent since mid-2013. With generics snapping at the heels of its best-selling lung drug Advair, Glaxo has been touting new follow-up medicines to Advair and its HIV portfolio, while shunning large-scale acquisitions.

The drugmaker may deliver on its 2020 new-product sales target one or two years in advance, Witty said during his presentation.

‘Poor Performance’

U.K. fund manager Neil Woodford also suggested the company split up and divest some portions of the business.

http://www.bloomberg.com/news/articles/2016-01-12/glaxo-may-consider-spinoffs-after-novartis-deal-integration 2/3 8/23/2016 Glaxo May Consider Spinoffs After Novartis Deal Integration “What we’d like the business to do is to recognize that it should focus on certain activities in the portfolio and do them better than they have done in the past, and de-merge the bits that they haven’t managed particularly well,” Woodford said in an interview with a BBC radio program last week.

Other investors have said that Glaxo should buy out the minority stakeholders in ViiV --- Pfizer and Shionogi & Co. -- and the consumer-health joint venture with Novartis AG, which hold so-called put options that are limiting Glaxo’s payouts to shareholders and impeding its ability to grow.

While a breakup would boost enterprise value, separately listing its drugs, vaccines and consumer-health units is unlikely to create more than a 10 percent increase, Bloomberg Intelligence analyst Sam Fazeli said in a note Monday.

Glaxo last quarter beat analysts’ earnings estimates and has started to demonstrate areas where it can grow, according to Walters. Still, “as a result of the poor performance historically, there isn’t much room for any further slip-ups,” he said.

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http://www.bloomberg.com/news/articles/2016-01-12/glaxo-may-consider-spinoffs-after-novartis-deal-integration 3/3 8/23/2016 Google goes further towards competing with its own OEMs

Google goes further towards competing with its own OEMs

CEO Sundar Pichai hints at greater control of Nexus hardware and a unique Android implementation to tempt Apple users

News that Google will put “a lot more thought” into Android, to enhance its differentiation from iOS and upcoming mobile operating systems, was encouraging – until CEO Sundar Pichai linked that work directly to Google’s own Nexus range of devices. The company has always had to make difficult compromises between control and openness in Android, but now it seems to be veering heavily towards increasing control by being a fully fledged hardware vendor. In doing so, it needs to remember the sorry precedent set by Microsoft’s handset adventure as well as its own period of owning Motorola.

Pichai told the conference that Google will add more features to Android for Nexus, and will be “more opinionated” about design. It will not go as far as designing its own hardware, at least for now – Nexus production will still be sub-contracted to partners and phones co-branded. But Google will take a more active role in hardware specs as well as controlling the Android user experience, and including features which are not available to the wider ecosystem. “There’s a lot of software innovation to be had,” Pichai added.

Nexus handsets and tablets have functioned primarily as showcases for the latest Android releases, but in very vanilla form, the idea being to encourage OEMs and developers to move to the newest platform and implement it in a Google-approved way. So Nexus has not achieved significant market share, because it was not intended to – like some of Microsoft’s hardware over the years, the aim has been to kickstart a new Android phase and accelerate the production of high end devices and apps by device makers.

Now Pichai is talking about Nexus having its own implementation of Android, with additional features layered on top, making it distinct from other Android smartphones, not just from iOS. Even though Nexus devices would continue to be made by partners, many recent comments by Pichai and other Google executives indicate the firm aims to have control over their hardware design, and to include software features in Nexus which are not available to the whole Android ecosystem.

This would seem to create the conflicts of interest with its own OEMs that Nexus has largely managed to avoid so far because of its modest commercial ambitions. And far from encouraging third parties to adopt a ‘gold standard’ Android implementation as demonstrated on Nexus, this is likely to drive OEMs like Samsung to intensify their work on their own differentiated user experiences. That, in turn, will increase the fragmentation which has dogged Android since the start.

It is not clear what Google aims to achieve here. Android has flourished despite the fragmentation of implementations, or perhaps because of it. The range of choice for consumers can outweigh the developer issues of having to support and update multiple releases, or the problem of inconsistent and sub-standard Android experiences. Much of the success has been driven by the support of companies like Samsung whose economies of scale, supply chain processes and distribution channels can move vast quantities of devices. Google cannot compete in that respect, and it should not risk alienating the handset experts at a time when the http://rethink-wireless.com/2016/06/02/google-goes-further-towards-competing-with-its-own-oems/ 1/3 8/23/2016 Google goes further towards competing with its own OEMs smartphone market’s growth is slowing, and market share wars – fought on price and efficiencies more than user experience – will erupt.

Yet Google seems determined to pursue a hardware path, even though it failed to turn its shotgun wedding with Motorola Mobility into a successful union (and even the more hardware-focused Lenovo, which now owns Motorola, is struggling in the slowing handset space). As Microsoft’s purchase of Nokia – another example of a software company entering the hardware market far too late, and with the wrong tools – crashes and burns, Google has hired back Motorola’s Rick Osterloh to lead a unified device program, and a revamped Nexus line looks set to be a highlight of that.

Perhaps Google feels that, as the smartphone market reaches its peak, there is too little innovation going on to drive its platform forward. It is already developing Android flavors for cars, industrial objects, wearables and so on, but smartphones will be the bulk of the installed base for many years to come. While OEMs focus on efficiencies, will they compromise on new capabilities to attract the high end users, leaving Google to fill the gap?

That may be true in software – large handset makers rarely succeed in pushing the OS or user experience boundaries, and most of Android’s new features come from Google or its broad apps developer base. But as long as people use Android more and more intensively, Google’s commercial objectives are fulfilled. Smooth upgrades and updates – the scourge of Android users – are far more important to drive usage than sales of brand new devices.

By asserting full control of its own version of Android, Google could go after the premium market with a single brand and user experience, fully centered on its own services (some OEMs sideline apps like Google Search or even replace them, cancelling out the commercial opportunity). It already spoke, at last month’s I/O developer conference, about designing devices to harness its virtual reality and AI advances.

But creating a showcase device to stimulate interest in a new technology is one thing. Becoming an Apple challenger is another. Nexus could be a direct competitor to the iPhone and enhance Google’s brand as well as usage of its apps. But that relies on the Nexus ecosystem creating devices which are more appealing to those premium users than the top end Galaxy S (as well as the latest iPhone); and if that succeeds, on dealing with

http://rethink-wireless.com/2016/06/02/google-goes-further-towards-competing-with-its-own-oems/ 2/3 8/23/2016 Google goes further towards competing with its own OEMs the fall-out among powerful OEMs which now have a new competitor in the only smartphone segment that still has real profitability and branding value.

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MARKETS | HEARD ON THE STREET Google’s Alphabet Shift Still Clicks

The internet giant has grown bigger and more profitable in the year since the shakeup

Some high-profile executives have exited Google lately. PHOTO: MARCIO JOSE SANCHEZ/ASSOCIATED PRESS

By DAN GALLAGHER Aug. 14, 2016 12:20 p.m. ET

A year ago, Google decided to become Alphabet. It hasn’t been your typical restructuring.

For one, the internet giant got even bigger. Alphabet hired more than 9,000 new employees in the past year, growing its head count by over 16%. And while the company has promised a more dutiful eye on spending, it has been a measured process. Operating margin as a percentage of net revenue was 32% for the 12 months ended June 30—up 1 percentage point from the same period last year.

In fairness, the Alphabet shift was never sold as a cost-cutting move. Rather, the company believed setting the core Google business apart from its myriad “other bets” would help it run those disparate businesses more efficiently and establish strong leaders for them.

That is why a recent round of executive departures raises eyebrows. The past week has seen the exits of the head of Google’s venture-capital arm, as well as the chief technology officer of its self-driving-car project. Tony Fadell, who ran the Nest home automation business, announced his departure in June.

Big, successful companies like Alphabet see executives come and go. And of the leavers, only Mr. Fadell has publicly suggested dissatisfaction with the new structure. Yet the moves bear watching, as attracting talent is key to Alphabet’s long-term health.

But it is also important to note that other bets won’t be paying the bills any time soon. Meanwhile, Google’s core advertising business remains strong, growing 17% to hit $73 billion for the trailing 12 months. With the stock up 21% since the Alphabet change was announced, investors rightly feel the new Google still clicks.

Write to Dan Gallagher at [email protected]

Health Care Companies See Scale as the Only Way to Compete By LESLIE PICKER APRIL 28, 2016 A spate of deals on Thursday showed that health care companies are convinced, regardless of tax benefits, that bigger is not only better, it is necessary.

The whole industry seems to be reading from the same playbook: Pair up with a company that makes the same product to become a leading provider, and thus gain more clout to negotiate business with hospitals and health insurers.

That explains some of the impetus behind the more than $40 billion of deals announced on Thursday. Some of the deal activity can also be explained by the desire to acquire growing biotech firms and product lines to make up for older products whose sales are in decline.

To get bigger in the cardiovascular-device world, Abbott agreed to purchase St. Jude Medical for $25 billion. To double down on treatments for prostate cancer, Sanofi made an offer to buy Medivation for about $9.3 billion. And as part of a bigger push into oncology treatments, AbbVie signed a $5.8 billion deal for Stemcentrx.

It is all part of an evolution in health care, where companies are responding to new regulation, new methods of payment and record consolidation. Regardless of the failed transaction between Pfizer and Allergan earlier this month, health care deal activity has been reinvigorated as company executives see no choice but to scale up.

“Imagine it’s a swim meet and Abbott has their toe in the water,” said Danielle Antalffy, an analyst at Leerink. “You can’t win unless you jump in the pool.”

Why so many companies chose to merge on Thursday is more a coincidence than anything, but it has made for a strikingly busy week. Deals worth almost $60 billion were announced in the sector over the last four days, making it the busiest period since mid-June last year, according to data compiled by Thomson Reuters.

That excludes Pfizer and Allergan’s $150 billion merger, which was announced in November and broke apart after the government issued new rules to discourage so-called inversions, in which American companies seek acquisitions to move their headquarters overseas for a lower tax bill.

As one set of new regulations caused a health care deal to break apart, another rule has, in some cases, encouraged other companies to come together.

The new rule involves bundling to create a single payment for all the costs associated with a patient’s condition. That means if someone requires care for a certain ailment, the doctor, the hospital stay, the devices used and the drugs administered would be offered as a package deal. This month, the Centers for Medicare and Medicaid Services mandated bundled payments for knee and hip replacements in certain cities. Analysts and experts say that it is only a matter of time before treatments for cancer and cardiovascular disease also move to bundling.

The goal is to make health care cheaper and more efficient, especially when the government is doing the reimbursing. Companies that position themselves as the leading providers of a product or service are at an advantage when it comes to getting in on those bundled deals, where smaller firms might not be considered providers of choice.

“If you can get enough critical mass as part of these acquisitions, they’ll need you and then you’ll have a place in the new world,” said David Friend, a managing director of BDO’s Center for Healthcare Excellence and Innovation. “If you’re too small, or too limited, you’ll just become irrelevant and bypassed.”

In addition to policies instituted by Medicare and Medicaid, the Affordable Care Act has been putting pressure on health care providers to deliver quality care more efficiently.

While bulking up through acquisitions may make strategic sense for many health care companies, these deals often do not come cheap. Investors did not reward these big merger announcements on Thursday.

Shares of Abbott declined 7.8 percent after the acquisition of St. Jude Medical was announced. The cash-and-stock deal would give St. Jude Medical shareholders about $85 a share, a 37 percent premium, based on Wednesday’s closing price.

The French drug company Sanofi said it had made a nonbinding offer to acquire Medivation, a biotech company based in San Francisco. Sanofi said Medivation had not responded to its offer letter, sent two weeks ago. That proposal comes at a premium of more than 50 percent over Medivation’s two- month volume-weighted average share price, Sanofi said. In acquiring Stemcentrx, AbbVie paid 16 percent more than the $5 billion the start-up fetched in its latest fund-raising round. AbbVie’s shares gained less than 1 percent on Thursday.

There are still more billion-dollar deals to be done in the health care world, analysts and experts say, so long as antitrust regulators continue to allow them.

“Do I think there will be a fair share of deals that have a ‘b’ in them? Absolutely,” said Thad Kresho, lead partner in PwC’s health care deals practice, referring to transactions worth more than a billion dollars. “From an activity perspective and number of transactions, we’ll continue to be fairly strong.”

A version of this article appears in print on April 29, 2016, on page B1 of the New York edition with the headline: Flurry of Deals as Health Companies Bulk Up.

Justice Dept. Will Seek to Block 2 Health Insurance Mergers By LESLIE PICKER and REED ABELSON JULY 19, 2016 The Justice Department is preparing lawsuits to block two giant health insurance deals, according to a person briefed on the matter, continuing a spate of antitrust actions in a whirlwind year for mergers and acquisitions.

Antitrust officials are concerned that Aetna’s $37 billion deal with Humana, and Anthem’s $48 billion pursuit of Cigna, will harm competition in the health insurance industry, said the person, who spoke on condition of anonymity because the suits had not yet been filed. The deals would have decreased the number of the largest insurers to three, from five.

The Justice Department’s final decision is expected this week or next, the person said.

Anthem and Cigna both declined to comment, and Humana did not immediately return a request for comment. A spokesman for Aetna said: “We don’t comment on rumors and speculation, but we are steadfast in our belief that this deal is good for consumers and the health care system as a whole.”

If both deals are withdrawn, 2015 would no longer be the largest year ever for mergers and acquisitions globally, according to Dealogic, a data provider. Instead, 2016 would be on pace to break records for the scope of withdrawn deals, with $723 billion of deals being abandoned so far this year.

Challenges to the health insurance deals would be the latest in a string of suits against what the government perceives to be anticompetitive mergers. Similar concerns caused the breakup of Baker Hughes’s proposed $35 billion combination with a fellow oil-field services company, Halliburton. Antitrust concerns also thwarted the $6.3 billion merger between Staples and Office Depot.

Bloomberg News reported on the expected lawsuits earlier on Tuesday. Shares of all four companies fell in afternoon trading.

If the lack of regulatory approval scuttles their deal, Anthem will need to pay a $1.85 billion breakup fee to Cigna, according to the merger agreement. Aetna will be required to give $1 billion to Humana under those same circumstances, according to a filing. The companies could challenge any Justice Department findings, and the mergers could proceed if the companies can successfully make the case that the deals do not harm competition.

The proposed mergers would greatly reshape the health insurance landscape. The combination of Anthem with Cigna would create a powerful presence in the market to offer insurance administration to large employers. And Aetna’s combination with Humana threatened to further consolidate the market for private Medicare plans.

Of the five largest insurers, only UnitedHealth Group, the most diversified of the national plans, remained out of last year’s merger frenzy.

While the two mergers were aimed at very different types of insurance markets, consumer advocates and others raised concerns that the deals would result in higher insurance prices for consumers. Even if the larger companies were able to drive down the prices they paid for care from hospitals and doctors, critics worried those savings would not flow to the people covered under the plans.

“Prices may go up either way,” said David Friend, managing director at BDO, the consulting firm. “But if they do not block, people can say you created this problem by allowing competition to disappear.”

The companies argued the mergers made sense in the new world created under the Affordable Care Act, in which their profits were limited and their business model shifted more to figuring out how to deliver care less expensively.

Investors have suspected for a while that the Anthem-Cigna deal was in trouble. In May, a series of letters reported on by The Wall Street Journal showed both sides fighting over issues such as Anthem’s lawsuit against Express Scripts over the price of drugs, and Cigna’s tendency to miss deadlines and submit paperwork in the wrong format to the Justice Department during its antitrust review process.

But analysts and others put better odds on Aetna and Humana completing the deal, given the ability of the companies to divest themselves of businesses in areas where the two had too much market share.

While both companies are expected to challenge the Justice Department’s decision, Aetna seems to be the most adamant about fighting the government’s attempt to block the deal.

In a note to investors, Ana Gupte, an analyst with Leerink Partners, described Anthem’s chances of winning as “slim,” while she had more faith in Aetna’s ability to prevail. Aetna and Humana may be able to eventually present a deal that allays antitrust concerns.

“I’m imagining they have a pretty good shot,” she said.

Health care has become a whirlwind of merger activity in recent years as both hospitals and health plans seek to become bigger. Many hospitals have scrambled to combine and to join forces with physician groups, and insurers have bulked up in response, as a way to have greater clout in their negotiations. Many hospital deals are too small to capture regulators’ notice.

The insurance companies have also argued that the Affordable Care Act, which transformed much of their business, has created pressure to merge. In an interview after Aetna announced its proposed merger with Humana, Mark T. Bertolini, Aetna’s chairman and chief executive, argued that companies needed to be able to invest the capital and resources necessary to compete in a rapidly changing environment.

“People who did not invest enough in health care reform and a retail marketplace are going to struggle,” he said.

Many deal makers believe regulators have taken a tougher stance this year. The Obama administration revealed an executive order in April, for example, that encouraged government agencies and policy makers to block mergers that they saw as obstructing competition.

The administration has also been more forceful in thwarting deals conducted purely for tax purposes. In April, the Treasury Department’s new rules on inversions — where American companies acquire foreign ones to attain tax efficiencies — helped to kill Pfizer’s $152 billion merger with Allergan, a fellow drug maker.

The Justice Department’s decision on the health care mergers has a good chance of overlapping with either the Republican or Democratic National Convention, and may result in additional political attention. Some politicians have looked at thwarting so-called mega-mergers as a way to address economic issues such as income inequality and wage growth.

If both health insurance deals fall through, the total amount of transactions would drop to $4.59 trillion, according to Dealogic. That would no longer set a record, but it would still be the highest since 2007.

Ben Protess contributed reporting.

A version of this article appears in print on July 20, 2016, on page B1 of the New York edition with the headline: U.S. Moves to Block 2 Big Health Care Mergers.

Here reinvents its wheels, ahead of auto industry turbulence - Rethink IoT

After being acquired by Audi, BMW and Mercedes-Benz, and fending off interest from China, Here has committed itself to an internal restructuring of sorts – as its new owners look to embrace the opportunities presented by the wider IoT market. The company hosted RIoT in its Berlin offices, where we dived into its plans and strategies for the looming turbulence in the connected car and IoT markets. It was reassuring to hear that Here’s new owners saw it as an asset to help keep the likes of Google and Apple at bay. Following the acquisition, the company is undergoing an internal restructuring, with a focus on addressing the IoT opportunity, bolstered by a large developer community driving a horizontal offering that can be adapted to meet the most lucrative verticals. The restructuring sees Here consolidate into two main business groups – one remaining focused on its automotive offering, and the other the product of merging its consumer and enterprise divisions. Automotive remains the bulk of its offering, and while Here doesn’t publish its numbers, we’ve been told that annual revenue is north of €1bn. The Open Location Platform is essentially the end-goal, as a solution to the problem of siloed location data, with Here customers and stakeholders contributing the location data that they generate and receiving access to this shared resource in return – with different views available to different customers, depending on the privacy concerns. In terms of monetizing the Open Location Platform, there’s an opportunity to turn the platform into a marketplace – which would allow users to sell their data assets to other companies if needed. For Here to persuade companies to make enough of their data available for free as standard might require some negotiation, but the more data that is traded on the platform, the more revenue Here can generate – as a % of each transaction. It’s worth bearing in mind that these stakeholders would already be paying for Here’s services, however, so the smaller % per transaction is likely not going to be a particularly big stumbling block if it turns out that the corporations can’t be persuaded to freely share their siloes. But Here is definitely becoming a databroker – a role that it has to navigate while retaining the trust of all parties involved in the platform. But Here is aggressively confident that it will win-out over Apple’s CarPlay and Google’s Android Auto – mostly due to the nature of the auto industry. A slide in its plethora of presentation PDFs notes that brand differentiation is key for auto OEMs, and that this is essentially anathema to the Apple and Google branding. Similarly, Apple and Google alllow very limited control over the content available through their platforms – something that Here think the auto OEMs won’t stomach, as it’s a “massive shift and a highly unfamiliar situation for OEMs.” Compounding the issue is the loss of data ownership, as Apple and Google would be capturing much of the on-board data and would consequently be loathe to part with that resource. Here also adds that the technical support that its customers have received from the respective Apple and Google developer teams has been sub-standard – and hardly inspiring of confidence. The Apple and Google model makes a lot of sense on the surface, and would be ideally placed if the auto industry was full of disruptive new entrants. The argument that a new vendor wouldn’t have to spend the time and money developing and IVI platform and could simply adopt CarPlay or Android Auto is similar to other offerings from technology providers looking to provide components that would slot into a modular stack. However, there aren’t any new entrants into the auto industry that can compete at scales large enough to justify this argument. The incumbents seem completely against ceding to Apple and Google, for the above reasons, and due to the economies of scale inherent in the manufacturing process, this isn’t a reality that is comparable to a new smartphone maker asking http://rethink-iot.com/2016/07/12/reinvents-wheels-ahead-auto-industry-turbulence/?utm_source=The+Rethink+IoT+List&utm_campaign=c7e046cff8-RIoT_115… 1/3 8/23/2016 Here reinvents its wheels, ahead of auto industry turbulence - Rethink IoT an ODM to skin up a few million units with stock Android. Cars exist in a very different world to most consumer electronics. Alex Mangan, Here’s head of Product Marketing, talked us through the Automotive offering in considerable detail. He noted that the division is still providing the bulk of Here’s revenue – although the restructuring in Here, with greater cooperation between the two wings is an attempt to balance operations. TomTom is Here’s closest rival, although Harman is a looming threat with massive reach. Continental is a similar proposition, but still the biggest danger to Here is the creeping presence of Apple and Google – leveraging their smartphone penetration. Mangan added that it was a strange time in the industry, with lots of overlapping RFQs. In his view, connectivity is now forcing the OEMs to change, and this has led to hardware and software being separated in those RFQs – a shift from the integrated systems of yesteryear. OEMs are waking up to the value of the data that is trapped inside their ecosystems, in both the vehicles as well as in the dealerships, and that they need to change their dinosaur thinking. Here cites forecasts of 33m connected vehicles on the roads by 2020, generating 163m terabytes of data. Mangan said that his initial use of ‘dinosaur’ was a little harsh, but that these OEMs have now seen that this data is like the oil of a new industry – and that they need to shift from being the hardware/product providers into mobility service providers. He noted, however, that the RFQs are still lagging behind this dawning realization – with some particularly outdated examples of structural search terms instead of contextual search emblematic of the conflicting internal requirements of the auto OEMs (the classic manager vs. engineer).

Another industry shift has been the move to global suppliers, rather than regional ones, which has seen greater simplification thanks to greater hardware sharing between brands. This means that the days of a company using Here for North America but TomTom for Europe are fading, in a similar way that they are looking to technology like eSIM to simplify their production lines. A term that was clarified for us was ‘probe,’ something that RIoT had (in-passing) assumed was a dedicated piece of hardware. Mangan explained that a probe was simply the readout from a device that listed latitude, longitude, speed, and direction – i.e. a phone, or a car, most typically. These sensors give an almost real-time (<2 seconds) picture. The difference between the simple data from the probes, which is used to flesh-out the Here platform and the performance of roads. However, the most valuable data doesn’t originate from these probes – instead, it comes from the Rich Sensors that the OEMs are realizing are trapped in the CanBUS of their vehicles. Things like cameras, airbags, tyre pressure, HVAC, and ECU readouts, are all very useful pieces of data by themselves, but can form hugely informative and collaborative ecosystems when shared with other stakeholders besides the OEM. Mangan said that Here’s work with Jaguar Land Rover has been particularly productive. JLR was the first company to use Here Auto, the complete IVI offering from Here, which allowed the company to tear down the archaic IVI practices of old. The http://rethink-iot.com/2016/07/12/reinvents-wheels-ahead-auto-industry-turbulence/?utm_source=The+Rethink+IoT+List&utm_campaign=c7e046cff8-RIoT_115… 2/3 8/23/2016 Here reinvents its wheels, ahead of auto industry turbulence - Rethink IoT turnaround in JLR’s Kelley Blue Book rating looks like proof of the software’s capabilities.Following the JLR launch, Here also unveiled its HD Live Map platform at CES, with a demo that provided a visual demonstration of how a car using the platform would merge the data pulled from its onboard sensors and the locational data provided from the cloud. Mangan walked us through the demo, explaining that the system is comprised of 2km2 tiles that the vehicles will download when they have a network connection – taking cues from the navigation system to download the tiles ahead of time, if needed. Each tile is essentially a 3D reconstruction of the physical world, which the connected car can then use as reference points for locating itself on the road. We saw the demo car use roadsigns and camera gantries, basically any street furniture, as fixed points, which it could then orientate itself with. Similarly, a representation of the GPS-shift was also shown, which demonstrated why a system like this was important – as the GPS alone wasn’t particularly precise. Here would, of course, be updating and maintaining the map as a service, (and uses a team of 1,500 people in 200 countries to do so) but blending the data shared from its customers would help simplify this process. Mangan said that there were 10 R&D pilots for HD Live Map underway. As for the consumer offerings, Here had been planning on becoming the dominant player on the third mobile platform that had threatened to emerge – with Amazon’s Fire OS, Samsung’s Tizen, and Microsoft’s Windows Phone all using the map app. However, that third ecosystem has failed to emerge, and so Here shifted strategies to one that targets mobile apps rather than mobile platforms. In the coming quarters, the enterprise and consumer offering is going to be a core development focus for the company.

12 July, 2016

http://rethink-iot.com/2016/07/12/reinvents-wheels-ahead-auto-industry-turbulence/?utm_source=The+Rethink+IoT+List&utm_campaign=c7e046cff8-RIoT_115… 3/3 Here's Why Intel's Latest Manufacturing Agreement Is a Big Deal

by David Meyer

August 17, 2016, 6:47 AM EDT E-mail Tweet Facebook Linkedin

Intel factories making ARM-based processors? That’s one way to do mobile.

In a move that would have been jaw-dropping a few years ago, Intel’s INTC 0.57% factories are soon going to be churning out chips that use ARM’s ARMH 1.26% designs.

ARM’s architecture almost completely owns the mobile processor space. Intel largely owns the desktop, but failed to make a serious dent in mobile with its Atom system-on-a-chip (SoC) products, which used Intel’s own x86 architecture.

So now Intel has struck a deal with ARM, through which the customers of Intel’s Custom Foundry chip- production lines will be able to make processors using ARM’s off-the-shelf designs. Get Data Sheet, Fortune’s technology newsletter. Intel said optimizing ARM’s technologies for its upcoming 10-nanometer manufacturing facilities would let customers make power-efficient, high-performance chips for mobile, the Internet of things and “other consumer applications.”

Intel already has LG lined up to build “a world-class mobile platform” using Custom Foundry’s 10nm processes.

Broadly speaking, the smaller the scale on which you build components, the more power-efficient you can make them (assuming you can make them to function reliably). This matters a great deal for embedded electronics, which are essential for mobile and the Internet of things.

Manufacturing facilities using 10nm processes will be state-of-the-art, so long as Intel can get them up and running fast enough. Taiwan Semiconductor Manufacturing Company (TSMC) TSMC 0.00% , a key rival, is looking to start trial production using even-dinkier 7nm processes next year.

ARM, which just got bought by SoftBank, said in a blog post that people shouldn’t be surprised to see it collaborating with Intel.

For more on Intel, watch our video.

“Despite press stories, Intel and ARM have worked together for years to help enable the ecosystem, and this is just the latest milestone in that long-standing relationship,” wrote Will Abbey, the general manager of ARM’s physical design group.

“I see it as a natural evolution of the design ecosystem: ARM is a leader in processor and physical design, and Intel Custom Foundry is a leading integrated device manufacturer. This combination is a win-win for customers.”

It’s certainly a way for Intel to stake out territory in the mobile processor business, despite the failure of its previous attempts to tempt people away from ARM. Intel is now rather moving to tempt customers away from key manufacturing rivals such as Samsung.

Photograph by JOHN MACDOUGALL — AFP/Getty Images Recommended For You

http://nyti.ms/1U1ebxz

Hostile Takeovers Abound, but Success Is No Guarantee Deal Professor

By STEVEN DAVIDOFF SOLOMON MAY 27, 2016

Assumed dead after Air Products and Chemicals failed to take over Airgas, hostile takeovers seem to be again sprouting up everywhere.

An examination of the most significant deals pending provides a nice lesson not only in how hostile takeovers work but in how would-be acquirers often make common mistakes.

The chief hurdle to take into account when planning a hostile takeover is the shareholder rights plan, more commonly known as the poison pill. Invented in the 1980s by the lawyer Marty Lipton, the poison pill changed takeover strategy. Before the poison pill, target companies were often on the back foot, lacking a defense against a barbarian at the gate.

The poison pill effectively allowed a board to cap the number of shares a hostile bidder could acquire at a certain threshold. These days, that threshold is typically 10 to 15 percent of the outstanding shares. To avoid setting off the poison pill, a hostile bidder had to replace a majority of the target’s board. The new board would then eliminate the poison pill, allowing the hostile bidder to acquire the target.

As a result, any hostile bid must be paired with a bid to replace the target board. As the many hostile takeover deals out there show, though, sometimes this is not that easy.

Tribune Publishing/Gannett

This is probably the most public hostile situation at the moment. Unfortunately for the Gannett Company, and for reasons unknown, it missed the deadline to nominate directors at Tribune Publishing’s coming annual meeting.

This was a big mistake. Lacking any real leverage, Gannett is running a campaign asking shareholders to withhold their votes for Tribune Publishing’s directors at the June 2 annual meeting as a show of support for its offer.

This is a weak straw poll, at best, as Tribune Publishing’s directors are elected by the plurality of shareholders present, and Tribune Publishing does not require its directors to obtain a majority of the votes cast. So even if there is overwhelming shareholder support for Gannett’s campaign, the Tribune Publishing board can just ignore it. (And there may not even be such support, because two proxy advisory services, Institutional Shareholder Services and Glass Lewis, have come out in favor of Tribune Publishing, calling Gannett’s latest offer underpriced.)

Tribune Publishing’s board raised the ante by selling a 12.92 percent stake to the billionaire entrepreneur Patrick Soon-Shiong. This type of move, known as a white squire, is permitted under the laws of Delaware, where Tribune is incorporated. It will be reviewed by Delaware courts under the so-called Unocal test, which looks to see whether the response is reasonable in relation to the threat posed and not preclusive or coercive.

The board probably has ample justification because it received a price of $15 a share and some technological exchanges, but it does not preclude Gannett from succeeding, provided that Gannett waits a whole year to submit a slate of directors at the next annual shareholder meeting. Tribune Publishing’s maneuver would not have stopped Gannett had it been able to run a director election, but it does make Gannett’s effort that much harder.

Prediction: Gannett’s hostile takeover attempt is not long for this world.

Medivation/Sanofi

Sanofi holds all the cards in its attempt to take over Medivation. The reason is that although the nomination deadline for Medivation’s annual meeting has passed, Medivation allows shareholders to act by written consent at any time. Under the law in Delaware, where Medivation is incorporated, directors on a board in which every director is up for election at the same time can be removed at any time with or without cause. Companies typically limit this maneuver by eliminating the right of shareholders to call a special meeting or act by written consent. This forces the hostile bidder to wait until the annual meeting to try to replace the directors and then have them remove the poison pill.

Sanofi has started the consent solicitation, and Medivation will have to fight the hardest fight – persuading its shareholders not to support the Sanofi slate.

Prediction: Medivation will be sold, to a third party if it can find another bidder in time, or it will be forced to make a deal with Sanofi.

Monsanto/Bayer

Bayer has made a $62 billion bid for Monsanto. It, too, has missed the deadline for nominations for Monsanto’s board. And Monsanto has yet to adopt a poison pill, although this can be done in a matter of hours. Because Bayer would have to obtain antitrust approval before buying a substantial number of Monsanto shares, Monsanto does not have to rush.

But the strategy here is different. Bayer is doing what is called a teddy bear hug – softly wooing Monsanto and saying, ‘Let’s get together, but I am not going to be too ferocious about it.’ It seems to be working: Monsanto said it would consider a higher offer that allowed its shareholders to participate in the upside.

This is a not an uncommon strategy, to use shareholder pressure in lieu of an uncertain full hostile bid and proxy contest. Foreign bidders in particular have been loath to pursue hostile deals because of the scrutiny it brings, although the aversion is less these days.

An interesting twist is also pushing Bayer’s strategy: Its offer of $122 a share is all in cash. Should it want to offer a stock component in a sweetened offer, things would get complicated. Bayer, a German company, is not listed in the United States, and to acquire Monsanto, an American company, in a share exchange, it would have to register its shares with the Securities and Exchange Commission. This could be an arduous process for Bayer that could take months or longer. On top of that, if Bayer pays stock, it will need a shareholder vote, something that will probably not be necessary if Bayer pays cash. This means Bayer is likely to face limits in pushing for an all-cash deal.

Prediction: Stay tuned for more maneuvering, but Bayer seems to be a bit skittish about going fully hostile.

W estlake Chemical/Axiall

The Westlake Chemical Corporation has been bidding for the Axiall Corporation since January. In March, Westlake raised its bid and nominated directors to replace Axiall’s board at its annual meeting. Westlake got the timing right. Axiall’s charter forbids shareholders from calling a special meeting or otherwise acting by written consent.

The pressure is getting to Axiall. On May 4, Axiall announced that it was putting itself up for sale by saying it would consider “strategic alternatives.” Westlake is putting together a revised bid.

Prediction: It looks as if Axiall has been forced to make a deal by the pressure of the proxy contest. The only question is whether a white knight can emerge.

The Andersons/HC2 Holdings This is a quirky deal and shows that when a company is organized outside Delaware, things can become harder for the acquirer.

In this case, HC2 Holdings, run by the hedge fund manager Philip A. Falcone, has missed its chance to nominate directors to the board of The Andersons, the American agriculture company. And The Andersons prevents shareholders from acting by written consent or calling a special meeting. The Andersons has not yet adopted a poison pill, a fact it has trumpeted. But it really does not need to take this defensive maneuver.

The reason is that it has other defenses. First, under the company’s charter, if any bid is not approved by the board, the votes of two-thirds of the shareholders are required to approve any merger.

The Andersons has adopted a control share acquisition statute in its charter, which is even more prohibitive of a hostile bid. It requires that any acquisition of more than 20 percent of the company’s shares must be approved by the shareholders if the acquirer wants to be able to vote those shares. The company also has a business combination statute that says that if an investor acquires more than 10 percent of the company’s stock but less than 85 percent without board approval, it cannot incorporate the remaining shares through a merger for three years.

These in the aggregate make it impossible for HC2 Holdings to acquire The Andersons unless the board bows to shareholder pressure and approves the bid.

Prediction: Unless Mr. Falcone can offer a rich price, this hostile takeover attempt is also destined for failure.

There is a lesson here – the defenses a company adopts when it goes public, something that may have happened decades ago, can make all the difference in a hostile situation. Be forewarned.

HP spinoff required splitting massive internal technology

For Hewlett Packard, splitting up was a lot of hard work

by Jonathan Vanian

@JonathanVanian

November 2, 2015, 12:00 PM EDT E-mail Tweet Facebook Linkedin

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How the tech giant split up its internal technology in prelude to a big corporate spin off.

Breaking up may be hard to do, but in the case of 76 year-old Hewlett Packard, it’s not just hard: it’s exhausting, expensive, and necessary.

For nearly a year, legions of the tech giant’s IT workers and consultants were busy splitting up its internal computer systems in prelude to cleaving H.P. into two separate companies on Sunday. Hewlett Packard

http://fortune.com/2015/11/02/hewlett-packard-split-infrastructure/ 1/5 8/23/2016 HP spinoff required splitting massive internal technology Enterprise will focus on selling data center hardware and consulting services while HP Inc. will sell PCs and printers.

That meant taking existing email, payroll, accounting, inventory tracking, and server farms—and dividing them in two. Everything had to be switched without any hiccups that could leave thousands of employees at either of the newly independent businesses in the dark ages.

Scott Spradley, chief information officer for H.P.’s finance and legal operations, recalled his reluctance when told a year ago that he would be in charge of the huge undertaking. A top executive mentioned that Spradley’s prior experience working on Intel’s integration with a partner had landed him the job.

Spradley’s response: “Who told you that? Because we need to find that person and I need to punch him in the throat.”

Companies of all stripes must tackle serious IT challenges when acquiring businesses, selling off divisions, and spinning out parts of their operations, as H.P. has done. And a lot can go wrong.

Asish Ramchandran, a principal in Deloitte’s mergers and acquisition group, which helps companies handle the complexities, explained that the process is like “managing a divorce proceeding.” Joint accounts need to be separated, items need to be allocated to the right parties, and payments need to be paid.

In one job he worked on, the IT team for a company being split apart failed to factor in operations in Brazil. The team set up a system that didn’t correctly report inventory under Brazilian law, ultimately earning the company a fine.

H.P. HPQ 1.39% is a sprawling company with 300,000 employees globally, making the split just that much more difficult. It is a venerable Silicon Valley institution with decades of data stored on a hodgepodge of computer systems.

CEO Meg Whitman decided to separate the companies in a high-profile effort to reignite their growth. Hewlett Packard has struggled in recent years as consumers moved away from buying PCs and printers. To make matters worse, business customers have increasingly shifted from buying servers to paying for computing on demand from companies like Amazon AMZN 0.39% and Microsoft MSFT 0.38% . Nothing H.P. executives have done has helped to restore the company’s momentum.

Joking aside, Spradley explained to Fortune that he was ready for the challenge because H.P.’s complicated IT infrastructure needed to be streamlined. It was one of the reasons for the company had trouble being competitive.

First, Spradley had to untangle systems that both of the newly independent companies relied on. The inventory tracking system, for example, would log orders and record sales for both networking hardware (part of the new Hewlett Packard Enterprises) and personal computers (part of the new HP Inc.).

Spradley likened it to having to fill a bucket by pouring water through 15 different pipes. Of course, pouring water directly into the container would be far easier. http://fortune.com/2015/11/02/hewlett-packard-split-infrastructure/ 2/5 8/23/2016 HP spinoff required splitting massive internal technology As a precaution, H.P. executives decided against waiting until Nov. 1 to find out if all their replumbing of H.P.’s technology had succeeded. They instead set a deadline in August to give them time to iron out any wrinkles.

Spradley immediately jumped into the job by spending the first few months planning. He and his team had to figure out what software the company used, how it interacted with the company’s hardware, and what software the divided companies would need going forward.

“It was just pedal to the metal at that point on,” said Spradley, who eventually drafted 550 IT employees to help out.

It was not enough to determine that H.P. had 2,500 software services. They had to determine which of the two companies would “own” each one.

They would keep the data relevant to the company that “owned” it. But to complicate matters, they had to wipe the left over data that was relevant to the other.

If it was impossible to determine who “owned” what, Spradley’s team would clone the service so that both companies could use it.

The team needed to take extra care when working with 18 software programs deemed so important that absolutely nothing could go wrong with them during the transition, Spradley said. H.P. referred to these as “Defcon zero systems,” and they included payroll software, sales tracking services, and the systems that managed its supply chain.

If these systems crashed, H.P. would be unable to pay workers, take orders, and ship inventory. To avoid a last minute disaster, the IT team worked on these critical systems first to give them more time to troubleshoot.

After the initial blueprinting phase, the team then spent the next couple of months tearing apart the old systems and building new ones. The job included cleaning data, migrating retained data to other systems, and installing the underlying software onto new hardware.

HP already had 35,000 servers in use, Spradley said. His team had to add several thousand more to support the new systems.

Over a period of just six weeks, HP built 6,000 servers loaded with the appropriate software. Typically, it takes H.P. about one year to install 1,200 servers, he said.

The team spent the last 100 plus days testing out the revamped infrastructure, including ensuring that the correct employees had access to the appropriate software and fixing any errors. H.P. had to be “uncompromising on the test time frame,” Spradley said, because a broken system could up hurting the business and damaging the brand.

H.P.’s separation team ended up running 300,000 different tests and resolved every single problem, he said.

During routine check-ins, H.P. executives would give “beat downs” to Spradley and his team over missed deadlines. The mood was that frantic, he explained. http://fortune.com/2015/11/02/hewlett-packard-split-infrastructure/ 3/5 8/23/2016 HP spinoff required splitting massive internal technology But eventually, Spradley said that it became clear to everyone that his team was on target to finish the massive project by the August deadline. “The beatings stopped at that point,” he said. But he still had to repeatedly reassure colleagues that their worst fears of “people running around with their heads cut off” when the spinoff happened wouldn’t come to pass.

“It’s not going to be like that,” Spradley told the executives. “We tested this thing every which way.”

Spradley said that the job was completed by August 1, and that, so far, no major problems have cropped up. The companies have been operating as separate entities for several months, at least when it comes to the technology powering them. People are getting paid and orders are being tracked. Emails end up in the correct inboxes.

During the company’s earnings call in August, CEO Meg Whitman bragged about the success of the split of the company’s internal technology. She said the company worked with over 3,500 customers and partners to prepare them.

“This was a huge accomplishment,” Whitman said.

Still, although the technology transition may be complete, both of Hewlett Packard’s legacy companies face challenges ahead — aside from the obvious business obstacles. For one thing, there is the issue of company culture.

As Sachin Shah, a partner in Bain & Company’s London office explained, employees sometimes consider one company in a spin off to be less attractive than the other. Workers may not want to go to the weaker company.

In one company split Shah worked on, it was clear that one of the businesses was on a growth spurt while the other one was going to operate more “lean and mean,” he said. All the IT talent wanted to work at the company that was expanding because it sounded more exciting.

