*GENERAL ELECTRIC REAFFIRMS FORECAST
Schlumberger to buy controlling stake in Eurasia
Renewed attempt follows a thwarted 2015 offer for Russia’s biggest oil and gas exploration company
US oil services provider Schlumberger has agreed to buy a 51 per cent stake in Russia’s Eurasia Drilling Company in a renewed attempt to take control of the country’s biggest oil and gas exploration company.
Schlumberger made a bid for the Russian company in 2015 but the deal came unstuck after Moscow’s Federal Antimonopoly Service delayed approvals, amid concerns over allowing foreign ownership of an important asset in the country’s hydrocarbon industry.
The financial terms of the agreement were not disclosed, but Schlumberger’s 2015 bid valued a 45.7 per cent stake in Eurasia Drilling at about $1.7bn. That deal also included a clause that would have allowed the US company to take full control after three years.
The renewed attempt is an endorsement of the continued expansion of Russia’s oil and gas industry despite the impact of three years of western sanctions.
While a proposal to broaden and deepen the scope of US sanctions against Russia is being debated in Congress, the existing measures have had a limited impact in checking the growth of domestic majors such as Rosneft and Gazprom, while restricting the activity of US majors such as ExxonMobil in the country.
The US company, the world’s largest oilfield services provider, said in a statement late on Thursday that its bid would also be subject to antitrust approval.
The agreement comes after a consortium of Russian, Chinese and Middle Eastern funds said last month they would acquire an undisclosed stake in Eurasia Drilling. Work on that investment is ongoing, Eurasia Drilling said.
“I warmly welcome Schlumberger as our majority shareholder. It builds on our strategic alliance with Schlumberger since 2011 and our mutually beneficial business relationship since 2007,” said Eurasia chief executiveAlexander Djaparidze.
“The combination of the technology know-how and operational expertise of Schlumberger coupled to the financial strength of the investment funds, brings significant benefits to our customers and the Russian conventional land drilling market.”
Eurasia Drilling, Russia’s largest services company by metres drilled, operates more than 650 offshore and onshore rigs, and boasts four of the five rigs operating in the Caspian Sea, the company says.
While parts of Russia’s oil and gas industry are subject to US and EU sanctions imposed after the country’s annexation of Crimea in 2014, many western oil and gas firms have recently begun to expand their activities in the country by focusing on areas where the restrictions are not applied.
Sanctions restrict companies from providing goods, services or technology to Russian deepwater, Arctic offshore or shale projects. State-controlled Gazprom Neft, Russia’s third-largest oil producer, said earlier this year it was searching for western oil servicing companies to assist with its projects.
European companies such as Repsol, Eni and Shell have all announced projects in Russia in areas not covered by sanctions. But investments by US companies have been noticeably more muted than their EU counterparts since 2014.
Yesterday, Exxon said it had sued the US Treasury in an attempt to stop a $2m fine for allegations it behaved with “reckless disregard” in violating Russian sanctions while Rex Tillerson, now US secretary of state, was chief executive in 2014.
German politicians, industry agree on diesel rescue plan: sources
BERLIN (Reuters) - Auto industry officials and politicians in Germany have agreed to clean up diesel vehicles through software updates as part of a rescue plan for avoiding diesel bans in cities, industry and government sources said on Friday.
The costs of the rescue plan amount to under 2 billion ($2.33 billion) euros for cars in Germany, with the auto industry agreeing to shoulder the expense of about 100 euros per car, the sources said.
Diesel engined cars from all brands equipped with Euro-6 and Euro-5 engines will be updated, the sources said, with the plan set to be presented at the beginning of August.
With the software updates, the auto industry is able to cut nitrogen oxide pollution by about 20 percent, the sources said. A committee to reduce pollution in communities will be set up.
Auto industry executives and German Transport Minister Alexander Dobrindt are due to discuss diesel pollution at a summit on August 2.
BERLIN (Reuters) - U.S. allies in eastern Europe and Ukraine are worried that Russia's planned war games in September could be a "Trojan horse" aimed at leaving behind military equipment brought into Belarus, the U.S. Army's top general in Europe said on Thursday.
Russia has sought to reassure NATO that the military exercises will respect international limits on size, but NATO and U.S. official remain wary about their scale and scope.
U.S. Army Lieutenant General Ben Hodges, who heads U.S. Army forces in Europe, told Reuters in an interview that allied officials would keep a close eye on military equipment brought in to Belarus for the Zapad 2017 exercise, and whether it was removed later.
"People are worried, this is a Trojan horse. They say, 'We're just doing an exercise,' and then all of a sudden they've moved all these people and capabilities somewhere," he said.
Hodges said he had no indications that Russia had any such plans, but said greater openness by Moscow about the extent of its war games would help reassure countries in eastern Europe.
NATO allies are nervous because previous large-scale Russian exercises employed special forces training, longer-range missiles and unmanned aerial vehicles.
Such tactics were later used in Russia's annexation of Crimea in 2014, its support for separatists in eastern Ukraine and in its intervention in Syria, NATO diplomats say.
Hodges said the United States and its allies had been very open about a number of military exercises taking place across eastern Europe this summer involving up to 40,000 troops, but it remained unclear if Moscow would adhere to a Cold War-era treaty known as the Vienna document, which requires observers for large-scale exercises involving more than 13,000 troops.
