FT : Japan must look beyond the 2020 Olympics

Japan must look beyond the 2020 Olympics
Prime Minister Shinzo Abe faces important decisions after the Games

The Tokyo Olympics of 1964 were the culmination of two decades of work to reconstruct Japan. It marked a proud return to the international spotlight as visitors rode the new shinkansen high-speed railways and the world watched the Games via the first international satellite broadcasts. Joe Frazier took gold in the heavyweight boxing and Japan delighted as its women defeated the Soviet Union to win the inaugural Olympic volleyball tournament.

For the past eight years, Japan has again been engaged in a project of revival under Prime Minister Shinzo Abe as it seeks to shake off the legacy of the 1990s and 2000s, when the economy was weak and the country lost its sense of direction. That project will culminate with the Tokyo Olympics of 2020, but while this second Olympiad brings a similar sense of pride and renewal, the path forward is less obvious than it was 56 years ago.

The 1964 Games were held in October, but jam-packed sporting schedules mean the 2020 Games will take place in the muggy heat of July and August, which is sure to provoke controversy. Nevertheless, there will be no tales of panic or unfinished construction: most of the venues have already hosted test events. The warmth of the welcome from Japan’s public is not in doubt.

Under Mr Abe, the country is on the up. The economy has performed significantly better in recent years thanks to his stimulus policies, even if it remains far from the Bank of Japan’s 2 per cent inflation objective. Diplomatically, the prime minister has been unusually active and visible for a Japanese leader, forging a notable friendship with US President Donald Trump and improving relations with China, although disputes with South Korea rumble on. He has struck trade deals and made important if not transformational reforms to corporate governance, energy markets, agriculture and working practices.

The question is, what happens after the Olympics, when Mr Abe has to make important decisions about the future, both political and economic? The fear is a loss of momentum as the rate at which the population is ageing, and declining, accelerates in the 2020s.

Politically, Mr Abe has a deadline in the autumn. His term as leader of the Liberal Democratic party — the last allowed under its constitution — expires in autumn 2021. The current term of the lower house of the Diet, Japan’s bicameral legislature, runs out around the same time. If Mr Abe intends to step down as prime minister, the natural time to do so is in the afterglow of a successful Olympics, giving the new leader a year to settle in before facing the voters. If he intends to stay, on the other hand, the way to force through a change in the party rules is to secure a new mandate in a general election first. If Mr Abe does want to continue, he needs to show he is not governing for the sake of it and has an agenda for longer years in office.

Economically, the prime minister needs to make sure there is no return to the contractionary policies of the past. The stated goal is 2 per cent inflation, but with the Bank of Japan having decided the costs of further monetary easing outweigh the benefits, there is no road map to achieving it. The answer is not to abandon the inflation target but rather to make more active use of fiscal policy to support growth. Mr Abe has taken welcome steps in that direction with a recent stimulus package.

The Japanese Olympic Committee has set a target for 30 gold medals at its home Games, up from the 12 it won in Rio de Janeiro in 2016. That is ambitious. But after so many years of economic gloom, it will be good to see an ambitious Japan welcome the world in 2020.

FT : China’s ‘potash king’ puts assets up for auction on Taobao

China’s ‘potash king’ puts assets up for auction on Taobao
Lossmaking state company seeks to offload $2.5bn of assets to avoid mandatory delisting

One of the largest state-owned companies in western China has been forced to auction assets and shares originally valued at more than $2.5bn on an ecommerce website, a controversial move aimed at avoiding delisting from the Shenzhen stock exchange next year.

But the assets put up for sale by Qinghai Salt Lake Potash Company, China’s largest potash producer, have so far failed to attract bids on the Alibaba-owned ecommerce site, Taobao. That has forced the troubled group to cut the asking price by more than 75 per cent and launch five consecutive auction rounds, with the latest one set to kick off on Tuesday.

Chinese companies have come under heavy financial pressure this year as economic growth slows to a three-decade low. Many strains from excessive leverage have surfaced among local governments across the country, most recently with the default of state-commodities trader Tewoo Group.