Regardless, Spradley, who is now chief information officer of Hewlett Packard Enterprise, remains optimistic that workers at both H.P. companies will be able to do their jobs when they get into the office today. At least, that’s the hope.

“It’s like winning the high school championship and then going to win the Super Bowl,” Spradley said. “I think that our separation was really that Super Bowl moment.”

Subscribe to Data Sheet, Fortune’s daily newsletter on the business of technology.For more on Hewlett- Packard, check out the following Fortune video: Meg Whitman, chief executive officer of Hewlett Packard Enterprise

Photograph by Stephen Lam — Reuters Recommended For You

http://fortune.com/2015/11/02/hewlett-packard-split-infrastructure/ 4/5 TECH POINTCLOUD Inside Oracle's Acquisition Machine by Cyrus Sanati @beyondblunt AUGUST 15, 2016, 9:45 PM EDT    

Larry Ellison, chairman of Oracle, at its OpenWorld 2015 conference in San Francisco. David Paul Morris/Bloomberg/Getty Images

So far: 33 acquired companies worth $15 billion. Oracle’s $9.4 billion acquisition of NetSuite late last month has Wall Street bankers frothing at the mouth on the hopes that the software giant is set to go on a spending spree of epic proportions. But while Oracle is no stranger to making big purchases at opportune times, such as its $10.3 billion acquisition of PeopleSoft in 2004 or its $8.5 billion acquisition of BEA Systems in 2008, the bulk of its deal flow will most likely remain modest in its size and narrow in its scope.

Such small deals usually draw yawns from financiers (and news editors), but it is all part of Oracle’s overall business strategy to dominate and control the most profitable industry verticals in the business software (read: cloud computing) world, all without drawing attention to itself or its affiliates.

The strategy, which Oracle cofounder and executive chairman Larry Ellison devised years ago, involves first acquiring companies that make software considered a “musthave” for a particular industry. The acquired companies are then placed into semiautonomous business groups called Global Business Units that are industryspecific (e.g. financial services or health sciences) and have their own organizational structure (each has its own general manager, development, sales, marketing, consulting and M&A strategy).

The GBU structure now encompasses seven business units made up of 33 acquired companies with a total deal value of around $15 billion. Oracle will expandSubscribe into any industry vertical it thinks it can come to dominate and can snap up a MENU company in theFortune.com blink of an eye. During one week in April, Oracle gobbled up two public companies; Textura, which makes software that helps companies manage construction projects, for $663 million; and OPower, which makes software that helps utilities monitor and compare electricity usage, for $532 million.

While the average deal size for a GBU target company usually comes in below $1 billion, there have been a few notable exceptions over the years, namely the group’s $5.3 billion acquisition of Micros, which makes software for the hospitality industry. As cloudbased software continues to grow in popularity, it is possible that Oracle will go after bigger targets in the months to come—it’s just a question of finding the right one. Resources certainly aren’t a limiting factor—Oracle’s cash reserves at the end of its most recent fiscal quarter stood at a mindblowing $56.1 billion.

To get a better understanding of Oracle’s GBU strategy, Fortune visited Boston’s Route 128 tech corridor to meet with the head of the GBU group, Robert Weiler. Weiler came to Oracle six years ago after its GBU machine gobbled up his pharmaceutical software company, Phase Forward.

In conversation, Weiler explains how the group operates and how it fits into the overall Oracle ecosystem. He also lends insight as to what makes a good target and what companies might be on his shopping list. (The following interview has been edited and condensed for clarity.)

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Subscribe  MENU Fortune.com Fortune: How did the GBU group get started? What is its mission today?

Weiler: Larry [Ellison] had a vision eight years ago that he wanted to create dedicated business units for acquired companies that would provide industryspecific applications. Our GBUs represent dedicated, industryfocused teams covering strategy, development, sales and delivery, which none of our competitors do at our scale. The heads of all the GBUs report to me here in Boston and we now have seven verticals—Retail, Financial Services, Communications, Health Sciences, Construction and Engineering, Hospitality and Utilities.

Why does the GBU group tend to buy smaller software companies instead of big ones?

Because that’s where the growth is. Larry started the GBUs as dedicated and industryfocused organizations to serve the needs of specific industries and their most critical software. You can buy horizontal apps from SAP, Oracle—all the big guys. But if you go out and try to buy a clinical trial app for life sciences, you will need to go to a small “pureplay” company like my former company, Phase Forward.

Many times big companies find themselves dependent on the software made by these smaller pureplay companies and will actually be the one to come to Oracle and say, “Can you buy them? We think they’re good, we like them, but they cannot scale as fast as we need them to scale as opposed to Oracle.”

So that’s where a lot of our inbounds in our M&As come from. We don’t comment on anything, but that’s a very good lead. I guarantee you that’s what happened when I was CEO of Phase Forward. I’m sure one of our big customers at the time was talking to Oracle and told them that they wanted to stay with us but were worried about our scale. Three years later, Oracle bought us and I came on to run all the GBUs. Get Data Sheet, Fortune’s technology newsletter.

How do you decide what company to buy within a certain industry vertical?

The hard part is finding a quality company that is the anchor of that vertical. If you look at overall verticals there are 17 to 23 of them to consider, and they are very fragmented. The companies we go after have defined solutions that we could either acquire and build upon or organically build upon.

So the newest one, which was 20 months ago, was Micros. Hospitality has retail, hotels, and food and beverage—so there are three verticals in one for an anchor solution. Finding a target company in a given industry that has actually done something of scale, quality, and holds a leadership position is the rule that we use when we want to expand.

For the GBU, why keep a vertical structure, where sales and administrative functions are replicated across diﬀerent units, instead of a horizontal one, where redundant functions can be eliminated?

Larry created the GBU because he said, “I want to make sure that if I acquire a great company, I acquire what makes them great. They have great products, Subscribedeveloped by great people; they already have market share; they have a good customer base; and their MENU salesFortune.com and development people know how to interact together.”

Larry’s view was that you lose domain expertise in big organizations because it scatters and naturally dilutes. You come back two years after an acquisition and you can’t find the company, the nucleus that made the company great. So he said for industry applications, “I am going to keep that nucleus.” As such, when we acquire a company, the development team and sales people are still working on the same thing. Occasionally we’ll change some things within a vertical, but they’re all around the same passion and solution.

Are you happy with seven industry verticals or do you want more? Which industries do you think are ripe for expansion?

We’d like to have more. I cannot tell you what industries are important because if I even mention one and you write it, their stock pops. But one of our goals is to continue to add to the footprint of each of our existing verticals with other products or areas that we think need expansion.

What do you look for in an acquisition?

Well, we would only look for something that’s in the cloud. We look for areas in each of our verticals where there are gaps. We bought OPower for its customer billing in utilities. We bought Textura because it is a payment system for project management construction and engineering issues. It was a good expansion for project management as customers could now manage the payment to each of their contractors, which they could then tie directly into a project. It is a billing function, but it’s cloud software tied to a project. This is different, then, say, healthcare billing, where a company, like Athena, gets paid on a percentage of receivables for medical billing. We don’t want to do that.

Why is cloud computing so important in your decisionmaking process?

One of Oracle’s biggest advantages over other software companies is that we offer PaaS [platform as a service] in the cloud, One of Oracle’s biggest advantages over other software companies is that we offer PaaS [platform as a service] in the cloud, which you can expand. Once you move to the cloud, we’re going to give you the hardware, the infrastructure, the SaaS [software as a service] application and the PaaS and provide all that in one environment. No one else does that. Amazon doesn’t do it. Microsoft doesn’t do it. It is a very unique environment that we would like to build on and these companies we acquire help us advance that goal.

So companies need to be in the cloud. Anything else?

Customer engagement is big. We look at trends within the cloud, then we look at our industry portfolio and try to continue to build out that solution. We determine if it’s a feature over a product. We build and acquire.

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BŲȘİŇĚȘȘ İňť’ŀ Pǻpěř’ș Ŀǻťěșť Đěǻŀ Řěfŀěčťș Đěmǻňđ fǿř Đįǻpěřș, Fěmįňįňě Přǿđųčťș

Čǿmpǻňỳ țǿ șpěňđ $2.2 bįŀŀįǿň bųỳįňģ Ẅěỳěřħǻěųșěř pųŀp bųșįňěșș

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Bỳ MİĶĚ ĚȘȚĚŘĿ ǻňđ ȚĚȘȘ ȘȚỲŇĚȘ Ųpđǻțěđ Mǻỳ 2, 2016 2:37 p.m. ĚȚ

İňțěřňǻțįǿňǻŀ Pǻpěř Čǿ. ǻģřěěđ țǿ bųỳ Ẅěỳěřħǻěųșěř Čǿ.’ș pųŀp bųșįňěșș fǿř $2.2 bįŀŀįǿň, mǻķįňģ ǻ bįģ běț ǿň řįșįňģ ģŀǿbǻŀ đěmǻňđ fǿř đįșpǿșǻbŀě đįǻpěřș ǻňđ fěmįňįňě přǿđųčțș.

Mǻřķ Șųțțǿň, İňțěřňǻțįǿňǻŀ Pǻpěř’ș čħįěf ěxěčųțįvě, șǻįđ įň ǻň įňțěřvįěẅ țħě čǿmpǻňỳ běŀįěvěș mǿřě čǿňșųměřș ẅįŀŀ bě ǻbŀě țǿ ǻffǿřđ đįșpǿșǻbŀě đįǻpěřș įň țħě čǿmįňģ ỳěǻřș įň ěměřģįňģ mǻřķěțș, įňčŀųđįňģ įň Čħįňǻ, ẅħįčħ řěčěňțŀỳ ěňđěđ įțș ǿňě-čħįŀđ pǿŀįčỳ fǿř čǿųpŀěș. Ǻț țħě șǻmě țįmě, ħě ǻđđěđ, pųřčħǻșěș ǿf đįǻpěřș țǿ čǿmbǻț ǻđųŀț įňčǿňțįňěňčě șħǿųŀđ řįșě ǻș pǿpųŀǻțįǿňș ģřǿẅ ǿŀđěř įň mǻňỳ čǿųňțřįěș.

Țħě đěǻŀ ẅįŀŀ ǻŀŀǿẅ İňțěřňǻțįǿňǻŀ Pǻpěř, ǻ čǿřřųģǻțěđ pǻčķǻģįňģ ģįǻňț, țǿ șųřpǻșș Ģěǿřģįǻ-Pǻčįfįč ĿĿČ ǻș țħě ẅǿřŀđ’ș ŀǻřģěșț mǻňųfǻčțųřěř įň țħě řǿųģħŀỳ $6 bįŀŀįǿň fŀųff pųŀp mǻřķěț. İňțěřňǻțįǿňǻŀ Pǻpěř įș ǻčqųįřįňģ fįvě pųŀp mįŀŀș, țẅǿ čǿňvěřțįňģ fǻčįŀįțįěș ǻňđ řǿųģħŀỳ $1.5 bįŀŀįǿň įň șǻŀěș fřǿm Ẅěỳěřħǻěųșěř.

Fŀųff pųŀp įș țħě șǿfț, ẅħįțě ǻbșǿřběňț ųșěđ įň đįǻpěřș, țǻmpǿňș ǻňđ șǿmě měđįčǻŀ bǻňđǻģěș. İț įș mǻđě fřǿm țħě ŀǿbŀǿŀŀỳ pįňě, ǻ fǻșț-ģřǿẅįňģ țřěě țħǻț țħřįvěș įň țħě Ų.Ș. Șǿųțħ. Ģŀǿbǻŀ đěmǻňđ ħǻș běěň ģřǿẅįňģ bỳ řǿųģħŀỳ 3% țǿ 4% įň řěčěňț ỳěǻřș.

Ẅěỳěřħǻěųșěř ħǻđ ǻ 24% șħǻřě ǿf țħě fŀųff pųŀp mǻřķěț ŀǻșț ỳěǻř, běħįňđ Ģěǿřģįǻ- Pǻčįfįč’ș 28% șħǻřě bųț ǻħěǻđ ǿf İňțěřňǻțįǿňǻŀ Pǻpěř’ș 18%, ǻččǿřđįňģ țǿ įňđųșțřỳ řěșěǻřčħěř ŘİȘİ, ẅħįčħ ěșțįmǻțěș đěmǻňđ ẅįŀŀ řįșě 4% ǻňňųǻŀŀỳ țħřǿųģħ 2019.

Weyerhaeuser Profit Falls Sharply (http://www.wsj.com/articles/weyerhaeuser-profit-falls-about-51- 1430465532) Weyerhaeuser Wagers on Scale, Housing Comeback With Plum Creek Deal (http://www.wsj.com/articles/weyerhaeuser-wagers-on-scale-housing-comeback-with-plum-creek-deal- 1447121630) International Paper to Sell Chinese Packaging Business for $150 Million (http://www.wsj.com/articles/international-paper-to-sell-chinese-packaging-business-for-150-million- 1457953133)

Ẅěỳěřħǻěųșěř Čħįěf Ěxěčųțįvě Đǿỳŀě Ř. Șįmǿňș șǻįđ țħě đěǻŀ fųřțħěřș țħě čǿmpǻňỳ’ș ěffǿřțș țǿ fǿčųș įțș bųșįňěșș ǿň țįmběř, ŀǻňđ ǻňđ fǿřěșț přǿđųčțș.

Ẅěỳěřħǻěųșěř ǻňňǿųňčěđ įň Ňǿvěmběř įț ẅǿųŀđ ňěǻřŀỳ đǿųbŀě įțș Ų.Ș. țįmběř ǻčřěǻģě bỳ ǻčqųįřįňģ Ų.Ș. řįvǻŀ Pŀųm Čřěěķ Țįmběř Čǿ., mǻķįňģ įțș ǿẅň běț țħǻț șčǻŀįňģ ųp čǻň bǿǿșț přǿfįț įň țħě ħěǻvįŀỳ șpŀįňțěřěđ țįmběř įňđųșțřỳ.

Fěđěřǻŀ Ẅǻỳ, Ẅǻșħ.-bǻșěđ Ẅěỳěřħǻěųșěř șǻįđ ǻț țħě țįmě įț ẅǻș ěxpŀǿřįňģ șțřǻțěģįč ǻŀțěřňǻțįvěș fǿř țħě čěŀŀųŀǿșě fįběřș ųňįț, ẅħįčħ įňčŀųđěđ fįvě pųŀp mįŀŀș, țẅǿ mǿđįfįěđ fįběř mįŀŀș, ǿňě ŀįqųįđ pǻčķǻģįňģ bǿǻřđ fǻčįŀįțỳ, ǻňđ ǿňě pųbŀįșħįňģ pǻpěřș jǿįňț-věňțųřě fǻčįŀįțỳ.

Ẅěỳěřħǻěųșěř șǻįđ Mǿňđǻỳ įț įș čǿňțįňųįňģ įțș řěvįěẅ ǿf įțș ŀįqųįđ pǻčķǻģįňģ bǿǻřđ fǻčįŀįțỳ, ǻș ẅěŀŀ ǻș įțș ňěẅșpřįňț ǻňđ pųbŀįșħįňģ pǻpěřș jǿįňț věňțųřě.

İňțěřňǻțįǿňǻŀ Pǻpěř, bǻșěđ įň Měmpħįș, Țěňň., șǻįđ įț ěxpěčțș țǿ įňčųř ǻ $300 mįŀŀįǿň țǻx běňěfįț řěŀǻțěđ țǿ țħě đěǻŀ. İț ǻŀșǿ ěxpěčțș ǻňňųǻŀ čǿșț șǻvįňģș ǿf řǿųģħŀỳ $175 mįŀŀįǿň bỳ țħě ěňđ ǿf 2018 fřǿm čǿmbįňįňģ ǿpěřǻțįǿňș țħǻț ẅįŀŀ řěșųŀț įň ǿňě-țįmě ěxpěňșěș ǿf řǿųģħŀỳ $85 mįŀŀįǿň.

Țħě čǿmpǻňỳ ħǿpěș țǿ čŀǿșě țħě ǻčqųįșįțįǿň įň țħě fǿųřțħ qųǻřțěř. Țħě đěǻŀ įș șųbjěčț țǿ řěģųŀǻțǿřỳ ǻppřǿvǻŀ, įňčŀųđįňģ įň țħě Ų.Ș., ẅħěřě mǿșț ǿf țħě mǻňųfǻčțųřįňģ įș bǻșěđ.

Mř. Șųțțǿň, İňțěřňǻțįǿňǻŀ Pǻpěř’ș ČĚǾ, șǻįđ țħěřě įș ňǿ břěǻķ-ųp fěě įf țħě đěǻŀ đǿěșň’ț ģǿ țħřǿųģħ bųț țħǻț țħě čǿmpǻňỳ ħǻș ǻģřěěđ țǿ șěŀŀ ǻș mǻňỳ ǻș țẅǿ pŀǻňțș įf řěqųįřěđ bỳ ǻňțįțřųșț ǻųțħǿřįțįěș.

“Ħǿpěfųŀŀỳ ẅě đǿň’ț ħǻvě țǿ șěŀŀ ǻňỳțħįňģ,” ħě șǻįđ.

İňțěřňǻțįǿňǻŀ Pǻpěř ħǻđ $22 bįŀŀįǿň įň șǻŀěș ŀǻșț ỳěǻř ǻňđ pŀǻňș țǿ fįňǻňčě țħě ǻčqųįșįțįǿň țħřǿųģħ đěbț.

Ẅřįțě țǿ Mįķě Ěșțěřŀ ǻț mįķě.ěșțěřŀ@ẅșj.čǿm ǻňđ Țěșș Șțỳňěș ǻț țěșș.șțỳňěș@ẅșj.čǿm Intel Foundry bows to the inevitable by embracing ARM physical IP

Written by Scott Bicheno 2 hours ago

Chip giant Intel has put an end to decades of trying to beat UK chip designer ARM at its own game by announcing it will be optimizing its 10 nm manufacturing process for ARM-based chips.

Historically Intel has made good margin from manufacturing its own chips – primarily those used in PCs and servers – in very expensive specialised plants referred to as fabs. But with the PC market in slow decline it seems Intel no longer needs so much fab capacity for its own products and is looking to take on the likes of TSMC and Samsung in the third-party foundry game, which encompasses pretty much the whole mobile market including Qualcomm and Apple.

One of the main ways we have been able to extract ever more performance from ever smaller pieces of silicon is the continual shrinking of the manufacturing process, which refers to the size of each individual transistor in the chip. The next major process shrink is to 10 nm and if Intel is serious about becoming a major foundry player it needs to be competitive at this level.

Intel has poured billions into becoming a mobile chip player but has never been able to overcome the advantages ARM’s architecture has over its own when it comes to power efficiency – a critical issue in the mobile space. So strong its ARM’s position that even parity would probably never have been enough for Intel, and it’s hard to see how any foundry could be competitive without being optimised for ARM physical IP, which is a library of information ARM offers to help with the manufacturing of its chip designs. “Our 10 nm design platform for foundry customers will now offer access to ARM Artisan physical IP, including POP IP, based on the most advanced ARM cores and Cortex series processors,” said co-GM of Intel Custom Foundry Zane Ball. “Optimizing this technology for Intel’s 10 nm process means that foundry customers can take advantage of the IP to achieve best-in-class PPA (power, performance, area) for power-efficient, high- performance implementations of their designs for mobile, IoT and other consumer applications.

Today’s announcement represents what we expect to be a long-term, mutually beneficial partnership with Intel Custom Foundry,” said SM for ARM’s Physical Design Group Will Abbey. “One of the strengths and differentiators of the Artisan platform is the availability of ARM core-optimized IP – what we call ARM PO technology. The value of POP technology for an ARM core on the Intel 10nm process is tremendous, as it will allow for quicker knowledge transfer, enabling customers to lower their risk in implementing the most advanced ARM cores on Intel’s leading-edge process technology.

“Additionally, POP technology enables silicon partners to accelerate the implementation and tape-outs of their ARM-based designs. The initial POP IP will be for two future advanced ARM Cortex-A processor cores designed for mobile computing applications in either ARM big.LITTLE or stand-alone configurations.”

Telecoms.com spoke to Sravan Kundojjala, Analyst at Strategy Analytics, to get his take on the news. “This is a smart move by Intel to take on TSMC, Samsung LS and Global Foundries, and the foundry business has good margins, with TSMC operating margin at around 35%,” he said. The LG and Spreadtrum mobile foundry deals will help Intel fill its fabs in the face of declining PC sales and if successful the company could even land orders from Qualcomm, Apple and MediaTek.

“Between 2011 and 2015 Intel spent approximately $15 billion on mobile R&D and approximately $3.5 billion on mobile-related acquisitions without much to show for it, so the latest move could provide a much needed boost to Intel’s mobile ambitions. TSMC and Samsung LSI are likely to beat Intel to market in 10 nm by 5-6 months but Intel could offer a credible foundry alternative.”