Some NATO allies believe the Russian exercise could number more than 100,000 troops and involve nuclear weapons training, the biggest such exercise since 2013.
Russia has said it would invite observers if the exercise exceeded 13,000 forces.
Hodges said NATO would maintain normal rotations during the Russian war game, while carrying out previously scheduled exercises in Sweden, Poland and Ukraine.
The only additional action planned during that period was a six-week deployment of three companies of 120 paratroopers each to Estonia, Latvia and Lithuania for "low-level" exercises, Hodges said.
"We want to avoid anything that looks like a provocation. This is not going to be the 'Sharks' and the 'Jets' out on the streets," Hodges said in a reference to the gang fights shown in the 1961 film "West Side Story" set in New York City.
Our London Correspondent Nick Ayton, the ‘Sage of Shoreditch,’ has been speaking to the Bitcoin core community about the politics and power struggles that will impact SegWit decision-making.
What happens to Bitcoin holders in the weeks ahead? What will be the consequences of SegWit for the user community and what does it mean to Bitcoin as a cryptocurrency and the role of miners? Is the economic model for Bitcoin being forced to change as the investment in POW infrastructure remains significant and where are the rewards declining?
Is SegWit really about control?
This article is not intended to go into the technical of SegWit (for more information see SegWit explained). Suffice to say the big topic since Bitcoin’s increase in popularity is the underlying performance of the network, or is this nothing more than a smoke screen to that masks an inevitable power struggle as the few that hold the old values of centralisation want to control it.
Having spoken to the community, read their blogs and posts and sat in forums, from what I can make out, SegWit is a battle of wills.
It’s a fight between the independent purists that don’t want change and want to keep the network closely aligned to the original Satoshi vision, versus the move by the enterprise thinking that is looking to concentrate power (hashing power) and force decisions to improve the economic model.
SegWit is a battle that will not only challenge the very ethos of Bitcoin from the founding Nakamoto roots but may ultimately split the community into several parts.
Will SegWit make Bitcoin more vulnerable?
Against a backdrop of a huge increase in volumes and drop off in transaction processing times it will come as no surprise to learn that for an intelligent, opinionated and evangelical network of Bitcoin market participants will never agree on the future direction Bitcoin. Many were unhappy with the NYC agreement, while other hold strong views and want to stay close to the original 2008 Satoshi script.
Some including Dr. Craig Wright, believe SegWit will open the door to manipulation by mining cartels.
Let us also not forget the network remains vulnerable to 51 percent attack and is designed to make sure the economic incentives do not deliver the returns to make it worthwhile.
Craig Wright who claims to be the founding father is not alone in believing SegWit opens the door for cartels to manipulate the network using an “AnyOneCanSpend” address essentially leaving the signature (witness) blank relying on all miners to play nicely and not steal funds. He claims that self-interest will eventually override social cooperation as the network grows and the amount of larger transactions increases , and that new mining pools could come in at essentially a discount with illicit intentions.
Dark side
But is there a darker side to this story as alleged co founder Alexandre Cazes of AlphaBay is found dead in a Bangkok jail, and law enforcement agencies cracking down on similar sites that use the TOR Darkweb network? However, the most significant impact is the large volume of BTC transactions have simply disappeared.
This is the main reason why the purists want to take a different path and why they feel the entire Libertarian concept behind the Bitcoin network is being highjacked. And they may have a point…
The enemy within
But then nothing in the world of Bitcoin throughout its short history has ever been straightforward or simple. For many people who use and hold Bitcoin, they may not realize the network is constantly under attack and the core developer community have to keep coming up with new ideas and ways to protect the integrity of Bitcoin and police its use.
Although the biggest attacks appear to come from the enemy within.
The politics of the miner community, in particular, is hard to fathom but also plays a significant part in the SegWit story.
For a long time concerns have been raised about the concentration in hashing power centered on the larger mining pools where the economic investment from the corporate world many believe has already distorted Bitcoin from its original path.
And it is clear SegWit will add to the debate and increase concerns for many involved driving their decisions and Bitcoin in new directions.
Government manipulation
Others sense the hand of government manipulation that hide off grid also using the dark shadows of TOR, who have in recent months attempted to discredit Bitcoin and blame the community for WannaCry outbreak, which started as a US government Windows-hacking program.
There are many communities and dare I say factions emerging within the community that breaks down into many different groups listed below that highlights some of the different forces that are at play Source CoinDance…
Although the detail of ownership is missing one has to remember the fundamental ethos of Bitcoin is that you get trust. This is because there is no trust of network participants as each has very separately economic alignment and why BGP was built into the protocol to prevent collusion and distortion. SegWit takes this away.
Bitcoin Core equates to 78 percent of the network (6740 nodes)
Bitcoin Unlimited 15 percent (918 nodes)
Bitcoin UASF 5.5 percent (474 nodes)
Bitcore 1.5 percent (134 nodes)
Bitcoin Classic 1.5 percent (128 nodes)
Bitcoin Knots 0.6 percent (58 nodes)
Bitcoin ABC 0.65 percent (54 nodes)
Bitcoin XT 0.36 percent (31 nodes)
Btcd 0.23 percent (26 nodes)
Bcoin 0.23 percent (20 nodes)
TRB 0.1 percent (9 nodes)
Libbitcoin 0.07 percent (6 nodes)
Could we end up with multi Bitcoin Wallets?
