Reportedly new about asbestos issues for years regarding talc baby powder and failed to tell FDA - press
- Documents indicate J&J successfully made efforts to influence FDA plans on talc regulation
- Earliest mentions in documents go as far back as 1957-1958
- Had placed asbestos scientists on a list of what the documents refer to as 'antagonistic personalities'
- Spokesperson in response to report: any suggestion that J&J knew or hid information about talc safety is false
Pernod Ricard’s third-generation leader faces battle of his life
Chief executive Alexandre Ricard aims to defend French family spirits company from US activist
On the small Mediterranean island of Bendor that he bought as a family retreat, Paul Ricard, founder of the eponymous French spirits maker, ordered that the stone statue in the port be engraved with a motto: nul bien sans peine.
That “no pain, no gain” ethos helped Ricard build a powerhouse from a humble anise-flavoured liqueur called pastis he created 43 years ago.
Now one of his 15 grandchildren, Alexandre Ricard will need to channel similar determination if he is to see off the greatest threat to the family-backed company in its history: the arrival of aggressive US activist hedge fund Elliott Management with a 2.5 per cent stake worth almost €1bn.
The 46-year-old chief executive of Pernod Ricard is well prepared for the challenge, according to family members, colleagues and friends, despite a calm and reserved demeanour that can lead some to underestimate him.
Mr Ricard has methodically prepared for this moment, from visiting stores with his late grandfather during an internship, to studying for an MBA at the Wharton School and doing stints as an investment banker at Morgan Stanley and as a consultant at Accenture.
“Alexandre embodies the values of my grandfather of hard work and loyalty,” said Patricia Ricard, his cousin. “He is very conscious of the role he must play and the faith that has been placed in him. We are all united behind him.”
Elliott, run by US billionaire investor Paul Singer, has publicly called for more cost cuts and an overhaul of the board to address what it calls Pernod’s perennial under-performance. Inside Pernod there are fears that Elliott will go further and push for a break-up or sale of the company, in which the Ricard family has a 14.2 per cent stake and a fifth of voting rights.
Nevertheless Mr Ricard is not an old guard French CEO who will reflexively reject Elliott as an Anglo-Saxon interloper. The tall, sandy-haired executive comes from a younger cohort of French business leaders who are more internationally minded and familiar with the pressures of global capitalism. Speaking with an unaccented and fluent English from time spent in the US as a child, Mr Ricard is likely to simply carry on working hard — very hard — to prove Elliott wrong.
He is off to a good start since taking over as chairman and chief executive from the long-serving Pierre Pringuet in 2015: organic sales growth reached 6 per cent last year, up from 2 per cent two years ago, although operating profit growth has been a modest 4 per cent.
Behind the acceleration is a shift away from marketing based on categories such as vodka or gin towards what Pernod calls “consumption moments” in a nightclub or at dinner in a restaurant. Mr Ricard has also doubled down on premium spirits and travel retail, and ramped up innovation and digital marketing.
The shares are up 50 per cent since he took over, ahead of a 43 per cent rise for rival Diageo, which Elliott has held up as a model, given its higher margins.
People who know him agree on one thing: he lives and breathes Pernod Ricard. He had a huge zinc-topped bar built in his Paris apartment where guests can peruse Pernod products — from old bottles of Jameson whisky to the newest flavour of Absolut vodka. He took a mixology course a few years ago and recently appeared naked in an internal video to introduce a new Absolut advertising campaign.
The second-youngest chief in the CAC 40 blue-chip index, he rejects the formality typical of many French grands patrons and asks people to call him Alex. Everyone at the company addresses him with the informal tu.
Wherever he travels, he hits the bars at night to talk to patrons and bartenders, according to Conor McQuaid, a longtime Pernod executive who worked for Mr Ricard in Ireland. The trips are both research and a chance to get his staff to open up. “At times, the real business was done in the bars,” said Mr McQuaid. “In the evening people would be more candid than they were during the PowerPoint presentation earlier in the day.”
