CHEMICALS
Total sells Atotech
Total SA agreed to sell its specialty chemicals unit Atotech to Carlyle Group LP for US$3.2 billion as the French oil company disposes of non-core assets to weather a slump in crude and preserve payouts to shareholders. The sale price is 11.9 times Atotech’s adjusted earnings for last year before interest, tax, depreciation and amortization, the companies said in a statement yesterday. Equity for the transaction is to come from buyout funds Carlyle Europe Partners IV and Carlyle Partners VI. Atotech, which had revenue of 1 billion euros (US$1.1 billion) last year, has more than 4,000 employees, mainly in China and Germany.
RETAIL
Wal-Mart sees flat earnings
US retail giant Wal-Mart Stores Inc on Thursday predicted that earnings would be flat in fiscal year 2018 as it pumps up investment in e-commerce initiatives. Wal-Mart said earnings for the next fiscal year that begins on Feb. 1 next year will be essentially unchanged from those of fiscal 2017, which are expected to come in at US$4.15 to US$4.35 a share. The company forecasted an overall capital budget of US$11 billion in both fiscal 2017 and 2018, down from US$11.5 billion in fiscal 2016. It will open 130 new stores in the US in the current year, down from a prior plan to build 135 to 155 stores. The company expects to build 55 new stores in the US in fiscal 2018.
INVESTMENT
Norwegian fund posts profit
Norway’s US$882 billion sovereign wealth fund, the world’s biggest, returned a profit in the third quarter thanks to strong stock markets, it said yesterday. The fund earned a return of 4 percent in the quarter, or 240 billion Norwegian kroner (US$29.7 billion), beating its benchmark by 0.2 percentage points. In the second quarter the fund booked a profit of 1.3 percent. “Equity investments performed strongest during the quarter with positive returns in all regions. This was the main contributor to the fund’s results,” fund deputy chief executive Trond Grande said in a statement.
AVIATION
CIT sells leasing unit
The CIT Group, a commercial lender, on Thursday agreed to sell its aircraft leasing business to a Chinese-owned competitor for about US$10 billion, signifying a big step by CIT to slim itself down in the face of pressure from investors. CIT is selling its aircraft leasing unit — which owns and manages 334 planes and has an additional 133 on order — to Avolon Holdings Ltd, which is based in Ireland, but is owned by the HNA Group (海航集團) of China. CIT will use the proceeds to pay out more than US$3 billion to its shareholders and to further bolster its balance sheet.
RETAIL
Seven & i restructuring
Seven & i Holdings Co unveiled a restructuring plan to divest struggling department stores and set up a real-estate division, in a bid to focus on boosting profit at its core 7-Eleven business. The new unit, to be created this fiscal year, will explore redeveloping property occupied by under-performing general merchandise stores into housing for seniors or other residential and commercial facilities, company president Ryuichi Isaka said on Thursday. Seven & i also announced a capital alliance with a local retailer and is to transfer three Sogo & Seibu department stores to the partner. Seven & i Holdings shares yesterday fell the most in three months in Tokyo trading in the wake of the plan’s announcement.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by