It very much looks like we will have to get used to multiple Bitcoin wallets each supporting different features, different Bitcoin networks where the processing of transactions will be handled differently.
Depending on what wallets you have today – lightweight, web wallet or full node these changes will impact you the User. And its seems you do have to upgrade.
But of course what we all really want to know is what happens to the value of our Bitcoin (BTC) - will it go up or down, or is there a chance we could lose it all?
Or will we end up owning different types of BTC when Bitcoin is forced to hard fork similar to Ether and Ethereum Classic?
Concerns
But SegWit is a soft fork so in the short term this remains unlikely but forces are at work where this may be inevitable. Many will go UAHF anyway.
There are so many questions - How will transactions be processed, will they be quicker? Will transaction costs increase?
In the SegWit transition period will transactions fall through the gaps and be lost, rejected or end up on a long backlog list?
Stirring the pot
And while these questions are looking for an answer the Bitcoin haters led by the VC community and other dark forces continue to ‘stir the pot’ and put the boot in creating additional and unnecessary market concerns that have contributed to BTC price drop in recent weeks.
The stories of impending doom have forced profit taking and for many amateur BTC investors have spooked them to a point where they have got out completely.
So what is going on behind the scenes in the Bitcoin community in relation to SegWit?
Hashrate concerns
The first thing to consider is how the SegWit decision will be made. Should the miners agree to get behind SegWit, it will require 95 percent of the networks Hashrate to push it through. Yes, you read it right, 95 percent of the Hashrate to ‘lock in’ SegWit as essentially the network upgrade.
That doesn’t mean 95 percent of individual Nodes and Miners but the concentration of Hashing Power- that supports the concern by some in the community of an enterprise led takeover…
And then the Full Nodes run by users and business need to adopt it to be upgraded to Bitcoin core v0.13.1 and why the soft fork is designed to allow community users to decide whether they want to adopt SegWit voluntarily.
And there you have it – consensus decision making. But is it really a consensus or will a handful of votes just be the deciding factor.
But at the end of the day does any of this matter?
Real issues
Isn’t the important thing here the underlying performance of the Bitcoin network and its integrity remains true and honest to ensure its future, to maintain the core principles of Bitcoin as the ‘peoples network’?
Or is it about speed and performance and low transaction fees? And of course, its price continues to rise as the scarcity model enters the last stretch of new Bitcoins being mined.
Or is the real issue that you cannot have both worlds coexisting, a stable true Bitcoin network true to its origins and a scalable payment network where the economics of investing in infrastructure have to be adjusted to make it viable?
It is worth remembering SegWit started a year ago in July 2016 and by November 2016 didn’t achieve ‘lock in’ and the same thing may happen again.
And in between Bitcoin Unlimited tried to gain support and failed.
But it is unlikely SegWit to continue past August where the likely outcome appears Bitcoin will be going in several directions all at once, or will it. And then there is SegWit2…
Impact on users
Should SegWit be adopted? What will be the impact on users, requiring a wallet that supports sending and receiving SegWit payments supporting a new SegWit address that starts with a ‘3’ (known as a P2SH address) that some wallets today already support?
SegWit transactions should happen quicker. You will probably end up paying lower transactions fees, alongside the current (non SegWit) Bitcoin because the part of the transaction that contains your signature (the “witness”) doesn’t need to be accessed by the Bitcoin network immediately, effectively batching and aligning the costs in terms of transaction fees to create the block.
If you want to stay with the non-SegWit wallet, it should still be able to transact with the users that have upgraded but then to be sure you should upgrade even though you want to stay traditional? Differences will mean it is likely the transaction may not appear until after it has been mined. So don’t hold your breath.
The Miners’ favorite
The Mining pools have their favorites. SegWit2x (intention), SegWit (BIP141) are leading contenders and so the complexity and importance of the decision remains less than straightforward given most Miners also don’t just mine Bitcoin. They strategically want to be best placed to commercially benefit from POW investment in infrastructure as the rewards reduce over time.
So where will it all end? As some in the Bitcoin community suggest, we could at least see four Bitcoin networks or even five, and then there are overlays such as Lightning…
Ultimately the bigger chains win the day and wallets will support as they do now different payment options where the user will decide the fate of their transaction, traditional and/or 10-minute block refresh, that may adjust as the remaining network re-sizes.
Keep calm
Bitcoin isn’t going anywhere and SegWit no matter what your opinion, is after all a ‘soft fork.’ However, there are forces at work that may be trying to move Bitcoin from its core principles as the People’s Network, the Internet of Money, trusted, fair and transparent to a darker place.
It is inevitable the old thinking of greed and fear will try to turn Bitcoin into a mechanism for a few to make money. For me, as a Libertarian, this is my main concern and must never be allowed as we will be back to square one.
As Fractional Reserve Banking implodes and central banks continue to print too much money and countries like Japan with -245 percent GDP to debt will never catch up, Bitcoin is the future and may be the only financial system that works as the next crisis emerges from the US once again.
