Posts in category Business


ApprovedBusinessBusiness and finance

The freaks are coming

PowerPoint slide, Berlin style

ROCKET INTERNET has just moved into a splendid, red building in central Berlin, around the corner from Checkpoint Charlie. The lease runs for the next 15 years, a signal of intent from a firm that brags of becoming the biggest online conglomerate outside America and China. Inside, everything is new. Alexander Kudlich, the managing director, jokes he should remove his shoes before stepping on a just-laid, thick, grey carpet in the boardroom.

The timing is awkward. Just as staff entered the building, in early September, Rocket warned about its financial performance this year. It had losses of €617m (just under $700m) in the first six months; the full details came in earnings announced this week. Few are surprised that Rocket, which went public in 2014, had to lower the values of some of its creations. Kinnevik, an investment firm with shares in Rocket that had some of the same holdings, had already done so.

Mr Kudlich claims “we are more bullish than five years ago”. But Rocket is finding life tougher than before its IPO. Its shares are down by almost half in the past year, leaving…Continue reading

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ApprovedBusinessBusiness and finance

Mistry’s elephant

CHIEF executives in the West share some familiar gripes: quarterly-results-obsessed analysts who make it impossible to think about the long term; activists pressing for change before investments come to fruition; and sluggish economic growth. How envious they must be of Cyrus Mistry, the boss of the Tata Group, India’s largest conglomerate. Its central firm, Tata Sons, is unlisted. Tata Trusts, the charities that own two-thirds of Tata Sons, think in terms of decades, not years. India is the world’s fastest-growing large economy. Given such favourable circumstances, Mr Mistry’s peers might well look at the uninspiring financial performance of much of his group since he took over in December 2012 and conclude they could do better.

The firm is rightly admired at home. Founded in 1868, it has long embodied the notion of corporate social responsibility. Employing nearly 700,000 people, it operates in a wide array of industries, among them table salt, IT, steel, watches, power plants, leather goods, a slew of shopping chains, tea, trucks and buses, undersea cables, mobile telephony and luxury cars and hotels. It has not relied on political favours to…Continue reading

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ApprovedBusinessBusiness and finance

Look, no claims!

ON THE list of industries set to be disrupted by autonomous cars, the motor-insurance business can claim a high place. The regime of compulsory insurance in rich countries, with the insurer of the at-fault driver paying for damage, is reasonable in a world where 90% of accidents are caused by human error. But autonomy is supposed to mean that accidents drop by up to four-fifths, and those that occur may not be a human’s fault. The motor-insurance market may shrink by 60% by 2040, according to KPMG, an accounting firm.

Lawyers and insurers concur that liability will move from private car-owners towards manufacturers for crashes when a car is in autonomous mode. But under the current legal system in Britain and America an owner might still be blamed for an accident in self-driving mode if, say, he neglected to install the latest software update, says Richard Farnhill of Allen & Overy, a law firm. A manufacturer might equally well try to shift the blame to a components supplier.

The best way to avoid endless blame-shifting and litigation may be what lawyers call a “strict” liability regime that automatically places responsibility on the owner. The insurer…Continue reading

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ApprovedBusinessBusiness and finance

Why businesses shouldn't push the cult of happiness

LORD Percy of Newcastle, Britain’s minister of education in 1924-29, was no fan of the fad for happy-clappy “progressive” education that spread among the country’s schools on his watch. He declared that it was all nonsense: “a child ought to be brought up to expect unhappiness.” This columnist feels the same suspicion of the fashion for happy-clappy progressive management theory that is rushing through the world’s companies and even some governments. 

The leading miscreant is Zappos, an online shoe shop. The firm expects its staff to be in a state of barely controlled delirium when they sell shoes. Pret A Manger, a British food chain, specialises in bubbly good humour as well as sandwiches. Air stewards are trained to sound mellifluous but those at Virgin Atlantic seem on the verge of breaking out into a song-and-dance routine. Google until recently had an in-house “jolly good fellow” to spread mindfulness and empathy.