As Kundojjala said Intel has already announced some foundry deals on the back of this move, including LG, which will start making its own mobile SoCs in partnership with Intel, following the trend established by Apple, Samsung and Huawei, who license ARM designs to make their own chips. Six months seems like a substantial lag in the fast-moving mobile market, however, so Intel will need to compete strongly on price and service too.

The announcement came on the opening day of Intel’s annual developer forum – IDF – at which there was several other juicy morsels well covered by Light Reading’s Brian Santo at the event. Among the big announcements were a couple of Virtual Reality initiatives and new NFV collaborations with AT&T and NEC.

To some extent this move is also an admission by Intel that ARM is likely to dominate IoT devices in much the same way it has mobile. If anything ARM should be even stronger in IoT as it designs chips all the way down to the simplest microcontrollers and Softbank is betting on exactly that. The IoT boom should yield a lot of foundry business and, regardless of its own chip ambitions, Intel needs to support ARM if it wants some of it.

Yes - VR is the next big thing Hmmm - Vive is good, but the VR market isn't big enough No - Vive doesn't match up to rivals 8/23/2016 Johnson & Johnson Is Urged to Slim Down

Johnson & Johnson Is Urged to Slim Down

Johnson & Johnson weighs heavy. The bulging health care conglomerate is swallowing the hair-care company Vogue International for $3.3 billion in defiance of calls to break up. Johnson & Johnson’s $312 billion market value makes it a hard target for activists. Yet its size has created ailments, including poor merger-and- acquisition activity and mediocre shareholder returns.

Over the last decade shareholders have largely come to the conclusion that pharmaceutical firms should focus on developing medicines. After all, there’s little in common between using science to discover a cure for Alzheimer’s and selling shampoo. That has led Abbott Laboratories to spin off the pharmaceutical division AbbVie; Pfizer and Merck each to sell their consumer-goods business;and GlaxoSmithKline to divest nutritional drinks. The results have been largely favorable to investors too, because the cash thrown off by consumer goods companies is coveted by yield-starved investors.

Johnson & Johnson has resisted the trend. About one-fifth of its revenue comes from selling consumer health and beauty products such as Band-Aids and Listerine. Over 40 percent comes from cutting-edge drugs, and the rest from medical devices. The diversity may produce relatively steady results, but investors aren’t terribly appreciative of the fish-fowl hybrid. The company is valued at about 11.5 times estimated earnings before interest, taxes, depreciation and amortization, or Ebitda, over the next 12 months. That’s lower than the multiples attached to the consumer goods maker Colgate and the drug maker Eli Lilly, which trade between 14 and 15 times Ebitda, and the medical device firm Medtronic, at 12.5 times.

This has not escaped investors. Artisan Partners tried to pressure Johnson & Johnson to split earlier this year. However, Artisan owned well under 1 percent of its stock; combined with Johnson and Johnson’s scattered investor base, the activist had almost no power to battle its giant target.

The company’s girth comes at a cost. The drug business is faring well, but the other divisions are not. The consumer-goods unit’s margins are below rivals’ and some of its factories still operate under regulatory oversight from the Food and Drug Administration after a wave of product recalls a few years ago. The medical device division’s profits have been essentially stagnant since 2010 despite buying a rival, Synthes, for around $20 billion five years ago. Slimming down, or even splitting into three, would serve Johnson & Johnson well.

http://www.nytimes.com/2016/06/03/business/dealbook/johnson-johnson-is-urged-to-slim-down.html 1/1 1/26/2016 Johnson Controls, Tyco to Merge in Inversion Deal - WSJ

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http://www.wsj.com/articles/johnson-controls-tyco-to-merge-in-inversion-deal-1453724828

BŲȘİŇĚȘȘ Jǿħňșǿň Čǿňťřǿŀș, Ťỳčǿ ťǿ Měřģě įň İňvěřșįǿň Đěǻŀ

Měřģěř ẅįŀŀ pŀǻčě čǿmbįňěđ čǿmpǻňįěș’ ħěǻđqųǻřțěřș įň İřěŀǻňđ, Țỳčǿ’ș ħǿmě

Johnson Controls has moved to shed auto-parts units that accounted for more than two-thirds of revenue. PHOTO: PETER STEFFEN/EUROPEAN PRESSSPHOTO AGENCY

Bỳ BǾB ȚİȚǺ ǻňđ ĐǺŇǺ MǺȚȚİǾĿİ Ųpđǻțěđ Jǻň. 25, 2016 7:47 p.m. ĚȚ

Jǿħňșǿň Čǿňțřǿŀș İňč. ǻňđ Țỳčǿ İňțěřňǻțįǿňǻŀ PĿČ ǻģřěěđ țǿ měřģě įň ǻ $14 bįŀŀįǿň đěǻŀ țħǻț čřěǻțěș ǻ ňěẅ ģįǻňț přǿvįđěř ǿf čǿmměřčįǻŀ-bųįŀđįňģ șỳșțěmș ǻňđ řěfŀěčțș ǻ ģřǿẅįňģ pųșħ bỳ șǿmě ěxěčųțįvěș ǻňđ șħǻřěħǿŀđěřș țǿẅǻřđ čǿmpǻňįěș țħǻț ǻřě bįģģěř bųț mǿřě http://www.wsj.com/articles/johnson-controls-tyco-to-merge-in-inversion-deal-1453724828 1/6 1/26/2016 Johnson Controls, Tyco to Merge in Inversion Deal - WSJ fǿčųșěđ.

Țħě đěǻŀ, ǻňňǿųňčěđ Mǿňđǻỳ, ẅǿųŀđ čǿmbįňě Jǿħňșǿň Čǿňțřǿŀș’ bųșįňěșș șěŀŀįňģ ħěǻțįňģ ǻňđ ǻįř-čǿňđįțįǿňįňģ ěqųįpměňț fǿř șķỳșčřǻpěřș, șčħǿǿŀș, ħǿșpįțǻŀș ǻňđ ǿțħěř șțřųčțųřěș ẅįțħ Țỳčǿ’ș ŀįňěș ǿf șěčųřįțỳ ǻňđ fįřě-șųppřěșșįǿň ģěǻř įňțǿ ǻ čǿmpǻňỳ ẅįțħ mǿřě țħǻň $30 bįŀŀįǿň ǻ ỳěǻř įň șǻŀěș.

Jǿħňșǿň Čǿňțřǿŀș șħǻřěħǿŀđěřș ẅįŀŀ ǿẅň ǻbǿųț 56% ǿf țħě ňěẅ čǿmpǻňỳ, ẅħįčħ ẅįŀŀ bě řěňǻměđ Jǿħňșǿň Čǿňțřǿŀș PĿČ bųț ẅįŀŀ mǻįňțǻįň Țỳčǿ’ș İřįșħ ŀěģǻŀ đǿmįčįŀě—mǻķįňģ țħě đěǻŀ țħě ŀǻțěșț įň ǻ șțřįňģ ǿf șǿ-čǻŀŀěđ įňvěřșįǿňș țħǻț břįňģ șħǻřěħǿŀđěřș țǻx běňěfįțș bųț ħǻvě șțįřřěđ čǿňțřǿvěřșỳ.

Bǿțħ Țỳčǿ ǻňđ Jǿħňșǿň Čǿňțřǿŀș įň řěčěňț ỳěǻřș ħǻvě mǻđě mǿvěș țǿ ųňșțįțčħ bųșįňěșșěș țħǻț ħǻđ ģřǿẅň șpřǻẅŀįňģ ǻňđ ųňẅįěŀđỳ fřǿm přěvįǿųș ǻčqųįșįțįǿňș. Țỳčǿ, ẅħįčħ țǿđǻỳ ħǻș ǻbǿųț $10 bįŀŀįǿň įň ǻňňųǻŀ řěvěňųě, șħřǻňķ įțșěŀf fřǿm ǻ čǿňģŀǿměřǻțě ẅįțħ șǿmě $41 bįŀŀįǿň įň șǻŀěș ǻňđ șěģměňțș țħǻț mǻđě ěŀěčțřǿňįčș čǿmpǿňěňțș ǻňđ șųřģįčǻŀ ěqųįpměňț. Jǿħňșǿň Čǿňțřǿŀș ħǻș mǿvěđ țǿ șħěđ ǻųțǿmǿțįvě-pǻřțș ųňįțș țħǻț ǿňčě ǻččǿųňțěđ fǿř mǿřě țħǻň țẅǿ-țħįřđș ǿf įțș řěvěňųě ǻș Čħįěf Ěxěčųțįvě Ǻŀěx Mǿŀįňǻřǿŀį ħǻș șǿųģħț țǿ fǿčųș ǿň ħįģħěř-mǻřģįň bųșįňěșșěș.

Țħǿșě čħǻňģěș řěfŀěčț, įň pǻřț, ǻ břǿǻđěř đįșșǻțįșfǻčțįǿň ǻmǿňģ șħǻřěħǿŀđěřș—ěșpěčįǻŀŀỳ șǿmě ǻčțįvįșț įňvěșțǿřș—ẅįțħ țħě čǿňčěpț ǿf șpřǻẅŀįňģ čǿňģŀǿměřǻțěș țħǻț ħǻvě țěňțǻčŀěș įň ẅįđěŀỳ ǻřřǻỳěđ įňđųșțřįěș. Ǻț țħě șǻmě țįmě, ěxěčųțįvěș șțįŀŀ șěě vǻŀųě įň čǿmbįňįňģ bųșįňěșșěș įň țħě șǻmě ǿř șįmįŀǻř įňđųșțřįěș țǿ ģįvě țħěm ģřěǻțěř mǻřķěț čŀǿųț.

Șįmįŀǻř đỳňǻmįčș ħǻvě běěň ěvįđěňț įň șǿmě ǿțħěř bįģ řěčěňț đěǻŀș. İň Ňǿvěmběř, Pfįżěř İňč. ǻňđ Ǻŀŀěřģǻň PĿČ ǻģřěěđ țǿ čǿmbįňě įň ǻ $155 bįŀŀįǿň đěǻŀ, țħěň přǿmpțŀỳ ǻňňǿųňčěđ țħǻț įț ẅǻș čǿňșįđěřįňģ șpŀįțțįňģ țħě fįňǻŀ čǿmpǻňỳ. Ŀǻșț mǿňțħ, Đǿẅ Čħěmįčǻŀ Čǿ. ǻňđ ĐųPǿňț Čǿ. ǻģřěěđ țǿ čǿmbįňě įňțǿ ǻ čħěmįčǻŀ ģįǻňț ẅǿřțħ mǿřě țħǻň $120 bįŀŀįǿň běfǿřě șpŀįțțįňģ ųp įňțǿ țħřěě čǿmpǻňįěș fǿčųșěđ ǿň țħřěě șěpǻřǻțě șěčțǿřș. ĐųPǿňț ČĚǾ Ěđẅǻřđ Břěěň ẅǻș Țỳčǿ’ș ČĚǾ ẅħěň įț đįđ mųčħ ǿf șpŀįțțįňģ, ǻňđ řěmǻįňș įțș čħǻįřmǻň.

Mǿňđǻỳ’ș đěǻŀ, ẅħįčħ Țħě Ẅǻŀŀ Șțřěěț Jǿųřňǻŀ řěpǿřțěđ ǿň Șųňđǻỳ ẅǻș įmmįňěňț, čǿměș ǻș bǿțħ čǿmpǻňįěș ŀǿǿķ țǿ bǿǿșț țħěįř șțǿčķ přįčěș įň țħě fǻčě ǿf șŀǿẅįňģ įňđųșțřįǻŀ ǻčțįvįțỳ. İț řěpřěșěňțș ǻ ẅǻțěřșħěđ fǿř țẅǿ įňđųșțřįǻŀ čǿmpǻňįěș ẅįțħ ŀǿňģ ǻňđ đįșțįňčț čǿřpǿřǻțě ħįșțǿřįěș. Fǿř Țỳčǿ, țħě měřģěř ẅǿųŀđ bě țħě fįňǻŀ čħǻpțěř ǿf ǻ đěčǻđěŀǿňģ đįșmǻňțŀįňģ ǿf ǻ ħǿŀđįňģ čǿmpǻňỳ țħǻț ẅǻș ǿňčě ǿňě ǿf țħě ŀǻřģěșț įňđųșțřįǻŀ čǿňģŀǿměřǻțěș įň țħě Ų.Ș. ųňđěř fǿřměř ČĚǾ Ŀ. Đěňňįș Ķǿżŀǿẅșķį. http://www.wsj.com/articles/johnson-controls-tyco-to-merge-in-inversion-deal-1453724828 2/6 1/26/2016 Johnson Controls, Tyco to Merge in Inversion Deal - WSJ Țħě čǿmbįňǻțįǿň ẅǿųŀđ ǻŀŀǿẅ Jǿħňșǿň Čǿňțřǿŀș țǿ ǿffěř bųįŀđįňģ ǿẅňěřș ǻňđ mǻňǻģěřș ǻ mǿřě čǿmpŀěțě șųįțě ǿf ěqųįpměňț ǻŀǿňģ ẅįțħ đǻțǻ-čǿŀŀěčțįǿň șěřvįčěș țǿ ǻňǻŀỳżě ǻňđ mǻňǻģě pǿẅěř čǿňșųmpțįǿň ǻňđ přěđįčț mǻįňțěňǻňčě řěqųįřěměňțș.

Țħě čǿmpǻňįěș șǻįđ țħě měřģěđ ěňțįțỳ ẅǿųŀđ șǻvě ǻț ŀěǻșț $150 mįŀŀįǿň ǻ ỳěǻř ǿň țǻxěș ǻňđ ǻț ŀěǻșț $500 mįŀŀįǿň įň čǿșțș ǿvěř țħě fįřșț țħřěě ỳěǻřș ǻfțěř țħě čǿmpŀěțįǿň ǿf țħě đěǻŀ.

Țħě měřģěř “ẅįŀŀ čřěǻțě ǻ běțțěř čǿmpǻňỳ,” Mř. Mǿŀįňǻřǿŀį șǻįđ ǿň ǻ čǿňfěřěňčě čǻŀŀ, “țħǻț ẅįŀŀ țřǻňșfǿřm ǿųř ǻbįŀįțỳ țǿ čǻpțųřě ǿppǿřțųňįțįěș įň ǻ fǻșț-mǿvįňģ mǻřķěț pŀǻčě.”

Mř. READ MORE

Merger Adds to U.S. Tax Exodus (http://www.wsj.com/articles/johnson-controls-tyco-deal-adds-to-u-s-tax- exodus-1453769049) Johnson Controls CEO Shifted Focus (http://www.wsj.com/articles/johnson-controls-ceo-molinaroli-pushes- for-higher-margin-businesses-1453758691) Heard on the Street: Why the Deal Won’t Set Off Alarms (http://www.wsj.com/articles/why-tycos-deal-wont- set-off-alarms-1453747329) Johnson Controls Said to Be in Advanced Talks to Combine With Tyco (http://www.wsj.com/articles/johnson-controls-said-to-be-in-advanced-talks-to-combine-with-tyco- 1453658806) (Jan. 24) Tyco Reaches Resolution with IRS Over Tax Dispute (http://www.wsj.com/articles/tyco-reaches-resolution- with-irs-over-tax-dispute-1453208121) (Jan. 19) Breen’s Tyco Experience Will Guide Him in Dismantling DowDuPont (http://www.wsj.com/articles/breens- tyco-experience-will-guide-him-in-dismantling-dowdupont-1452042032) Johnson Controls Forecasts Strong Revenue Growth (http://www.wsj.com/articles/johnson-controls- forecasts-strong-revenue-growth-1448973414) (Dec. 1) Tyco Revenue Falls as Currency Impact Hurts (http://www.wsj.com/articles/tyco-revenue-falls-as-currency- impact-hurts-1447420101) (Nov. 13) Johnson Controls to Shed 3,000 Jobs (http://www.wsj.com/articles/johnson-controls-to-shed-3-000-jobs- 1442580448) (Sept. 18) Johnson Controls to Spin Off Automotive Business (http://www.wsj.com/articles/johnson-controls-to-spin-off- automotive-business-1437742476) (July 24)

Mǿŀįňǻřǿŀį ẅįŀŀ ŀěǻđ țħě ňěẅ čǿmpǻňỳ fǿř 18 mǿňțħș ǻfțěř țħě țįě-ųp įș čǿmpŀěțě. Țỳčǿ ČĚǾ Ģěǿřģě Ǿŀįvěř ẅįŀŀ țħěň běčǿmě ČĚǾ ǻňđ Mř. Mǿŀįňǻřǿŀį ẅįŀŀ běčǿmě ěxěčųțįvě čħǻįřmǻň fǿř ǻ ỳěǻř, běfǿřě čěđįňģ țħǻț țįțŀě țǿ Mř. Ǿŀįvěř ǻș ẅěŀŀ. Mř. Břěěň ẅįŀŀ ģįvě ųp ħįș čħǻįřmǻňșħįp ǿf Țỳčǿ.

Ǻș ǻ řěșųŀț ǿf Jǿħňșǿň Čǿňțřǿŀș’ įňvěřșįǿň, țħě čǿmpǻňỳ’ș ěffěčțįvě țǻx řǻțě ẅįŀŀ bě 18% ǿř 19%, șǻįđ pěǿpŀě fǻmįŀįǻř ẅįțħ țǻx șțřųčțųřě. Țỳčǿ pǻįđ 12% ǿf įțș přǿfįț įň țǻxěș ǿvěř http://www.wsj.com/articles/johnson-controls-tyco-to-merge-in-inversion-deal-1453724828 3/6 1/26/2016 Johnson Controls, Tyco to Merge in Inversion Deal - WSJ țħě pǻșț țħřěě ỳěǻřș, věřșųș ǻň ǻvěřǻģě 29% bỳ Jǿħňșǿň Čǿňțřǿŀș, ǻččǿřđįňģ țǿ Ș&P Čǻpįțǻŀ İQ. Jǿħňșǿň Čǿňțřǿŀș șǻįđ įțș ěffěčțįvě țǻx řǻțě běfǿřě čěřțǻįň įțěmș ẅǻș ǻřǿųňđ 19% ǿvěř țħě pǻșț țẅǿ ỳěǻřș ěňđěđ Șěpț. 30.

Țħě đěǻŀ șțǻřțěđ țǿ țǻķě șħǻpě įň ŀǻțě șųmměř ẅħěň Țỳčǿ’ș Mř. Ǿŀįvěř ǻppřǿǻčħěđ Mř. Mǿŀįňǻřǿŀį ǻbǿųț ǻ șmǻŀŀěř đěǻŀ įňvǿŀvįňģ țħě Jǿħňșǿň Čǿňțřǿŀș’ șỳșțěm čǿňțřǿŀș bųșįňěșș. Ǻș țǻŀķș přǿģřěșșěđ, Mř. Ǿŀįvěř įň țħě pǻșț fěẅ mǿňțħș břǿǻčħěđ țħě įđěǻ ǿf ǻ fųŀŀ měřģěř, ǻččǿřđįňģ țǿ țħě čǿmpǻňįěș.

Țħě țẅǿ șįđěș ħǻđ țǿ ňěģǿțįǻțě țħě fįňǻŀ đěțǻįŀș ẅįțħ ǻň įmpěňđįňģ șňǿẅșțǿřm ẅħįčħ mǻđě ǻįř țřǻvěŀ đįffįčųŀț.

Mř. Mǿŀįňǻřǿŀį ẅǻș ǻț ŀǻșț ẅěěķ’ș Ẅǿřŀđ Ěčǿňǿmįč Fǿřųm įň Đǻvǿș, Șẅįțżěřŀǻňđ, ǻňđ mǻňǻģěđ țǿ mǻķě įț ǿųț ǿf Șẅįțżěřŀǻňđ ǿň Fřįđǻỳ ňįģħț běfǿřě ǻįřpǿřțș čŀǿșěđ, șǻįđ ǻ pěřșǿň fǻmįŀįǻř ẅįțħ țħě mǻțțěř. Mř. Mǿŀįňǻřǿŀį șǻįđ țħě țįmě đįffěřěňčě běțẅěěň Đǻvǿș ǻňđ țħě Ų.Ș. mǻđě fǿř ŀǿňģ đǻỳș ǿf čǿňfěřěňčě čǻŀŀș ẅįțħ ěxěčųțįvěș įň țħě Ų.Ș.

Ǿvěř țħě ẅěěķěňđ, Jǿħňșǿň Čǿňțřǿŀș’ bǿǻřđ měț įň Mįŀẅǻųķěě. Měǻňẅħįŀě, Țỳčǿ’ș bǿǻřđ měț įň İřěŀǻňđ ẅħěřě țħěỳ ǻřě řěqųįřěđ țǿ měěț ǿň mǻjǿř șțřǻțěģįč đěčįșįǿňș běčǻųșě ǿf įțș İřįșħ đǿmįčįŀě, pěǿpŀě fǻmįŀįǻř ẅįțħ țħě mǻțțěř șǻįđ.