It is likely price volatility will increase as we await the outcome of SegWit and for Bitcoin users, there will be some adjustment required as different wallets are needed for different purposes. But your BTC remains safe for the time being and price should start to move in the right direction through August.
The transition period will be tricky. Traditionalists are intent on standing their ground behind the current network, and where the enterprise movement will favour the economics of SegWit, albeit they may have sensible intentions may open the door to collusions, further concentration of power and new cartels entering the network the result of which is sure to create a Hard Fork event…
Stand by your beds. The story of Bitcoin is going to get more interesting, more dramatic and why we are making a mini series about it called “21Million” as this story has to be told…
Superstar DJ David Guetta on how he built his hedonistic brand
Over sea bass in Ibiza, the EDM legend explains how making money was his rebellion against his leftwing intellectual family
The rogue scion of a leftwing intellectual Parisian family sits opposite me at a wooden table under a canopy on a whitewashed terrace. Blue sea and yachts are to his right, to his left is an equally blue swimming pool ringed by buff young people in afternoon repose. Behind him, on the opposite side of the bay, is Ibiza Town, shimmering in the cloudless heat. “I love being here,” says a smiling David Guetta.
The Frenchman is in his natural habitat. As one of the world’s most successful DJs, Guetta spends his summers on the Spanish Balearic island renowned for its unbridled nightlife. Each week he plays a pair of club nights, or “parties”, as he calls them, at two prominent Ibizan clubs, Pacha and Ushuaïa. With tourism to the island booming — 2016 saw a record-breaking 7.1m visitors — he began this year’s DJ-ing duties in June, a month before the season usually gets under way.
“I was a little bit scared, you know,” he says. “Because it [Ushuaïa] is a big place and the island was not supposed to be full yet. But it was packed. Insane.”
Our lunch is at Destino, a chic resort owned by Pacha. Guetta first appeared at the club in 1996 (“It is like family”). His residency is called, with characteristic delicacy, “F*** Me I’m Famous”, a perfect inscription for the age of the superstar DJ. Guetta and his fellow dance-music titans — they are almost all men — are like rock stars used to be in the 1970s, leading a lifestyle of private jets, adoration, egotism and vast wealth.
Over the past decade Guetta’s fame has gone global. His brash anthems, a kind of hyper-disco, reverberate around the world’s pleasure zones, from Las Vegas to Phuket. Like a fallen Pilgrim Father, he helped trigger the US’s conversion to the promised land of dance music in the 2000s. He has conquered the charts with dance-pop hits featuring some of pop’s biggest names, including Rihanna, Nicki Minaj, Usher and Sia. He has his own record label, Jack Back Records, and divides his time between Los Angeles, Miami and London as well as an Ibiza mansion. A chartered jet awaits him at the airport, ready to take him to club nights and summer festivals around Europe. Last year Forbes estimated his annual earnings at $28m.
Today Guetta, 49, is wearing Ray-Ban sunglasses and a white T-shirt. His usual long hair has been cut short and he has a beard, gingerish with flecks of grey. It is 3.30pm. “In Ibiza everything is late,” he says. Without looking at the menu, he orders grilled chicken, steamed vegetables and rice, with water to drink, the health-conscious choice of a trim middle-aged man determined to maintain his trimness. (“In Love with Myself” comes to mind, one of the tracks from his impeccably named 2004 album Guetta Blaster.) However, he changes his mind when I muse about the fish. Guetta picks the sea bass, which the waitress glosses in English as “more clean” than the alternative, John Dory, which I choose.
“This is the only time of the year when I’m a little social,” Guetta says. He speaks in English, with a trace of an American accent. “People imagine that we [DJs] just party. But the reality is very different. You go from the hotel to the stage, there’s a security corridor to get you on stage, and then you go back to the hotel. So when I’m in Ibiza I invite all my friends. I have a house here, I go out to listen to other DJs. We hang out together, which we don’t normally. So it’s a nice time of year.”
The waitress returns with glasses filled with ice for water. Guetta does not want the ice cube in his and throws it out of the glass towards the sea in a violent motion. It bounces off a post back on to the floor. I point out the potential health-and-safety hazard. He gets up and kicks it out the way. “I don’t want you to break a leg,” he tells the waitress.
If Ibiza is Guetta’s natural habitat then the US is his adopted home. Although techno and house music are American inventions, formed in cities such as Detroit and Chicago, the nation lagged behind the rest of the world in opening itself up to dance music. That changed almost a decade ago with its rebranding as “electronic dance music”, or EDM. Guetta was its flag-bearer.
In 2009 he was asked by The Black Eyed Peas’ leader William “will.i.am” Adams to produce the Californian hip-hop group’s song “I Gotta Feeling”. The result united high-tempo Eurodance with US pop-rap, an irresistibly catchy act of hybridisation. It became one of the best-selling singles in chart history. Guetta recalls the music mogul Jimmy Iovine saying to him: “Look, David, this record is going to change the world. This is the new format of pop music from now on.”
So it proved. Guetta’s One Love album, also released in 2009, brought him a series of hits under his own name, including “Sexy Bitch”, featuring the R&B singer Akon, which was given the marginally less offensive title of “Sexy Chick” for the “clean” radio version.