Qinghai Salt Lake Potash, named after the province where it is based and known as China’s “potash king”, reported losses for both 2017 and 2018.

A third year of losses for the group, which is 27 per cent owned by the Qinghai government and 20 per cent held by state chemicals conglomerate Sinochem, would result in the company’s delisting from the Shenzhen stock exchange in 2020, as mandated by bourse rules.

In an attempt to boost fourth-quarter income and save itself from delisting, Qinghai Salt Lake Potash has resorted to hawking a collection of shares and assets on Taobao, the group said in a regulatory filing.

The auction is an unusual and controversial move for a state-owned company.

Chinese media including respected financial magazine Caixin have raised questions over whether state assets could be undervalued in the auction process, resulting in losses for government shareholders.

The first auctions starting in late November for three packages of assets and shares had a total starting price of Rmb17.8bn ($2.5bn), results from the public auction show.

After attracting no bids on four auctioning rounds, the fifth round, which starts on Tuesday, has priced the same assets at just Rmb4.3bn — a 75 per cent discount to the original asking price.

Economists have recently pinpointed Qinghai as a hotspot for high levels of government debt.

“Ballooning local government debt is creating a systemic balance-sheet mismatch risk, which underlay the 1997-98 Asian financial crisis,” Chi Lo, senior greater China strategist at BNP Paribas Asset Management, said in a note to investors last week. “Local debt-to-GDP ratios are the highest in Guizhou, Qinghai and Yunnan.”

Alibaba’s Taobao, one of the largest ecommerce businesses in the world, includes a court auction platform that has become a venue for sales of everything from shares in listed banks and Audis confiscated from arrested officials to distressed debt portfolios and even a national toothpaste brand.

On Monday, an auction of more than 3,600 tonnes of indium ingots with a starting price of Rmb2.9bn failed to attract investors. The stockpile was once held by the state-backed Fanya Metals Exchange, which collapsed in 2015 following a major fraud incident.

FT : Gene-editing scientist jailed in China

Gene-editing scientist jailed in China
Creator of the world’s first genetically modified twins handed three-year sentence

A scientist who created the world’s first genetically modified twins has been sentenced to three years in prison for “illegal medical practice” by a Chinese court.

He Jiankui, who sparked a global outcry last year by revealing the birth of twins whose genes had been altered with the editing technique known as Crispr, was convicted of “illegal medical practice” on Monday by a court in the southern province of Guangdong, which also fined him Rmb3m ($430,000).

The court said that three genetically modified children had been born as a result of the scientist’s research, which involved forging ethical review documents and deception of patients. It did not provide any details on the children or their current health. Health officials revealed in January that a second woman was pregnant with a foetus whose genes were edited by He.

Two other scientists, Zhang Renli and Qin Jinzhou, were given jail sentences of two years and 18 months respectively for aiding the research.

The three men “deliberately violated national regulations on scientific research and medical management, crossed an ethical bottom line, and rashly applied gene editing technology”, the court said, according to the official Xinhua news agency.

In 2018 the doctor had said he was “proud” of his experiment and that the twins’ genes were edited to give them an immunity to HIV, but his work drew condemnation from scientists in China and abroad on ethical and safety grounds.

The unidentified twin girls had a single gene, named CCR5, altered to make them less susceptible to HIV infection when their embryos were just a day old, according to He. That would be early enough to become incorporated in the gene line, meaning the resistance could be passed to future generations.

Such far-reaching changes are prohibited in several countries including the US. China has banned the development of genetically-altered embryos beyond 14 days, but there is no specific punishment attached to the regulation.

He’s lawyers could not be reached for comment, and it was not clear whether he would appeal.

China has emerged as a world leader in Crispr research, which scientists say has huge potential in treating genetically-linked diseases. Chinese researchers performed the first Crispr editing on monkeys in 2014, and used the technique on human embryos for the first time a year later.