Ųňđěř țħě đěǻŀ, Jǿħňșǿň Čǿňțřǿŀș șħǻřěħǿŀđěřș ẅįŀŀ řěčěįvě ǿňě șħǻřě ǿf țħě čǿmbįňěđ čǿmpǻňỳ ǿř čǻșħ ěqųǻŀ țǿ $34.88 ǻ șħǻřě, ǻ ẅěįģħțěđ ǻvěřǻģě ǿf țħě přįčě ǿf Jǿħňșǿň Čǿňțřǿŀș’ șħǻřěș ǿvěř țħě pǻșț fįvě țřǻđįňģ đǻỳș. Čǿmpǻňỳ řěpřěșěňțǻțįvěș đįđň’ț įmměđįǻțěŀỳ řěșpǿňđ țǿ řěqųěșțș fǿř čǿmměňț ǿň țħě đěǻŀ’ș ǿvěřǻŀŀ vǻŀųě.

Țỳčǿ șħǻřěħǿŀđěřș ẅįŀŀ řěčěįvě șŀįģħțŀỳ ŀěșș țħǻň ǿňě șħǻřě ǿf Jǿħňșǿň Čǿňțřǿŀș șțǿčķ fǿř ěǻčħ ǿf țħěįř Țỳčǿ șħǻřěș.

Jǿħňșǿň Čǿňțřǿŀș pǻįđ ǻň 11% přěmįųm fǿř Țỳčǿ, ẅħįčħ įș ŀǿẅěř țħǻň țỳpįčǻŀ přěmįųmș įň đěǻŀș bįŀŀěđ ǻș “měřģěř ǿf ěqųǻŀș.” Țħě ǻvěřǻģě přěmįųm pǻįđ įň ǻ měřģěř ǿf ěqųǻŀș ŀǻșț ỳěǻř ẅǻș 20%, ǻččǿřđįňģ țǿ đǻțǻ přǿvįđěř Đěǻŀǿģįč.

Ǻ ŀǻřģě pǿřțįǿň ǿf țħě đěǻŀ įș șțřųčțųřěđ įň șțǿčķ, ẅħįčħ mǻđě řěčěňț mǻřķěț vǿŀǻțįŀįțỳ ěǻșįěř țǿ đěǻŀ ẅįțħ țħǻň įf įț ẅǿųŀđ ħǻvě běěň ǻ čǻșħ đěǻŀ ẅįțħ ǻ șěț přěmįųm, șǻįđ șǿmě ǿf țħě pěǿpŀě.

—Mįčħǻěŀ Șįčǿňǿŀfį ǻňđ Jǿǻňň Ș. Ŀųbŀįň čǿňțřįbųțěđ țǿ țħįș ǻřțįčŀě.

Ẅřįțě țǿ Bǿb Țįțǻ ǻț řǿběřț.țįțǻ@ẅșj.čǿm ǻňđ Đǻňǻ Mǻțțįǿŀį ǻț đǻňǻ.mǻțțįǿŀį@ẅșj.čǿm

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Lawyers Put Final Spin on HP-Oracle Spat

Ben Hancock, The Recorder

June 29, 2016

SAN JOSE—Attorneys for Hewlett Packard have spent much of the past month in a $3 billion trial against Oracle Corp. rebutting the notion that a once-lucrative HP server technology already was on the way out before Oracle yanked its software support. But in closing remarks Wednesday, one of HP's lead attorneys reinforced this message: That doesn't actually matter.

"Even if it was true, it's no excuse," said Gibson, Dunn & Crutcher's Jeffrey Thomas, who has been HP's man at the lectern for much of the prolonged trial. Thomas stressed to the jury that the decisive issue must be whether Oracle's 2011 announcement that it would stop development for HP's Itanium chip-based servers breached a contract from the year before.

"The contract doesn't say Oracle can stop offering its software because it, Intel or anybody else said something about [the future of] Itanium," Thomas told jurors in Santa Clara Superior Court Judge Peter Kirwan's courtroom, speaking in an animated and sometimes conversational style. "This whole 'end of life' story is much ado about nothing when you focus on the question about whether they breached the contract."

If HP hopes to carry the day, it will have to make that idea stick. Oracle's lawyers at Boies Schiller & Flexner and Latham & Watkins have scored some points in establishing, largely through internal emails and testimony, that HP and Intel, the Itanium chip's manufacturer, knew the chip was sliding into obsolescence.

From Oracle's perspective, that's key. No one denies that Oracle issued a press release in March 2011 saying it would stop developing its industry-leading software for Itanium. Where the two sides part ways is whether that, in and of itself, constitutes a breach of their 2010 contract. HP's Itanium business lost half of its market share following Oracle's announcement.

"A press release doesn't kill great technology," Boies Schiller's William Isaacson, who co-led most of the trial with partner Karen Dunn, said during his portion of Oracle's closing argument on Wednesday.

Dunn noted that, after Oracle lost the first phase of the trial in 2012, it quickly resumed development of its software for Itanium—and Itanium customers were never without the latest version of Oracle's industry-leading database software. That means HP can pin zero damages on Oracle, she said. "HP's problem in Phase II is that they won Phase I."

As Oracle's team has done many times, Dunn again contended that the market losses HP suffered resulted from the release of a cheaper and faster chip made by Intel called E7 that made Itanium obsolete. She rarely referred to Itanium without saying the word "dying" beforehand and used colorful analogies to unpack the technological issues at the heart of the litigation. Some of the most unfavorable testimony for HP came from HP executive Martin Fink when he was pressed on emails he sent suggesting that HP and Intel planned to release the next version of the Itanium chip in phases—the first one being a weaker version. (HP pulled the plug on the chip altogether after its market share started to tank.)

Oracle has portrayed that as evidence that Itanium was nearing the end of its life and that HP was simply trying to "milk" its customers for as much profit as possible. Speaking to the jury, Dunn compared it to when she buys a box of a dozen donuts for her family and they pick apart the last donut to make it last.

In the end, the verdict could come down to another technical issue that, overall, has gotten less attention in the suit: whether HP upheld its end of the contract. Oracle has argued that, shortly after the contract was negotiated, HP lessened support for Oracle's Enterprise Linux operating system.

HP says the change was superficial and that Oracle only raised the issue as a defense in litigation and that, if the jury finds that HP failed to uphold its end of the deal, the entire lawsuit would fall.

While Gibson Dunn took the limelight at trial for HP, Chicago-based trial boutique Bartlit Beck Herman Palenchar & Scott did much of the back-end work in the suit. Robert Frank of Choate also handled some testimony for HP.

Underlying HP's narrative throughout trial has been the notion that Oracle's then-CEO and current chairman, Larry Ellison, wanted to crush HP because of a personal vendetta. Ellison testified that he was angry after HP's board forced out his friend Mark Hurd as CEO; Hurd then joined Oracle, right around the time it bought Sun Microsystems and became a competitor to HP in the server market.

Dunn dismissed that storyline as the stuff of fiction. "This is Silicon Valley the place," she said. "It's not Silicon Valley the TV show."

Contact the reporter at [email protected].

August 15, 2016

Breakingviews By KEVIN ALLISON Lyft, the No. 2 American ride-hailing service, recently rebuffed takeover interest from General Motors, its 9 percent owner, according to the news service The Information. There are reasons for Lyft to steer clear of Detroit, despite a shared vision for autonomous cars. But cash-flush rivals could still force the Silicon Valley start-up into G.M.’s lane.

It was probably only a matter of time before G.M. made a move, after it paid $500 million in January for a stake in Lyft and took a seat on Lyft’s board. In March, the companies unveiled a deal to lease G.M. vehicles to Lyft drivers. They also plan to collaborate on building a fleet of autonomous on-demand vehicles.

Speculation about Lyft’s future heated up in June when information emerged that the company had hired the Silicon Valley investment bank Qatalyst Partners, which was founded by Frank Quattrone. Qatalyst is known for helping clients find lucrative exits.

A recent agreement by Uber, the market leader, to merge its China operations with its rival Didi Chuxing, freeing up some $1 billion a year to spend elsewhere, could make Lyft’s fight for market share in America even harder.

Despite the mounting pressures, it’s understandable that Lyft’s founders, Logan Green and John Zimmer, would want to try to stay independent, at least for a while longer. G.M. has been investing heavily in driverless technology, but so have many of its peers, as well as the likes of Alphabet, Google’s parent company, and Apple. So there is no guarantee the carmaker will come up with a winning product.

With software, rather than powertrain, a valuable component of autonomous vehicles, Lyft has little incentive to sell for anything other than top dollar. It would also presumably find it easier to recruit top programming talent as an independent company.

Lyft may run out of road eventually. Being second to the much-larger Uber is a major disadvantage in an industry where drivers and riders prefer the largest, most active network. An expensive battle for ride-hailing supremacy would distract from the bigger prize: a chance to fundamentally disrupt car ownership with driverless technology — an opportunity Mr. Zimmer estimates is worth over $2 trillion per year in the United States alone, including the cost of buying, maintaining and insuring cars. That may ultimately direct Lyft to seek an off-ramp that leads to G.M. It just has to hope that when it does, G.M. is still willing to take the wheel. 8/23/2016 A.P. Møller-Maersk Names Søren Skou CEO; Shares Jump

A.P. Møller-Maersk Names Søren Skou CEO; Shares Jump

Danish conglomerate is planning a restructuring that could split itself into multiple publicly-listed companies

ENLARGE Nils S. Andersen, chief executive of A.P. Moeller-Maersk A/S, is stepping down. Photo: Bloomberg News By Costas Paris Updated June 23, 2016 6:31 p.m. ET Danish conglomerate A.P. Møller-Maersk A/S—buffeted by the worst ocean-shipping downturn in years and a historic oil-price rout—said on Thursday it is replacing its chief executive and considering splitting itself up.

Maersk said Søren Skou, now chief executive of its large shipping business, would take over from Nils S. Andersen as the head of the entire company, starting next month. The 51-year-old’s first task will be to decide whether to disband the holding company.

Apart from shipping and energy, Maersk operates ports, an oil-drilling service company and other businesses. Maersk Chairman Michael Pram Rasmussen said the board wants Mr. Skou to help determine a “possible new structure,” including potentially “abolishing the group” as an umbrella holding company. http://www.wsj.com/articles/a-p-mller-maersk-names-sren-skou-ceo-shares-jump-1466688033 1/4 8/23/2016 A.P. Møller-Maersk Names Søren Skou CEO; Shares Jump The twin moves surprised investors, and sent the Copenhagen-based company’s shares up 12% on Thursday to 9,140 Danish krone (about $1,388).

Its Maersk Line shipping business, the biggest global operator of container ships by capacity, has slashed jobs, slowed expansion of its fleet and cut other costs as it struggles with falling rates and industry overcapacity. Those headwinds have triggered a frenzy of consolidation among its smaller competitors. Until recently, Maersk said its scale would cushion it from the worst of the downturn.

Meanwhile, nearly two years of low crude-oil prices have sapped its energy unit.

Maersk is controlled through a foundation by its founding family, which built the business from a steamship company started in 1904.

Related Video

0:00 / 0:00 Japan's Mitsubishi Motors failed to issue a forecast for the current financial year on Wednesday, citing uncertainties as the scandal over fuel-economy manipulation deepens. Photo: Reuters

The companies also plan to jointly develop new cars together. Mitsubishi hopes to tap into Nissan’s global network of factories to grow in more markets, such as the lucrative U.S., where Mitsubishi has only a small presence. Nissan wants a bigger share of Southeast Asia, where Mitsubishi has had more success.

The deal also catapults the Renault-Nissan alliance into a rarefied stratosphere of the world’s biggest car makers. Renault-Nissan and Mitsubishi sold a combined 9.6 million vehicles world-wide in 2015, data from each of the companies showed. That is close to the roughly 10 million vehicles that Toyota Motor Corp. , Volkswagen AG and General Motors Co. , the world’s three biggest auto makers, each sell in a year.

Mr. Ghosn called the deal a “potential win-win” for both companies, but the risks are proportional to the benefits, analysts say.

Mitsubishi’s sales are declining while its costs are ballooning as a result of admitting in April to falsifying data relating to fuel economy on at least four minicar models sold in Japan. Two of the models were manufactured by Mitsubishi and sold under Nissan’s brand name.

“Mitsubishi could post losses as its domestic operations suffer. If recovery is not in sight, that could also impact Nissan’s earnings,” said Koji Endo, an automotive analyst at Advanced Research Japan.

Mitsubishi and Nissan earlier estimated a combined ¥270 billion ($2.5 billion) in costs related to the fuel economy scandal, a person familiar with the matter said.

Nissan isn’t leaping into the ¥237.4 billion deal blindly. Its investigators are leafing through Mitsubishi’s books, and the deal is contingent upon them not finding anything surprising, Mr. Ghosn said. The companies hope to have the deal done by May 25.

Shares in Mitsubishi closed up 16% after news of a possible deal emerged earlier Thursday. Nissan shares fell 1.4%.

Mitsubishi’s struggles after the revelations about falsified fuel-efficiency tests accelerated what it says was an inevitable alliance between the two companies, which have been working together on minicar development and manufacturing since 2011.

http://www.wsj.com/articles/nissan-to-take-34-stake-in-mitsubishi-motors-1463038142 3/4 8/23/2016 Nissan to Take $2.2 Billion Staken i Scandal-Hit Mitsubishi Motors “While the fuel-economy problem has accelerated our talks, I believe we would have taken this path anyway,” Mr. Masuko said.

The deal also marks a step-back for the Mitsubishi group, which had been the largest shareholder—and a source of a previous bailout for Mitsubishi Motors.

Mitsubishi Motors will issue new shares to Nissan. That means Mitsubishi Heavy Industries Ltd. , Mitsubishi Corp. and Bank of Tokyo-Mitsubishi UFJ Ltd. will see their combined holding in Mitsubishi Motors fall to about 20% from 34% currently, Mr. Masuko said.

A spokesman at Bank of Tokyo-Mitsubishi UFJ said it viewed the planned alliance positively. “We hope it will lead to solutions to their problem,” he said.

The Mitsubishi group companies rescued Mitsubishi Motors back in 2004 by purchasing preferred shares after the car maker’s partnership with DaimlerChrysler fell apart. The auto maker paid back the group companies roughly two years ago.

Under Japanese law, shareholders owning more than one-third of a company’s stock get veto power on management decisions. Nissan will appoint the chairman of the Mitsubishi Motors board and one-third of the board seats, Mr. Ghosn said.

The deal will require approval from Japanese antitrust regulators, Mr. Ghosn said.

Nissan also announced on Thursday its full-year results for the year ended in March. The company posted a net profit of ¥523.8 billion, up 14% from ¥457.6 billion a year earlier, after solid sales in the U.S. and China offset slowdowns in emerging markets. It expects to post a net profit of ¥525 billion during the current financial year.

—Atsuko Fukase contributed to this article.

Write to Yoko Kubota at [email protected] and Sean McLain at [email protected]

http://www.wsj.com/articles/nissan-to-take-34-stake-in-mitsubishi-motors-1463038142 4/4 1/26/2016 Pfizer Weighs Splitting Up New Drug Behemoth - WSJ

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BŲȘİŇĚȘȘ Pfįżěř Ẅěįģħș Șpŀįťťįňģ Ųp Ňěẅ Đřųģ Běħěmǿťħ

Đěǻŀ ẅįțħ Ǻŀŀěřģǻň șěțș ǻ pǻțħ țǿ čřěǻțě țẅǿ șěpǻřǻțě čǿmpǻňįěș bǻșěđ ǿň đřųģ pǿřțfǿŀįǿ

Bỳ JǾŇǺȚĦǺŇ Đ. ŘǾČĶǾFF Ųpđǻțěđ Ňǿv. 23, 2015 8:20 p.m. ĚȚ

Țħě $155 bįŀŀįǿň ǻģřěěměňț țǿ čǿmbįňě Pfįżěř İňč. ẅįțħ Ǻŀŀěřģǻň PĿČ ẅǿųŀđ čřěǻțě ǻ đřųģ běħěmǿțħ șǿ bįģ țħǻț Pfįżěř įș ǻŀřěǻđỳ țħįňķįňģ ǿf břěǻķįňģ įț ųp.

Țħě đěǻŀ, ẅħįčħ ẅǻș ǻňňǿųňčěđ Mǿňđǻỳ, břįňģș țǿģěțħěř ǻ đįvěřșě șțǻbŀě ǿf đřųģș, fřǿm Pfįżěř’ș čǻňčěř měđįčįňěș ǻňđ vǻččįňěș, țǿ Ǻŀŀěřģǻň’ș șķįň-čǻřě țřěǻțměňțș ǻňđ ěỳě đřųģș.

Țħě čǿmpǻňįěș ěxpěčț țǿ ǻčħįěvě $2 bįŀŀįǿň įň čǿșț șǻvįňģș ǻș ẅěŀŀ ǻș șįģňįfįčǻňț țǻx běňěfįțș fřǿm țħě đěǻŀ, ųňđěř ẅħįčħ Pfįżěř’ș țǻx bǻșě ẅǿųŀđ șħįfț țǿ Ǻŀŀěřģǻň’ș ħǿmě bǻșě įň İřěŀǻňđ įň ǻ șǿ-čǻŀŀěđ įňvěřșįǿň. Ǻș ǻ řěșųŀț ǿf țħě mǿvě, Pfįżěř ěxpěčțș țǿ čųț įțș țǻx řǻțě țǿ 17% ǿř 18%, fřǿm įțș řǿųģħŀỳ 25% řǻțě čųřřěňțŀỳ, běčǻųșě čǿřpǿřǻțě țǻxěș įň İřěŀǻňđ ǻřě ŀǿẅěř țħǻň įň țħě Ų.Ș.

Țħě ňěẅ đřųģ čǿmpǻňỳ ẅǿųŀđ bě țħě ẅǿřŀđ’ș bįģģěșț ẅįțħ $63.5 bįŀŀįǿň įň ỳěǻřŀỳ șǻŀěș, 110,000 ěmpŀǿỳěěș ǻňđ $9 bįŀŀįǿň įň ǻňňųǻŀ řěșěǻřčħ șpěňđįňģ.

Pfįżěř ěxěčųțįvěș ħǻvě fǿř ỳěǻřș čǿňșįđěřěđ șpŀįțțįňģ țħě čǿmpǻňỳ, bųț țħěỳ ħǻvě běěň đěțěřřěđ bỳ čǿňčěřňș țħǻț įțș bųșįňěșșěș mǻỳ ňǿț bě ŀǻřģě ěňǿųģħ țǿ șțǻňđ ǻŀǿňě. Ňǿẅ, http://www.wsj.com/articles/pfizer-and-allergan-to-merge-in-huge-inversion-deal-1448280652 1/5 1/26/2016 Pfizer Weighs Splitting Up New Drug Behemoth - WSJ ẅįțħ Ǻŀŀěřģǻň, țħě čǿmpǻňỳ ẅǿųŀđ ħǻvě șțřěňģțħ įň bǿțħ ħįģħ-čǿșț, ħįģħ-ģřǿẅțħ đřųģș ǻș ẅěŀŀ ǻș ǿŀđěř, ŀǿẅěř-čǿșț đřųģș țǿ mǻķě șųčħ ǻ șpŀįț.

Ǿň Mǿňđǻỳ, ěxěčųțįvěș șǻįđ țħěỳ ẅǿųŀđ čǿňșįđěř șpŀįțțįňģ țħě čǿmbįňěđ čǿmpǻňỳ įňțǿ țẅǿ bỳ 2018.

Ǿňě bųșįňěșș ẅǿųŀđ fǿčųș ǿň ňěẅěř přǿđųčțș, șųčħ ǻș Pfįżěř’ș břěǻșț-čǻňčěř đřųģ İbřǻňčě ǻňđ Ǻŀŀěřģǻň’ș bŀǿčķbųșțěř Bǿțǿx, ǻňđ ħǻvě șǻŀěș țħě čǿmpǻňįěș přǿjěčț ẅįŀŀ ģřǿẅ įň țħě đǿųbŀě đįģįțș.

