On Thursday, November 27th, the European Parliament approved a resolution promoting a Google breakup. The resolution was approved with 384 in favor and 174 opposed, and is a recommendation to the European Commission, which has ultimate authority over the matter. Although the resolution does not specifically mention Google, it is clearly the target following a 2010 probe into Google’s search dominance.
Dow Chemical Company Adds New Board Members
A raging dispute has finally been settled in the Dow Chemical boardroom following criticism from its shareholders.
Valeant and Ackman’s Hostile Takeover Falls Through But Still Pays Out
Valeant’s aggressive and longstanding pursuit of Allergan, Inc. has finally been resolved with an unlikely twist: a deal between Allergan and Actavis. As of November 16, Allergan has agreed to be acquired by Actavis for $66 billion, representing a valuation of about $219.00 per share in cash and stock. This deal leaves Valeant and William Ackman, who joined forces to acquire Allergan, with a victory that defies conventional wisdom; the stock acquired in their bid to control Allergan’s board is now worth $2.6 billion, with 15% to go to Valeant and the remaining $2.2 billion to be collected by Ackman’s hedge fund.
Record Punitive Damages set in Juarez v. AutoZone Stores, Inc. Verdict
On November 18, the U.S. District Court for the Southern District of California upheld a jury verdict awarding Rosario Juarez, a former San Diego AutoZone store manager, almost $873,000 in compensatory damages and a record $185 million in punitive damages due to pregnancy-related harassment, discrimination, and retaliation.
Market Conditions Lead to Increase in Mergers & Acquisitions
A strong stock market, low borrowing costs, and increased confidence in the global economy have created conditions ripe for the current boom in mergers & acquisitions (M&A). M&A deals targeting American companies have topped $1.5 trillion this year, while total global deals have reached the $3 billion mark for just the fifth time. These numbers are both up over 50% from a year ago and are the highest seen in the last seven years. This is strong evidence that the M&A market has completed its resurgence and has finally recovered from the malaise of the global financial crisis.
Central Bank Gets Blame for Cypriot Crash
The release of a Cyprus government report this past week reveals the enduring difficulties faced by central banks of small European nations, in their efforts to stabilize fragile economies while promoting the monetary interests of the wider Eurozone.
Is More Better? Transparency and a CEO’s Compensation
Employers generally hire the best person for a job at the lowest possible cost while still ensuring a remuneration package large enough to prevent voluntary lateral transfers and hostile talent acquisition. This is especially true for a company’s chief executive officer (“CEO”), who serves a dual role of maximizing profits for the company and responding to shareholders’ demands. However, the exponential growth in CEO compensation raises concerns over regulating individual corporate governance and promoting collective social policy goals.
Fannie Mae Seeks to Ease Mortgage Rules
Despite current low interest rates, the U.S. housing market is still struggling and is not back to the pre-2008 crisis status. The federal government wishes to increase available housing credit to bring more people into the housing market by expanding mortgage availability with lower down payments. These changes could set the stage for more lending.
The Royal Bank of Scotland Will Help British Police Tackle Complex Financial Crimes
The Royal Bank of Scotland, in which the British government owns 81 percent, was allegedly involved in manipulation of foreign exchange markets and subject to various regulatory investigations along with several other major banks. The Department of Justice in Washington and the Serious Fraud Office in Britain are overseeing separate criminal investigations into these banks and their traders.
Virgin America Announces Plan For Initial Public Offering
On Monday November 3, 2014 Virgin America announced its plan for an initial public offering (IPO). The company plans to sell 13.1 million of the 13.3 million shares in the IPO to raise about $320 million. The shares are expected to be priced at $21 to $24 per share, which would value the company at approximately $1 billion. According to the filing with the Securities and Exchange Commission, the raised capital will be used for expansion of new routes and improving inflight entertainment systems.