Separately on Monday, a court in the city of Chengdu sentenced Wang Yi, a Christian pastor, to nine years in jail for “inciting state subversion” and “illegal business operation” in the latest prosecution to target protestants who operate unregistered “house churches”.

Tens of millions of Chinese people are estimated to worship at such underground churches, but Beijing has in recent years stepped-up efforts to shut them down and encourage Christians to attend state-run churches.

Chinese courts often announce verdicts on sensitive cases towards the end of the calendar year, as judges are under pressure to meet annual work targets. Rights groups also accuse Beijing of timing human rights hearings for the Christmas period, when they may receive less international attention.

WSJ : The Decade of the Uber-Decadent House

The Decade of the Uber-Decadent House

How an influx of global wealth gave rise to supertall condo buildings, megamansions and $100 million home sales


At the dawn of this decade, the U.S. was reeling from a real-estate crash and the worst economic downturn since the Depression. Home prices in some regions were starting to recover, but it seemed impossible that values would return anytime soon to their dizzying boomtime highs.

Few could have predicted that within a few years, the luxury market would not only recover but reach a staggering new height. A tidal wave of global wealth poured into U.S. real estate after the 2007-09 recession, creating in the 2010s a new segment of the market: ultraluxury homes targeted at the global billionaire elite.

Amenities at Le Belvedere included a Turkish hammam. PHOTO: DAVID O. MARLOW

Pricier and more lavish than anything that came before them, these homes had outsized amenities such as commercial-grade hair salons, hotel-worthy spas and home theaters with concession stands. As the extreme became commonplace, homeowners began to add more attention-grabbing features, such as shark tanks and private nightclubs.

Meanwhile, luxury-condominium buildings grew taller than ever. Standing 1,550-feet high with 131 stories, Central Park Tower in Manhattan is now the tallest residential building in the world.

Today, because so many buyers are wealthy enough to withstand the most severe economic swings, this new sector largely acts independently from the broader real-estate market. So while the number of sales are falling in many luxury markets across the country, six homes in the U.S. have closed for $100 million or more so far in 2019—the highest number for a single year. In 2010, there were none. That year, the highest sale price was $50 million (plus about $2 million of furnishings) for Le Belvedere, a Bel-Air mansion with a swan pond and a ballroom that could seat more than 200 people.

As pricey as this home is, it pales in comparison to the biggest sales these days. Six homes in the U.S. have closed for $100 million or more so far this year—the highest number for a single year. PHOTO: DAVID O. MARLOW

 “People don’t realize that there are two markets happening in the world,” said Oren Alexander, an agent at Douglas Elliman Real Estate. “We’ve been hearing that things have slowed down, and that’s true—no doubt about it. But the unique, one-of-a-kind, top-notch product? That market is doing better than ever.”

Home sales of $50 million or more used to be an anomaly, with two or less each year in the early 2000s, according to Miller Samuel, a residential appraisal and consulting company. In 2014 that figure spiked to 23, and hasn’t fallen below 12 since.


In Los Angeles, the average home-sales price soared 153% to $2.5 million between the third quarter of 2009 and the same quarter of 2019, according to Miller Samuel. Florida’s ritzy barrier island of Palm Beach saw its average home price surge 77% in that same period, while Miami’s jumped 72%. Manhattan, which has stumbled in recent years, still had an average sales price of $1.65 million in the third quarter, 25% higher than the same quarter 10 years earlier.

A decade that will be remembered for its excesses, the 2010s saw the first-ever condo sales topping $100 million, then $200 million. In the 2010s billionaires bought not just one, but multiple $100 million-plus homes for themselves.

Some buyers paid tens of millions of dollars for houses, only to raze them and build brand-new mansions in their place. They bought newly constructed, multimillion-dollar condos and gut-renovated them, putting existing high-end finishes out with the trash. They upholstered their walls in red leather from the uber-luxury handbag brand Hermès. The youngest members of the family got playhouses that cost more than conventional homes.

