Tensions in the alliance between Renault and Nissan were on display at the latter’s annual shareholders’ meeting, the first since the arrest on financial-misconduct charges of Carlos Ghosn, who ran the alliance. Nissan’s investors directed most of their ire at Jean-Dominique Senard, Renault’s chairman, who has pushed for a full merger with Nissan and had threatened to scupper changes to its governance (Renault owns 43% of Nissan). At the meeting, Mr Senard admitted that the relationship between the two companies was in a bad state.
BMW said it would have 25 new fully electric or hybrid models on the market by 2023, two years earlier than expected. Europe’s carmakers are accelerating their plans for cleaner vehicles in order to comply with stricter EU rules on car emissions.
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A golden opportunity
Eldorado Resorts agreed to buy Caesars Entertainment in a $17.3bn deal that creates America’s biggest casino company. Caesars, which counts Caesars Palace, Bally’s and the Flamingo, all in Las Vegas, among its assets, is the bigger of the two. It had faced calls from Carl Icahn, an activist investor, to put itself up for sale to cut costs. Eldorado has no properties in Vegas, but it does own the Tropicana in Atlantic City.
The latest blockbuster deal in the drugs industry saw AbbVie stumping up $63bn for Allergan, best known for Botox, a skin-smoothing treatment popular with the more mature clientele. AbbVie is hunting for new sources of sales as the patent protection on Humira, its bestselling inflammatory treatment, will expire in America in 2023. Separately, Bristol-Myers Squibb’s merger with Celgene, valued at $90bn when it was announced in January, was delayed until at least the end of this year as it works to overcome antitrust concerns.
In its first week as a publicly listed company, Slack’s share price slipped below the $38.62 at which it closed on the first day of trading. The office-messaging service opted for a direct listing of its existing stock on the New York Stock Exchange rather than an IPO (through which new shares are issued), because it didn’t need to raise fresh capital, according to Stewart Butterfield, Slack’s chief executive.
Jerome Powell raised concerns about the world economy, warning that the “global risk picture has changed”, and that there was “greater uncertainty” over trade. The comments from the chairman of the Federal Reserve bolstered those who are betting on the central bank reducing interest rates in July. Mr Powell also stressed that the Fed won’t bow to pressure in its decision-making. In his latest outburst Donald Trump, who wanted the Fed to cut rates this month, tweeted that it “doesn’t know what it is doing” and is behaving “like a stubborn child”. See article.
Financial regulators responded coolly to Facebook’s plan to launch a global digital currency, to be called Libra. Mark Carney, the governor of the Bank of England, said that Libra could become “systemic” and would “have to be subject to the highest standards of regulation”. Randal Quarles, the head of the Financial Stability Board, which advises the G20, warned that the use of “cryptoassets” deserves “close scrutiny”. Their comments, along with several others, suggest that Facebook will have to jump many hurdles to get Libra up and running.
The publicity surrounding Libra helped boost the price of cryptocurrencies. Bitcoin traded above $13,000, its highest level in 18 months, rekindling fears about a bubble in the market.
America’s Supreme Court overturned a long-standing ban on trademarks that use “immoral” or “scandalous” words on the grounds that it violated the right to free speech and had been imposed unevenly. The case was brought by the owner of a clothing line he brands as FUCT (Friends U Can’t Trust). See article.
Netflix is to lose the rights to broadcast the American version of “The Office” because NBCUniversal, the sitcom’s producer, wants to run it on its new, yet-to-be-named streaming service from 2021. “The Office” is Netflix’s most popular show in America. With rival streaming channels in the works from Disney, WarnerMedia and others, Netflix faces the prospect of losing more content made by other companies, which, despite the plaudits for the media it produces in-house, accounts for the bulk of users’ viewing time.
A gripping yarn
An industry report suggested that the global market for spandex is expanding, with sales set to reach 1m tonnes by the end of 2020. The main reason is that demand for sports “shapewear” has stretched beyond the rich world to the emerging-market middle class. Invented in 1958 by a chemist in Virginia, the spandex industry is now highly elastic, with China accounting for 75% of the world’s production.