A weird assortment of gurus and consultancies is pushing the cult of happiness. Shawn Achor, who has taught at Harvard University, now makes a living teaching big companies around the world how to turn…Continue reading

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ApprovedBusinessBusiness and finance

Growing pains

LAST year, Pfizer almost became the world’s largest drug firm when it tried to merge with Allergan, an Irish company that makes Botox, among many other products. The deal would have been worth $160 billion, but was indirectly blocked by the American government (via a change in tax rules) because it appeared to be aimed at avoiding taxation. In the confused aftermath, Pfizer said it would return to an earlier plan: breaking itself up. Then last month it gobbled up Medivation, a cancer-drug company, in a $14 billion deal, followed by AstraZeneca’s antibiotics division for $1.6 billion, and questioned whether a split would be worthwhile.

By wrestling with the question of its corporate structure, Pfizer is having a debate that echoes throughout the industry. Investors have pressed many diversified drug firms this year over whether they should break themselves up into more specialised units. Diversified firms are those that typically have consumer-health divisions offering low-margin products such as plasters and talcum powder. Meanwhile, “pure-play” drug companies focus on innovative medicines—for example, a full cure for Hepatitis…Continue reading

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ApprovedBusinessBusiness and finance

Twitter in retweet

BEFORE Jack Dorsey helped found Twitter, the social-media firm known for snappy, rapid-fire updates, he worked briefly as a masseur. More recently, Mr Dorsey has been trying to massage away the aches and pains that afflict his creation. He returned as the firm’s chief executive in July 2015, taking over from Dick Costolo, who presided over a period of slowing growth and a string of departures by senior executives.

Twitter’s problems have continued despite Mr Dorsey’s ministrations. The biggest is that it has largely stopped growing. Its tally of monthly users, at around 313m, is barely rising. Americans who use the service via their smartphones spend around 2.8 minutes on it each day, which is around a third less than they did two years ago and far less than they spend on rival apps, such as Facebook and Snapchat. In the next quarter, revenues are expected to fall. Even though sales will probably increase for the full year, a quarterly drop is worrying for an internet company which is a household name and only ten years old.

In bringing back Mr Dorsey, who was pushed out in 2008, Twitter’s board was betting that his earlier knack for…Continue reading

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ApprovedBusinessBusiness and finance

Pitt stop

SITTING in the back seat of the self-driving Uber as it navigates narrow streets in Pittsburgh’s old industrial heart, the Strip District, is surreal. The global ride-sharing firm chose the area as the spot to develop and test driverless cars, and picked up its first customers on September 14th. Your correspondent got a ride the day before. The vehicle moves smoothly down busy Penn Avenue, stopping at four-way stop signs and traffic lights, slowing to allow other cars to parallel park. It navigates around double-parked delivery vans. It even stops to allow jaywalking pedestrians to cross.

The cars are not truly driverless yet. During the trial an Uber employee sits behind the wheel, ready to take over should something go wrong. A second employee, a sort of co-pilot, sits in the front passenger seat, monitoring a screen, alerting the pilot to what the car “sees”, including other cars, upcoming traffic, potential obstacles and elevation—Pittsburgh is very hilly. Another monitor in the back seat allows passengers to see what the car is seeing.

By the end of the year, 100 Volvos will be on the road, but in the meantime a fleet of Ford…Continue reading

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ApprovedBusinessBusiness and finance

Risky business

MULTINATIONAL companies have always paid careful attention to political risk in the developing world. No surprise there, given the risk premium attached to investment in emerging markets. Western businesses turn for advice to consultancies that keep a watchful eye on alarming developments in far-flung places. There is booming demand for political-risk insurance that can protect companies against shocks, be they coups in Turkey, sanctions against Russia or a debt default by Venezuela.

