The Edhec Express Weekly Newsletter of Edhec Students Finance Club
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January 25th, 2021 THE EDHEC EXPRESS WEEKLY NEWSLETTER OF EDHEC STUDENTS FINANCE CLUB CONTENTS EUROPE USA Eurostar calls for UK bailout WhatsApp to delay launch of after passenger numbers update business features after collapse 3 privacy backlash 7 Birkenstock explores sale to Ahead of Biden Era, Toyota private equity 3 Agrees to Pay $180m In London Metal Exchange plans to Emissions Case 7 permanently close historic ‘Ring’ Tesla has started deliveries of metals trading floor 3 the Chinese-made Model Y 7 ASIA Total quits US oil lobby over Lumentum to acquire Coherent Thailand's PTTOR aims to raise climate policy 4 in cash and stock deal valued at up to $1.8bn in IPO 12 Airbus to raise production more $5.7bn 8 China Evergrande’s Electric slowly as pandemic bites 4 Netflix tops 200m subscribers vehicle ambitions stall 12 BlackRock fail ‘fee disclosure’ but faces growing challenge SoftBank takes new $350m stake test 4 from Disney Plus 8 in OneWeb 13 Moonpig confirms London IPO Office Depot rejects $2.1bn Tianqi Lithium scraps share sale with £1.2bn valuation target 5 takeover bid from rival Staples 8 after exchange queries plan 13 Suez prepares to talk to Veolia U.S. agency orders Ford to recall Chinese purchases of US exports after proposing alternate terms 5 3m vehicles over air bags 9 fall far behind trade deal pledge British Airways agrees cut-price P&G raises forecast after 13 deal for Air Europa 5 earnings top expectations, fueled Hedge fund Elliott pulls out of Deliveroo receives Private by 8% jump in sales 9 Hong Kong 14 finance boost ahead of IPO 5 Morgan Stanley beats estimates Chinese vaping group RLX set to German Online retailer valued at on better-than-expected Wall raise $1.4bn in US IPO 14 $3bn after being listed in the US Street and wealth management Japan insists Tokyo Olympics 6 results 9 will go ahead despite pandemic Nescafe to double their Intel drops 4% after a reported 15 sustainability spending 6 hack forced the chipmaker to China’s currency heads into Logitech raises annual forecasts release its 4th-quarter earnings Biden era on front foot 16 as quarterly profits soar 6 early 10 Jack Ma makes first public United Airlines pledges more appearance since Ant’s cancelled cost cuts 10 IPO 16 IBM pledges return to growth in TikTok owner ByteDance 2021 after another sales drop 10 launches payments in China as it pushes into fintech and e- commerce 16 S. Korea’s Naver to buy global storytelling platform Wattpad for $600m 17 PAGE 1 EBay mulls strategic options for The big miner is under pressure More yield at the expense of its Korea unit. What investors from the local activist group on unnecessary risks 23 need to know 18 the environment issue 20 French Government issued a 5G chipmaker Sumitomo India’s uncertain investment 50-year OAT (Obligations Electric hedges bet on top client environment for foreign Assimilables Du Trésor) 23 Huawei 18 investors 21 Chinese phone maker Honor Indian IT giants reported record partners with key chip suppliers profits on digital transformation RATES after Huawei split 19 trends 21 China’s GDP growth rate Trafigura puts €1.5bn of own increased by +6.5% in Q4 2020 cash to cement close links with 24 Rosneft 21 Pound Sterling-Euro rate hits 8 months high 24 ECB experts overturn GDP growth rate forecast for eurozone 24 UK house price growth rate reaches a four-year high 25 EMERGING MARKETS AND OTHERS SUSTAINABLE FINANCE Report card of BlackRock after Google will stop search engine service in Australia if forced to DEBT one year of making sustainability promises 26 pay for media contents 20 The recovery of real rates could Adnoc continues accelerating be announcing an economic Joe Biden’s big move 26 crude output despite investors’ recovery not too far into the green strategy 20 future 22 CONCEPT OF THE WEEK Yield also comes with time 22 Depository Receipts 27 PAGE 2 EUROPE +40% on the previous year. The company, born in 1774, has been eying a sale option for months. After Eurostar calls for UK bailout initially pursuing interest from competitors in the after passenger numbers industry with the help of bankers at Goldman Sachs, collapse Birkenstock has turned to private equity bidders. While CVC has been a strong competitor for months, there is no certainty that an agreement will be made. Eurostar, the train operator that runs services through On the other hand, talks with Permira is not certain the Channel Tunnel between London, Paris, and either. The deal would be the latest private equity Brussels, has called for a UK government bailout deal affecting a European shoe business, after following a drop in travel between Britain and the Permira acquired luxury sneaker group Golden Goose