The exterior of 220 Central Park South, where hedge-fund manager Ken Griffin purchased a roughly $238 million penthouse. PHOTO: DOROTHY HONG FOR THE WALL STREET JOURNAL

The postrecession flood of buyers has now slowed, and far more home sellers seek nine-figure price tags than actually achieve them. Still, it is clear that ultraluxury sales are now a fixture of the marketplace.

The $100 million sale “is now a thing,” said real estate appraiser Jonathan Miller of Miller Samuel. “This will not go away.”

In the 2010s, hedge-fund billionaire Ken Griffin poured at least $820 million into home purchases in New York, Palm Beach, Chicago and London. Since 2011, Facebook CEO Mark Zuckerberg has spent at least $250 million on real estate. Embattled WeWork founder Adam Neumann has paid about $90 million for six homes since 2012, including a California estate with a guitar-shape living room. Natural gas billionaire Michael S. Smith paid $110 million in 2018 for an oceanfront compound on Malibu’s Carbon Beach. What Mr. Smith paid is more than 1,500 times the U.S. median household income for that year, or $63,179, according to census data. It’s enough to buy 550 Ferraris, or more than 450 houses priced at $243,225, the current median value of a home in the U.S.

“These are numbers that mere mortals don’t pay for housing,” said Mr. Miller.

How did we get here?

In 2013, Wooldon Manor estate in New York’s Southampton sold for $75 million. PHOTO: CHRIS FOSTER

Back in 2010, Uber and Airbnb were fledgling startups. Instagram had just launched. Many people used Amazon.com primarily for buying books. Many tech companies have seen expansive growth since then, yielding massive amounts of wealth for their founders. Meanwhile, vast fortunes were created in emerging economies across the world, such as China, Russia and Brazil.

“Over the last 10 years, we’ve seen a recovery from the financial crisis and a long boom in stock prices,” said Maya Imberg, director of Thought Leadership and Analytics at Wealth-X. “That’s pushed up the overall amount of wealth in the world.


In 2009 there were 174,000 people world-wide with a net worth of $30 million or more, according to Wealth-X. By 2019 that number had jumped to 275,000.

This generation of affluent people has eagerly purchased luxury real estate in their home countries and around the world to diversify their assets or escape political instability at home, said Liam Bailey, head of Knight Frank’s residential-research team. “Wealth has become much more mobile,” he said. “The new wealth that has been created in emerging markets in particular has a very global outlook.”

Today, he added, international ultrahigh-net-worth individuals typically have at least three or four homes in multiple cities outside their home country. With interest rates low after the financial crisis, “investors were running around the globe investing in real estate as a way to generate higher returns,” Mr. Miller said. “It was a frenzy.”

A key turning point came in 2012, when former Citigroup Chairman Sandy Weill sold his penthouse at Manhattan’s 15 Central Park West for $88 million—roughly twice what he had paid for it in 2007—to Russian billionaire Dmitry Rybolovlev. That deal “opened up a whole new echelon of what could be,” said Corcoran chief executive Pamela Liebman.

In 2017, a penthouse at 432 Park Avenue sold for $91.1 million. PHOTO: ANDREW LAMBERSON FOR THE WALL STREET JOURNAL

Hedge-fund executive Bill Ackman and a group of investors paid $91.5 million for a penthouse at One57 in 2015. PHOTO: DOROTHY HONG FOR THE WALL STREET JOURNAL

With land prices high and credit tight in the wake of the recession, developers buoyed by investment dollars built almost exclusively high-end product, Mr. Miller said. The result was an “explosion of luxury new builds” in cities such as New York, London and Los Angeles, said Mr. Bailey, reversing an earlier trend where buyers would pay a premium for established, old-money buildings. “It almost created a brand-new marketplace.”

In Manhattan, for example, new-construction luxury towers like One57 sprang up on what is now called Billionaires’ Row, taking advantage of new technology to build taller buildings than ever before as they competed to lure wealthy international buyers. “You’ve got this arms race between developers, who are using architecture and design to stand out from the crowd,” Mr. Bailey said. “You end up with these incredible buildings.”

In 2014, tech entrepreneur Michael Dell set a new Manhattan record when he bought a condo at One57 for $100.47 million. In 2015, an investor group led by billionaire hedge-fund manager William Ackman paid $91.5 million for another unit in the same building. In 2017, an unknown buyer paid $91.1 million for a penthouse at 432 Park Avenue, a nearly 1,400-foot-high tower on Billionaires’ Row.

The past decade will be known for redefining luxury, as developers sought to wow buyers by piling on the most over-the-top features. “The amenities have doubled and quadrupled,” said Manhattan real-estate agent Richard Steinberg.

It was the decade when sellers put homes on the market with Lamborghinis, Warhols and Picassos included in the asking price.

It was the decade when Miami’s Porsche Design Tower was built with glass-walled garages adjacent to the units and accessed by a specially designed car elevator, allowing residents to park just outside their apartments, even 60 stories in the air.

In 2017, a Beverly Hills spec house was listed for $100 million with a Champagne vault filled with 170 bottles of Cristal, and a full-time house manager whose salary had been prepaid for two years.

A mid-2010s photo of a private nightclub at the home of Paris Hilton. PHOTO: LISA CORSON FOR THE WALL STREET JOURNAL

A sauna in an East Hampton home. PHOTO: DOROTHY HONG FOR THE WALL STREET JOURNAL

That same year, a Los Angeles spec house dubbed Billionaire hit the market with two fully stocked wine cellars, a candy room filled with treats from Dylan’s Candy Bar and an elevator clad in crocodile skin. The lower level had a four-lane bowling alley with bowling shoes in various sizes. The house sold this year for $94 million.

In Boston, the under-construction St. Regis Residences will offer buyers personal butler service and the option of having a watch-winder in the closet. “Always reliable and faithful, your butler will come to understand your exact preferences and even anticipate your needs,” the website boasts.

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Features now routine in high-end properties, like home automation systems, weren’t long ago considered “super luxury and unattainable to the average person,” said real-estate agent Catherine Marcus Bassick. “What defined luxury in 2009 is not the luxury we would describe now.”

A hair salon in a home in Utah. PHOTO: KIM RAFF FOR THE WALL STREET JOURNAL

 

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FT : French start-up boom points to entrepreneurial resurgence

French start-up boom points to entrepreneurial resurgence
Macron’s cuts to taxes and red tape help to drive small business growth

Justine Hutteau embodies the entrepreneurial spirit that France hopes can flourish. Little more than 18 months since the 25 year-old’s natural deodorant brand went on sale, the business has expanded its workforce from two to 16.

“We aim to launch a new product each month,” said Ms Hutteau, co-founder of the company called Respire. “Our vision is to be the number one natural hygiene brand in Europe”.

As strikes over pension reforms have brought disruption to public transport and put the government of President Emmanuel Macron on a collision course with trade unions, her ambition attests to another force that is playing out in an economy long perceived as lacking dynamism.

The number of businesses being created has surged since Mr Macron came to power with a pledge to overhaul the economy, reaching almost 809,000 over the past 12 months. This is up 45 per cent compared with the year before the former banker took office in May 2017.

There have been sharp rises in businesses created in areas such as transport and storage, real estate, manufacturing and business support services, according to data from national statistics agency Insee.

For some observers, the explosion is connected to government policies to slash red tape, reduce taxes and encourage innovation.

“It reflects a lot of reforms that have been going on not only under the Macron government, but even under earlier governments, that aimed to give more support to entrepreneurship and more flexibility to the labour market,” said Daniela Ordóñez, chief French economist at Oxford Economics.

Among the measures are state financial assistance and special visas for the technology sector to attract talent. In the first half of 2019, French start-ups raised a record €2.79bn, up 43 per cent on the previous year and higher than Germany.

Beyond an easing of the bureaucracy and high costs that France has traditionally placed on businesses, the trend also points to shifting cultural attitudes towards work and entrepreneurship.

Once a land of artisans, farmers, skilled professionals and sole-traders, the number of French petits propriétaires — or smallholders — was in decline until about 20 years ago as salaried jobs became the norm, according to Institut Montaigne, a free-market think-tank.

Today, as Institut Montaigne wrote in a report this year, “we’re experiencing a renewal of self-employed activity” that is “once again an ideal for many French people”.

Gilles Moec, chief economist at insurer Axa, said buoyant construction activity and a rebound in tourism have contributed to the business registration figures. “The immediate cause over the past two-to-three years is the change in the rules to register as a micro-entrepreneur,” he added.

The status, created more than a decade ago, is open to individuals and offers simplified registration and tax benefits. Revenue ceilings were doubled at the start of 2018, which economists say has recruited an army of micro-entrepreneurs.

They have accounted for more than two-fifths of the new businesses registered throughout the Macron presidency and already represented one-third of the 3.2m people in France with some form of self-employed activity outside agriculture by the end of 2017, according to Insee.

An attraction is that it allows jobseekers to pursue an activity without giving up all unemployment benefits, while people already in salaried job can more easily earn on the side.

Stephanie Guainebe struck out on her own as a micro-entrepreneur after three years of working as an administrative assistant for a tradesman in her home city of Orléans.

“I wanted to be my own boss. I was tired of not being recognised for my work,” said the 45 year-old, who provides outsourced office management and secretarial work, as well as lessons at an educational institute.

Although in her first full year of self-employment she will earn a similar amount to her previous salary of €15,000, Ms Guainebe has already signed contracts worth €50,000 for the future.

While Mr Macron can boast of a near-decade low in unemployment, at 8.6 per cent, the rise of micro-entrepreneurs has however sparked anxiety about a creeping “gig economy” of low-paid, unskilled work and fewer rights, inhabited by the likes of Uber drivers and fast-food couriers.

Eric Heyer, a director of the French Economic Observatory at university Sciences Po, said many people have in effect simply switched from employment to freelancing to benefit from more favourable tax treatment, without any real difference in the nature of their work.

“There is an increase in businesses, but when we look at the details there are more micro-entrepreneurs and they often do not last that long [in their new roles],” said Mr Heyer added. “The main winners are the highly paid employees who can complement their salary with a second source of revenue”.

He added: “In the short-term, everyone wins. Afterwards, the problem is that you are less covered. You pay fewer [social] contributions, you have less rights to unemployment and pension benefits. Overall, it is a legal way of getting around the French social model.”

In the longer run, the challenge for France is to generate more value from its smaller and medium-sized buinesses and help start-ups to grow. “We will need to assess [companies’] survival rates and their capacity to add jobs,” said Mr Moec at Axa. “But the change is already tangible.”

WSJ : In Battle to Recruit New Quants, Hedge Funds Outpay Banks

In Battle to Recruit New Quants, Hedge Funds Outpay Banks
The funds are eager to attract workers with quantitative skills; some graduates say they are earning $1 million

Hedge funds are paying top dollar to bring in new employees with quantitative skills, underscoring the desperation some funds face to bulk up their abilities around big data and algorithms.

A new survey from Baruch College’s financial engineering program found that recent graduates working at hedge funds made significantly more than their peers working at banks. Baruch’s master’s program teaches students skills like data science and financial modeling.

At hedge funds, Baruch graduates’ pay ranged from around $200,000 to more than $1 million, the survey found.

But for those alumni working at banks, pay ranged from about $100,000 to $400,000 a year.

Hedge-fund managers once reigned over the investment industry. Now, many of them are floundering. In the quest to gain a new foothold, many have shifted their investment decisions from humans to computers. In turn, Wall Street recruiters say people with quantitative skills are in high demand.

In a sign of the shift, some prominent funds have tried to remake themselves. Funds have been recruiting the kind of people who can make investment decisions using code, big data and machine learning.

Two of the Baruch graduates working at hedge funds reported a compensation of $1 million or more.

“People who make that much money make a lot more money for the firm,” said Dan Stefanica, a Baruch math professor who analyzed the alumni salary data. “And if you don’t compensate them enough, they just go somewhere else.”