Now, however, firms need to pay the same attention to political risk in the developed world. Just consider the latest news from the American election trail. The woman who stands between the presidency and a hot-head who wants to tear up the world’s trading system is losing her air of invincibility, due to an unguarded comment about a “basket of deplorables”, a bout of pneumonia and a foolish decision to conceal the illness from voters.

Britain’s vote on Brexit in June was a reminder that impossibles may turn into improbables, and then quickly become fact. Businesses now face years of uncertainty as politicians thrash out the details of the…Continue reading

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ApprovedBusinessBusiness and finance

Long journey

Rihanna shows the way

ASIAN designers have little trouble appealing to wealthy fashionistas in the West. Last year, a long yellow cape dress worn by Rihanna at the Met Gala made a celebrity of Guo Pei, a Chinese designer. Winning over the mainstream shopper is another story. In 2005 Uniqlo, a Japanese brand with a genius for selling multicoloured basics, entered the American market with three stores in suburban shopping malls in New Jersey, only to close them within two years. It has yet to turn a profit in America with its other stores; between this January and June it closed five outlets.

Now Muji, another Japanese clothing and lifestyle giant, is expanding. It has ventured into New Jersey with a big new store in a glitzy mall. The difficult thing is reaching local people and selling them ordinary, daily essentials, says Asako Shimazaki, the head of operations in America. Customers queued for the store’s grand opening last month. But their aim, they said, is to be part of a cool, niche group of Muji fans: not exactly what the brand had in mind.

The majority of the world’s clothes, bags and shoes are…Continue reading

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ApprovedBusinessBusiness and finance

Three-hit wonder

Hack with a future

FEW feel as conflicted about the internet’s descent into glib, 140-character tweets as Evan Williams. As a co-founder of Twitter, he has profited handsomely from the social-media firm’s rise and remains its largest shareholder. Yet now his main project is to ensure that serious-minded, long-form prose will offset the torrent of tweets, often penned by twits.

Mr Williams’s latest venture, Medium, which launched in 2012, is a clean, elegant-looking destination for essays, open letters and “big think” pieces. It is trying to become the central hub for writing by the public at large, as YouTube is for amateur videos. Journalists, business executives and heads of state, including Barack Obama, have all published on Medium. When Amazon disagreed with a New York Times article on the e-commerce giant’s apparently brutal work culture, a senior executive from the firm wrote a long retort on Medium. Small papers and digital-media firms, such as the Pacific Standard and The Ringer, are using it to publish content.

As in Hollywood, it is easier to…Continue reading

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ApprovedBusinessBusiness and finance

Chemical reaction

Green and pleasant innovation

ALONG the west bank of the Rhine, south of Frankfurt, cormorants and herons frolic as barges moor at Ludwigshafen. Here the world’s largest chemical park stretches out over ten square kilometres. Streets such as Chlor-, Ammoniak- and Methanolstrasse are shaded by 2,850 kilometres of pipes that connect everything like arteries; red is for steam, yellow for gas, green for water. The saying goes that most Westerners touch at least one product from a BASF site before leaving home.

It is the world’s largest chemical company, and one of Europe’s largest manufacturers. Because it sells chemicals and chemical products to other companies, such as BMW, Nestle and Procter & Gamble, BASF is little known to consumers. It isn’t one for blowing its own trumpet. “We will try our best to remain spectacularly unspectacular for the media,” said Kurt Bock, the CEO, at last year’s 150th anniversary. But BASF repays attention for two reasons: the sheer impact of what it does, given its size, and its systematic approach to innovation.

Big and bold

The two go together. Mr…Continue reading

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ApprovedBusinessBusiness and finance

Stay or go

EIRA, a 38-year-old Venezuelan, used to like shopping. Now she stands beside barren shelves in a Caracas supermarket. The average Venezuelan spends 35 hours each month queuing for food. This supermarket’s few products include Kellogg’s Zucaritas, its muscular tiger cartoon strangely pallid in hue—supposedly to make the packaging more eco-friendly but, many Venezuelans reckon, more likely the result of an ink shortage.

