SECURITIES
Central banks buy US debt
Overseas central banks are piling into US Treasuries in the face of the longest market rout this year. Foreign official accounts raised their holdings of US securities in custody at the Federal Reserve to US$2.99 trillion as of Wednesday, the highest level this year, based on Fed data. The purchases came amid a selloff that pushed US 10-year yields to a six-month high of 2.36 percent this week. US 10-year yields of 2.21 percent as of 6:42am in London was 92 basis points more than the average of the other G7 nations, according to data compiled by Bloomberg. The benchmark Treasury yield has risen 58 basis points from this year’s low in January.
SHIPPING
Port privatization relaunched
Greece’s new left-wing government has relaunched the process of privatizing the nation’s largest port, but is offering a reduced stake to bidders, a source close to the deal said on Thursday. The previous conservative government had planned to sell a 67 percent stake in the Piraeus port, but this has now been reduced to 51 percent, the source said. The unnamed source said three companies were interested in the port privatization offer: the Chinese conglomerate COSCO Group (中國海運集團), the Dutch company APM Terminals and the Philippines’ International Container Terminal Services. The companies have until September to submit their offer, the source added.
BREWERIES
SAB to buy Meantime
SABMiller said it would acquire British craft beer firm Meantime Brewing Co, giving the maker of big-name brands such as Peroni and Grolsh, exposure to the fastest-growing part of the British beer market. SAB said it planned to grow the sales of Greenwich, London-based Meantime’s beers across Britain and would also look to export it in other European markets. The financial terms of the deal were not being disclosed, SAB said, adding that the acquisition would be completed early next month. Meantime’s beers include London Pale Ale and London Lager.
PHARMACEUTICALS
Aspen targets baby food
Aspen Pharmacare Holdings Ltd, Africa’s largest generic-drug maker, is in talks to buy a baby-food business to add to the company’s nutrition unit two years after it bought licenses to sell Nestle SA’s infant formula, the Johannesburg-based company said in a statement on Thursday. Aspen, which supplies medicines in more than 150 countries, has spent in excess of US$2 billion on acquisitions in the past two years and has identified opportunities for further deals, the company said in March. The company said on Monday it had agreed to sell a pharmaceutical business to Dublin-based Endo International PLC for 1.6 billion rand (US$135 million).
BANKING
Chinese lender to buy BBM
Bank of Communications Co (交通銀行), China’s fifth-largest bank, is nearing an agreement to purchase control of Brazilian lender Banco BBM SA for about US$200 million, people with knowledge of the matter said. The Chinese lender plans to acquire about 80 percent of the bank, while BBM’s founding Mariani family will keep the remaining stake, according to the people. The deal could be announced as soon as next week, during Chinese Premier Li Keqiang’s (李克強) visit to Brazil, the people said. BBM had a book value of 575.6 million reais (US$192 million) at the end of December.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure