Corporate Restructuring

Frontrunning: November 29

  • North Korea Missile Launch Shows Ability to Reach D.C. (WSJ)
  • Senate Republicans shove tax bill ahead as Democrats fume (Reuters)
  • British negotiators still working on Brexit deal: Treasury minister (Reuters)
  • Trump Retweets Anti-Muslim Videos From Far-Right U.K. Group (BBG)
  • Bitcoin Futures Provoke Pushback From Market Cops (BBG)

GE CEO Jeff Immelt To Step Down

In a major shakeup at one of the largest US industrial conglomerates, General Electric said Monday Jeff Immelt, 61, would step down as CEO and Chairman, a move that had been expected by many. John Flannery, 55, the company’s current president and CEO of GE Healthcare, will take over as companywide CEO effective August 1, concluding a 16 years period during which the stock price of GE has barely budged. 

Global Supply Chains Paralyzed After World's 7th Largest Container Shipper Files Bankruptcy, Assets Frozen

After years of relentless decline in the Baltic Dry index today the largest casualty finally emerged on Wednesday when South Korea's Hanjin Shipping, the country's largest shipping firm and the world's seventh-biggest container carrier, filed for court receivership on Wednesday after losing the support of its banks, leaving its assets frozen as ports from China to Spain denied access to its vessels.

Frontrunning: August 23

  • Dollar Drops on Rate Outlook as European Stocks Rise, Oil Falls (BBG)
  • Bank of Japan's rush into stocks raises fears of market distortions (Reuters)
  • With Moderate Drinking Under Fire, Alcohol Companies Go on Offensive (WSJ)
  • Merkel Says Brexit Is U.K.’s Loss While Pledging EU Results (BBG)
  • Turkey cuts rates for sixth straight month amid ratings worries (Reuters)

Currency Wars Re-Escalate As Bank Of Korea Eases To Record Low Rate With Surprises Rate Cut

 With the 655th rate-cut globally since Lehman, the Bank of Korea stunned the market tonight and cut rates 25bps to 1.25% (a record low). Only 1 of 18 economists expected a rate cut as it appears record highs in US equities signal nothing about the underlying turmoil in the world's economy. After 6 straight days stronger (against the USD), the Won is sliding back above 1160 as it seems the currency wars are reigniting in AsiaPac...

One Third Of Energy Companies Could Go Bankrupt Deloitte Warns As Credit Risk Hits Record High

At 1600bps, the extra yield investors are demanding to take on US energy credit risk has never been higher. However, if a new report from Deloitte proves true, this is far from enough as they forecast roughly a third of oil producers are at high risk of slipping into bankruptcy this year as low commodity prices crimp their access to cash and ability to cut debt..."2016 is the year of hard decisions, where it will all come to a head."

Biogen Fires 11% Of Workers Despite Reporting Stellar Earnings, Boosting Guidance

There may not be many biotechs with positive cash flows out out there, but the 4th most profitable, Biogen (after Gilead, Amgen and Shire), saw its shares halted moments ago ahead of reporting earnings, which were a blowout. However what is most confusing is why, in light of the company's glowing earnings and impressive guidance, it also announced it would be laying off 11% of its workforce, or about 800 workers, while cutting a number of pipeline programs.

Greece Changes Strategy: No Longer Demands Debt Write Off, Ask For Debt Exchange Instead

Update, and in line with the FT report, here's Bloomberg: GREECE SAID TO DROP WRITEDOWN REQUEST AFTER OPPOSITION FROM EU

Over a week after the new Greek government came to power, it has presented its first actual proposal of how it hopes to negotiate with Europe that does not involve the infamous "debt write off", which as both Germany and the ECB have made clear, is a non-starter as it impairs the ECB's balance sheet and leads to a loss of "faith" in the money printer, the legacy monetary system and so on. So instead of yet another debt restructuring, the FT reports that Yanis Varoufakis "would no longer call for a headline write-off of Greece’s €315bn foreign debt. Rather it would request a “menu of debt swaps” to ease the burden, including two types of new bonds." Actually he still does, only he is not calling it as such.

IBM Stock Disappointed That Company Isn't Firing A Mindboggling 110,000

Over the weekend, in a repeat of rumors that were widespread last year, Forbes 'reported' about Project Chrome, a massive corporate reorganization for IBM that would see Big Blue cull over a quarter of its staff – in real terms that means over 110,000 employees, as early as next week. IBM stocks surged higher on this 'great' news... and then, disappointment started as "the largest corporate restructuring in history" was denied by the company...

Frontrunning: April 14

  • Three dead in shootings at Kansas Jewish centers; man to face charges (WSJ)
  • Sanctions Blowback in Russia Targets Burgers to Movies (BBG)
  • Deadly Virus's Spread Raises Alarms in Mideast (WSJ)
  • China group buys $6bn Glencore Peru copper mine (BBG)
  • Iran lodges complaint against United States over U.N. envoy ban (Reuters)
  • Russian assets down sharply on Ukraine conflict fears (Reuters)
  • ECB comments knock euro, but not much (Reuters)
  • World-Leading $25 Hourly Wage Roils Swiss Businesses (BBG)