The dearth of goods reflects the fact that Venezuela, led by Nicolás Maduro, the president, is in freefall. The International Monetary Fund expects output to shrink by 10% this year and inflation to top 700%. Businesses are prostrate. The country has never been rich, but having the world’s largest oil reserves once meant many citizens could afford foreign brands. Not now. Firms have long grappled with price controls, bizarre labour laws, the threat of expropriation and, since 2003, currency restrictions. Plunging oil prices have further exposed the system’s frailty. As the bolívar’s value has tumbled, firms with profits in the currency have reported big losses—for example, Merck, an American drugmaker, announced a hit to its earnings of $876m for…Continue reading

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BusinessBusiness and finance

Incumbents rule

LOBBYING is big in Brussels (see chart). As well as lots of cash, it takes up vast amounts of time. Between December 2014 and this July, members of the European Commission, the EU’s executive body, and their closest advisers held more than 11,000 meetings with lobbyists. Among the most approachable, it seems, were commissioners Andrus Ansip and Günther Oettinger and their teams. They clocked up 2,156 meetings, or 6.5 per working day on average, according to Transparency International, an anti-corruption group.

It helps to keep these numbers in mind to understand the evolution of what is arguably the commission’s most important economic initiative, led by Messrs Ansip and Oettinger. This is to create a digital single market across all of the EU’s member states. On September 14th the commission unveiled its most controversial proposals thus far, one on telecoms regulation, the other on copyright reform. The plans have to be approved by national governments and the European Parliament, and they are already being fought over.

The commission’s intentions are laudable. In the digital realm Europe is still very much a patchwork. Digital…Continue reading

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ApprovedBusinessBusiness and finance

Breaking bad

GERMANY’S largest utilities, E.ON and RWE, used to be known in the stockmarket as “widows’ and orphans’ paper”, so dependable were their profits and dividends. Those days are long gone. Since 2011, when the government stepped up its support for wind and solar energy and decided to abandon nuclear power after Japan’s Fukushima disaster, the share prices of both firms have plunged by two-thirds.

That is why both firms are splitting in two. Their aim is to free up their renewables businesses, allowing them to thrive relatively unencumbered by debts, while underpinning their earnings with boring but reliable returns from running electricity down pylons, poles and wires. Dirtier power-generating assets, exposed to the vagaries of climate politics and commodities prices, are being put into separate companies. In a culmination of this process, on September 12th E.ON plans to spin off Uniper, a new firm into which it has separated its coal- and gas-fired power stations. Later this year RWE will pull off a similar split, albeit in a different way.

The manoeuvres highlight the huge jolt Germany’s Energiewende, or…Continue reading

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ApprovedBusinessBusiness and finance

Making eyes across the ocean

NO GERMAN firm has paid a higher price for shopping abroad than Daimler-Benz with its disastrous $43 billion merger with America’s Chrysler. When they did their deal in 1998, the carmakers claimed it was a smart manoeuvre in the face of industry consolidation. In fact, after culture clashes and much wasted effort, it fell apart within a decade. Eighteen years on, the record will be broken if Bayer, a drugs and chemicals giant best known for its pharmaceutical products such as aspirin, succeeds in its bid for Monsanto, the world’s biggest seed producer. Whether the outcome would be any better is another question.

Bayer first made an unsolicited bid for the American firm in May. A deal now looks close. Monsanto has spent the summer playing hard to get; this week it succeeded in getting Bayer to raise its offer again, to a whopping $65 billion (including debt). The German firm is responding to a wave of consolidation in the global chemicals and seeds industry. Earlier in the year ChemChina, a state-owned Chinese firm, agreed to pay $43 billion for Syngenta, a big Swiss firm that sells chemicals to farmers. Buying Monsanto would give Bayer control of the world’s biggest seller…Continue reading

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ApprovedBusinessBusiness and finance

Profits overboard

THE collapse of Hanjin Shipping, a South Korean container line, on August 31st brought home the extent of the storm in shipping. The firm’s bankruptcy filing left 66 ships, carrying goods worth $14.5 billion, stranded at sea. Harbours around the world, including the Port of Tokyo, refused entry for fear of going unpaid. With their stock beyond reach, American and British retailers voiced concerns about the run-up to the Christmas shopping period.