Hedge funds’ hunger for talent is apparent during Baruch’s recruiting sessions. During the fall semester, Wall Street firms make their pitch to students. Three years ago, the split of companies presenting was 75% banks, 25% hedge funds, said Mr. Stefanica.

Now it has flipped.

The Baruch survey also found that female graduates made less than the men, said Mr. Stefanica. Median pay was $190,000 for women and $210,000 for men, he said.

Some male graduates surveyed took home more than double the pay than any of the women. For women, pay ranged from $110,000 to $450,000; for men, $110,000 to more than $1 million, he said.

The women graduates surveyed tended to work at banks.

More than half of the women—64%—worked in banks whereas 21% worked at hedge funds or in asset management, Mr. Stefanica said.

Across the entire survey, 48% of all respondents worked at banks and 38% worked in asset management or hedge funds.

Just under a third of the Baruch survey respondents were women, he said.

Baruch surveyed 50 alumni who have been working for four to six years after studying in Baruch’s masters of financial engineering program.

Regardless of salary, the graduates reported roughly the same job satisfaction, about 8 on a scale of 10, Mr. Stefanica said. It suggests, he said, that more money doesn’t necessarily buy more happiness.

FT : WeWork documents reveal bosses’ golden parachutes

WeWork documents reveal bosses’ golden parachutes
Co-chiefs to gain $8m each if ousted from property group as it deals with cash crunch

WeWork will have to pay close to $17m to replace its co-chief executives under exit packages negotiated in the run-up to the company’s rescue by SoftBank, according to documents reviewed by the Financial Times and people briefed on the matter.

Artie Minson and Sebastian Gunningham, who became co-chief executives after WeWork founder and chief executive Adam Neumann stepped down in September, will receive $8.3m apiece if they are sacked or leave for a number of reasons, including a diminution of their duties, cuts to their pay or involuntary relocation. 

Jennifer Berrent, chief legal officer, will receive $1.5m under the same scenarios. She also will not have to repay $12m of retention bonuses if she is terminated or leaves the company, which otherwise could have been clawed back under her previous agreement.

The exit packages are set out in documents sent to shareholders of the lossmaking property company, including many of its employees, ahead of a $3bn tender offer for shares by SoftBank. They give further insight into remuneration at the top of WeWork amid a cash crunch that has forced it to scale back its global expansion and sack thousands of staff.

The FT revealed on December 24 that Mr Neumann, who left with a $1.6bn exit package, could earn hundreds of millions of dollars more under an agreement that revised the terms of some of his remaining economic interests in the company.

The packages for the co-chief executives and Ms Berrent are striking, given the WeWork board has actively considered other candidates to replace all three, according to multiple people briefed on the discussions. The three executives and WeWork declined to comment.

Mr Minson and Mr Gunningham agreed salaries of $1.5m each in September, when the company was still fighting to save its doomed initial public offering. The two men now report to Marcelo Claure, the SoftBank executive who was appointed executive chairman of WeWork several weeks after their promotion, when the Japanese company finalised its rescue deal.

Mr Minson’s pay represented a big increase in his non-stock based compensation from his time as chief financial officer, when he was “predominantly compensated” through equity awards, according to filings with US securities regulators. The former AOL executive was paid a salary of $51,000 and received $625,000 in loan forgiveness as WeWork chief financial officer in 2018.

It was unclear what Mr Gunningham earned before he was elevated to co-CEO. He was an executive at the online retailer Amazon before he joined WeWork in 2018.

Ms Berrent, who was central in drafting the documents for WeWork’s IPO and its communications with US regulators at the Securities and Exchange Commission, is receiving a salary of $600,000, according to the tender offer documents and people briefed on her pay. That compares with $871,154 last year. 

Mr Minson and Ms Berrent have accumulated lucrative stakes in WeWork since joining in 2015 and 2014, respectively, which they can tender as SoftBank buys $3bn of stock from employees and investors over the coming months. 