Although Mr Ricard can give off a stiff vibe in public, his Instagram feed offers a glimpse of a more relaxed demeanour. There is a photo of him bearded, grinning with friends at the seaside, drinking Ricard of course. There are also hints of his values: an old black-and-white snap of his grandfather along with a handwritten note from the founder calling for an end to poverty and inequality.
But his Instagram feed does not feature photos of his partner with whom he has two children, and he has worked to ensure that her name has never appeared in the press.
People who know him say this discretion comes from a life lived under the weight of expectations. “He is someone who has had to protect himself,” said one former colleague.
With Elliott bearing down, however, Mr Ricard will have to get used to a public contest. His even temper will be an asset, said Emmanuel Babeau, his first boss at Pernod when he was a junior in the audit department who is now deputy chief executive of Schneider Electric. “I have never seen him be ruled by his emotions.”
Air Berlin administrator sues Etihad for up to €2bn
Abu Dhabi-based airline was the main shareholder in the collapsed German carrier
Etihad Airways is being sued for up to €2bn over its role in the bankruptcy of German carrier Air Berlin, a court in the German capital said on Friday.
The Abu Dhabi-based airline was the main shareholder in Air Berlin, which declared insolvency in August 2017. Air Berlin ran out of funds despite receiving a “comfort letter” from Etihad just four months earlier declaring that the Abu Dhabi flag carrier would provide financial backing to the troubled German airline over the next 18 months.
Etihad’s announcement that it would no longer stand by that commitment was the trigger for Air Berlin’s collapse, which prompted severe political recriminations and significant upheaval in Germany’s aviation market
Air Berlin had racked up losses of about €2bn in the six years leading up to its insolvency. The carrier, which struggled to compete with low-cost rivals such as Ryanair, had €1.2bn in net debt at the time.
In an attempt to recoup losses suffered by more than 1m claimants, Air Berlin’s insolvency administrator is now taking legal aim at Etihad. According to a statement from the Berlin district court on Friday, the administrator “is of the opinion that [Etihad] gave a binding commitment. Because it violated that commitment, it should settle all the justified claims of creditors.”
The administrator believes that at least three separate claims worth €500m in total are justified. But given the large number of additional claimants, the court has provisionally estimated the overall value of the claims to be “up to €2bn”.
Etihad has until the end of January to respond to the claims. The final decision over whether or not the claims are justified will be taken by the Berlin court.
The collapse of Air Berlin was the largest aviation bankruptcy in German corporate history. It came at the height of the summer holiday season, sparking fears that hundreds of thousands of tourists could be left stranded. To avert that scenario, the German government stepped in with a €150m bridge loan to keep the airline flying and win more time to find a buyer for the company’s assets.
The principal beneficiary of the dismantling of Air Berlin was German flag carrier Lufthansa, which managed to cement its position as the largest airline by far in Europe’s biggest economy.
Lufthansa ended up acquiring more than half its rival’s assets, including Austria’s Niki, a holiday airline, for €210m. EasyJet bought another portion of Air Berlin’s operations, while parts of the carrier’s logistics operations found a local buyer.
Gapping down
In reaction to disappointing earnings/guidance:
- COST -4.4%, SBUX -3.8% (Starbucks outlines growth agenda, co reiterated its FY19 targets at today's Investor Day), ADBE -2%, CNC -1.4% (Centene reaffirms 2018 guidance, provides in-line 2019 EPS guidance and announces 2-for-1 stock split), CIVI -1%
Other news:
- AXON -10.6% (Axovant Sciences licenses exclusive worldwide rights for GMA gangliosidosis and GM2 gangliosidosis from the University of Massachusetts Medical School; commences underwritten public offering of common shares)
- IDRA -8.9% (presents data from ongoing phase 2 expansion of the ILLUMINATE-204 trial investigating tilsotolimod in combination with ipilimumab)
- SHOP -5.9% (Shopify lower after filing preliminary prospectus supplement to its short form base shelf prospectus dated August 3, 2018)
- LNT -1.9% (prices offering of 7,268,673 shares of common stock at $44.85 per share)
Analyst comments:
- N/A.