Hanjin is not alone. Of the biggest 12 shipping companies that have published results for the past quarter, 11 have announced huge losses. Several weaker outfits are teetering on the edge of bankruptcy. In Japan three firms, Mitsui OSK Lines, NYK Line and Kawasaki Kisen Kaisha, look vulnerable. Activist investors are now pressing for them to merge to avoid the same fate as the South Korean line.

Even the strongest are suffering. France’s CMA CGM, the world’s third-largest carrier, announced a big first-half loss on September 2nd. Maersk Line, the industry leader, and the largest firm within A.P. Moller-Maersk, a family-controlled Danish conglomerate, will be in the red this year, having lost…Continue reading

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ApprovedBusinessBusiness and finance

Passé

NEW YORK CITY has just begun its sacred rites of retail. For its fashion week, which started on September 7th, tents go up, guests emerge from black cars, models sulk down catwalks and the wealthy and celebrated clap in unison. The point of all this is for designers to declare what will be “in” next spring. But for much of fashion retail, it is increasingly clear that something is out of place.

For a sense of the problem, consider what happens when the week-long schedule of shows ends. Designers start making the clothes that retailers have ordered, with delivery scheduled four to six months later. But consumers see collections online instantly. “Fast fashion” shops such as Zara, which is part of Spain’s Inditex, rapidly produce clothes “inspired” by what appeared on the runway. When the originals arrive in stores, they feel tired.

This has produced clear winners and losers. The world’s two biggest clothes retailers are now Inditex and TJX, according to Euromonitor, a research firm. TJX buys excess inventory of brand-name clothes and resells them at low prices. Traditional department stores, meanwhile, are struggling, partly…Continue reading

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ApprovedBusinessBusiness and finance

Mission, interrupted

A waste in space

ROCKET scientists love their jargon, and it seems to be infectious. On September 1st, when a Falcon 9 rocket belonging to SpaceX, a private rocketry firm, blew up on the launchpad at Cape Canaveral, in Florida, the emergency services announced that the mission had undergone a “catastrophic abort”. It happened while the rocket was being fuelled for a pre-launch engine test. No one was hurt, although windows were rattled several miles away. A communications satellite costing $200m that was mounted on the rocket, in preparation for the planned launch on September 3rd, was destroyed in an instant.

The blast is a setback for SpaceX, a firm founded by Elon Musk, an entrepreneur who also runs Tesla, an electric-car maker. With contracts to fly cargo and supplies to the International Space Station (ISS) for NASA, as well as a thick book of orders from private satellite firms, it is the flag-bearer for a growing, buccaneering “new space” industry. The explosion was SpaceX’s second big failure in 15 months: on June 28th 2015, an uncrewed Falcon 9 rocket exploded halfway to the ISS.

The immediate…Continue reading

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ApprovedBusinessBusiness and finance

Still ringing bells

And on the 7th day…

APPLE’s events have often been compared to religious worship. Evangelical fans watch as the company’s darkly-clad boss—first Steve Jobs, now Tim Cook—presents shiny new iSomethings in front of a screen showing colourful slides reminiscent of stained glass. Yet Apple’s latest event, on September 7th, was a less rapturous affair. The iPhone 7, the firm’s new smartphone, will come with a better camera, a faster chip and a brighter display, but will otherwise not be much of an improvement. The main novelty is that it no longer has a conventional jack for headphones, which have to plug into the charging port or be wireless (conveniently, Apple also introduced new untethered “AirPods”, which will cost $160 a pair).