“That moment in 2009 something really unique happened. And it happened, I would say, from 2009 to 2016. There was a moment when the music in the United States and Europe was the same. This never happens. Maybe at the time of The Beatles, you know, but it’s very rare,” he says.
Guetta detects a change today. “Music is back to very hip-hop in the US and pop and dance here,” he says. But the EDM genie cannot be returned to its jar. The Frenchman remains a frequent star at mega-raves in Miami and Las Vegas, appearing on immense podiums surrounded by fireworks and manic lighting shouting “I have come to party with you!” to thousands of revellers like a disco Olympian. “It’s huge. It’s an industry now,” he says. Although growth slowed last year, the EDM market still reached $7.1bn.
Guetta himself has slipped slightly down the Forbes annual earnings list and believes it is time to adapt. “Because it’s the end of a cycle, with death there is every possibility. There is like an empty space that needs to be filled,” he says. In September he will fly to LA to work on his seventh album. It will include his latest hit, “2U”, which features Justin Bieber, formerly derided as a teen-pop brat, now lauded as a credible A-lister. “He got a lot of shit for his career for a bit, which I guess comes with success for anyone. And then when you stay, people are like — OK!” He gives a Gallic shrug and reaches for an olive from a bowl.
Guetta has his own haters. He has been lambasted as a purveyor of trashy, vulgar songs for the masses, crude in execution and outlook. His fellow EDM superstar Deadmau5 called him “a shitty overpaid DJ” in 2015 when Guetta rode into Pacha on a horse to open his F*** Me I’m Famous night. The video to his 2014 single “Dangerous” is a fantasy in which the fast-car-loving Guetta wins a Formula One race, aided by a team of female mechanics in impracticably scanty unitards. “In a club nothing really matters,” runs a robotically intoned lyric in one of his tracks. To Guetta’s detractors, the sentiment sums up his vacuity.
“I never felt like I was a sellout because I have always made the music I love. I was just trying to make it for a broader audience. There was a moment in my career when I wasn’t sure because there was so much pressure and I was doubting a little bit, so I would still play those underground parties,” he says, referring to his transformation into an EDM icon. “But the minute I said, ‘Look, this is who I am, this is what my heart feels like, this is what I want to do with my life and people are happy — what is the problem?’ From that day I never heard those criticisms.”
I ask whether he regrets the chauvinistic sentiments of “Sexy Bitch”, which he wrote in Atlanta with Akon, who came up with the title and lyrics.
“No, actually. It was super-funny,” Guetta replies. “At the time I was married, very much of a good boy, and he was like, ‘You don’t understand anything about women, my friend. You have to understand that this is going to make the girls so horny, a song like this.’ ‘No,’ I said, ‘they’re going to feel insulted.’ But from the time I released this record it was so crazy, girls would throw me underwear. He was right!” He laughs. “It was insane! This was like a late lesson about woman’s psychology.”
As he talks, his body pulses to the sound of the background tunes. He projects the self-confidence of one who spends a good portion of his life standing above thousands of people with their hands in the air and rapture on their faces. “I’m trying to do something timeless,” he says of his music. “People always want to listen to something new, but at the same time emotions are always the same. There’s not a new emotion that is going to come out, because we are human beings.”
Our food arrives, fish and vegetables with bowls of rice. Guetta forks some rice into his mouth before piling it on his plate. He has two chunky rings on the fingers of one hand, rock-star jewellery.
His DJ-ing epiphany arrived in 1988 when he visited the London club Shoom at the height of acid house, where the DJ Danny Rampling stood under banks of lights, the star of the show, not an anonymous record-selector in the darkness. “That changed my life completely,” Guetta remembers. He returned to Paris, where, with his wife Cathy as business partner, he created a mini-empire of nightspots, including two restaurants and a burlesque bar. Guetta recalls that this time “was amazing as a social experience but business-wise, oh my God, it’s one of the hardest businesses to make profitable. You have to really count everything and I’m not like this at all.”
The venues are gone but his entrepreneurialism continues. After making “I Gotta Feeling”, his meeting with Iovine led to a link-up with the mogul’s Beats Electronics range of headphones. At Ibiza airport, advertisements show him sporting a timepiece by the luxury watchmaker TAG Heuer. One of their watches sits in chunky splendour on his wrist at Destino. “The first time I did endorsements, my whole community was so shocked. It was like, ‘Oh my god, how could you do this? It’s terrible.’ But now it’s standard. Every DJ is doing this. It’s actually a sign of being successful.”
He began wanting to be a DJ at the age of 12. “It’s so crazy because there was no famous DJ at the time. There was no glamour, there was no money, there was nothing like that.” He chomps a crunchy vegetable. “Mmm. I was just obsessed with music and I was very into the technical aspect of creating it. I don’t even understand it myself because my family were not musicians or anything.”
His Belgian mother Monique worked as a psychologist while his Moroccan Jewish father Pierre was a sociologist, specialising in the world of work. “Both of my parents are intellectuals and intellectuals always have a completely wrong understanding of real life,” he says cheerfully between mouthfuls.
When he was seven, his father decided to seek a more relaxed life by opening a traditional French restaurant. “But of course it was way harder,” Guetta says with a chuckle, “even though the restaurant was very small. He had no idea what he was getting into. It was actually a very fascinating place. My father would go around reciting the food poems of Baudelaire.”
The contents on his plate are moved around robustly, the fork chopping down on the sea bass in a no-nonsense manner. “My mum thought that everything I was doing was very stupid,” he says. “She was a communist so she felt like all this superficial life and chasing materialistic dreams were a waste of my time.”
Were there arguments? “Oh yeah, at the time, of course,” he replies, clenching his fist at the memory. And now? “Hmm, I think she’s proud of my success. She still feels the same about society. We would fight like crazy when I was young. I was like, ‘I’m going to be rebellious, I’m going to make money.’ ” He chuckles again. “That was me being a rebel to my parents. Isn’t that funny? My mum was almost disgusted that I was so business-oriented.”
In the 2000s he decided to sell the restaurants and burlesque bar and concentrate on music. “My mum was like, ‘I’m so proud of you, you’re finally going to be an artist.’ Like, who says this?! It’s completely crazy!”
His plate is emptied before mine. A pair of women take a selfie behind him, either to get a view of the superstar DJ’s head or the John Dory-munching features of the FT’s pop critic. The former seems more likely.
Our plates are removed. Guetta waives dessert but I suggest I might have one. “Of course! But why not?” he replies expansively. He orders a black tea. A mobile phone materialises in his hand while I inspect the menu and is placed on the table when I choose ice cream and coffee.
In November he will turn 50, a landmark about which he professes unconcern. “I come to party with the people, that’s my thing. This is why I’m actually not tripping on my age. The people who are in front of me, they are always the same age since I started. Always in their twenties. I feel like I’m the same. My energy and passion are the same. So, OK, it’s a little crazy, sometimes I’m with friends who are 25 and they laugh at me and say, ‘Man, you know you’re double our age.’ ”
In 2014 he split from Cathy, his wife of 22 years. In an acrimonious case that generated much media coverage, she claimed half of his reported $30m fortune. (“Very hard because of course it was also having a direct impact on my children.”)
His current partner is the Cuban model Jessica Ledon, 24, with whom he was recently snapped by paparazzi “sharing a steamy kiss” (in tabloid-speak) on a beach. “Of course I don’t like it, having pictures taken when I don’t look good,” he says, laughing.
Escapism is the Frenchman’s stock-in-trade. But a final question about the troubled world beyond the Ibizan bubble — terrorism in other countries is a reason for the island’s booming tourism — elicits something of a Guetta remix of liberté, egalité, fraternité.
“I was never into politics but my choices when it comes to life and music were always to bring people together,” he says.
“I’m not especially VIP — I mean, I have money and I live this life, but I like mixing with everyone, so to me this is already the best possible answer. For me the fact that we are all together dancing on the same beat, people are coming from every different country in the world to Ibiza: this is already the best possible answer to everything that is happening.”
The dance floor as utopia — his mother would approve. “Absolutely!” he says brightly.
Unilever ‘set to abandon dual listing’
Board supports change, says leading investor
One of the biggest shareholders in Unilever has said that he expects the giant consumer group to set out plans for a single unified company by the end of the year.
In what could be the most significant move for the Anglo-Dutch maker of Dove soap in a decade, the investor said he understood that Unilever’s board wanted to end the dual-listed structure so that it could become a simpler and more agile company.
The top ten shareholder told The Times: “I understand that a unified structure is the goal of the board, which is supported by shareholders.”
He said that Unilever last reviewed its dual status a decade ago and that the current convoluted ownership, in which the group has two legally separate parent companies in Britain and in the Netherlands, was not appropriate in a highly competitive consumer goods environment.
However, Paul Polman, the chief executive, said yesterday that the board and a team of experts were still assessing whether its dual structure could, or should, be changed. He said it was a very complicated process and that no decision had been taken. Mr Polman said that the board was likely to reveal the outcome of the review by the end of the year when the group is also expected to announce a possible sale or spin-off of its spreads divisions.
Mr Polman was speaking as Unilever reported a solid first-half performance. Its underlying sales rose 3 per cent, which it said was ahead of the market. However, the uplift was a result of higher prices as Unilever’s volumes were flat.
The big talking point for shareholders, though, was the bigger-than-expected increase in the group’s operating margin which rose by 1.8 percentage points as Unilever cut costs faster. About €1 billion has been cut and the group is targeting €6 billion over the next three years, a substantial proportion of which will be reinvested in the business.
Mr Polman, who recently defended the company against an opportunistic £115 billion takeover bid by Kraft Heinz, said that Unilever was constantly trying to create strong innovations globally alongside “more relevant, local innovations”.
This need for agile innovation in a competitive market is the key reason why many shareholders have been calling for Unilever to simplify its business and shareholder structure.
A simpler company with a single class of shares could make it easier for Unilever, which makes products ranging from Knorr seasonings to Magnum ice cream lollies, to restructure its business and use its stock, which has been at record highs since the failed takeover attempt in February, to carry out large-scale transformative acquisitions.
Mr Polman said yesterday that some options for its margarine spread unit, such as a possible spin-off, could potentially be easier to carry out if the company had a single structure.
