Restaurant Brands International, the third-largest fast-food chain restaurant group in the world, posted a quarterly loss in the fourth quarter of 2014. The rather large net loss of $514.2 million, attributable to shareholders, is particularly significant because it marks the first quarterly financial data available since the formation of the group through Burger King’s purchase of Canadian coffee and doughnut chain Tim Hortons. The loss can primarily be explained by “one-time costs related to the merger.”
Puerto Rico District Court Strikes Down Debt Restructuring Law
Puerto Rico’s recently enacted debt restructuring law was struck down. On February 6, 2015, Judge Francisco Besosa of the United States District Court in Puerto Rico ruled that the law was unconstitutional and enjoined its enforcement.
CIT and One West to Merge
Commercial Investment Trust, a private commercial lender that focuses mainly on middle-market lending in various industries, recently announced its intent to acquire fellow bank One West. The CEO of CIT, John Thain, wants to take advantage of the synergies that will be created by marrying the commercial lending of CIT to the residential lending that dominates One West’s asset sheet. Yet investors may not be as keen on the deal given the two banks rocky experiences with the financial crisis.
Payday Lenders’ Extortionate Practices Face Consumer Protection Crackdown
For many Americans who survive from one paycheck to the next, payday loans are one of the only forms of credit available. However, while providing emergency credit is a vital service, these loans often carry shockingly high interest rates that have drawn increased scrutiny from the Consumer Financial Protection Bureau. In order to finally address these predatory lending practices, the CFPB expects to hand down its first set of federal rules regulating this 46 billion dollar industry in the coming weeks.
2015 Starts Strong in Europe with Four Major I.P.O.s
Last week, four companies – Sunrise Communications, Vision Express, GrandVision and Générale d’Optique – launched their shares on exchanges in the European market. Investors responded eagerly, with several offerings, such as Sunrise and GrandVision, being oversubscribed multiple times and shares moving to substantially higher levels in their debuts.
Four Accused of Insider Trading in Silicon Valley Settle Case
The Securities and Exchange Commission has accused Christian B. Keller, an in-house financial specialist, and three others of running of an insider-trading scheme that turned out nearly $750,000 in illegal profits.
Shake Shack’s IPO: Eating the Burger and Keeping it Whole
In late January, Shake Shack, the upper tier hamburger chain, went public and “broke” Wall Street: not only was the company able to sell its shares at a price of $21 per share, twice as much as the price-per-share foreseen prior to the IPO, but it also maintained its strict “anti-activism” corporate governance regime without deterring its investors.
Staples Proposes Merger with Office Depot: Merging the 3 Largest Office Supply Retailers
In an effort to compete with giants like Wal-Mart and Amazon, Staples announced its plan to purchase Office Depot in a $6.3 billion dollar deal. Staples is currently the world’s largest office supply chain store, posting annual revenues of $23.1 billion in 2013 [read performance summary here]. Office Depot posted revenues of $11.24 billion in the same year. Together, Staples and Office Depot control more than 70 percent of the office supply market.
Justice Department Investigating Moody’s
After reaching a $1.38 billion settlement with Standard & Poor’s Ratings Services (S&P) for issuing favorable grades on mortgage deals leading to the 2008 economic crisis, the U.S. Department of Justice is now setting its sights on Moody’s.
Zoetis Appoints New Board Member from Activist Investor Ackman’s Hedge Fund Firm
On February 4, 2015, Zoetis (ZTS), an animal healthcare company, announced the appointment of William F. Doyle, through the hedge fund firm Pershing Square Capital Management LP, as its new board member, expanding its board to ten members. Doyle is a former McKinsey & Co. consultant and former Johnson & Johnson executive. He also attended Harvard Business School with Pershing Square’s founder and CEO, William Ackman. Pershing Square is expected to add a second member to Zoetis’ board in the near future.