This lack of sparkle will disappoint devotees, but the new iPhone neatly encapsulates the mood in the smartphone market. After almost ten heady years, dating from the release of the first iPhone in mid-2007, both growth and the pace of innovation have slowed markedly in recent months. Prices have fallen, too. Some people are starting to talk of an end to the smartphone era, much as when…Continue reading

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ApprovedBusinessBusiness and finance

Free speech

Ambani dials up the pressure

IN THE end it was even worse than they had feared. For months now, India’s dozen mobile-phone operators have been pondering just how aggressively Mukesh Ambani, the boss of Reliance Industries and India’s richest man, would gatecrash their market with the launch of Jio, his new 4G telecoms operation. They certainly expected the thousands of billboards adorned by Shah Rukh Khan, a ubiquitous Bollywood star. Heavily discounted prices were predictable, too. But the news that, from September 5th, anyone paying as little as 149 rupees ($2.20) a month would be able to make free phone calls and browse the internet a bit was a genuine shock. The share prices of rival firms tumbled.

Telecoms incumbents are right to worry. Reliance has been able to use billions in cash from its main oil and refining businesses to invest over $20 billion in the infrastructure required to deliver high-speed connectivity across India. And Mr Ambani understands the industry extremely well. He built a network from scratch in the early 2000s, although that firm eventually went to his younger brother, Anil, in 2005 after the pair…Continue reading

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BusinessBusiness and finance

Companies should help introverts flourish

MOST companies worry about discriminating against their employees on the basis of race, gender or sexual preference. But they give little thought to their shabby treatment of introverts. Carl Jung spotted the distinction between introverts and extroverts in 1921. Psychometric tests such as the Myers-Briggs Type Indicator consistently show that introverts make up between a third and a half of the population. Susan Cain’s book on their plight, “Quiet: The Power of Introverts in a World that Can’t Stop Talking”, has sold more than 2m copies; the TED talk based on the book has been viewed just over 14m times. And yet, if anything, the corporate approach to introverts has been getting worse.

The biggest culprit is the fashion for open-plan offices and so-called “group work”. Companies rightly think that the elixir of growth in a world where computers can do much of the grunt work is innovation. But they wrongly conclude that the best way to encourage creativity is to knock down office walls and to hold incessant meetings. This is ill-judged for a number of reasons. It rests on a trite analogy between intellectual and physical barriers between people. It ignores the fact…Continue reading

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ApprovedBusinessBusiness and finance

Seizure-inducing

Sticker shock

JULIANA KEEPING is rushing to work in Oklahoma with two children in tow. Her three-year-old son, Eli, has cystic fibrosis, a deadly lung disorder. He is too young for a drug called Orkambi from Vertex Pharmaceuticals, a biotech firm, but one day it may keep him alive. His mother’s question is why it costs over $250,000. A charity helped pay for its development, she says, with some donations from people who were “D-Y-I-N-G”—she spells out the word. That is because she doesn’t want her other child to understand. “She doesn’t know her brother’s disease is F-A-T-A-L.”

Ms Keeping has started a petition against the price of Orkambi. She is not alone in her anger. Americans are furious about the cost of medicines. Over the past week their ire engulfed Mylan, a generic-drug firm, which had raised the price of its EpiPen, an injectable medicine that fends off deadly allergic reactions, to $608, from about $100 in 2007. On August 29th Mylan said it would start selling a generic version for half the price. The brawl is far from over. Both Hillary Clinton and Donald Trump are proposing measures that would…Continue reading

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ApprovedBusinessBusiness and finance

Stada and deliver

IT MADE an uncommonly inviting target for an activist. Stada, a German maker of generic drugs based near Frankfurt, had low revenues, high running costs and opaque accounting. It was valued lower than its peers and shunned by investors. And if its overpaid top managers were lacklustre, its supervisory board was fossilised: crammed with elderly doctors and pharmacists who did little to pep it up.