*FOSUN TO BID FOR REST OF PAREF AT EU73 A SHARE
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Investors turn from US to European stocks
Fund flows into continental equities highest since Macron victory in France
Flows into European stocks surged to their highest level since Emmanuel Macron clinched victory in French elections in May, providing further ammunition to continental equities as interest in US stocks fades.
Investors added more than $3bn to dedicated European equity funds in the week to July 19, lifting inflows for the year to more than $26bn, according to data provider EPFR.
With the backdrop of a quickening economic recovery — providing central bank policymakers an opening to debate when to reduce stimulus measures — sectors typically tied to faster growth have regained an edge in Europe. Shares of banks and basic resources companies on the pan-European Stoxx 600 have outperformed healthcare and utility groups since the start of July.
The acceleration of inflows to the asset class follows a torrid 2016, when investors withdrew more than $100bn from European stock funds as deflationary fears roiled markets and voters in Britain voted to leave the EU.
Brian Singer, head of dynamic allocation at William Blair, said that European markets were “attractive”, pointing to “benign” risks as the French election and other political challenges receded in the rear-view mirror.
The investor shifts preceded a closely scrutinised meeting of the European Central Bank on Thursday, where president Mario Draghi struck a dovish tone and said that the “last thing the governing council may want is an unwanted tightening of the financing conditions that . . . may even jeopardise [the recovery]”.
Mr Singer added: “The 800lb gorilla in markets is central banks . . . if you are influencing interest rates then you are influencing asset prices and the market cannot function efficiently with that in play. Our sense is that the 800lb gorilla is beginning to lose some weight.”
The additions to European stocks contrasted with the fifth straight week of redemptions from US equity funds. Investors withdrew $840m in the week to July 19, buoying outflows since late-June to nearly $20bn.
While benchmark stock indices in Germany, France and Spain have lagged behind the US S&P 500 index over the past month, some of the divergence owes to a resurgent euro. In dollar terms, the French CAC 40 and Spanish Ibex 35 are both ahead of the US market over the same timeframe, while the German Dax trails it by less than a tenth of a percentage point.
One corner of US stock markets still favoured by investors is the technology sector, which enjoyed two consecutive weeks of inflows for the first time in a month. Investors added $119m to the asset class last week, lifting inflows this year to $9.3bn. That has helped propel the S&P 500 tech sector to new highs this week, eclipsing a record set at the peak of the dotcom boom of the early 2000s.
As Washington continues to grapple with policy gridlock and many of the pro-growth policies President Donald Trump proposed remain stalled, investors were looking at stocks that could generate higher returns in those straightened circumstances, said Michael Arone, chief investment strategist at State Street Global Advisors.
“Investors are zeroed in on growth at a time when it is lacking,” he said. “And one of the few sectors able to generate it is tech.”
Power struggle at Guggenheim Partners rattles a Wall Street star
Battle between CEO and investment chief has alarmed clients and sparked departures
A power struggle has broken out between Guggenheim Partners’ two most prominent executives, sapping morale, alarming clients and contributing to the departure of several top managers, according to current and former employees of the $240bn asset manager and investment bank.
The battle pitting founder Mark Walter against chief investment officer Scott Minerd has erupted at an inopportune time for the secretive but historically successful Wall Street firm, coming after it has seen a rare drop in asset management fees, according to documents seen by the Financial Times.
At least 10 senior professionals have left Guggenheim in the past 15 months, including co-head of corporate credit Jeff Abrams, macro strategist Anne Mathias and chief financial officer Brad Olson. Amid the upheaval, the firm recently added a new president of investment management and a new head of strategy and planning.
Guggenheim saw its total return to its owners drop by four per cent last year, while its investment management division reported a five per cent year-on-year drop in revenue to $765m, according to a June 30 memo sent to investors — an aberration at a group whose assets under management have grown from just $35bn 10 years ago.
According to employees and clients, the tensions between Mr Walter, Guggenheim’s chief executive and a co-owner of the Los Angeles Dodgers baseball team, and Mr Minerd, who has been credited with turning a small investment manager into a Wall Street powerhouse, were exacerbated by recent changes in the firm’s institutional distribution group, which acts as intermediary between Guggenheim’s money managers and investors such as pension funds, insurers and investment consultants.
Those clients include Midland National Life Insurance and the pension funds for the New York City Police and state employees in South Carolina.
Mr Minerd has been frustrated by changes implemented by Alexandra Court, an ally of Mr Walter’s, since she was promoted in April 2016 to be global head of institutional distribution, according to eight current and former Guggenheim employees.
Mr Minerd “is frustrated with the choices and decisions of certain executives and their impact on the direction, culture and soul of the firm as it has grown,” according to a person close to him, who added that Mr Minerd would not provide comment to the FT.
Mr Walter, an Iowa native, co-founded privately held Guggenheim in 1999, combining his small Chicago investment firm with a family office that managed a portion of the Guggenheim fortune that traces back to 19th century lead and silver mines. Mr Minerd, a competitive bodybuilder who joined Guggenheim at the start, is the face of the business, appearing frequently on television and in print to discuss global economic and investing themes.
Within days of Ms Court’s appointment last year, 22 members of the US distribution team she took over were fired, saving about $10m in annual costs but angering several of Mr Minerd’s investment colleagues. The firm also changed the structure of the distribution team, sharply reducing the number of employees handling calls and requests from institutional clients.