Țħě RELATED ǿțħěř,

Pfizer’s Allergan Deal Offers Ireland Few New Benefits (http://www.wsj.com/articles/pfizers-allergan-deal- ẅįțħ offers-ireland-few-new-benefits-1448370381) ǻ While Pfizer Gets a Tax Break, Its Investors Face a Hit (http://www.wsj.com/articles/pfizer-and-allergan-how- the-deal-adds-up-1448304644?tesla=y) Inversion Deal Pressures U.S. Lawmakers to Change Tax Rules (http://www.wsj.com/articles/pfizer- inversion-puts-pressure-on-u-s-lawmakers-to-revamp-tax-rules-1448301715?tesla=y) U.S. Unveils Rules to Make Corporate Inversions More Difficult (http://www.wsj.com/articles/u-s-unveils- rules-to-make-corporate-inversions-more-difficult-1447970935) (Nov. 19) Heard on the Street: How the Deal Adds Up (http://www.wsj.com/articles/pfizer-and-allergan-how-the-deal- adds-up-1448304644?tesla=y) (http://www.wsj.com/articles/u-s-unveils-rules-to-make-corporate-inversions-more-difficult-1447970935) Inversion Deals Retain Their Allure (http://www.wsj.com/articles/inversion-deals-retain-their-allure- 1438910884) (Aug. 6)

pǿțěňțįǻŀŀỳ mįđ-șįňģŀě-đįģįț ģřǿẅțħ řǻțě, ẅǿųŀđ čǿňșįșț ǿf đřųģș țħǻț ħǻvě ŀǿșț pǻțěňț přǿțěčțįǿň ǿř ǻřě ǻbǿųț țǿ, șųčħ ǻș Pfįżěř’ș Čěŀěbřěx ǻřțħřįțįș đřųģ ǻňđ Ǻŀŀěřģǻň’ș Țěfŀǻřǿ ǻňțįbįǿțįč.

Țħě țẅǿ bųșįňěșșěș “mǻỳ ǿř mǻỳ ňǿț fįț” țǿģěțħěř, Pfįżěř Čħįěf Ěxěčųțįvě İǻň Řěǻđ șǻįđ įň ǻň įňțěřvįěẅ. http://www.wsj.com/articles/pfizer-and-allergan-to-merge-in-huge-inversion-deal-1448280652 2/5 1/26/2016 Pfizer Weighs Splitting Up New Drug Behemoth - WSJ Șħǻřěħǿŀđěřș ẅǿųŀđ ħǻvě přěfěřřěđ mǿřě čěřțǻįňțỳ ǿň ǻ șpŀįț, ǻččǿřđįňģ țǿ ǻňǻŀỳșțș, běčǻųșě ǻ břěǻķųp čǿųŀđ įňčřěǻșě țħě vǻŀųě ǿf țħěįř ħǿŀđįňģș. Țħěỳ ẅěřě ǻŀșǿ đįșǻppǿįňțěđ, ǻňǻŀỳșțș șǻįđ, běčǻųșě Pfįżěř pųșħěđ bǻčķ țħě țįměŀįňě fǿř mǻķįňģ ǻ đěčįșįǿň bỳ țẅǿ ỳěǻřș, șǻỳįňģ įț ẅǻňțěđ țǿ fįřșț fǿčųș ǿň přǿpěřŀỳ đįģěșțįňģ Ǻŀŀěřģǻň.

Țħě čǿmpǻňįěș đįđň’ț ẅǻňț țǿ đřǿp țħě ňěųțřǻŀ țǿňě Pfįżěř ħǻș ųșěđ țǿ đěșčřįbě įțș đěŀįběřǻțįǿňș běčǻųșě țħě đřųģ mǻķěř đǿěșň’ț ẅǻňț țǿ ħųřț ěmpŀǿỳěě mǿřǻŀě, ǻččǿřđįňģ țǿ ǻ pěřșǿň fǻmįŀįǻř ẅįțħ țħě mǻțțěř.

Șħǻřěș įň Pfįżěř fěŀŀ 2.7%, ẅħįŀě Ǻŀŀěřģǻň ŀǿșț 3.4% Mǿňđǻỳ.

Ǻňǿțħěř đřǻģ ǿň țħě șțǿčķș: čǿňčěřň țħǻț țħě Ų.Ș. ģǿvěřňměňț čǿųŀđ țřỳ țǿ țħẅǻřț ǻ čǿmbįňǻțįǿň țħǻț ẅǿųŀđ mǿvě ǿňě ǿf țħě țǿp ňǻměș įň čǿřpǿřǻțě Ǻměřįčǻ țǿ ǻ fǿřěįģň čǿųňțřỳ.

Ħǿẅěvěř, đěșpįțě ňěẅ řųŀěș įșșųěđ bỳ țħě Ų.Ș. Țřěǻșųřỳ Đěpǻřțměňț ŀǻșț ẅěěķ țǿ đěțěř “įňvěřșįǿň” đěǻŀș, įț įș ųňŀįķěŀỳ țħǻț ǻňỳ șįģňįfįčǻňț čħǻňģěș țǿ țħě čǿřpǿřǻțě țǻx čǿđě ǻřě įň țħě ǿffįňģ ẅįțħǿųț ǻčțįǿň bỳ Čǿňģřěșș. Pfįżěř șțřųčțųřěđ țħě đěǻŀ—ųňđěř ẅħįčħ șmǻŀŀěř Ǻŀŀěřģǻň įș țǻķįňģ įț ǿvěř ǻňđ Ǻŀŀěřģǻň șħǻřěħǿŀđěřș ẅįŀŀ čǿňțřǿŀ 44% ǿf țħě čǿmbįňěđ čǿmpǻňỳ—țǿ ħěŀp bỳpǻșș Țřěǻșųřỳ’ș ěffǿřțș.

Mř. Řěǻđ șǻįđ țħě țǻx-řěșțřųčțųřįňģ ẅǿųŀđ fřěě ųp bįŀŀįǿňș ǿf đǿŀŀǻřș įň čǻșħ fǿř ųșě ǿň đřųģ řěșěǻřčħ ǻňđ ǿțħěř přǿģřǻmș. Țħǻț čǻșħ ẅǻș țřǻppěđ ǿvěřșěǻș, běčǻųșě břįňģįňģ įț bǻčķ țǿ țħě Ų.Ș. ẅǿųŀđ ħǻvě ģěňěřǻțěđ ǻ ħųģě țǻx țǻb.

“Țħįș jųșț ěňǻbŀěș ųș țǿ įňvěșț mǿřě įň țħě Ų.Ș.,” ħě șǻįđ.

Ǻț țħě ěňđ ǿf Șěpțěmběř, Pfįżěř ħǻđ $37.6 bįŀŀįǿň įň čǻșħ ǻňđ ěqųįvǻŀěňțș, mǿșț ǿf țħǻț ǿvěřșěǻș, Pfįżěř Čħįěf Fįňǻňčįǻŀ Ǿffįčěř Fřǻňķ Đ’Ǻměŀįǿ șǻįđ.

Fǿř įțș pǻřț, țħě İřįșħ ģǿvěřňměňț įș șǻňģųįňě ǻbǿųț țħě đěǻŀ, șįňčě bǿțħ pħǻřmǻčěųțįčǻŀ čǿmpǻňįěș ǻŀřěǻđỳ ěmpŀǿỳ țħǿųșǻňđș ǿf pěǿpŀě įň țħě čǿųňțřỳ. Ǻ șpǿķěșmǻň fǿř Fįňǻňčě Mįňįșțěř Mįčħǻěŀ Ňǿǿňǻň șǻįđ țħě ǿňŀỳ “mǻjǿř čǿňčěřň” ẅǻș țħǻț țħě měřģěř ẅǿųŀđ řěșųŀț įň jǿb ŀǿșșěș. “Ẅě ẅǿųŀđ bě ħǿpįňģ țħǻț țħě měřģěř ẅǿųŀđ řěșųŀț įň ǻň įňčřěǻșě įň ěmpŀǿỳměňț ħěřě řǻțħěř țħǻň ǻ đěčřěǻșě,” ħě șǻįđ.

Țħě đěǻŀ vǻŀųěș ěǻčħ Ǻŀŀěřģǻň șħǻřě ǻț $363.63, mǿřě țħǻň ǻ 30% přěmįųm țǿ țħě přįčě běfǿřě Țħě Ẅǻŀŀ Șțřěěț Jǿųřňǻŀ řěpǿřțěđ țħě đěǻŀ țǻŀķș ŀǻțě ŀǻșț mǿňțħ. Ǻŀŀěřģǻň șħǻřěħǿŀđěřș ẅǿųŀđ ģěț 11.3 șħǻřěș įň țħě čǿmbįňěđ čǿmpǻňỳ fǿř ěǻčħ ǿf țħěįř ǿẅň, ǻňđ Pfįżěř șțǿčķħǿŀđěřș čǿųŀđ ěxčħǻňģě șǿmě ǿf țħěįř șħǻřěș fǿř čǻșħ.

http://www.wsj.com/articles/pfizer-and-allergan-to-merge-in-huge-inversion-deal-1448280652 3/5 1/26/2016 Pfizer Weighs Splitting Up New Drug Behemoth - WSJ Bǿțħ Pfįżěř ǻňđ Ǻŀŀěřģǻň ħǻvě běěň ẅħįpșǻẅěđ bỳ įňțěģřǻțįǿňș ǻňđ řěșțřųčțųřįňģș įň řěčěňț ỳěǻřș, ǻ přǿđųčț ǿf țħě șěįșmįč čħǻňģěș țħǻț ħǻvě běěň řįppŀįňģ țħřǿųģħ ħěǻŀțħ čǻřě ǻș ǻ řěșųŀț ǿf přěșșųřě țǿ čǿňțřǿŀ șpěňđįňģ, țħě řǿŀŀǿųț ǿf țħě Ǻffǿřđǻbŀě Čǻřě Ǻčț, ǻňđ țħě ěňđ ǿf ǻ ẅǻvě ǿf pǻțěňț ěxpįřǻțįǿňș fǿř țǿp- șěŀŀįňģ đřųģș ŀįķě Pfįżěř’ș Ŀįpįțǿř čħǿŀěșțěřǿŀ pįŀŀș.

“Bǿțħ RELATED

Pfizer’s Allergan Deal Offers Ireland Few New Benefits (http://www.wsj.com/articles/pfizers-allergan-deal- offers-ireland-few-new-benefits-1448370381) Inversion Deal Pressures U.S. Lawmakers to Change Tax Rules (http://www.wsj.com/articles/pfizer- inversion-puts-pressure-on-u-s-lawmakers-to-revamp-tax-rules-1448301715?tesla=y) Heard on the Street: How the Deal Adds Up (http://www.wsj.com/articles/pfizer-and-allergan-how-the-deal- adds-up-1448304644?tesla=y) While Pfizer Gets a Tax Break, Its Investors Face a Hit (http://www.wsj.com/articles/pfizer-and-allergan-how- the-deal-adds-up-1448304644?tesla=y) U.S. Unveils Rules to Make Corporate Inversions More Difficult (http://www.wsj.com/articles/u-s-unveils- rules-to-make-corporate-inversions-more-difficult-1447970935) (Nov. 19) (http://www.wsj.com/articles/u-s-unveils-rules-to-make-corporate-inversions-more-difficult-1447970935) Inversion Deals Retain Their Allure (http://www.wsj.com/articles/inversion-deals-retain-their-allure- 1438910884) (Aug. 6)

čǿmpǻňįěș ǻňđ bǿțħ șěțș ǿf ŀěǻđěřș ħǻvě běěň țřǻňșfǿřmįňģ țħěįř bųșįňěșșěș,” șǻįđ Ǻŀŀěřģǻň ČĚǾ Břěňț Șǻųňđěřș įň ǻň įňțěřvįěẅ. “Țħįș čǿmbįňǻțįǿň řěǻŀŀỳ řěpřěșěňțș ǻ ģįǻňț șțěp fǿřẅǻřđ ǻŀǿňģ țħǿșě ŀįňěș,” șǻįđ Mř. Șǻųňđěřș, ẅħǿ ẅįŀŀ șěřvě ǻș přěșįđěňț ǻňđ čħįěf ǿpěřǻțįňģ ǿffįčěř ǿf țħě čǿmbįňěđ čǿmpǻňỳ ǻňđ jǿįň įțș bǿǻřđ.

Ǻfțěř țǻķįňģ țħě ħěŀm ǿf Pfįżěř įň ŀǻțě 2010, Mř. Řěǻđ șpěǻřħěǻđěđ ǻ ňųmběř ǿf đěǻŀș țǿ fǿčųș țħě čǿmpǻňỳ ǿň ħųmǻň měđįčįňěș ǻňđ řěbųįŀđ įțș pįpěŀįňě. Pfįżěř șpųň ǿff įțș ǻňįmǻŀ-ħěǻŀțħ bųșįňěșș, fǿř įňșțǻňčě, ǻňđ mǿșț řěčěňțŀỳ bǿųģħț Ħǿșpįřǻ fǿř $16 bįŀŀįǿň.

http://www.wsj.com/articles/pfizer-and-allergan-to-merge-in-huge-inversion-deal-1448280652 4/5 1/26/2016 Pfizer Weighs Splitting Up New Drug Behemoth - WSJ Mř. Řěǻđ ǻŀșǿ řěǿřģǻňįżěđ Pfįżěř įňțǿ șěģměňțș fǿčųșįňģ ǿň pǻțěňț-přǿțěčțěđ měđįčįňěș ǻňđ ǿŀđěř đřųģș, ǻ mǿvě țħǻț čǿųŀđ pǻvě țħě ẅǻỳ fǿř ǻ pǿțěňțįǻŀ șpŀįț.

Ǻŀŀěřģǻň ħǻș ųňđěřģǿňě ǻň ěvěň bįģģěř řěmǿđěŀįňģ, șįňčě Pǻųŀ Bįșǻřǿ țǿǿķ ǿvěř ǻ řěŀǻțįvěŀỳ șmǻŀŀ ģěňěřįč đřųģ čǿmpǻňỳ čǻŀŀěđ Ẅǻțșǿň Pħǻřmǻčěųțįčǻŀș įň 2007. Ẅǻțșǿň ěxpǻňđěđ įțș pǿřțfǿŀįǿ ǿf țħě ķňǿčķǿff đřųģș țħřǿųģħ ǻ șěřįěș ǿf đěǻŀș, įňčŀųđįňģ ǿňě fǿř țħě Ěųřǿpěǻň čǿmpǻňỳ Ǻčțǻvįș, ẅħǿșě ňǻmě țħě čǿmpǻňỳ țǿǿķ.

Ŀǻșț ỳěǻř, țħě čǿmpǻňỳ mǿvěđ įňțǿ pǻțěňț-přǿțěčțěđ đřųģș bỳ bųỳįňģ Fǿřěșț Ŀǻbǿřǻțǿřįěș—ẅħǿșě ČĚǾ ẅǻș Mř. Șǻųňđěřș—ǻňđ țħěň șčǿǿpěđ ųp Ǻŀŀěřģǻň. Mǿșț řěčěňțŀỳ, țħě čǿmpǻňỳ țǿǿķ ǻ bįģ șțěp țǿẅǻřđ mǿvįňģ ǿň fřǿm įțș ħěřįțǻģě, ǻģřěěįňģ țǿ șěŀŀ įțș ģěňěřįč-đřųģș bųșįňěșș țǿ Țěvǻ Pħǻřmǻčěųțįčǻŀ İňđųșțřįěș Ŀțđ. fǿř $40.5 bįŀŀįǿň. Mř. Bįșǻřǿ, čųřřěňțŀỳ țħě ěxěčųțįvě čħǻįřmǻň ǿf Ǻŀŀěřģǻň, ẅįŀŀ jǿįň țħě bǿǻřđ ǿf țħě ňěẅ čǿmpǻňỳ.

—Đěňįșě Řǿŀǻňđ čǿňțřįbųțěđ țǿ țħįș ǻřțįčŀě.

Ẅřįțě țǿ Jǿňǻțħǻň Đ. Řǿčķǿff ǻț Jǿňǻțħǻň.Řǿčķǿff@ẅșj.čǿm MǾŘĚ FŘǾM ǾPİŇİǾŇ Țħě Đěfįčįț Řįșěș Ǻģǻįň

http://www.wsj.com/articles/pfizer-and-allergan-to-merge-in-huge-inversion-deal-1448280652 5/5 Pfizer’s Medivation Deal Latest in Long Line of Similar Acquisitions

Other big pharmaceutical companies have bought smaller rivals with prized assets

ENLARGE Medivation’s prostate-cancer drug Xtandi Photo: Medivation By Jonathan D. Rockoff Aug. 22, 2016 12:22 p.m. ET Pfizer ’s $14 billion deal to buy Medivation and its prostate-cancer drug Xtandi is the latest in a long line of big pharmaceutical company acquisitions of smaller companies with prized assets. Sometimes, the big pharmaceutical companies do the deals to plug in the sales of already approved and big-selling drugs; other times, it is to acquire medicines in development that show strong potential. Here is a list of some other notable transactions from the past several years.

AbbVie -Pharmacyclics. Last year, AbbVie Inc. paid $21 billion for Pharmacyclics to obtain its blockbuster blood-cancer drug Imbruvica. AbbVie outbid rivals including Johnson & Johnson, which also sells Imbruvica, to reduce its reliance on the world’s top-selling drug, rheumatoid arthritis therapy Humira. AbbVie reported net revenues of $820 million from Imbruvica during the first half of this year.

Gilead-Pharmasset. The $11 billion purchase of Pharmasset, considered a hefty sum at the time of the deal four years ago, may go down as one of the drug industry’s most lucrative transactions. Gilead Sciences Inc. obtained a promising but still unapproved hepatitis C drug. That compound was named Sovaldi upon its subsequent approval and later included in a combination drug called Harvoni. That franchise has gone on to be a top industry moneymaker, notching $19.1 billion in sales last year. Their price tags, of $1,000 a day or more, has also generated criticism of Gilead and industry pricing in general.

Amgen -Onyx. Onyx was selling a multiple-myeloma drug named Kyprolis that Amgen Inc. sought in a $10.4 billion takeover in 2013. Amgen was one of the pioneering biotechs, famed for the cancer drugs that poured out from its labs, but those products were aging. Kyprolis sales, totaling $512 million last fiscal year, have given the company a boost.

Celgene-Receptos. Last August, cancer-drug company Celgene Corp. bought Receptos and its experimental multiple-sclerosis drug ozanimod for $7.2 billion. Celgene hopes the acquisition will help the company diversify beyond its franchise of multiple-myeloma drugs and into autoimmune diseases. Ozanimod is still under development.

Bristol-Medarex. Bristol-Myers Squibb & Co. took a big risk when it bought Medarex for $2.1 billion 2009. The partners had been chasing a longtime elusive goal of drug researchers: unlocking the body’s immune system so it could fight cancer. The bet paid off. Now Bristol sells two such immunotherapies, Yervoy and Opdivo, and leads the market for the medicines that analysts expect will top $23 billion in 2020. Rivals, including Pfizer, are trying to catch up.

Merck-Cubist. Merck & Co. celebrated its $8.4 billion agreement in late 2014 to buy Cubist Pharmaceuticals and its antibiotic Cubicin. Cubicin generated nearly $1 billion in yearly sales, and it fit into Merck’s expanding portfolio of antibiotics and other drugs given in hospitals. Yet just hours after the deal’s announcement, a judge invalidated some key Cubicin patents. Late last year, Merck lost its appeal, which paves the way for Pfizer to sell a generic version of Cubicin as early as this year.

Write to Jonathan D. Rockoff at [email protected]

Advertisement 8/23/2016 Shell Completes Acquisition of BG Group, Giving Energy Giant a Large Footprint in Brazil

Shell Completes Acquisition of BG Group, Giving Energy Giant a Large Footprint in Brazil

Shell become largest foreign oil company in Brazil

ENLARGE Royal Dutch Shell CEO Ben van Beurden in London in January. Photo: Agence France-Presse/Getty Images By Will Connors and Sarah Kent Feb. 15, 2016 8:09 a.m. ET RIO DE JANEIRO—Royal Dutch Shell PLC on Monday completed its roughly $50 billion acquisition of BG Group PLC, giving the Anglo-Dutch oil company a dominant footprint offshore Brazil—one of the most prized oil plays in the world, but one that presents a number of challenges.

It is the culmination of nearly a year of painstaking deal-making that sent Shell executives flying around the world to convince investors of the viability of the acquisition amid a persistent slump in oil prices.

On Monday, speaking from Brazil, Shell Chief Executive Ben van Beurden said it was a “momentous day” and that the combined company will be “more attractive for shareholders,” “more resilient” to fluctuating oil prices http://www.wsj.com/articles/shell-completes-buy-of-bg-group-1455541779 1/3 8/23/2016 Shell Completes Acquisition of BG Group, Giving Energy Giant a Large Footprint in Brazil and “more predictable” for investors.

The prize for Mr. van Beurden is significant. The acquisition of U.K.-based BG will bolster Shell’s already significant position in the fast-growing liquefied-natural-gas market and turn it into the largest foreign oil company in Brazil.

That Mr. van Beurden chose Brazil as the location in which to make his first remarks at the helm of the combined company highlights the importance of the country’s oil and gas market.

Brazil is a “top three” country for Shell, Mr. van Beurden said, and in terms of oil exploration and production Brazil will be “the most valuable country in our portfolio.” He added that Brazil “will remain a key destination country for us for investment dollars for at least a decade.”

Shell already has numerous investments in Brazil and its roots in the country go back over a century, but the company must confront a host of new challenges here, and is betting that a Brazilian oil sector, fresh off a corruption scandal and a turbulent political scene, is worth the trouble.