Gapping up
In reaction to strong earnings/guidance:
- N/A.
M&A news:
- BEL +39.9% (be acquired by LVMH (LVMUY) for $25.00/share in cash)
Other news:
- WPM +10% (reaches settlement with Canada Revenue Agency regarding tax dispute regarding foreign income)
- XPO +7.8% (responds to yesterday's 'misleading' report from a short-selling firm; long-term financial outlook remains positive; Board authorizes the Company to repurchase up to $1 bln of its common stock)
- ESRX +1.6% (continued strength after California approved CI / ESRX merger; also the cos disclosed that NY determined that a previously noticed hearing in that State was not required and issued its approval of the transaction)
- SGMS +1.5% (reaches settlement in litigation with Shuffle Tech International)
- WM +0.7% (to increase quarterly dividend rate for 2019 to $0.5125 per share from $0.465 per share; authorizes new repurchase plan of $1.5 billion)
Analyst comments:
- REGN +0.8% (upgraded to Buy and added to Conviction Buy list at Goldman)
Crypto suffers a black eye after a buzzy $130 million project crumbles
The failure of Basis is a reminder of why some Silicon Valley investors shied away from the cryptocurrency industry in the first place.
The cryptocurrency industry has had a wild, peak-to-valley year. Case in point: The news today that Basis — one of Silicon Valley’s buzziest attempts to create an alternative to traditional currency — is shutting down.
Basis said it raised $133 million just this April from blue-chip venture capitalists like Andreessen Horowitz and Alphabet’s GV. That shocking amount of dough was meant to build a “stablecoin” — or a currency that would be insulated from inflation — and to try and prevent the price sensitivity that has bedeviled other cryptocurrencies.
But Basis felt the project would really only work if its tokens, or what Basis created to adjust the supply of its stablecoin and therefore keep its value relatively stable, wouldn’t be subject to U.S. securities laws. Regulators have been trying to assess whether to apply standard laws that govern things like stocks to digital assets like coins — and Basis said it was reading the tea leaves and predicting a crackdown.
“Unfortunately, having to apply US securities regulation to the system had a serious negative impact on our ability to launch Basis,” its CEO Nader Al-Naji wrote Thursday.
But at a bigger-picture level, this is a black eye for the entire cryptocurrency industry. As the amount of money it raised makes clear, Basis was seen as being at the vanguard of the cryptocurrency revolution. And while the company says it is returning the money it raised to its investors, it’s nevertheless a very public stumble for its prestigious backers.
Of course, crypto investing — just like startup investing — produces lots of failures. That’s normal. But this particular failure also is a reminder why some Silicon Valley investors shied away from investing in crypto projects such as initial coin offerings in the first place: The regulatory landscape is just too uncertain to be able to predict much of anything.
Whiskies du Monde brings in IDIA Capital Investissement as investor
14 DEC 2018
IDIA Capital Investissement, the private equity arm of listed French banking group Credit Agricole [EPA:ACA], announced on 10 December the acquisition of an undisclosed stake in the premium spirits distributor Whiskies du Monde. The French-language item noted that the founder's children Florence and Arnaud Pontoizeau retain a majority stake.
Located in Merignac, France, Whiskies du Monde turned over EUR 16.5m in the year ending June 2018, according to its annual accounts.
The investor was advised by ACA Nexia and Viguie Schmidt & Associes. Deloitte and Taj acted as advisors for the company.
Bitcoin Wasn’t a Bubble Until It Was
Even after it soared a million percent, cryptocurrency boosters denied it was a bubble—and they weren’t wrong.
When Lambo?
