TELECOMS
Softbank shares fall 10.68%
Softbank Corp yesterday morning plunged as investors gave a thumbs down to the Japanese mobile giant’s US$32 billion purchase of British iPhone chip designer ARM Holdings PLC, which raised questions about its credit rating. The sharp drop bucked an upward trend in the broader market after a three-day holiday, tracing another record close on Wall Street. Softbank dropped 10.68 percent to ¥5,365 (US$50.58) after the ¥24.3 billion deal was announced on Monday. The firm said it would offer ¥17 for each ARM share, a premium of about 43 percent compared with Friday’s closing price, sending ARM rocketing more than 40 percent in London. However, Softbank’s stock took a pummeling, as investors turned up their nose at the bid price, reigniting concerns about its balance sheet after a string of earlier acquisitions — including US-based mobile giant Sprint Corp — raised fears over its finances.
AUTOMAKERS
Volvo operating profit rises
AB Volvo’s second-quarter operating profit rose 2.5 percent, as production cuts to save costs helped offset a sales slowdown in the US heavy truck market. Earnings before interest and taxes — excluding capital gains, a provision related to a EU competition investigation and restructuring costs — increased from 5.98 billion kronor (US$697.74 million) a year earlier to 6.13 billion kronor, the Gothenburg, Sweden-based manufacturer said in a statement yesterday. Slowing demand in the US and the Middle East and recession in Brazil have wreaked havoc on truckmakers’ expectations for the year.
PHARMACEUTICALS
Novartis warns of profit drop
Novartis AG said profit might fall this year, as the Swiss drugmaker increases spending on heart medicine Entresto and faces declining sales of its best-selling cancer treatment, Gleevec. Core operating income is to either be about the same as last year or decline by a percentage in the low single digits at constant exchange rates, Novartis said in a statement yesterday, adding that sales will be largely unchanged. Novartis is depending on revenue from newer medicines like Entresto and Cosentyx, as blockbuster Gleevec faces generic competition in the US, and sales at its eyecare division Alcon Inc slump. Second-quarter earnings declined 3 percent to US$1.23 per share, excluding some items, the Basel, Switzerland-based company said. Analysts estimated US$1.19, according to data compiled by Bloomberg. Revenue dropped 2 percent to US$12.5 billion, compared with analysts’ average forecast of US$12.2 billion.
AUTOMAKERS
Authorities probe FCA US
Federal prosecutors are investigating allegations that FCA US LLC, more commonly known as Fiat Chrysler, violated securities laws by getting dealers to falsely report sales of new cars in order to inflate the company’s numbers. The company on Monday confirmed that it is cooperating with investigations by the US Department of Justice and the US Securities and Exchange Commission. The probe apparently stems from a lawsuit filed in January by the Illinois-based Napleton dealership group alleging that competing dealers were given thousands of US dollars to report false sales. The group alleges that an FCA executive offered Napleton US$20,000 to falsely report sales of 40 new vehicles. The lawsuit also alleges that the false sales give the appearance that FCA’s performance is better than it actually is.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last