Shell’s main partner in Brazil is state-run oil company Petróleo Brasileiro SA, or Petrobras, which is the world’s most-indebted oil company and which is still dealing with the fallout from a corruption scandal in which several senior executives were arrested.

Advertisement Petrobras by law controls the majority of the country’s prized pre-salt oil reserves, trapped deep under thick layers of rock and salt beneath the waters offshore Brazil.

According to the U.S. Energy Information Administration, Brazil holds 15 billion barrels of proved oil reserves, second only to Venezuela in South America.

Though the assets Shell is acquiring in Brazil are oil fields that can be profitable even at relatively low crude prices, the scandal buffeting Petrobras and the political climate in Brazil create numerous challenges.

“There are multiple risks,” said Jefferies analyst Jason Gammel, taking note of the impact of the continuing scandal on Petrobras, recent proposals to increase taxes on oil and gas production, and Petrobras’s debt load.

“Petrobras’s ability to finance itself is certainly a risk,” Mr. Gammel said.

After the discovery of the pre-salt reserves, Brazilian President Dilma Rousseff made a number of changes to the oil industry in an attempt to give Petrobras a competitive advantage and to tap into oil revenue for social programs.

A new law required Petrobras to hold at least a 30% stake and be the sole operator of the pre-salt fields.

Foreign companies were required to use more local materials and companies for projects, which drove up costs.

http://www.wsj.com/articles/shell-completes-buy-of-bg-group-1455541779 2/3 8/23/2016 Shell Completes Acquisition of BG Group, Giving Energy Giant a Large Footprint in Brazil Oil-field auctions became less predictable. That soured the outlook in Brazil for several oil companies, some of which have left the country.

But Shell’s substantial investments in Brazil, and now its purchase of BG, means that it must stick it out.

On Monday Mr. van Beurden said that while he hasn’t met with Ms. Rousseff since the BG deal was announced to advocate for change, it “would make sense” for Brazil to ease the pre-salt field restrictions, and that if the government did so Shell would be “ready to step up and play a role” in investment and development of the fields.

He added that Shell isn’t exposed to the corruption scandal involving Petrobras, and that the company factored in any potential slowdown in the country’s oil industry because of the scandal before the BG acquisition.

BG was an early mover in Brazil, investing in exploration in the oil-rich Santos basin when it was still viewed as unproven frontier.

It was rewarded with a series of blockbuster discoveries thought to contain billions of barrels of oil.

Last year, its high-margin oil production in the country rose to record levels.

It is a boost Shell sorely needs.

The company’s reserves dropped 20% last year as low oil prices erased 1.4 billion barrels from the volume of oil and gas it expects to develop.

The BG acquisition will help damp the impact of that, boosting Shell’s production by roughly 20% and increasing its reserves 25%.

Write to Will Connors at [email protected] and Sarah Kent at [email protected]

http://www.wsj.com/articles/shell-completes-buy-of-bg-group-1455541779 3/3 This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. http://www.wsj.com/articles/sina-shouldnt-be-worth-less-than-its-weibo-parts-1471341308

MARKETS | HEARD ON THE STREET Sina Shouldn’t Be Worth Less Than Its Weibo Parts

Imagine a profitable and growing Twitter; that’s why investors are so worked up about Weibo recently

Negative Equity Sina's market value, excluding its Weibo stake

$1.8 billion

1.5

1.3

1.0

0.8

0.5

0.3

-0.2

-0.5 2015 ’16 Source: FactSet THE WALL STREET JOURNAL.

By JACKY WONG Aug. 16, 2016 5:55 a.m. ET

Imagine a profitable and growing Twitter. That is why investors are so worked up about Weibo recently. Shares of the Chinese social media firm have surged 23% since its quarterly results last week. Weibo, which provides a Twitter-like service, saw its revenue rise 36% last quarter from a year ago. And unlike its unprofitable U.S. counterpart, Weibo’s profit has leapfrogged sixfold from last year. The results are particularly encouraging since Weibo has managed to attract smaller advertisers after ending a cooperation agreement with e- commerce giant Alibaba earlier this year.

But after nearly quadrupling since February lows, Weibo’s shares are no longer cheap, trading at 43 times next year’s adjusted earnings—much higher than many Chinese internet names. Alibaba, for example, trades at 30 times even after a recent rally on a blowout quarter. Tencent, which owns messaging/payments/social service WeChat, which has nearly three times as many active users as Weibo, trades at 28 times.

For investors hoping to ride on Weibo’s wave, however, its parent Sina could offer better value.

Shares of Sina appears to be trading at less than the sum of its parts. PHOTO: NELSON CHING/BLOOMBERG NEWS Sina have also gone up this year, but have lagged behind its sexier subsidiary. In fact, it is now worth less than the value of its 54.5% stake in Weibo. Throwing in around $1 billion of net cash sitting on its books, and other investments, Sina is essentially trading at around 25% discount to its sum of the parts, according to Ryan Roberts, an analyst at MCM Partners.

This means the market has essentially ascribed negative value to Sina’s portal business. The unprofitable business, which is similar to Yahoo’s, is understandably out of flavor. But there are signs of improvement there. Portal advertising revenue rose 6% last quarter on constant currency basis, excluding the impact from the termination of the Alibaba agreement. Its mobile news app has also been sweeping up tons of new users.

Some potential deals long in the rumor mill—such as a sale of Weibo to Alibaba, which already owns 30.5% of it—could instantly unlock value for Sina.

Charles Chao, Sina’s chairman, said during last week’s earnings call that he will look into ways to unlock value “very closely in the near future.” Sina investors should get the message. 1

Antitrust Cops Put Brakes on Staples, GE Deals FTC files suit to block Staples’ takeover of Office Depot, as GE drops agreement to sell appliances business to Electrolux By BRENT KENDALL in Washington and DREW FITZGERALD and TED MANN in New York Updated Dec. 7, 2015 8:10 p.m. ET

From kitchen stoves to paper clips, U.S. antitrust enforcers are putting the brakes on a series of corporate deals that have tested the government’s willingness to let longtime rivals combine two big businesses. On Monday, the Federal Trade Commission filed a lawsuit to block Staples Inc.’s roughly $6 billion takeover of Office Depot Inc., a deal that would create an office supplier with nearly $40 billion in annual sales. The lawsuit alleged the combination would mean higher prices for companies that buy office supplies in bulk. Staples and Office Depot said they would contest the suit, but shares of both companies tumbled. The FTC’s unanimous decision came the same day that General Electric Co. abandoned a $3.3 billion agreement to sell its appliances business to Electrolux AB of Sweden. GE walked away from the deal, which it struck 15 months ago, in the middle of a courtroom fight with the U.S. Department of Justice. Once again, government lawyers argued the combination would reduce competition and raise prices. Shares of Electrolux, whose CEO had testified the deal was “absolutely critical” to its business, lost 15% of their value, while GE shares slipped less than 1%. Both transactions would have left bigger companies atop industries that have been consolidating for years. Adding Office Depot, which merged with OfficeMax in 2013, would leave Staples with 70% of the market for pens, pads and office essentials that large businesses buy directly, according to the FTC. Combining GE and Electrolux would have created a merged firm that sold two of every three cooking ranges in the U.S., government lawyers said. “Each horizontal merger raises concentration. And when market concentration goes up, the likelihood that the next merger will be challenged goes up as well,” said University of Iowa law professor Herbert Hovenkamp. “The government has been on a decent roll in merger cases the last couple of years. These are both good examples of that.” Cheap debt and a slow-growth economy has helped fuel a record year for mergers and acquisitions—with $4.35 trillion in global volume and $2.12 trillion in U.S. deals, according to Dealogic. But it has also been a banner year for transactions that have fallen at the hands of antitrust police appointed by President Barack Obama. Antitrust objections by the Justice Department earlier this year helped derail Comcast Corp.’s $45 billion bid for Time Warner Cable Inc. The FTC won a court fight in June thatblocked the $3.5 billion combination of food-distribution rivals Sysco Corp. and US Foods Inc. Last week, two leading tuna producers—the owners of Bumble Bee and Chicken of the Sea brands—called off a $1.5 billion merger in light of U.S. concerns.

The agencies this year have sought to stop deals in an array of other markets, including movie advertising networks, hospitals and the semiconductor industry. So far this year, Dealogic says companies have abandoned 77 deals worth $263 billion, though that tally includes many deals withdrawn for non-regulatory reasons. 2

All four current FTC commissioners, three Democrats and a Republican, voted in favor of the Staples lawsuit. Market expansion or new entry by other office-supply vendors wouldn’t be timely, likely or sufficient to counter the anticompetitive effects of the merger, the FTC said. Shares of Office Depot fell 16% Monday, while Staples lost 14%. The companies said the decision was “based on a flawed analysis and misunderstanding of the intense competitive landscape.” The lawsuit marks the second time the FTC has intervened to prevent the two companies from combining. The commission in 1997 won a ruling from a federal judge that blocked a Staples- Office Depot merger. Both companies argued the industry has evolved over the past two decades, including through growing competition from the Internet and big-box retailers. The FTC acknowledged this evolution when it allowed Office Depot to merge with OfficeMax. “The FTC now contradicts its prior ruling, even though competition has materially intensified in the two years since the commission declared this market highly competitive,” the companies wrote in a letter to clients. “This contradiction is not only unfair; it flies in the face of marketplace realities.” The FTC said business-to-business market is distinct from the more competitive retail markets for office supplies sold to consumers. The companies had sought to ease FTC concerns by offering to shed hundreds of millions of dollars in corporate contracts. FTC staffers weren’t enthusiastic about the divestiture offer, and the companies in recent days had offered larger concessions, according to people familiar with the matter. Both Staples and Electrolux asked the government to take a broader view of markets and give credit to newer, smaller competitors. The GE transaction was in jeopardy since the summer, when the Justice Department filed a lawsuit to block it. “This deal was bad for the millions of consumers who buy cooking appliances every year. Electrolux and General Electric could not overcome that reality at trial,” Justice Department lawyer David Gelfand said Monday. The companies pointed to the Bush Justice Department’s decision in 2006 to allow Whirlpool Corp. to acquire rival Maytag Corp. Top executives from Electrolux and GE had testified during the trial, which began in early November. Though the court handling the case had yet to render a verdict, GE used its right to terminate the sale after 15 months of talks, which was its first opportunity to walk away from the transaction and collect a breakup fee. GE said Monday it is entitled to a $175 million breakup fee. Electrolux, though, said it was reviewing the terms of the fee. “The appliances business is performing well and GE will continue to run the business while it pursues a sale,” GE said. The deal’s failure is a setback to the company’s effort to focus on high-tech industrial industries but GE has been confident it could find another buyer if the Electrolux deal fell through, according to people familiar with the company’s thinking. Electrolux had hoped to create an appliances seller capable of competing with the behemoth of Whirlpool and rising Asian competitors. “We are disappointed but we are certainly not defeated,” Electrolux CEO Keith McLoughlin said during a conference call. The merged Electrolux-GE business would have had about one-quarter of the U.S. market last year, compared with roughly 30% for Whirlpool, and 12% and 13%, respectively, for South Korean rivals LG Corp. and Samsung Electronics Co., according to data from TraQline.

Tesla’s Plan to Buy SolarCity Has Major Flaws

The market hates the idea of Tesla Motors acquiring SolarCity.

After Tesla’s announcement on Tuesday of a $2.8 billion offer to acquire SolarCity, Tesla’s stock was down more than 8 percent early Wednesday morning, more than the total market capitalization of SolarCity itself. The market is ascribing a negative value to this possible acquisition.

The reaction reflects two things.

Solar City is a maker of solar energy products, basically home and business solar panels. Tesla is a maker of battery-powered cars, though some view the company’s battery-making component as its bigger future.

To Elon Musk, the chairman of SolarCity and the chief executive of Tesla, putting together these two different businesses is “blindingly obvious” and a “no-brainer.” A blog post on the Tesla website explained the reasons:

We would be the world’s only vertically integrated energy company offering end-to-end clean energy products to our customers. This would start with the car that you drive and the energy that you use to charge it, and would extend to how everything else in your home or business is powered.

In other words, the deal makes sense because people who buy Tesla’s cars also want solar power. In a combined company, they can get it in the same place.

The market is not buying it.

To investors, it is as if the Walt Disney Company bought a birthing center business to offer “end-to-end” service for its parent customers. It’s not clear that Tesla owners will really want to buy solar panels, or that if they did, it would be in sufficient number.

And SolarCity is hardly a growth business these days. Both companies are burning cash. SolarCity went through $2.6 billion last year, while Tesla spent $2.2 billion. SolarCity’s business model is struggling as cheap energy shakes up the solar market. So the acquisition is being viewed not so much as a “no-brainer” but as a bailout of SolarCity by Tesla, one that may sink both companies.

http://www.nytimes.com/2016/06/23/business/dealbook/teslas-plan-to-buy-solarcity-has-major-flaws.html 1/3 8/23/2016 Tesla’s Plan to Buy SolarCity Has Major Flaws The idea would be dismissed as yet another Silicon Valley lark (although who knows whether the visionary Mr. Musk is right), but there is a second problem with this deal. It’s a bit of a corporate governance nightmare.

Mr. Musk owns 21 percent of Tesla and 22 percent of SolarCity, according to Standard & Poor’s Global Market Intelligence. His cousin, Lyndon Rive, is a founder and the chief executive of SolarCity.

Given the troubles of SolarCity, the appearance is that Mr. Musk is bailing SolarCity out while profiting handsomely. He will be paid a premium by Tesla for a company in which he is the biggest shareholder, one that the market at least views as outside the business of Tesla.

Today, companies are separated into makers of ball bearings and makers of steel because even they are viewed as being too different. Only in Silicon Valley could a cross-industry acquisition like this even possibly fly.

Tesla did announce some procedures to deal with this conflict. Mr. Musk recused himself from the deliberations at Tesla and Mr. Rive said the same thing at SolarCity. In addition, Tesla said that any deal would be subject to approval by a majority of its disinterested shareholders.

This is part of the standard procedure in conflict situations. The general idea is that each company forms a committee of independent directors with its own advisers and legal counsel. This would ensure approval of the disinterested directors. Then any deal itself would be subject to approval of the disinterested shareholders. The State of Delaware, where a majority of American companies are incorporated, technically requires only that either the disinterested directors or disinterested shareholders approve the deal, but the standard practice is to do both.

Even so, Tesla is not following this standard procedure. It does not appear that Tesla or SolarCity truly formed an independent committee or hired independent counsel, but instead opted for a recusal. (Another director on both boards, Antonio J. Gracias, also recused himself.) http://www.nytimes.com/2016/06/23/business/dealbook/teslas-plan-to-buy-solarcity-has-major-flaws.html 2/3 8/23/2016 Tesla’s Plan to Buy SolarCity Has Major Flaws That is sufficient for Delaware law, but the optics are not great.

Indeed, one of the actions Tesla took on Tuesday was to amend its bylaws to require all shareholder litigation to be filed in Delaware. It knows the lawsuits are coming.

So this deal suffers from some significant defects at the get-go. It should have been structured more formally and put through the stricter process of a formal special committee. This is particularly true after the recent ruling in the Dell appraisal proceedings, in which Dell did everything it could to structure the management buyout to the highest standards, and the Delaware court still found fault with the process.

A bigger issue is the shareholder approval requirement. Because Mr. Musk has an interest in SolarCity, a vote is required under the stock exchange rules.

Institutional shareholders, however, hold 63.57 percent of Tesla. It is hard to see them liking this deal. Tesla is also a darling of day traders. These short-term holders want the stock to go up, and voting no on the deal is a way to get the shares to rise.

Given the reaction, it is hard to see how a deal like this can happen now.

In the end, Tesla’s offer appears destined to die as quickly as a fruit fly, in part because it does not make sense to the market, but also because the announcement and the structuring show a poor understanding of public relations.

Indeed, it almost seems as if this is an offer intended to horrify institutional investors.

Chalk it up to the sometimes stifling exuberance of Silicon Valley, where founders think they can do anything until they can’t.

Correction: June 23, 2016 An earlier version of this article misstated the stock market requirement for a shareholder vote on Tesla Motors’ planned acquisition of SolarCity. A vote is required because Elon Musk, the chief executive of Tesla, owns a stake in SolarCity; Tesla cannot avoid a vote on a technicality by issuing shares below the minimum set to require a vote.

http://www.nytimes.com/2016/06/23/business/dealbook/teslas-plan-to-buy-solarcity-has-major-flaws.html 3/3 8/23/2016 The Unsettlingc A quisitiveness of Anbang, a Chinese Insurer, in the U.S.

The Unsettling Acquisitiveness of Anbang, a Chinese Insurer, in the U.S.

Credit Harry Campbell

A buying spree by a Chinese insurance company that has emerged seemingly overnight is flashing a warning sign.

An alliance led by the Chinese company, the Anbang Insurance Group, has for the moment been outbid for Starwood Hotels & Resorts, the owner of the Sheraton and Westin brands, by Marriott International. But that Anbang is even in the running — and may yet win out — is an indication of deal-making gone awry.

Typically in a takeover battle, a strategic bidder should always triumph over a financial bidder like a private equity firm or Anbang, which has teamed up with two investment firms.

The reason is simple. A strategic buyer is an operating company and almost always can pay more for a target. The strategic buyer can expect to earn more from the target through cost savings. There would be no need for two general counsels, for example.

A strategic buyer should also be able to reap operating efficiencies or other benefits from putting two assets together — what deal makers call “synergies.” Think of the Walt Disney Company buying Marvel Entertainment to put the Marvel characters in Disney’s movies and theme parks. This sort of strategic rationale is what is driving Marriott’s bid.

The last time financial buyers regularly beat out strategic buyers was in the months before the financial crisis as the credit bubble drove a huge private equity feeding frenzy. In those days, Kohlberg Kravis Roberts and Company could acquire First Data for $29 billion, borrowing more than the company was worth the day before the deal’s announcement. http://www.nytimes.com/2016/03/23/business/dealbook/the-unsettling-acquisitiveness-of-a-chinese-insurer-in-the-us.html 1/4 8/23/2016 The Unsettlingc A quisitiveness of Anbang, a Chinese Insurer, in the U.S. Anbang also announced deals for the Waldorf Astoria in October 2014 for $1.95 billion, 717 Fifth Avenue in February 2015 for an estimated $500 million and Strategic Hotels & Resorts for $6.5 billion from Blackstone only two weeks ago. Blackstone bought the company for $500 million less only three months ago. It’s a nice deal for Blackstone, but one wonders why Anbang would pay so much more only a few months later.

So what gives with all the hotel acquisitions?

Anbang, which was founded in 2004, appears to be trying to build itself into a financial conglomerate along the lines of Warren E. Buffett’s Berkshire Hathaway. Like Berkshire, Anbang is using insurance reserves to buy assets in a variety of businesses such as banking and real estate. It also spent over $2 billion on insurers in Belgium and South Korea in 2015.

And Anbang is funding this spree by selling high-yield investment products to Chinese citizens.

If this type of company existed in the United States, there would be an outcry. It may be reasonable for an Internet company to appear out of nowhere and be a giant after 10 years, but an insurance company? And one that is buying noncore assets abundantly? We’ve seen this story many times before, and it typically doesn’t end well.

But a huge hunger for growth doesn’t quite explain Anbang’s attempt to buy more than $20 billion worth of hotel properties in the space of a year or so. There are the political connections, of course. Anbang’s deal-maker chairman, Wu Xiaohui, is said to enjoy warm relations with the Beijing government. His wife is the granddaughter of Deng Xiaoping, the former leader of China.

The company’s explanation is that it is diversifying. It appears to view global real estate as a high-yielding asset that will allow the company to diversify its assets out of China at a time when China’s economy is slowing. This is particularly important for a life insurer, since China’s population is aging rapidly, so higher returns are a must.

It is easy to compare the shopping spree by Anbang and other Chinese companies to the shopping by Japanese companies in the 1980s. Back then, the emerging giants of Japan sought out trophy properties in the United States, including Rockefeller Center. The Japanese mostly bought at the top and then suffered through the downturn in the early 1990s. Given the price of commercial real estate these days, as well as the price Anbang paid for the Waldorf Astoria — a record for a hotel in New York — one has to think that this might be the case again.

http://www.nytimes.com/2016/03/23/business/dealbook/the-unsettling-acquisitiveness-of-a-chinese-insurer-in-the-us.html 2/4 8/23/2016 The Unsettlingc A quisitiveness of Anbang, a Chinese Insurer, in the U.S.

But acquiring Starwood is even a step further afield. In the case of the Waldorf, Anbang entered into a 100-year contract with Hilton to manage the property.

But who would manage Starwood? Anbang has partnered with the private equity firm J. C. Flowers & Company and the Primavera Capital Group. J. C. Flowers specializes in acquisitions in the financial services industry. Primavera is a Chinese private equity firm. Neither appears to have much hotel experience.

Given the state of the hotel industry — with Airbnb shaking up the world — it is hard to see where Anbang would get the necessary experience. One supposes the life insurer could keep on the Starwood team, but Anbang has already had trouble managing its new non-Chinese subsidiaries.

In the case of Anbang’s Belgian acquisition, the management team left after a few months amid complaints of Anbang’s management style.

None of this justifies outbidding Marriott, which has more experience and can reap more savings from Starwood.

Instead, this is probably just a grand currency play. Anbang is willing to overpay because it is converting Chinese currency. As the world knows, there are expectations that there will be a further devaluation of the Chinese currency, the renminbi. By moving its money out of China, Anbang can hedge against such a downturn.

Anbang also buys further protection from interference by Beijing authorities. So even though there is a slow- motion flight of dollars leaving China that Beijing is trying to halt, Anbang is probably trying to get more dollars out. After all, if there is a devaluation, this will benefit everyone in China, at least.

Anbang may have now pushed too far on this front. Caixin, a Chinese business publication, has reported that insurance regulators in China are said to be preparing to block the bids for both Starwood and Strategic Hotels & Resorts, because they would violate rules prohibiting insurers from investing more than 15 percent of their assets abroad. We’ll see how these politics play out.

Should Anbang persevere and come out the winner in the bidding for Starwood, there will certainly be talk about national security and the review process by the Council on Foreign Investment in the United States. This will be akin to the review over Smithfields when it was bought by Shuanghui International Holdings. There will be some hand-wringing about a Chinese buyer, but ultimately there will be no issues except perhaps some forced sales of hotels near strategic areas, like Starwood’s hotel near the White House. http://www.nytimes.com/2016/03/23/business/dealbook/the-unsettling-acquisitiveness-of-a-chinese-insurer-in-the-us.html 3/4 8/23/2016 The Unsettlingc A quisitiveness of Anbang, a Chinese Insurer, in the U.S. But national security is not the real issue.

The important question is this: If a 10-year-old opaque American financial conglomerate with no hotel experience were to buy Starwood, funding the transaction in part with the sale of high-yield investment products to retail investors, wouldn’t that give us pause?

Not only that, wouldn’t we wonder about the future of Starwood?

One answer is that we wouldn’t. Starwood should be sold to the highest bidder, no matter the circumstance. But lost in all of this are the employees and operation of Starwood, and whether Anbang can even capably run this company. Shareholders, meanwhile, including its two largest shareholders that are activist funds, would probably just take the money.

Perhaps the more prudent answer, one our current financial system doesn’t address, is that there is too much risk here. The acquisition raises all sorts of issues about takeovers and the responsibility to look out for the company itself.

It seems to be a conversation worth having.

Steven Davidoff Solomon is a professor of law at the University of California, Berkeley. His columns can be found at nytimes.com/dealbook. Follow @stevendavidoff on Twitter.

A version of this article appears in print on March 23, 2016, on page B5 of the New York edition with the headline: The Unsettling Acquisitiveness of a Chinese Insurer in the U.S. Order Reprints| Today's Paper|Subscribe

http://www.nytimes.com/2016/03/23/business/dealbook/the-unsettling-acquisitiveness-of-a-chinese-insurer-in-the-us.html 4/4 8/23/2016 Three Coca-Cola Bottlers Confirm Merger

Three Coca-Cola Bottlers Confirm Merger

Company will be based in London and trade on NYSE, Euronext Amsterdam and Madrid Exchange

ENLARGE Coke Chief Executive Muhtar Kent told analysts Thursday that a merger of three bottlers would help “more effectively compete and drive growth” across Western Europe. He didn’t rule out more bottling consolidation in coming years. Photo: Bloomberg News By Mike Esterl Updated Aug. 6, 2015 3:45 p.m. ET Three Coca-Cola Co. bottlers agreed to a merger combining $12 billion in revenue across 13 European countries, part of a global consolidation push by the U.S. soda giant to cut costs amid slowing sales.

Publicly traded bottler Coca-Cola Enterprises Inc., or CCE, also would relocate its headquarters to the U.K. from the U.S. in the planned tie-up with Spain’s privately held Coca-Cola Iberian Partners SA and Germany’s Coca- Cola Erfrischungsgetränke AG, the latter owned by Atlanta-based Coke.

http://www.wsj.com/articles/three-west-european-coca-cola-bottlers-confirm-merger-1438864553 1/4 8/23/2016 Three Coca-Cola Bottlers Confirm Merger CCE, which makes and distributes Coke in eight European countries including the U.K. and France, would have a 48% stake in the new company, Coca-Cola European Partners PLC. Iberian Partners and Coke would have 34% and 18% stakes, respectively. The merger, which would create the world’s largest independent Coke bottler by revenue, is subject to shareholder and regulatory approvals.

Coca-Cola European Partners will be based in London and traded on the Euronext Amsterdam, New York Stock Exchange and Madrid Stock Exchange. The Wall Street Journal reported last week the bottlers were in advanced merger talks.

Coke Chief Executive Muhtar Kent told analysts in a conference call Thursday that the bulked-up bottler would help “more effectively compete and drive growth” across Western Europe. He didn’t rule out more bottling consolidation in the coming years.

The three companies estimated the merger would generate $350 million to $375 million in annual cost savings within three years that could be plowed back into marketing Coke, Sprite and dozens of other beverage brands.

Coke reported in July that its beverage volumes in Europe were flat in the first six months of 2015 as revenue fell 8% to $2.65 billion, weighed down by the strengthening dollar. Coke’s global volumes rose just 1% in the first half of the year, hurt by sluggish sales of carbonated drinks as consumers shift to water and other beverages.

The company sells beverage concentrate that it distributes to hundreds of mostly independent bottling partners across the globe. Making concentrate is a higher-margin and less capital-intensive business than bottling. Larger bottlers, though, have greater scope for efficiencies.

Coke has been eager to sell its German bottling operations for several years and is in the midst of divesting itself of its U.S. distribution assets. In 2013, it sold its bottling assets in the Philippines to Coca-Cola Femsa SAB, a Mexican bottler.

Advertisement In 2014, Coke backed a deal combining bottling operations in Southern and Eastern Africa into one serving 12 countries. The year before that, it helped cement a merger among seven Spanish and one Portuguese Coca- Cola bottlers, creating the Iberian Partners business.

http://www.wsj.com/articles/three-west-european-coca-cola-bottlers-confirm-merger-1438864553 2/4 8/23/2016 Three Coca-Cola Bottlers Confirm Merger

ENLARGE The prospective merger would create the world’s largest independent Coke bottler by revenue. Photo: Jens Kalaene/DPA/Zuma Press CCE said in July its beverage volumes declined 1% in the second quarter from a year earlier. Revenue plunged 18% to $1.9 billion, dragged down by weakening European currencies. By relocating its headquarters to Europe, CCE will no longer have to convert its results into dollars or pay U.S. taxes on repatriated profits.

But John Brock, CCE’s chief executive, who will become CEO of the combined company, said the planned merger isn’t a so-called inversion deal to generate tax savings. CCE was mainly a U.S. bottler until 2010, when Coke bought CCE’s North American operations.

“This is not even remotely a tax-driven transaction. It’s a strategic and operational transaction,” he told reporters during a conference call Thursday.

Coke also has been hurt by weak consumer demand in Germany and Spain. Coca-Cola Iberian Partners tried to lay off workers last year, but Spain’s Supreme Court ruled the company had to rehire employees and provide back pay. The bottler is owned by Spanish families who have been Coke partners since 1951.

CCE shareholders will receive one share in the combined bottler for each CCE share and a one-time cash payment of $14.50 per share. The newly created bottler will fund the $3.3 billion payment with newly issued debt.

CCE shares were 2.9% higher at $53.36 in afternoon trade on the New York Stock Exchange. http://www.wsj.com/articles/three-west-european-coca-cola-bottlers-confirm-merger-1438864553 3/4 8/23/2016 Three Coca-Cola Bottlers Confirm Merger The companies expect the merger to close in the second quarter of 2016.

Write to Mike Esterl at [email protected]

http://www.wsj.com/articles/three-west-european-coca-cola-bottlers-confirm-merger-1438864553 4/4 Uber in China: Why Foreigners Never Win in Tech

Foreign tech firms that find success in the world’s second-largest economy often are cut down to size

ENLARGE An Uber station outside a shopping mall in Beijing. Photo: Agence France-Presse/Getty Images By Alex Frangos Aug. 1, 2016 5:25 a.m. ET From disruption to state-sanctioned monopoly in the blink of an eye. Welcome to the Chinese internet.

Ride-hailing giant Uber became the latest in a long line of U.S. tech companies to call it quits or greatly scale back ambitions in China by selling its China operations to rival Didi Chuxing. Chief Executive Officer Travis Kalanick, who looked overly aggressive in making China a priority, deserves credit for pulling out before it was too late, while maintaining exposure there.

Both UberChina and Didi were bleeding cash. And foreign tech companies trying to make China a big market have always found it a fraught endeavor. Google, Yahoo, eBay, Microsoft, Qualcomm all spring to mind. Even Apple has seen its fortunes fade in China. Its investment in Didi earlier this year might even have been about bolstering its reputation there.

Some tech-in-China troubles were simply operational failures that outsiders face everywhere. In that light, Uber was smart to have a partner in dominant search-and-maps giant Baidu. But foreign tech firms in China also face a massive disadvantage in that if they do find success, state media and regulators find a way to cut them down to size.

Uber Deal Clears Road for Chinese Rival

0:00 / 0:00 Uber is swapping its China operations for a big stake in its $28 billion homegrown rival, Didi Chuxing. WSJ’s Rick Carew shares what you need to know about the deal in the world’s largest ride-hailing market. Photo: AP and Getty Images

That formula has done wonders for nurturing China’s homegrown talent, especially Tencent, Baidu and Alibaba, who have been able to grow to scale protected from foreign rivals.

By the bar-napkin method of valuations, Uber is getting out undented. Uber essentially traded its China operations for a 20% stake in Didi, which theoretically is now worth $36 billion when combined with Uber’s latest valuations. That implies Uber’s stake in Didi is valued at around $7 billion. Throw in another $1 billion that Didi will invest in Uber, and that lifts the deal’s value to $8 billion, similar to the $8 billion valuation Uber’s China operation fetched after its latest funding round wrapped up in January.

But Uber was probably never going to be the dominant player in China on its own. While Uber partnered locally, Didi had flashier friends in the backing of Alibaba and Tencent, Baidu’s bigger rivals, plus an influential investment from China’s sovereign-wealth fund.

By capitulating, Uber leaves with the upside of owning a fifth of a near monopoly. Didi’s position is further cemented by nationwide regulations put out last week, formally legalizing the ride-hailing sector across China. In theory this should draw the eye of China’s antitrust regulators, but probably won’t. There are smaller rivals, such as UCAR, partially owned by Hong Kong-listed Car Inc. But in ride hailing, the advantages accrue to the largest network.

Advertisement Uber was smart to bolt while it could still get a ride out of town.

Write to Alex Frangos at [email protected] http://nyti.ms/2aIab9X

Under Pressure, Big Banks Vie for Instant Payment Market By MICHAEL CORKERY and NATHANIEL POPPER AUG. 1, 2016 In this digital age when almost anything can be had in an instant, the movement of money can seem glaringly slow.

Most people paying a housekeeper or collecting money for an office pool still use cash or a check, which can take days to go through — a relative eternity that banking regulators worry is impeding commerce and economic growth.

The slowness has led many Americans to new mobile services, like PayPal’s Venmo or Square Cash, which make it possible to pay a friend instantly with just a phone.

Now, the banks are catching up. On Monday, Wells Fargo joined JPMorgan Chase, Bank of America and US Bank in allowing customers to send money in seconds to one another’s bank accounts using just a phone number or email address. Customers of the biggest banks can now use their mobile phones, say, to send money instantly to a child in college who needs cash.

“We pay attention to what customers are asking for, and we are doing all the things we need to stay competitive,’’ said Brett Pitts, who leads digital initiatives at Wells Fargo.

The stakes are high: Banks are under broad pressure both from the Federal Reserve, which has a “faster payments committee” aimed at requiring immediate improvements, and from tech companies like PayPal and Apple, whose Apple Pay service was a bright spot in its recent earnings report.

All these companies, and Visa and MasterCard, are competing to build and control the payment network of the future.

Banks are promoting their new services as cool and convenient: One Chase advertisement shows the basketball star Stephen Curry dribbling a basketball while making an instant payment on his phone.

American bank executives fear that they could lose ground to plucky payment companies like Venmo, a popular choice among millennials who want to pay each other — and send emoji-filled messages to their friends.

The banks worry that if they do not respond with their own instant payment offerings, they will be relegated to performing less- profitable back-office functions for hip new payment companies, which make their money primarily by charging small fees to customers who pay by credit card rather than directly from a bank account.

The person-to-person payment market is valuable because it allows financial companies to gain the first point of contact with a consumer and then try to sell them other products like loans.

Analysts predict that eventually the new payments network could be extended to connect consumers with merchants, providing a potentially lucrative source of fees for banks.

“It’s like owning a toll road: You are going to get paid by everybody that uses it,” said Gareth Lodge, a payments analyst at Celent, a financial consulting firm.

Mastercard and Visa, which have a tight grip on payments made with credit and debit cards, are also trying to gain a foothold in these new networks.

Late last month, Mastercard acquired a majority stake in VocaLink, the company that operates a mobile and internet payment network in the United Kingdom and is helping to develop an even broader system in the United States. Also, Visa recently announced a broad partnership with PayPal that will make both of their offerings more instantaneous.

Instant person-to-person payment is something that people in many other countries have been able to do for years, and the absence of the service in the United States has been a marker of the relative backwardness of American banks.

The banks began developing the system being introduced this year in 2011, when Bank of America, JPMorgan and Wells Fargo created a network called clearXchange. That system has already allowed bank customers to send each other money using just an email address or cellphone number, but transactions were not instant until this year.

In addition to payments technology that the nation’s largest banks are rolling out this summer, banks that belong to an industry group called the Clearing House are developing a broader network that will allow businesses and even governments to make large instant payments.

A fast and efficient payment network also has implications for the economy. Federal officials and analysts say the current lag time between when a payment is sent and when the money is cleared to spend can hinder businesses from balancing their books and managing their supplies. The lag also puts the United States at a disadvantage compared with, say, Europe, where banks are far ahead in making payments instantaneous.

The banks now face a challenge to make their real-time technology easy enough to lure customers away from start-ups like Venmo.

With Venmo, a user can send money to anyone simply by tapping into the app and entering a phone number or email address. By contrast, customers of JPMorgan Chase, for example, must log into their Chase app using their password, then navigate through a series of somewhat clunky tabs to initiate a transaction with QuickPay. The banks also lack the social networking capabilities that have helped make Venmo a hit.

Talie Baker, a payments analyst at the Aite Group, a banking consultancy, said that even her friends who have Chase’s service often do not think it is worth using. “I can’t get anybody to accept a Chase QuickPay payment from me,” she said. “Banks are probably going to start losing market share if they don’t make their applications as easy to use as Venmo is.”

Chase and the other banks say the additional steps they ask of customers provide more security. The banks also say they are already handling significantly more personal payments than Venmo and other competitors like Square Cash.

Chase said that last year it processed about $20 billion in so-called peer-to-peer payments, while Venmo handled about $10 billion. PayPal as a whole made about $40 billion in such payments, the company said.

The banks should have a significant advantage over technology companies, given the sheer number of customers they already have, payment industry analysts say.

PayPal and the banks say the most immediate opportunity is not taking business from one another, but cannibalizing the enormous number of payments that are still made by cash and check, which represent more than three-quarters of all peer-to-peer transactions.

Bill Ready, who oversees Venmo at PayPal, said he was happy that American banks were finally catching up with the progress that has been made in most other developed countries.

“The rest of the world has already been here a long time,” he said. “To see an industry move is a great thing.”

A version of this article appears in print on August 2, 2016, on page B1 of the New York edition with the headline: Largest Banks Pursue Instant Payments Market.

Retailer also to shutter Beauty.com as part of a broader plan to cut costs

ENLARGE The company said it plans to close the two websites by the end of September. Photo: Associated Press By Paul Ziobro July 28, 2016 1:05 p.m. ET Walgreens Boots Alliance Inc. on Thursday said it is shutting down two websites--Drugstore.com and Beauty.com--five years after acquiring them, a sign of how traditional retailers continue to struggle with online properties.

The retailer acquired both sites as part of its $429 million acquisition of Drugstore.com in 2011. At the time, Drugstore.com and its affiliated sites were the eighth largest pureplay online retailer, according to Internet Retailer Magazine.

Related Walgreens new management has started to unwind that acquisition to focus its online business on its own website devoted to its flagship drugstore chain, according to a Thursday regulatory filing. Earlier this year, Walgreens sold Skinstore.com, another vestige of the Drugstore.com acquisition, to the Hut Group, a U.K. online retailer, according to a company spokesman, who didn’t specify the sale price.

The company is still trying to fine tune its e-commerce strategy but clearly wants to focus more of its resources on one main site. “They want to make sure they can invest more of the equity in Walgreens.com,” said Brian Owens, a director at the consultancy Kantar Retail. “Drugstore.com and Beauty.com are distractions.”

Other retailers have picked up pure-play e-commerce sites, only to shut them down shortly thereafter. Target Corp. last year shuttered ChefsCatalog.com and Cooking.com, less than three years after buying them.

Walgreens currently ranks as the 37th largest online retailer in North America, according to Internet Retailer, which estimates that its online sales were $1.3 billion last year. Its U.S. pharmacy sales last year were $81 billion.

The company said in the filing it plans to close the two sites by the end of September and that it will record a $115 million pre-tax charge related to the shutdown. The move is part of a broader cost saving plan to shed $1.5 billion in annual costs by the end of its next fiscal year, the company said.

An undisclosed number of jobs will be eliminated in Bellevue, Wash., the company spokesman added, declining to provide details on how much the company expects to save from the closures.

Advertisement Walgreens will continue to operate VisionDirect.com, which sells contact lenses and was also part of the Drugstore.com acquisition, according to the company spokesman.

Write to Paul Ziobro at [email protected] This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com. http://www.wsj.com/articles/why-hulu-isnt-a-serious-threat-to-cable-tv-1468955524

MARKETS | HEARD ON THE STREET Why Hulu Isn’t a Serious Threat to Cable TV

The cable-style online TV service Hulu is developing could be a focus for media investors this quarter, but it is unlikely to pose a serious threat to cable

Investors in coming weeks will be looking for details on the cable-style online TV service Hulu aims to launch in the first quarter of 2017. PHOTO: DAN GOODMAN/ASSOCIATED PRESS

By MIRIAM GOTTFRIED July 19, 2016 3:12 p.m. ET

A new TV service in the works from Hulu could give media companies the power to wage war against their pay-TV distributors. But they have ample reason to want to keep the peace. As the companies report earnings in the coming weeks, investors will be looking for details on the cable-style online TV service Hulu aims to launch in the first quarter of 2017. The theory is that Hulu, owned by Walt Disney, 21st Century Fox and Comcast’s NBCUniversal, should be able to offer a more robust content lineup for a lower price than similar services currently on the market. But while its media ownership means it could pose a greater threat to traditional TV, it also means Hulu’s parents have a lot to lose from undermining the status quo. That should reassure cable investors.

The more Hulu charges for a TV service, the less its chances of luring away traditional pay-TV subscribers and convincing them to cut the cord. “Simplistically, if they price it at $40 a month, you want to be short cable,” said Craig Moffett of research firm MoffettNathanson. “At $50, you want to be long, or at least it isn’t a factor.”

The instinct may be to assume that Hulu will aim for the lower end of that range to spur adoption. But the traditional programmer business model remains quite attractive to TV networks, and the economics of undercutting pay-TV may simply not make sense.

Assuming a Hulu service has the most-watched cable networks from its parent companies, plus the four big broadcasters, the total wholesale cost of that bundle will be about $34, MoffettNathanson figures. To get there, the firm applies a 20% premium— reflecting the higher rates small distributors must pay—to estimates from SNL Kagan for what media companies get for their channels from pay-TV providers. That suggests that if Hulu charges $40, it would come out with only $6 of gross margin.

And that doesn’t account for other costs pay-TV providers currently handle, including customer acquisition, technology and customer service. A streaming subscription service would likely have higher churn than cable. Moreover, while media companies are accustomed to getting annual price increases in their contracts with pay-TV providers, it is tougher to sell consumers on an annual increase. Hulu may need to build a year or two worth of step-ups into the initial price.

Of course, it may not make sense for Hulu’s owners encourage it to invest in a service that isn’t priced low enough to seriously compete with cable. But they may only be doing it to appease investors concerned that Big Media isn’t doing enough to adapt to change.

Hulu’s new service may be pitched as disruptive, but cable investors shouldn’t lose much sleep over it.