Shareholders in Germany usually shy away from confronting such problems. But after a rancorous 14-hour annual general meeting on August 26th, they voted out Stada’s chairman, Martin Abend. He went the way of the once-dominant chief executive, Hartmut Retzlaff, who quit in June (owing to an illness). As the board is rejigged, managers have rediscovered some ambition. They have promised to lift revenue to €2.6 billion ($2.9 billion) by 2019, from €2.1 billion last year.

It is a big victory for a young, German-led investment firm, Active Ownership Capital (AOC), which has adopted the sort of aggressive style usually associated with American, British or Nordic funds, such as Cevian Capital of Sweden. AOC, which has a 7% stake in Stada, fought for a year to shake up the…Continue reading

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ApprovedBusinessBusiness and finance

Show me again

IF YOU can sell smartphones, you can sell anything. That seems to be the motto of Xiaomi, a Chinese firm best known for making feature-laden but affordable handsets. On August 31st, at a splashy event in Beijing, it unveiled a robotic vacuum cleaner—the latest in its “ecosystem” of devices, which also includes smartwatches, air purifiers, hoverboards, rice cookers and even an electric screwdriver (most are built by startups in which Xiaomi has a stake).

The snazzy vacuum—it features a futuristic distance sensor that is able to scan its surroundings up to 1,800 times a second—is a symbol of the hubris that has led Xiaomi to chase its ecosystem dreams even as it has neglected its core business. Considered the world’s most valuable startup only a couple of years ago, when it attracted more than $1 billion in funding at a valuation of $46 billion, some now reckon it to be worth only a tenth of that.

The firm vigorously rejects such estimates—and calls another figure deeply flawed. According to IDC, a market-research firm, sales of Xiaomi handsets on the Chinese mainland fell by nearly 40% in the second quarter of…Continue reading

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Honest partner

The wind’s set fair

THE maroon hot-air balloons which carry tourists over Bagan—an ancient city teeming with crumbling red-brick temples—are famous in Myanmar. The fleet belongs to one of the country’s best-known tycoons. Since the pariah nation began to open up in 2011, Serge Pun has gradually transformed an empire built on property into a conglomerate with interests in tourism, consumer goods and other industries. His firms have become favourite partners for foreign multinationals.

Mr Pun is an atypical character in Myanmar’s business scene. He spent his teenage years in China, his family having left Myanmar after the army’s coup in 1962. During the Cultural Revolution Chinese authorities sent him to a re-education camp. He returned home in the early 1990s after starting his own property firm in Hong Kong.

He owns two flagship companies, First Myanmar Investments (which became the first company to list on Myanmar’s new stock exchange in March) and Yoma Strategic Holdings, which is listed in Singapore. Both hold stakes in a number of housing developments, whose value Myanmar’s opening has greatly…Continue reading

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The €13 billion bite

MARGRETHE VESTAGER, the EU’s competition commissioner (pictured), likes to knit elephants in her spare time, because, she once said, “they bear no grudge, but they remember well”. It is hard to imagine executives at one of the big beasts of the tech world forgetting August 30th 2016 in a hurry: that is when Ms Vestager told the Irish government to recover up to €13 billion ($14.5 billion), plus interest, in unpaid taxes from Apple. The decision was expected, but the figure was higher than experts had predicted.

 

The ruling is the most important—and controversial—moment so far in the war on corporate tax avoidance. Tax-justice campaigners hooted with delight. Apple was livid, and vowed to appeal. The Irish government may follow; its finance minister, Michael Noonan, would rather “defend the integrity of our tax system”, as he put it, than accept a windfall that would exceed Ireland’s annual health budget. Politicians in America, Apple’s home market, denounced the move as a “tax grab”.

The commission concluded that Irish rulings in 1991 and 2007 artificially lowered the tax Apple was due to pay, and that…Continue reading

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Business

In a Political Season

Many, if not most, people I know don’t want to talk about it — the election, that is. Lots of them have views but they don’t want to share them, based on a dislike of contentiousness. Who likes conflict? There is an article floating around the Internet that I lost track of that says nobody’s mind ever changes in a heated debate about something so vital, so why engage?

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