European continent. The company, which is from Carlyle in February. Permira and German buyout controlled by French state railway SNCF, is at risk of group Triton last year eyed US sports outfitter Reebok, bankruptcy following a collapse in travel since which has been put up for sale by its German parent March of at least 95%. It has been running just two company Adidas. return services a day since the start of the pandemic and has warned that it could run out of cash this summer. The French government has a majority 55% stake in Eurostar, has already provided €200m ($243m) for the operator, and Belgium 5% after the UK government sold its stake in 2015. Christophe Fanichet, head of SNCF Voyageurs, said that part of the reason the company is in such critical position was that the company was seen in the UK as a French business that was not supported by the British, and in France as a UK-based business not aided by the French. The company was negotiating for UK loans, as well as a SOURCE: FT recapitalization by shareholders. While the UK’s Department for Transport said: “The government has been engaging extensively with Eurostar on a regular London Metal Exchange plans basis since the beginning of the outbreak. We will to permanently close historic continue to work closely with them as we support the safe restart and recovery of international travel.” ‘Ring’ metals trading floor SOURCE: FT The LME’s proposed closure of the Ring, known for its distinctive circle of red sofas, would mark one of the biggest changes to the world’s oldest and largest metal Birkenstock explores sale to bourse since its founding in a City of London coffee private equity house in 1877. The Ring is popular by the strict dress code of its members and the conditions of trading. The family-owned German sandal maker, Birkenstock LME members usually set the world’s daily benchmark is surveying the option of sale. Deal could value prices for industrial metals such as copper, aluminum family-owned German company at more than €4bn and zinc by shouting buy and sell orders across the Ring (including debt). Private equity group CVC, Buyout during intense five-minute sessions throughout the group Permira and at least one other private equity trading day. Matthew Chamberlain, chief executive of group have been scouting the German company for the LME, told that the pandemic had forced the buying it out. In 2019, Birkenstock made €721.5m in exchange to test whether electronic trading worked revenues and €129m in net income. Net profit was up as well as the Ring for setting its daily closing prices. PAGE 3 “It found that trading volumes increased compared Airbus, the European leader in aeronautics, is with the Ring over the past 10 months,” he said. increasing production of its most successful single- aisle passenger jets more slowly than expected, fading hopes of an early recovery for an industry devastated by the collapse in air travel. The European aerospace manufacturer will raise production of its popular A320 family of aircraft from 40 to 45 a month by the end of this year after the resurgence in the coronavirus. With new restrictions in European countries, the timing of any recovery in passenger traffic now appears to have been postponed, putting further pressure on a sorely weakened airline industry. IATA, the aviation SOURCE: FT trade body, this week called for a further $80bn in aid to the aviation industry, on top of the $170bn already Total quits US oil lobby over identified. climate policy SOURCE : FT BlackRock fail ‘fee disclosure’ test French energy company Total becomes the first major oil group to break ties with American petroleum institute (API), Big oil’s powerful Washington lobby group. This is another step towards the US-Europe rift with Total clearing its stance on climate change and This week, Blackrock came under the eyes of UK support for politicians who opposed the Paris regulators. It was among the 29 fund managers agreement. This decision comes only a few days before assessed as not meeting minimum standards to help Joe Biden enters the White house with a pledge to rejoin pension trustees get a handle on costs. The company the Paris climate pact. This move is likely to induce a appeared among the list of investor companies who chain reaction where multiple companies pull out of the failed to disclose fees amply to pension clients. From lobby in support of climate change leaving API at a very 2019, UK has made it mandatory for asset managers tough situation. to disclose their fees and charges, using standardized templates developed by an industry working group, SOURCE: FT assembled by the Financial Conduct Authority. ClearGlass found 242 asset managers met its minimum Airbus to raise production more quality standards for provision of cost and performance data.