Mr Minson could receive up to $14m based on his vested shares, if the tender goes as expected, according to WeWork and SoftBank estimates, while Ms Berrent could realise up to $4.9m. Mr Gunningham did not have any vested interests in WeWork and his stock options have exercise prices above the $19.19 a share price that SoftBank is paying.

The documents sent to shareholders warned that WeWork “may continue to experience [a] significant amount of turnover of senior management”, while also laying bare the dire financial situation that WeWork faced after it in September — a fundraising executives expected would unlock more than $9bn to cover losses. 

The company said it had expected to run out of cash in early November after the IPO was derailed, had it not secured fresh funding from SoftBank.

>>> What to look at this today ( & this WE) - 30th of December 2

Stocks in Asia were mixed in thin trading Monday, while the dollar retreated for a third straight session.
With little more than positioning adjustments and order flows governing markets in the run-up to the New Year holiday, equities had a scattered performance at the end of a blockbuster year. Futures on the S&P 500 Index edged up after a lackluster session Friday. Japanese, Australian and South Korean shares dropped, while Hong Kong and Shanghai rose. Treasuries were flat.

Nikkei -0.76% Hang Seng +0.43% CSI +1.39% Shanghai +1.06% Shenzen +0.85%

Eur$ 1.1194 CNH 6.9816 CNY 6.9857 JPY 109.15 GBP 1.3110 CHF 0.9726 RUB 61.9980 TRY 5.9476 WTI$ 61.77 +0.08%

S&P +0.15% EuroStoxx -0.14% FTSE -0.13% Dax -0.22%

Macro :
- These Are Some of Europe’s Best and Worst Stocks of 2019
- Recession Gets Priced Out in a Stock Rally for the Record Books
- Pound’s Rally Could Hit Roadblock With Next Set of EU Talks
- Time for EM Stocks to Shine as S&P Gains Slow: Markets Live 2020

Keep an eye on :
- AEGN GA : Aegean Airlines Confirms Offer to Take Croatia Airlines Private
- AAPL US : Apple Sued by New York Doctor Over Watch’s Heart Technology
- ASR IM : U.S. Billionaire Friedkin Nears Buying AS Roma Soccer Club
- ATL IM : Autostrade to Extend Suspension of 2019 Toll Tariffs Increase
- BMPS IM : Italy Plans to Sell Its Monte Paschi Stake by 2021, Sole Says
- DASNSKE DC : Danske Bank Falls Behind in Danish Mortgage Market: JP
- EL FP : EssilorLuxottica: Fraudulent Financial Activities at an Essilor Plant in Thailand
- FB US : Libra Isn’t Ready for Swiss Approval, Finance Minister Says
- FEVR LN : Fevertree Guidance Looks a Stretch After Nielsen Data: Jefferies
- FCT IM : Fincantieri Unit Gets Ships Contract Valued at About $1.3B
- LHA GY : Lufthansa’s Eurowings Hit as Three-Day UFO Union Strike Begins
- NEXI IM : SIA Festive Transaction Growth Reads Well for Nexi, Citi Says
- NMC LN : NMC Share Plunge Caps a Busy Year for Short Seller Muddy Waters
- NOVOB DC : Novo Nordisk Biopharm Head Targets More Growth: JP
- NHY NO : Norsk Hydro’s Paragominas Mine, Alunorte Refinery Resume Output
- PRU LN : Prudential to Prioritize Asia Investing After U.K. Demerger: FT
- SAN FP : Regeneron Cuts Some Staff as It Reworks Partnership With Sanofi
- G24 GY : Scout24 Holder Singer Lowers Stake to 4.91%
- SRG IM : Italy’s Snam Starts Blockchain Gas-Services Trading Trial
- SOBI SS : Pharming to Acquire Sobi’s Ruconest Commercial Rights for EU7.5m
- TRE SM : Tecnicas Reunidas Wins Algeria Refinery Contract: Expansion
- TKO FP : Tikehau Capital Extends Shr Buyback Mandate Until March 19