It was around the peak of bitcoin’s value a year ago at just below $20,000 that this obnoxious question entered the Urban Dictionary: How long would it take to amass enough cryptowealth to buy a Lamborghini? Now, those bitcoin owners still holding on for dear life after an 82% decline are putting on a brave face, but there is no more denying that we have witnessed the popping of a classic bubble.
Some believers in blockchain’s vast potential agree and rue the gold-rush mentality. Others are in denial, characterizing the current rout as just another bump in the road for a transformative technology. They point to multiple parabolic peaks and valleys over the years and actually have—or rather had—a point.
A speculative craze isn’t defined by its frequency or even its amplitude, which makes defining a bubble tricky. When bitcoin had appreciated by more than 1 million percent, an expert in manias said it didn’t meet his criteria for a bubble. Months later, bitcoin finally ticked nearly all of his boxes.
Harvard University lecturer Vikram Mansharamani, author of “Boombustology: Spotting Financial Bubbles Before They Burst,” put his money where his mouth was.
In March 2017, when he was hearing that bitcoin was a mania, he disagreed and bought some for around $1,000 each. By last December, when bitcoin was racing toward $20,000, he sold “enough to pocket a very handsome return.”
What changed? Mr. Mansharamani has several bubble criteria. One missing ingredient at first was widespread participation. Technical hurdles for buying cryptocurrencies are higher than for tech stocks, houses or tulips, but there arguably were still many potential converts on the sidelines in early 2017.
That changed late in the year. Media mentions and Google searches reached a crescendo that almost exactly mirrored bitcoin’s peak. Mr. Mansharamani relies on another classic, if clichéd, litmus test: “When taxi cab drivers start asking about it, then you know it’s a bubble.”
The use of leverage is another of his telltale signs. Stories of people selling all of their possessions to invest in cryptocurrencies or buying with credit cards cropped up around the peak. Futures contracts, a traditional way to make a bet with even more bang for the buck, also took off. In fact, researchers from the San Francisco Federal Reserve believe it is no coincidence that bitcoin, which soared ahead of the launch of futures trading, peaked the day the Chicago Mercantile Exchange listed contracts on it. Futures finally gave skeptics a way to bet on its decline.
“Reflexivity,” the term financier George Soros uses for prices going up simply because they are going up without an anchor in objective reality, is another of Mr. Mansharamani’s bubble indicators. By late 2017, credulous investors were willing to buy cryptorelated investments that weren’t even pretending to be a store of value.
On the day after bitcoin peaked, The Wall Street Journal published a story about the sale of a digital token described by the people selling it as having “no purpose.” The venture, which eventually raised $4 billion, was reminiscent of the offering for “a company for carrying out an undertaking of great advantage, but nobody to know what it is” that appeared during Britain’s South Sea Bubble of 1720, one of the earliest financial manias.
Similar to the tech bubble, financially marginal companies could multiply their value through cryptocurrency association. Take Long Island Iced Tea Corp. The money-losing firm’s shares briefly surged by nearly 300% after it changed its name to Long Blockchain Corp. at the height of the frenzy last December.
Buyers of bitcoin near the top weren’t just overconfident—a hallmark of bubbles—but were dismissive of skeptics as Luddites who just didn’t get it. Bulls said the same thing in 1999 during the tech boom. The bitcoin bubble, following the housing bubble and the tech bubble, is the third in less than 20 years. Clearly, bursting bubbles don’t inoculate us against falling for another one.
Yet skeptics basking in bitcoinfreude shouldn’t forget that early froth doesn’t necessarily mean an asset is flawed. The infamous “Amazon $400” call 20 years ago—it eventually rose an additional 30-fold adjusting for stock splits—would have heralded a fantastic investment. Amazon.com really did become “the everything store” and the internet really did transform our lives despite the stock market losses in the tech bust.
Even so, the odds that someone will buy a Lamborghini with their bitcoin profits now are awfully slim.