Guggenheim’s money managers were barred from communicating directly with clients unless interactions were arranged through Ms Court’s sales team, according to a January 2017 memorandum sent to the investment team by Mr Walter and Andrew Rosenfield, a managing partner. The memo, seen by the FT, cited “a fundamental change” when Ms Court was appointed.
“Only Distribution has the authority to schedule meetings, to prospect and to manage client services,” the memo read. “Consistent with this, [portfolio managers] were instructed that they were, under no circumstances, themselves to set up prospecting meetings, to market funds or services, to schedule client meetings or to deal directly with clients at all unless authorised, in advance, by Distribution to do so.”
Although a spokesman for Guggenheim said Ms Court was selected by a group of company executives including Mr Minerd, the people close to Mr Minerd said she was selected only after two other internal candidates he preferred were passed over.
Mr Minerd and his team believe Ms Court was emboldened to implement changes due to a close relationship she had with Mr Walter, according to 11 current and former employees at Guggenheim. A spokesman for Guggenheim disputed this, saying she did not report directly or indirectly to Mr Walter and her restructuring was part of a strategy approved by the division’s entire leadership.
Mr Walter’s relationship with Ms Court was disclosed to the members of Guggenheim’s board, according to three executives.
The Guggenheim spokesman said: “There is no non-business relationship, but if there were it was fully and promptly disclosed to the appropriate parties at Guggenheim in accordance with established processes and procedures, which were then fully implemented, to avoid improper influence or favour.”
Mr Minerd’s allies said the investment chief is not interested in replacing Mr Walter as chief executive, but the upheaval inside the firm was leading him to question Mr Walter’s position.
The Guggenheim spokesman denied any split between Mr Walter and Mr Minerd, insisting recent tensions were “nothing more than the usual internal debate.” In an email the spokesman added: “If people perceive the interaction between the two of them as a power struggle, we believe that is an inaccurate portrayal.”
Ms Court has strongly defended her role at the firm, citing her prior record as London-based head of distribution in Europe where she successfully ran a much smaller team than Guggenheim had in the US, a streamlined model that her American team has now also pursued.
“The Institutional Distribution team services and maintains in excess of 800 clients and client retention has been close to (if not) 100 per cent since my appointment,” Ms Court said in an email.
Assets under management have grown by more than $20bn since her appointment, according to the company, and while Guggenheim reported a decline in revenues in its June memo to investors, it also said performance in the first half of 2017 led it to expect a return to growth in the full year.
Guggenheim employees own about 45 per cent of the company, according to its website. Sammons Enterprises, Guggenheim’s largest outside shareholder and a big investor in its funds, declined to comment.
However, Mr Minerd and several other senior Guggenheim portfolio managers believe the cuts to Ms Court’s US team are hampering the firm’s ability to raise new money from institutional investors, according to more than 10 current and former employees.
“We didn’t have an outlet to distribute investment capabilities,” said one current Guggenheim fund manager, pointing to the inability of portfolio managers to contact clients directly. “Clients have been negatively impacted.”
Two investment consultants, who recommend clients to Guggenheim, said they had seen a marked drop-off in responsiveness from the firm after Ms Court’s promotion and the subsequent upheaval.
“The turnover [of staff] is causing concerns about what else is going on over there. We are increasing our scepticism,” said one consultant, who asked not to be named because was not authorised to speak publicly about the matter.
Another said: “We used to have a dedicated person on our account before Alex Court joined. After that, there was only a single person to cover all their accounts. We had to find other people at Guggenheim outside [her] group to handle our requests.”
Ms Court has insisted that two members of her team are allocated to each account, ensuring timely responsiveness.
Mr Minerd’s team is unhappy with the new role for Ms Court’s distribution team, in part, because they believe the chief investment strategist is responsible for the group’s strong performance and should be treated as one of the leading figures on Wall Street.
“Bill Gross and Jeff Gundlach are Scott’s [Minerd] peers but those guys are actually running their firms. Scott’s frustration is not knowing where the firm is going,” another person close to Mr Minerd said.
Some Guggenheim staff members have also raised concerns about Ms Court’s lack of US securities licences. At most of Guggenheim’s direct competitors — such as Lazard, Voya, Barings, TWC and Janus Capital — the heads of distribution have a series 7 or series 24 certification issued by Wall Street’s self-regulatory body, Finra. These licenses, which are obtained by passing exams, are considered to be standard for professionals marketing financial products and supervising other sales executives, respectively.
The Guggenheim spokesman, Michael Sitrick, said the firm had sought a waiver from the licensing requirement from Finra when Ms Court moved from the UK, where she had similar Financial Conduct Authority licenses, but Finra denied the request in the middle of last year. Mr Sitrick added that at all times appropriately licensed professionals have overseen all of the firm’s distribution staff.
In June, Guggenheim notified staff that Ms Court had taken a summer sabbatical and would return on September 1, according to an internal memorandum seen by the FT. Guggenheim’s spokesman said Ms Court would have licenses when she returns.
Consultants who work with Guggenheim say they hope the firm will sort out its infighting. “We think the investment team at Guggenheim has a truly differentiated product. We think highly of them. We hope there is chance that things improve over there now,” one said.